<PAGE>
[LOGO] G.T. GLOBAL GROWTH FUNDS: ADVISOR CLASS
PROSPECTUS -- MARCH 1, 1995, AS REVISED JUNE 1, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
G.T. GLOBAL: WORLDWIDE GROWTH FUND G.T. GLOBAL: EUROPE GROWTH FUND
G.T. GLOBAL: INTERNATIONAL GROWTH FUND G.T. GLOBAL: JAPAN GROWTH FUND
G.T. GLOBAL: NEW PACIFIC GROWTH FUND G.T. GLOBAL: AMERICA GROWTH FUND
</TABLE>
Each G.T. Global Growth Fund (collectively, "Funds"), organized as a diversified
series of G.T. Global Growth Series ("Company"), seeks long-term growth of
capital by investing in the securities of issuers based in its Primary
Investment Area. There can be no assurance that any Fund will achieve its
investment objective.
The Funds' investment manager, G.T. CAPITAL MANAGEMENT, INC. ("G.T. Capital"),
attempts to identify countries and industries where economic and political
factors, including currency movements, are likely to produce above average
growth rates, and to identify companies within such countries and industries
that are best positioned to benefit from these factors.
G.T. Capital is part of the G.T. Group, a leading international investment
advisory organization with offices throughout the world that long has emphasized
global investment.
Shares offered by this prospectus are available for purchase only by certain
investors and are offered at net asset value without the imposition of a front-
end or contingent deferred sales charge and without a Rule 12b-1 charge.
This Prospectus sets forth concisely the information an investor should know
before investing and should be read carefully and retained for future reference.
A Statement of Additional Information, dated March 1, 1995, as revised June 1,
1995, has been filed with the Securities and Exchange Commission ("SEC") and, as
amended or supplemented from time to time, is incorporated herein by reference.
The Statement of Additional Information is available without charge by writing
to the Funds at 50 California Street, 27th Floor, San Francisco, California
94111, or calling (800) 824-1580.
FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR ENDORSED OR GUARANTEED BY,
ANY BANK, NOR ARE THEY FEDERALLY INSURED OR OTHERWISE PROTECTED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
An investment in one or more of the Funds offers the following advantages:
/ / Access to Securities Markets Around the World
/ / Professional Management by a Leading Manager with Offices in the World's
Major Markets
/ / Automatic Dividend and Other Distribution Reinvestment
/ / Exchange Privileges with the Advisor Class of the Other G.T. Global Mutual
Funds
FOR FURTHER INFORMATION CALL (800) 824-1580 OR CONTACT YOUR
FINANCIAL ADVISOR.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED ON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Prospectus Page 1
<PAGE>
G.T. GLOBAL GROWTH FUNDS
TABLE OF CONTENTS
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Page
---------
<S> <C>
Prospectus Summary........................................................................ 3
Financial Highlights...................................................................... 8
Investment Objectives and Policies........................................................ 18
How To Invest............................................................................. 23
How to Make Exchanges..................................................................... 24
How to Redeem Shares...................................................................... 25
Shareholder Account Manual................................................................ 27
Calculation of Net Asset Value............................................................ 28
Dividends, Other Distributions and Federal Income Taxation................................ 29
Management................................................................................ 30
Other Information......................................................................... 36
</TABLE>
Prospectus Page 2
<PAGE>
G.T. GLOBAL GROWTH FUNDS
PROSPECTUS SUMMARY
- ------------------------------------------------------------
<TABLE>
<S> <C>
G.T. GLOBAL: WORLDWIDE GROWTH FUND G.T. GLOBAL: EUROPE GROWTH FUND
G.T. GLOBAL: INTERNATIONAL GROWTH FUND G.T. GLOBAL: JAPAN GROWTH FUND
G.T. GLOBAL: NEW PACIFIC GROWTH FUND G.T. GLOBAL: AMERICA GROWTH FUND
</TABLE>
The following summary is qualified in its entirety by the more detailed
information appearing in the body of this Prospectus. Cross-references in this
summary are to headings in the body of the Prospectus.
<TABLE>
<S> <C> <C>
Investment Objectives: Each Fund seeks long-term growth of capital
Principal Investments: Each Fund invests primarily in equity securities of issuers within
its Primary Investment Area
Investment Manager: G.T. Capital, part of the G.T. Group, a leading international
investment advisory organization with over $20 billion under
management
Advisor Class shares are offered through this Prospectus to (a)
Advisor Class Shares: trustees or other fiduciaries purchasing shares for employee
benefit plans which are sponsored by organizations which have at
least 250 employees; (b) any account investing at least $25,000 in
one or more G.T. Global Mutual Funds if (i) a financial planner,
trust company, bank trust department or registered investment
adviser has investment discretion over such account, and (ii) the
account holder pays such person as compensation for its advice and
other services an annual fee of at least .50% on the assets in the
account; (c) any account investing at least $25,000 in one or more
G.T. Global Mutual Funds if (i) such account is established under
a "wrap fee" program, and (ii) the account holder pays the sponsor
of such program an annual fee of at least .50% on the assets in
the account; (d) accounts advised by one of the companies
comprising or affiliated with the G.T. Group; and (e) any of the
companies comprising or affiliated with the G.T. Group
Exchange Privileges: Advisor Class shares of one Fund may only be exchanged for Advisor
Class shares of other G.T. Global Mutual Funds
Dividends and Other
Distributions: Dividends paid annually from available net investment income and
realized net short-term capital gains; other distributions paid
annually from realized net capital gain and net gains from foreign
currency transactions, if any
Reinvestment: Distributions may be reinvested automatically in Advisor Class
shares of the distributing Fund or in Advisor Class shares of
other G.T. Global Funds
Net Asset Value: Advisor Class shares of the G.T. Global Growth Funds are expected
to be quoted daily in the financial section of most newspapers
</TABLE>
Prospectus Page 3
<PAGE>
G.T. GLOBAL GROWTH FUNDS
PROSPECTUS SUMMARY
(Continued)
- --------------------------------------------------------------------------------
THE FUNDS. Each G.T. Global Growth Fund is a diversified series of G.T. Global
Growth Series ("Company"), a registered open-end management investment company.
Advisor Class shares of each Fund's common stock are available through Financial
Advisors who have entered into agreements with the Fund's distributor, G.T.
Global Financial Services, Inc. ("G.T. Global") and certain of its affiliates.
See "How to Invest" and "Shareholder Account Manual." Shares also may be
acquired directly through the Funds' distributor or through exchanges of shares
of the other G.T. Global Mutual Funds. See "How to Invest" and "Shareholder
Account Manual." Shares may be redeemed through the Funds' transfer agent, G.T.
Global Investor Services, Inc. ("Transfer Agent"). See "How to Redeem Shares"
and "Shareholder Account Manual."
INVESTMENT MANAGER AND ADMINISTRATOR. G.T. Capital is the Funds' investment
manager and administrator. G.T. Capital provides investment management and/or
administration services to all of the G.T. Global Mutual Funds as well as other
institutional, corporate and individual clients. G.T. Capital is part of the
G.T. Group, a leading international investment advisory organization that long
has emphasized global investing. The G.T. Group maintains fully staffed
investment offices in San Francisco, London, Tokyo, Toronto, Hong Kong,
Singapore and Sydney. As of April 1, 1995, total assets under G.T. Group
management exceeded $20 billion. Of this amount, more than $17 billion was
invested in the securities of non-U.S. issuers. The companies comprising the
G.T. Group are indirect subsidiaries of the Prince of Liechtenstein Foundation.
See "Management."
INVESTMENT OBJECTIVES, TECHNIQUES AND RISK FACTORS. Each Fund seeks long-term
capital growth and normally invests at least 80% of its assets in the equity
securities of issuers domiciled in that Fund's Primary Investment Area. The
Primary Investment Area of each Fund corresponds to the Fund's name. Equity
securities in which the Funds may invest include common stocks, preferred stocks
and warrants to acquire such securities. In selecting securities for the Funds,
G.T. Capital attempts to identify those countries (where multiple markets are
permitted) and industries (in each case) where economic and political factors,
including currency movements, are likely to produce above-average growth, and
then seeks those companies within the countries and industries so identified
that are best positioned and managed to take advantage of such factors. See
"Investment Objectives and Policies."
Under normal conditions, 20% to 60% of the Worldwide Growth Fund's assets are
invested in equity securities of U.S. issuers. The America Growth Fund currently
expects to invest a majority of its assets in the securities of small- and
mid-size companies. Each Fund may invest up to 20% of its assets in convertible
bonds and investment grade debt securities, and may invest up to 15% of its net
assets in illiquid securities.
The Funds may engage in certain foreign currency, options and futures
transactions to attempt to hedge against the overall level of investment and
currency risk associated with its present or planned investments. For temporary
defensive purposes, each Fund may hold U.S. or foreign currency and/or may
invest any portion of its assets in debt securities or high quality money market
instruments of U.S. or foreign issuers. The Funds also temporarily may hold cash
and invest in high quality foreign or domestic money market instruments pending
investment of proceeds from new sales of Fund shares, or to meet their ordinary
daily cash needs. See "Investment Objectives and Policies," "Investment
Objectives and Policies -- Other Policies" and "Investment Objectives and
Policies -- Options, Futures and Forward Currency Transactions."
There is no assurance that any Fund will achieve its investment objective. Each
Fund's net asset value will fluctuate, reflecting fluctuations in the market
value of its portfolio positions. Changes in foreign currency exchange rates
also affect each Fund's net asset value, earnings and gains and losses realized
on sales of securities.
Investments in foreign securities involve risks relating to political and
economic developments abroad and the differences between the regulations
Prospectus Page 4
<PAGE>
G.T. GLOBAL GROWTH FUNDS
PROSPECTUS SUMMARY
(Continued)
- --------------------------------------------------------------------------------
to which U.S. and foreign issuers are subject. Individual foreign economies also
may differ favorably or unfavorably from the U.S. economy. Securities of foreign
companies may be less liquid and their prices more volatile than those of
securities of comparable U.S. companies. Certain foreign countries may impose
withholding taxes on income earned and/or gains realized by the Funds in
connection with investments in such countries. Each Fund's participation in the
currency, options and futures markets involves certain risks and transaction
costs. See "Investment Objectives and Policies -- Risk Factors."
EXPENSES. Each Fund (except America Growth Fund) pays G.T. Capital investment
management and administration fees, based on the average daily net assets of the
Fund, at the annualized rate of .975% on the first $500 million, .95% on the
next $500 million, .925% on the next $500 million, and .90% on amounts
thereafter. America Growth Fund pays G.T. Capital investment management and
administration fees, based on its average daily net assets, at the annualized
rate of .725% on the first $500 million, .70% on the next $500 million, .675% on
the next $500 million, and .65% on amounts thereafter. G.T. Capital has
undertaken to limit each Fund's, other than America Growth Fund's, expenses
(exclusive of brokerage commissions, taxes, interest and extraordinary expenses)
to the maximum annual level 1.90% of the average daily net assets of each
Advisor Class shares. Similarly, G.T. Capital has undertaken to limit the
America Growth Fund's expenses (exclusive of brokerage commissions, taxes,
interest and extraordinary expenses) to the maximum annual level of 1.65% of the
average daily net assets of the Fund's Advisor Class shares.
Prospectus Page 5
<PAGE>
G.T. GLOBAL GROWTH FUNDS
PROSPECTUS SUMMARY
(Continued)
- --------------------------------------------------------------------------------
SUMMARY OF INVESTOR COSTS. The expenses and maximum transactions costs
associated with investing in the Advisor Class shares of each Fund are reflected
in the following tables*:
<TABLE>
<CAPTION>
G.T. GLOBAL: G.T. GLOBAL: G.T. GLOBAL: G.T. GLOBAL: G.T. GLOBAL: G.T. GLOBAL:
WORLDWIDE INTERNATIONAL NEW EUROPE JAPAN AMERICA
GROWTH GROWTH PACIFIC GROWTH GROWTH GROWTH GROWTH
FUND FUND FUND FUND FUND FUND
------------ ------------- -------------- ------------ ------------ ------------
ADVISOR ADVISOR ADVISOR ADVISOR ADVISOR ADVISOR
CLASS CLASS CLASS CLASS CLASS CLASS
------------ ------------- -------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION COSTS:
Maximum sales charge on purchases (as a %
of offering price)...................... None None None None None None
Sales charges on reinvested
distributions........................... None None None None None None
Deferred sales
charges................................. None None None None None None
Redemption charges........................ None None None None None None
Exchange fees:
-- On first four exchanges each
year................................... None None None None None None
-- On each additional exchange.......... $7.50 $7.50 $7.50 $7.50 $7.50 $7.50
ANNUAL FUND OPERATING EXPENSES (AS A % OF
AVERAGE NET ASSETS):
Investment management and administration
fees.................................... .98% .97% .97% .96% .98% .73%
12b-1 service and distribution costs...... None None None None None None
Other expenses............................ 0.57% 0.47% 0.58% 0.57% 0.77% 0.51%
------------ ------------- -------------- ------------ ------------ ------------
Total Fund Operating Expenses............. 1.55% 1.44% 1.55% 1.53% 1.75% 1.24%
------------ ------------- -------------- ------------ ------------ ------------
------------ ------------- -------------- ------------ ------------ ------------
</TABLE>
- --------------
HYPOTHETICAL EXAMPLE OF EFFECT OF EXPENSES:
An investor directly or indirectly would have paid the following expenses at the
end of the periods shown on a $1,000 investment, assuming a 5% annual return*:
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------- ---------- --------- ---------
<S> <C> <C> <C> <C>
G.T. Global: Worldwide Growth Fund
Advisor Class shares....................................................... $16 $48 N/A N/A
G.T. Global: International Growth Fund
Advisor Class shares....................................................... 14 45 N/A N/A
G.T. Global: New Pacific Growth Fund
Advisor Class shares....................................................... 16 48 N/A N/A
</TABLE>
Prospectus Page 6
<PAGE>
G.T. GLOBAL GROWTH FUNDS
PROSPECTUS SUMMARY
(Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------- ---------- --------- ---------
<S> <C> <C> <C> <C>
G.T. Europe Growth Fund
Advisor Class shares....................................................... $15 $48 N/A N/A
G.T. Japan Growth Fund
Advisor Class shares....................................................... 18 54 N/A N/A
G.T. America Growth Fund
Advisor Class shares....................................................... 12 39 N/A N/A
<FN>
- ------------------
* BECAUSE ADVISOR CLASS SHARES HAVE NOT PREVIOUSLY BEEN OFFERED, EXPENSES ARE
ESTIMATES AND DO NOT REFLECT ACTUAL ADVISOR CLASS EXPENSES. SUCH DATA ARE
DERIVED FROM CLASS A AND CLASS B SHARE EXPENSES FOR A FUND'S FISCAL YEAR
ENDED DECEMBER 31, 1994. THESE TABLES ARE INTENDED TO ASSIST INVESTORS IN
UNDERSTANDING THE VARIOUS COSTS AND EXPENSES ASSOCIATED WITH INVESTING IN
THE FUNDS. "Other expenses" include custody, transfer agent, legal, audit
and other expenses. The transfer agent fees are calculated on a per account
and per transaction basis, rather than on the basis of average net assets.
"Other Expenses" may be reduced to the extent that (i) certain
broker/dealers executing the Funds' portfolio transactions pay all or a
portion of the Funds' custodian expenses, or (ii) fees received in
connection with the lending of portfolio securities are used to reduce
custodian fees. These arrangements are not anticipated to materially
increase the brokerage commissions paid by the Funds. Without such
reductions, "Other expenses" for Advisor Class shares of Worldwide Growth
Fund, International Growth Fund, Pacific Growth Fund, Europe Growth Fund,
Japan Growth Fund, and America Growth Fund are estimated to be 0.60%,
0.52%, 0.63%, 0.65%, 0.89% and 0.51%, respectively. See "Management" herein
and in the Statement of Additional Information for more information.
Investors purchasing Advisor Class shares through financial planners, trust
companies, bank trust departments or registered investment advisers, or
under a "wrap fee" program, will be subject to additional fees charged by
such entities or by the sponsors of such programs. Where any account
advised by one of the companies comprising or affiliated with the G.T.
Group invests in Advisor Class shares of a Fund, such account shall not be
subject to duplicative advisory fees. THE "HYPOTHETICAL EXAMPLE" SET FORTH
ABOVE IS NOT A REPRESENTATION OF PAST OR FUTURE EXPENSES; EACH FUND'S
ACTUAL EXPENSES MAY BE MORE OR LESS THAN THOSE SHOWN. The above tables and
the assumption in the Hypothetical Example of a 5% annual return are
required by regulation of the Securities and Exchange Commission applicable
to all mutual funds; the 5% annual return is not a prediction of and does
not represent the Funds' projected or actual performance.
</TABLE>
Prospectus Page 7
<PAGE>
G.T. GLOBAL GROWTH FUNDS
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The tables below provide condensed information concerning income and capital
changes for one share of each Fund for the periods shown. This information is
supplemented by the financial statements and accompanying notes appearing in the
Statement of Additional Information. The financial statements and notes for
fiscal year ended December 31, 1994 have been audited by Coopers & Lybrand,
L.L.P., independent accountants, whose reports thereon appear in the Statement
of Additional Information. Information presented below for the periods ended
December 31, 1991 and prior thereto was audited by other auditors, which served
as the Funds' independent certified public accountants for those periods.
Financial information is not presented for Advisor Class shares because no
shares of that class were outstanding during the periods presented below.
G.T. GLOBAL: WORLDWIDE GROWTH FUND
<TABLE>
<CAPTION>
CLASS B++
-------------------------
APRIL 1, CLASS A+
1993 ----------------------------------------------------------------------------
TO
YEAR ENDED DECEMBER YEAR ENDED DECEMBER 31,
DECEMBER 31, ----------------------------------------------------------------------------
31, 1994 1993* 1994 1993* 1992 1991 1990 1989 1988
----------- ----------- -------- --------- --------- --------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net asset value,
beginning of period..... $17.39 $15.67 $17.47 $ 14.47 $ 14.07 $ 11.83 $13.63 $10.18 $8.84
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Net investment income
(loss).................. (0.11) (0.04) (0.00) 0.04 0.07 0.10 0.11 (0.01) 0.02
Net realized and
unrealized gain (loss)
on investments.......... (1.16) 2.72 (1.16) 3.92 0.39 2.29 (1.82) 3.82 1.42
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Net increase (decrease)
in net asset value
resulting from
investment operations... (1.27) 2.68 (1.16) 3.96 0.46 2.39 (1.71) 3.81 1.44
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Distributions:
Net investment
income................ (0.00) (0.00) (0.00) (0.00) (0.00) (0.15) (0.09) (0.00) (0.00)
Net realized gain on
investments........... (0.78) (0.96) (0.78) (0.96) (0.06) (0.00) (0.00) (0.36) (0.10)
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Total
distributions....... (0.78) (0.96) (0.78) (0.96) (0.06) (0.15) (0.09) (0.36) (0.10)
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Net asset value, end of
period.................. $15.34 $17.39 $15.53 $ 17.47 $ 14.47 $ 14.07 $11.83 $13.63 $10.18
----------- ----------- -------- --------- --------- --------- -------- -------- -------
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Total investment return
(c)..................... (7.32)% 17.3%(a) (6.65)% 27.6% 3.3% 20.3% (12.5)% 37.6% 16.3%
----------- ----------- -------- --------- --------- --------- -------- -------- -------
----------- ----------- -------- --------- --------- --------- -------- -------- -------
Ratios and supplemental
data:
Net assets, end of period
(in 000's).............. $52,567 $20,592 $182,467 $193,997 $141,310 $126,868 $85,894 $38,263 $11,673
Ratio of net investment
income (loss) to average
net assets.............. (0.66)% (0.4)%(b) (0.01)% 0.9% 0.5% 0.8% 0.7% (0.1)% 0.2%
Ratio of expenses to
average net assets
before expense
reductions.............. 2.49% 1.84%
Ratio of expenses to
average net assets...... 2.46% 2.5%(b) 1.81% 1.9% 2.1% 2.0% 2.1% 2.0% 2.0%
Portfolio turnover
rate+++................. 86% 92% 86% 92% 95% 122% 107% 91% 181%
<CAPTION>
JUNE 9, 1987
(COMMENCEMENT
OF
OPERATIONS)
THROUGH
DECEMBER 31,
1987
-------------
<S> <C>
Per Share Operating
Performance:
Net asset value,
beginning of period..... $ 10.00
-------------
Net investment income
(loss).................. (0.05)
Net realized and
unrealized gain (loss)
on investments.......... (1.11)
-------------
Net increase (decrease)
in net asset value
resulting from
investment operations... (1.16)
-------------
Distributions:
Net investment
income................ (0.00)
Net realized gain on
investments........... (0.00)
-------------
Total
distributions....... (0.00)
-------------
Net asset value, end of
period.................. $ 8.84
-------------
-------------
Total investment return
(c)..................... (11.60)%(a)
-------------
-------------
Ratios and supplemental
data:
Net assets, end of period
(in 000's).............. $6,570
Ratio of net investment
income (loss) to average
net assets.............. (1.4)%(b)
Ratio of expenses to
average net assets
before expense
reductions..............
Ratio of expenses to
average net assets...... 2.8%(b)
Portfolio turnover
rate+++................. 271%
<FN>
- ------------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Calculated based upon weighted average shares outstanding during the
period.
(a) Not annualized.
(b) Annualized.
(c) Total investment return does not include sales charges.
</TABLE>
Prospectus Page 8
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: AMERICA GROWTH FUND
<TABLE>
<CAPTION>
CLASS B+
--------------------------- CLASS A+
APRIL 1, ------------------------------------------------------------------------------------
1993
YEAR ENDED TO YEAR ENDED DECEMBER 31,
DECEMBER 31, DECEMBER 31, ------------------------------------------------------------------------------------
1994(C) 1993 1994(C) 1993 1992 1991 1990 1989 1988
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share
Operating
Performance:
Net asset
value,
beginning of
year.......... $ 17.09 $ 15.90 $ 17.17 $ 17.12 $ 14.13 $ 11.89 $ 12.84 $ 8.76 $ 8.56
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Net investment
income
(loss)........ (0.09) (0.29) 0.04 (0.21 ) (0.11 ) 0.01 (0.01 ) 0.10 * (0.40 )
Net realized
and unrealized
gain (loss) on
investments... 2.55 2.78 2.55 1.56 4.54 2.28 (0.94 ) 4.65 1.35
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Net increase
(decrease) in
net asset
value
resulting from
investment
operations.... 2.46 2.49 2.59 1.35 4.43 2.29 (0.95 ) 4.75 0.95
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Distributions:
Net
investment
income...... (0.00) (0.00) (0.02) (0.00 ) (0.00 ) (0.01 ) (0.00 ) (0.10 ) (0.00 )
Net realized
gain on
investments... (2.05) (1.30) (2.05) (1.30 ) (1.44 ) (0.04 ) (0.00 ) (0.57 ) (0.75 )
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Total
distributions... (2.05) (1.30) (2.07) (1.30 ) (1.44 ) (0.05 ) (0.00 ) (0.67 ) (0.75 )
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Net asset
value, end of
year.......... $ 17.50 $ 17.09 $ 17.69 $ 17.17 $ 17.12 $ 14.13 $ 11.89 $12.84 $ 8.76
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Total
investment
return**
(d)........... 15.06% 16.1%(a) 15.69% 8.3 % 31.7 % 19.3 % (7.4 )% 54.8 % 11.1 %
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
------------ ------------ ------------ ---------- ---------- --------- --------- -------- --------
Ratios and
supplemental
data:
Net assets, end
of period (in
000's)........ $80,060 $ 1,982 $196,937 $116,468 $166,712 $88,041 $65,413 $9,930 $1,548
Ratio of net
investment
income (loss)
to average net
assets........ (0.48)% (1.3)%(b) 0.17% (0.7 )% (1.1 )% 0.0 % (0.1 )% 1.2 %* (4.7 )%
Ratio of
expenses to
average net
assets after
expense
reductions.... 2.23% 2.2%(b) 1.58% 1.6 % 1.8 % 1.7 % 2.0 % 1.9 %* 5.1 %
Portfolio
turnover
rate++........ 102% 92% 102% 92 % 114 % 156 % 145 % 133 % 184 %
<CAPTION>
JUNE 9, 1987
(COMMENCEMENT
OF OPERATIONS)
THROUGH
DECEMBER 31,
1987
--------------
<S> <C>
Per Share
Operating
Performance:
Net asset
value,
beginning of
year.......... $10.00
-------
Net investment
income
(loss)........ (0.19 )
Net realized
and unrealized
gain (loss) on
investments... (1.25 )
-------
Net increase
(decrease) in
net asset
value
resulting from
investment
operations.... (1.44 )
-------
Distributions:
Net
investment
income...... (0.00 )
Net realized
gain on
investments... (0.00 )
-------
Total
distributio (0.00 )
-------
Net asset
value, end of
year.......... $ 8.56
-------
-------
Total
investment
return**
(d)........... (14.4 )%(a)
-------
-------
Ratios and
supplemental
data:
Net assets, end
of period (in
000's)........ 1,$039
Ratio of net
investment
income (loss)
to average net
assets........ (2.7 )%(b)
Ratio of
expenses to
average net
assets after
expense
reductions.... 3.8 %(b)
Portfolio
turnover
rate++........ 505 %
<FN>
- ------------------------
+ Commencing April 1, 1993, the Fund began offering Class B shares. All
capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Includes reimbursement by G.T. Capital Management, Inc. of Fund operating
expenses of $0.11. Without such reimbursement, the ratio of expenses to
average net assets would have been 3.3% and the ratio of net investment
income to average net assets would have been (1.2)%.
** Total investment return does not reflect the maximum sales charge on
purchases of Class A shares and the contingent deferred sales charge
imposed on certain redemptions of Class B shares.
(a) Not annualized.
(b) Annualized.
(c) The selected per share data were calculated based upon weighted average
shares outstanding.
(d) Total investment return does not include sales charge.
</TABLE>
Prospectus Page 9
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
CLASS A+
CLASS B+ -----------------------------------------------------
---------------------------------
YEAR ENDED APRIL 1, 1993 YEAR ENDED DECEMBER 31,
DECEMBER 31, TO -----------------------------------------------------
1994 DECEMBER 31, 1993* 1994 1993* 1992 1991 1990
------------ ------------------ ------------ -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of
period............................... $ 10.98 $ 8.74 $ 11.02 $ 8.21 $ 8.74 $ 7.82 $ 9.25
------------ -------- ------------ -------- -------- -------- --------
Net investment income (loss).......... (0.10) (0.01) (0.04) 0.03 0.11 0.14 0.10
Net realized and unrealized gain
(loss) on investments................ (0.82) 2.25 (0.82) 2.78 (0.62) 0.89 (1.42)
------------ -------- ------------ -------- -------- -------- --------
Net increase (decrease) in net asset
value resulting from investment
operations........................... (0.92) 2.24 (0.86) 2.81 (0.51) 1.03 (1.32)
------------ -------- ------------ -------- -------- -------- --------
Distributions:
Net investment income............... (0.04) (0.00) (0.04) (0.00) (0.02) (0.11) (0.11)
Net realized gain on investments.... (0.95) (0.00) (0.95) (0.00) (0.00) (0.00) (0.00)
------------ -------- ------------ -------- -------- -------- --------
Total distributions............. (0.99) (0.00) (0.99) (0.00) (0.02) (0.11) (0.11)
------------ -------- ------------ -------- -------- -------- --------
Net asset value, end of period........ $ 9.07 $ 10.98 $ 9.17 $ 11.02 $ 8.21 $ 8.74 $ 7.82
------------ -------- ------------ -------- -------- -------- --------
------------ -------- ------------ -------- -------- -------- --------
Total investment return***............ (8.36)% 25.6%(a) (7.78)% 34.2% (5.8)% 13.2% (14.3)%
------------ -------- ------------ -------- -------- -------- --------
------------ -------- ------------ -------- -------- -------- --------
Ratios and supplemental data:
Net assets, end of period (in
000's)............................... $71,794 $30,745 $430,701 $523,397 $421,693 $463,851 $343,949
Ratio of net investment income (loss)
to average net assets................ (0.69)% (0.4)%(b) (0.04)% 0.3% 1.2% 1.5% 1.4%
Ratio of expenses to average net
assets before expense reductions..... 2.40% 1.75%
Ratio of expenses to average net
assets after expense reductions...... 2.35% 2.4%(b) 1.7% 1.8% 1.9% 1.9% 1.9%
Portfolio turnover rate++............. 96% 90% 96% 90% 89% 83% 58%
<FN>
- --------------------
+ Commencing April 1, 1993, the Fund began offering Class B shares. All
capital shares issued and outstanding as of March 31, 1993 were reclassi-
fied as Class A shares.
++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Calculated based upon weighted average shares outstanding during the year.
** The per share data reflects a 3 for 1 stock split effective August 14,
1989.
*** Total investment return does not reflect the maximum sales charge on
purchases of Class A shares and the contingent deferred sales charge im-
posed on certain redemptions of Class B shares.
(a) Not annualized.
(b) Annualized.
</TABLE>
Prospectus Page 10
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: INTERNATIONAL GROWTH FUND
(CONTINUED)
<TABLE>
<CAPTION>
JULY 19, 1985
CLASS A+ (COMMENCEMENT
-------------------------------------------- OF
OPERATIONS)
YEAR ENDED DECEMBER 31, THROUGH
-------------------------------------------- DECEMBER 31,
1989** 1988** 1987** 1986** 1985**
-------- ------- ------- ------- -------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.............. $ 6.77 $ 5.71 $ 6.13 $ 4.16 $ 3.33
-------- ------- ------- ------- -------------
Net investment income (loss)...................... 0.01 (0.01) (0.01) (0.05) (0.02)
Net realized and unrealized gain (loss) on
investments...................................... 2.60 1.12 0.35 2.22 0.85
-------- ------- ------- ------- -------------
Net increase (decrease) in net asset value
resulting from investment operations............. 2.61 1.11 0.34 2.17 0.83
-------- ------- ------- ------- -------------
Distributions:
Net investment income........................... (0.00) (0.00) (0.00) (0.00) (0.00)
Net realized gain on investments and foreign
currency....................................... (0.13) (0.05) (0.76) (0.20) (0.00)
-------- ------- ------- ------- -------------
Total distributions......................... (0.13) (0.05) (0.76) (0.20) (0.00)
-------- ------- ------- ------- -------------
Net asset value, end of period.................... $ 9.25 $ 6.77 $ 5.71 $ 6.13 $ 4.16
-------- ------- ------- ------- -------------
-------- ------- ------- ------- -------------
Total investment return***........................ 38.6% 19.4% 6.2% 53.7% 24.7%(a)
-------- ------- ------- ------- -------------
-------- ------- ------- ------- -------------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $136,975 $29,792 $17,178 $12,052 $1,797
Ratio of net investment income (loss) to average
net assets....................................... 0.1% (0.2)% (0.3)% (0.9)% (1.1)%(b)
Ratio of expenses to average net assets........... 1.9% 2.1% 1.9% 1.9% 2.4%(b)
Portfolio turnover rate++......................... 82% 115% 198% 122% 37%
</TABLE>
Prospectus Page 11
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: NEW PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
CLASS A+
CLASS B+ -----------------------------------------------------
--------------------------------
YEAR ENDED APRIL 1, 1993 YEAR ENDED DECEMBER 31,
DECEMBER 31, TO -----------------------------------------------------
1994 DECEMBER 31, 1993 1994 1993 1992 1991 1990
------------ ----------------- ------------ -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of
period............................... $ 15.79 $ 11.27 $ 15.86 $10.31 $11.30 $10.57 $12.61
------------ -------- ------------ -------- -------- -------- --------
Net investment income (loss).......... (0.06) (0.10) 0.02 (0.03) 0.07 0.11 0.13
Net realized and unrealized gain
(loss) on investments................ (3.15) 5.27 (3.15) 6.23 (0.97) 1.25 (1.51)
------------ -------- ------------ -------- -------- -------- --------
Net increase (decrease) in net asset
value resulting from investment
operations........................... (3.21) 5.17 (3.13) 6.20 (0.90) 1.36 (1.38)
------------ -------- ------------ -------- -------- -------- --------
Distributions:
Net investment income............... (0.00) (0.00) (0.01) (0.00) (0.06) (0.08) (0.12)
Net realized gain on investments.... (0.55) (0.65) (0.55) (0.65) (0.03) (0.55) (0.54)
In excess of net realized gain on
investments........................ (0.07) (0.07)
------------ -------- ------------ -------- -------- -------- --------
Total distributions............... (0.62) (0.65) (0.63) (0.65) (0.09) (0.63) (0.66)
------------ -------- ------------ -------- -------- -------- --------
Net asset value, end of period........ $ 11.96 $ 15.79 $ 12.10 $15.86 $10.31 $11.30 $10.57
------------ -------- ------------ -------- -------- -------- --------
------------ -------- ------------ -------- -------- -------- --------
Total investment return**............. (20.30)% 46.3%(a) (19.73)% 60.6% (8.0)% 13.1% (11.0)%
------------ -------- ------------ -------- -------- -------- --------
------------ -------- ------------ -------- -------- -------- --------
Ratio and supplemental data:
Net assets, end of period (in
000's)............................... $120,171 $72,122 $404,680 $498,898 $281,418 $333,800 $234,793
Ratio of net investment income (loss)
to average net assets................ (0.54)% (0.9)%(b) 0.11% (0.3)% 0.6% 1.0% 1.1%
Ratio of expenses to average net
assets before expense reductions..... 2.51% 1.86%
Ratio of expenses to average net
assets after expense reductions...... 2.46% 2.5%(b) 1.81% 1.9% 2.0% 2.0% 2.1%
Portfolio turnover rate++............. 87% 117% 87% 117% 72% 85% 75%
<FN>
- ------------------------
+ Commencing April 1, 1993, the Fund began offering Class B shares. All
capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* The per share data reflects a 2 for 1 stock split effective August 14,
1989.
** Total investment return does not reflect the maximum sales charge on
purchases of Class A shares and the contingent deferred sales charge
imposed on certain redemptions of Class B shares.
(a) Not annualized.
(b) Annualized.
</TABLE>
Prospectus Page 12
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: NEW PACIFIC GROWTH FUND
(CONTINUED)
<TABLE>
<CAPTION>
CLASS A+
-------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
-------------------------------------------------------------------------------
1989* 1988* 1987* 1986* 1985* 1984*
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period......... $8.74 $7.25 $14.98 $8.82 $8.49 $8.95
--------- --------- --------- --------- --------- ---------
Net investment income (loss)................. (0.01) 0.01 (0.01) (0.05) 0.04 0.05
Net realized and unrealized gain (loss) on
investments................................. 4.21 1.66 0.51 6.22 0.72 (0.03)
--------- --------- --------- --------- --------- ---------
Net increase (decrease) in net asset value
resulting from investment operations........ 4.20 1.67 0.50 6.17 0.76 0.02
--------- --------- --------- --------- --------- ---------
Distributions:
Net investment income...................... (0.00) (0.00) (0.00) (0.01) (0.03) (0.30)
Net realized gain on investments and
foreign currency.......................... (0.33) (0.18) (8.23) (0.00) (0.40) (0.18)
--------- --------- --------- --------- --------- ---------
Total distributions...................... (0.33) (0.18) (8.23) (0.01) (0.43) (0.48)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period............... $12.61 $8.74 $7.25 $14.98 $8.82 $8.49
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
Total investment return**.................... 48.1% 23.2% 5.7% 69.9% 9.3% (3.0)%
--------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- ---------
Ratio and supplemental data:
Net assets, end of period (in 000's)......... $170,071 $56,342 $642,969 $648,157 $530,986 $466,685
Ratio of net investment income (loss) to
average net assets.......................... (0.1)% 0.0% (0.2)% (0.5)% 0.4% 0.6%
Ratio of expenses to average net assets...... 2.0% 2.2% 1.9% 1.4% 1.4% 1.4%
Portfolio turnover rate++.................... 70% 107% 215% 229% 81% 68%
</TABLE>
Prospectus Page 13
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: EUROPE GROWTH FUND
<TABLE>
<CAPTION>
CLASS A+
CLASS B+ ---------------------------------------------------------
---------------------------------
YEAR ENDED APRIL 1, 1993 YEAR ENDED DECEMBER 31,
DECEMBER 31, TO ---------------------------------------------------------
1994* DECEMBER 31, 1993* 1994* 1993* 1992* 1991 1990
------------ ------------------ ------------ -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating
Performance:
Net asset value, beginning of
period....................... $ 10.79 $ 9.02 $ 10.84 $8.51 $9.59 $9.33 $10.94
------------ -------- ------------ -------- -------- ---------- ----------
Net investment income......... (0.00) 0.00 0.06 0.05 0.11*** 0.21 0.10
Net realized and unrealized
gain (loss) on investments
and foreign currency......... (0.69) 1.85 (0.69) 2.36 (1.19) 0.19 (1.71)
------------ -------- ------------ -------- -------- ---------- ----------
Net increase (decrease) in net
asset value resulting from
investment operations........ (0.69) 1.85 (0.63) 2.41 (1.08) 0.40 (1.61)
------------ -------- ------------ -------- -------- ---------- ----------
Distributions:
Net investment income....... (0.00) (0.06) (0.05) (0.06) (0.00) (0.14) (0.00)
In excess of net investment
income..................... (0.00) (0.02) (0.00) (0.02) (0.00) (0.00) (0.00)
In excess of net realized
gain on investments........ (0.13) (0.00) (0.13) (0.00) (0.00) (0.00) (0.00)
------------ -------- ------------ -------- -------- ---------- ----------
Total distributions..... (0.13) (0.08) (0.18) (0.08) (0.00) (0.14) (0.00)
------------ -------- ------------ -------- -------- ---------- ----------
Net asset value, end of
year......................... $ 9.97 $ 10.79 $ 10.03 $10.84 $8.51 $9.59 $9.33
------------ -------- ------------ -------- -------- ---------- ----------
------------ -------- ------------ -------- -------- ---------- ----------
Total investment return****... (6.38)% 20.5%(a) (5.80)% 28.3% (11.3)% 4.3% (14.7)%
------------ -------- ------------ -------- -------- ---------- ----------
------------ -------- ------------ -------- -------- ---------- ----------
Ratios and supplemental data:
Net assets, end of period (in
000's)....................... $81,602 $34,048 $646,313 $854,701 $781,607 $1,211,709 $1,428,677
Ratio of net investment income
(loss) to average net
assets....................... (0.04)% (0.1)%(b) 0.61% 0.6% 1.2 *** 1.7% 1.1%
Ratio of expenses to average
net assets before expense
reductions................... 2.46% 1.81%
Ratio of expenses to average
net assets after expense
reductions................... 2.38% 2.6%(b) 1.73% 1.9% 2.0 *** 1.8% 1.9%
Portfolio turnover rate++..... 91% 67% 91% 67% 65% 55% 34%
<FN>
- ------------------------
+ Commencing April 1, 1993, the Fund began offering Class B shares. All
capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
+++ Includes waivers of investment management and administration fees and
partial reimbursement of operating expenses by G.T. Capital Management,
Inc.
* Calculated based upon weighted average shares outstanding during the
year.
** The per share data reflects a 2 for 1 stock split effective August 14,
1989.
*** Includes reimbursement by G.T. Capital Management, Inc. of Fund Class A
operating expenses of less than one cent per share. Without such
reimbursement, the ratio of expenses to average net assets would have
been 2.1% and the ratio of net investment income to average net assets
would have been 1.2%.
**** Total investment return does not reflect the maximum sales charge on
purchases of Class A shares and the contingent deferred sales charge
imposed on certain redemptions of Class B shares.
(a) Not annualized.
(b) Annualized.
</TABLE>
Prospectus Page 14
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: EUROPE GROWTH FUND
(CONTINUED)
<TABLE>
<CAPTION>
JULY 19,
1985
CLASS A+ (COMMENCEMENT
---------------------------------------------------------- OF
OPERATIONS)
YEAR ENDED DECEMBER 31, THROUGH
---------------------------------------------------------- DECEMBER
1989** 1988** 1987** 1986** 31, 1985**
---------- -------- ------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period......... $7.77 $7.76 $9.62 $6.82 $ 5.00
---------- -------- ------- ------------ -----------
Net investment income (loss)................. (0.02) (0.07) (0.00)+++ (0.03)+++ (0.03)
Net realized and unrealized gain (loss) on
investments and foreign currency............ 3.19 0.87 0.57 2.83 1.85
---------- -------- ------- ------------ -----------
Net increase (decrease) in net asset value
resulting from investment operations........ 3.17 0.80 0.57 2.80 1.82
---------- -------- ------- ------------ -----------
Distributions:
Net investment income...................... (0.00) (0.00) (0.00) (0.00) (0.00)
Net realized gain on investments........... (0.00) (0.79) (2.43) (0.00) (0.00)
---------- -------- ------- ------------ -----------
Total distributions.................... (0.00) (0.79) (2.43) (0.00) (0.00)
---------- -------- ------- ------------ -----------
Net asset value, end of period............... $10.94 $7.77 $7.76 $9.62 $ 6.82
---------- -------- ------- ------------ -----------
---------- -------- ------- ------------ -----------
Total investment return****.................. 40.7% 11.1% 6.6% 41.0% 36.4%(a)
---------- -------- ------- ------------ -----------
---------- -------- ------- ------------ -----------
Ratios and supplemental data:
Net assets, end of period (in 000's)......... $382,428 $8,376 $10,227 $9,809 $1,004
Ratio of net investment income (loss) to
average net assets.......................... (0.6)% (1.0)% (0.00)%+++ (0.4)%+++ (1.1)%(b)
Ratio of expenses to average net assets...... 1.9% 3.6% 2.0%+++ 2.0%+++ 2.8%(b)
Portfolio turnover rate++.................... 43% 153% 193% 102% 0.2%
</TABLE>
Prospectus Page 15
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: JAPAN GROWTH FUND
<TABLE>
<CAPTION>
CLASS A+
CLASS B+ ---------------------------------------------------------
--------------------------------
YEAR ENDED APRIL 1, 1993 YEAR ENDED DECEMBER 31,
DECEMBER 31, TO ---------------------------------------------------------
1994 DECEMBER 31, 1993 1994 1993 1992* 1991 1990
------------ ----------------- ----------- ------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of
period............................ $ 11.57 $ 9.85 $ 11.61 $ 8.70 $ 11.16 $ 11.48 $ 16.39
------------ ------- ----------- ------- ---------- --------- ---------
Net investment income (loss)....... (0.13) (0.18) (0.04) (0.14) (0.00)*** (0.09) (0.05)++
Net realized and unrealized gain
(loss) on investments............. 0.79 1.90 0.79 3.05 (2.40) (0.23) (4.60)
------------ ------- ----------- ------- ---------- --------- ---------
Net increase (decrease) in net
asset value resulting from
investment operations............. 0.66 1.72 0.75 2.91 (2.40) (0.32) (4.65)
------------ ------- ----------- ------- ---------- --------- ---------
Distributions:
Net realized gain on
investments..................... (0.21) (0.00) (0.21) (0.00) (0.06) (0.00) (0.26)
------------ ------- ----------- ------- ---------- --------- ---------
Total distributions.......... (0.21) (0.00) (0.21) (0.00) (0.06) (0.00) (0.26)
------------ ------- ----------- ------- ---------- --------- ---------
Net asset value, end of period..... $ 12.02 $ 11.57 $ 12.15 $ 11.61 $ 8.70 $ 11.16 $ 11.48
------------ ------- ----------- ------- ---------- --------- ---------
------------ ------- ----------- ------- ---------- --------- ---------
Total investment return****........ 5.81% 17.5%(a) 6.56% 33.5% (21.5)% (2.8)% (28.7)%
------------ ------- ----------- ------- ---------- --------- ---------
------------ ------- ----------- ------- ---------- --------- ---------
Ratios and supplemental data:
Net assets, end of period (in
000's)............................ $ 27,355 $3,699 $98,066 $88,487 $93,865 $61,519 $51,693
Ratio of net investment income
(loss) to average net assets...... (0.97)% (0.9)%(b) (0.32)% (0.3)% (0.0)%*** (1.5)% (1.2)%++
Ratio of expenses to average net
assets before expense
reductions........................ 2.68% 2.03%
Ratio of expenses to average net
assets after expense reductions... 2.56% 2.7%(b) 1.91% 2.1% 2.2%*** 2.2% 2.2%++
Portfolio turnover rate++.......... 49% 104% 49% 104% 115% 251% 138%
<FN>
- ------------------------
+ Commencing April 1, 1993, the Fund began offering Class B shares. All
capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Calculated based upon weighted average shares outstanding during the
period.
** The per share data reflects a 2 for 1 stock split effective August 15,
1988.
*** Includes reimbursement by G.T. Capital Management, Inc. of Fund Class A
operating expenses of $0.01. Without such reimbursement, the ratio of
expenses to average net assets would have been 2.3% and the ratio of net
investment loss to average net assets would have been (0.1)%.
**** Total investment return does not reflect the maximum sales charge on
purchases of Class A shares and the contingent deferred sales charge
imposed on certain redemptions of Class B shares.
++ Includes reimbursement by G.T. Capital Management, Inc. of Fund Class A
operating expenses of $0.01. Without such reimbursement, the ratio of
expenses to average net assets would have been 2.4% and the ratio of net
investment loss to average net assets would have been (1.35)%.
(a) Not annualized.
(b) Annualized.
</TABLE>
Prospectus Page 16
<PAGE>
G.T. GLOBAL GROWTH FUNDS
G.T. GLOBAL: JAPAN GROWTH FUND
(CONTINUED)
<TABLE>
<CAPTION>
JULY 19, 1985
CLASS A+ (COMMENCEMENT
--------------------------------------- OF
OPERATIONS)
YEAR ENDED DECEMBER 31, THROUGH
--------------------------------------- DECEMBER 31,
1989 1988** 1987** 1986** 1985**
------- ------- ------- ------ -------------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period.............. $ 10.57 $ 10.36 $ 9.88 $6.20 $ 5.00
------- ------- ------- ------ -------------
Net investment income (loss)...................... (0.19) (0.20) (0.15) (0.14 ) (0.01)
Net realized and unrealized gain (loss) on
investments...................................... 6.57 2.44 4.52 3.91 1.21
------- ------- ------- ------ -------------
Net increase (decrease) in net asset value
resulting from investment operations............. 6.38 2.24 4.37 3.77 1.20
------- ------- ------- ------ -------------
Distributions:
Net realized gain on investments and foreign
currency....................................... (0.56) (2.03) (3.89) (0.09 ) (0.00)
------- ------- ------- ------ -------------
Total distributions......................... (0.56) (2.03) (3.89) (0.09 ) (0.00)
------- ------- ------- ------ -------------
Net asset value, end of period.................... $ 16.39 $ 10.57 $ 10.36 $9.88 $ 6.20
------- ------- ------- ------ -------------
------- ------- ------- ------ -------------
Total investment return****....................... 60.7% 21.9% 52.1% 61.3 % 24%(a)
------- ------- ------- ------ -------------
------- ------- ------- ------ -------------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $48,405 $18,591 $10,049 $7,313 $511
Ratio of net investment income (loss) to average
net assets....................................... (1.6)% (1.5)% (2.4)% (1.6 )% (0.4)%(b)
Ratio of expenses to average net assets........... 2.1% 2.2% 3.0% 2.2 % 3.8%(b)
Portfolio turnover rate++......................... 108% 150% 319% 207 % 93%
</TABLE>
Prospectus Page 17
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INVESTMENT OBJECTIVES
AND POLICIES
- --------------------------------------------------------------------------------
The investment objective of each Fund is long-term growth of capital. Each Fund
seeks this objective by investing, under normal circumstances, at least 80% of
its assets in equity securities of issuers domiciled in its Primary Investment
Area, as listed below. Equity securities in which the Funds may invest include
common stocks, preferred stocks and warrants to acquire such securities. There
is no assurance that any Fund will achieve its investment objective.
The Primary Investment Areas of the Funds are as follows:
G.T. GLOBAL: NEW PACIFIC GROWTH FUND ("PACIFIC FUND") -- Australia, Hong Kong,
Indonesia, Malaysia, New Zealand, the Philippines, Singapore, South Korea,
Taiwan and Thailand
G.T. GLOBAL: EUROPE GROWTH FUND ("EUROPE FUND") -- Austria, Belgium, Denmark,
Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands,
Norway, Portugal, Spain, Sweden, Switzerland, Turkey and the United Kingdom
G.T. GLOBAL: JAPAN GROWTH FUND ("JAPAN FUND") -- Japan
G.T. GLOBAL: INTERNATIONAL GROWTH FUND ("INTERNATIONAL FUND") -- all countries
listed for each other Fund, and Argentina, Brazil, Canada, Chile, Mexico and
Venezuela, but not the United States
G.T. GLOBAL: AMERICA GROWTH FUND ("AMERICA FUND") -- the United States
G.T. GLOBAL: WORLDWIDE GROWTH FUND ("WORLDWIDE FUND") -- all countries listed
for each other Fund, and the United States
As indicated by these Primary Investment Areas, the WORLDWIDE FUND is designed
for those investors desiring to delegate equity investment decisions, including
allocation of assets among the world's different markets, currency strategies
and individual stock selection, to G.T. Capital's professional team of
investment specialists. The INTERNATIONAL FUND is intended for investors seeking
to complement their U.S. equity investments with a professionally managed
international portfolio. The PACIFIC FUND and the EUROPE FUND are regional funds
for investors interested in a more geographically concentrated investment but
still desiring to diversify across multiple markets. Finally, the JAPAN FUND and
the AMERICA FUND are designed for investors wishing to concentrate their
investment in a particular market but still desiring the professional
management, liquidity and diversification afforded by a mutual fund.
Each Fund may invest up to 20% of its assets in the equity securities of issuers
domiciled outside of the Fund's Primary Investment Area. Such investments may
include, e.g.: (a) securities of issuers in countries that are not located in
the Primary Investment Area but are linked by tradition, economic markets,
cultural similarities or geography to the countries in such Primary Investment
Area; and (b) securities of issuers located elsewhere in the world which have
operations in the Primary Investment Area or which stand to benefit from
political and economic events in the Primary Investment Area. For example, a
Fund may invest in a company outside of its Primary Investment Area when G.T.
Capital believes at the time of investment that the value of the company's
securities may be enhanced by conditions or developments in that Primary
Investment Area even though the company's production facilities are located
outside of that Primary Investment Area.
In managing the Funds, G.T. Capital seeks to identify those countries and
industries where economic and political factors, including currency movements,
are likely to produce above average growth rates. G.T. Capital further attempts
to identify those companies in such countries and industries that are best
positioned and managed to take advantage of these economic and political
factors. G.T. Capital intends to invest in such markets only after balancing the
potential for growth of selected companies in each market relative to the risks
of investing in each such country. Among the factors to be considered are that
several of the markets included in the Primary Investment Areas of the Pacific
Fund, the Europe Fund, the International Fund, and the Worldwide Fund are
so-called developing countries, and their economies and markets are less
developed and more prone to
Prospectus Page 18
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G.T. GLOBAL GROWTH FUNDS
uncertainty, instability and risk than those of the other markets in which the
Funds invest.
Under ordinary circumstances, the assets of the Worldwide Fund and the
International Fund are invested in the equity securities of issuers domiciled in
at least three different countries, and 20% to 60% of the Worldwide Fund's
assets normally are invested in the equity securities of U.S. issuers. The
America Fund currently expects to invest a majority of its assets in the
securities of mid- and small-size companies. In selecting securities for
inclusion in the America Fund's portfolio, the Fund's managers initially focus
on companies with total equity market capitalization of $2 billion or less.
Up to 20% of each Fund's assets may be invested in convertible bonds and debt
securities. These debt obligations include U.S. and foreign government
securities and corporate debt securities, including Samurai and Yankee bonds,
Eurobonds and Depository Receipts. The issuers of such debt securities may or
may not be domiciled in the Primary Investment Area of the Fund purchasing the
securities. The Funds will limit their purchases of debt securities to
investment grade obligations. "Investment grade" debt refers to those securities
rated within one of the four highest ratings categories by Moody's Investors
Service, Inc. ("Moody's") or by Standard & Poor's Ratings Group ("S&P"), or, if
unrated deemed by G.T. Capital to be of equivalent quality. Moody's considers
securities rated in the lowest category of investment grade, i.e., securities
rated Baa, to have speculative characteristics. See the Statement of Additional
Information for a full description of Moody's and S&P ratings. The Funds may
also use instruments (including forward currency contracts) often referred to as
"derivatives." See "Options, Futures and Forward Currency Transactions."
OTHER POLICIES. Each Fund may invest up to 15% of its net assets in illiquid
securities.
Because the development of the world's economies and stock markets is rapidly
evolving, from time to time the Board of Trustees may redefine a Fund's Primary
Investment Area. In the past, new markets such as Indonesia, South Korea, and
Taiwan have been added in the Primary Investment Area of the Pacific Fund and
Greece, Ireland, Portugal and Turkey have been added in the Primary Investment
Area of the Europe Fund. On the other hand, Japan has been eliminated from the
Primary Investment Area of the Pacific Fund.
With respect to certain countries, currently including Taiwan, investments by a
Fund may only be made through investment in other investment companies that in
turn are authorized to invest in the securities of such countries. Each Fund may
invest up to 10% of its assets in other investment companies. As a shareholder
in an investment company, a Fund would bear its ratable share of that investment
company's expenses, including its advisory and administration fees. At the same
time, the Fund would continue to pay its own management fees and other expenses.
Each Fund retains the flexibility to respond promptly to changes in market and
economic conditions. Accordingly, in the interest of preserving shareholders'
capital and consistent with each Fund's investment objective, G.T. Capital may
employ a temporary defensive investment strategy if it determines such a
strategy to be warranted due to market, economic or political conditions. Under
a defensive strategy, each Fund may hold cash (U.S. dollars, foreign currencies
or multinational currency units) and/or invest any portion or all of its assets
in debt securities or high quality money market instruments issued by
corporations, or the U.S. or a foreign government.
For temporary defensive purposes, such as during times of international
political or economic uncertainty, most or all of a Fund's investments may be
made in the United States and denominated in U.S. dollars. To the extent a Fund
adopts a temporary defensive position, it will not be invested so as to achieve
directly its investment objective. In addition, pending investment of proceeds
from new sales of Fund shares or to meet its ordinary daily cash needs, each
Fund may hold cash (U.S. dollars, foreign currencies or multinational currency
units) and may invest in high quality foreign or domestic money market
instruments. Money market instruments in which the Funds may invest include, but
are not limited to, the following: government securities; high grade commercial
paper; bank certificates of deposit; bankers' acceptances; and repurchase
agreements related to any of the foregoing. High grade commercial paper refers
to commercial paper rated P-1 by Moody's or A-1 by S&P at the time of investment
or, if unrated, deemed by G.T. Capital to be of comparable quality.
From time to time, it may be advantageous for each Fund to borrow money rather
than sell existing portfolio positions to meet redemption requests. Accordingly,
each Fund may borrow from banks or may borrow through reverse repurchase
agreements and "roll" transactions in connection with meeting requests for the
redemptions of the Fund's
Prospectus Page 19
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G.T. GLOBAL GROWTH FUNDS
shares. Each Fund also may borrow up to 5% of its total assets for temporary or
emergency purposes other than to meet redemptions. However, no Fund will borrow
for leveraging purposes, nor will any Fund purchase securities while borrowings
are outstanding. See "Investment Objectives and Policies" in the Statement of
Additional Information.
The Funds are authorized to make loans of portfolio securities, for the purpose
of realizing additional income, to broker/dealers or to other institutional
investors. At all times a loan is outstanding, the borrower must maintain with
the Funds' custodian collateral consisting of cash, U.S. government securities
or other liquid, high grade debt securities equal to at least the value of the
borrowed securities, plus any accrued interest. Each Fund will receive any
interest paid on the loaned securities and a fee and/or a portion of the
interest earned on the collateral. Each Fund will limit loans of portfolio
securities to an aggregate of 30% of the value of its total assets, measured at
the time any such loan is made. The risks in lending portfolio securities, as
with other extensions of secured credit, consist of possible delay in receiving
additional collateral or in recovery of the securities or possible loss of
rights in the collateral should the borrower fail financially.
The Funds may purchase debt securities on a "when-issued" basis and may purchase
or sell such securities on a "forward commitment" basis in order to hedge
against anticipated changes in interest rates and prices. The price, which
generally is expressed in yield terms, is fixed at the time the commitment is
made, but delivery and payment for the securities take place at a later date.
When-issued securities and forward commitments may be sold prior to the
settlement date, but the Funds will enter into when-issued and forward
commitments only with the intention of actually receiving or delivering the
securities, as the case may be. No income accrues on securities which have been
purchased pursuant to a forward commitment or on a when-issued basis prior to
delivery to the Fund. If the Fund disposes of the right to acquire a when-issued
security prior to its acquisition or disposes of its right to deliver or receive
against a forward commitment, it may incur a gain or loss. At the time a Fund
enters into a transaction on a when-issued or forward commitment basis, a
segregated account consisting of cash or high grade liquid debt securities equal
to the value of the when-issued or forward commitment securities will be
established and maintained with its custodian and will be marked to market
daily. There is a risk that the securities may not be delivered and that a Fund
may incur a loss.
The Funds also may invest in securities of foreign issuers in the form of
American Depository Receipts ("ADRs") or other similar securities convertible
into securities of foreign issuers. These securities may not necessarily be
denominated in the same currency as the securities into which they may be
converted. ADRs are receipts typically issued by a United States bank or trust
company evidencing ownership of the underlying securities. Generally, ADRs in
registered form are designed for use in U.S. securities markets. See "Investment
Objectives and Policies" in the Statement of Additional Information.
RISK FACTORS. Each Fund's net asset value will fluctuate, reflecting
fluctuations in the market value of its portfolio positions and its net currency
exposure.
As of December 31, 1994, companies outside the U.S. comprised approximately 63%
of the world's stock market capitalization, according to Morgan Stanley Capital
International. Moreover, from time to time, the equity securities of issuers
located outside the U.S. have outperformed substantially those of U.S. issuers.
Accordingly, G.T. Capital believes that the Funds' policies (except those of the
America Fund) of investing in equity securities of issuers outside the U.S. may
enable them to produce returns greater than those produced by funds investing
solely in the securities of domestic issuers.
Foreign investing entails certain risks. The securities of non-U.S. issuers
generally will not be registered with, nor will the issuers thereof be subject
to, the reporting requirements of the SEC. Accordingly, there may be less
publicly available information about foreign securities and issuers than is
available about domestic securities and issuers. Foreign companies generally are
not subject to uniform accounting, auditing and financial reporting standards,
practices and requirements comparable to those applicable to domestic companies.
Securities of some foreign companies are less liquid and their prices may be
more volatile than securities of comparable domestic companies. Each Fund's
interest and dividends from foreign issuers may be subject to non-U.S.
withholding taxes, thereby reducing its net investment income. In addition,
certain costs attributable to foreign investing, such as custody charges, are
higher than those attributable to domestic investing.
Prospectus Page 20
<PAGE>
G.T. GLOBAL GROWTH FUNDS
With respect to some foreign countries, there is the possibility of
expropriation or confiscatory taxation, limitations on the removal of funds or
other assets of the Funds, political or social instability, or diplomatic
developments which could affect the Funds' investments in those countries.
Moreover, individual foreign economies may differ favorably or unfavorably from
the U.S. economy in such respects as growth of gross national product, rate of
inflation, rate of savings and capital reinvestment, resource self-sufficiency
and balance of payments positions.
G.T. Capital allocates investments among fixed income securities of particular
issuers on the basis of its views as to the best values then currently available
in the market place. Such values are a function of yield, maturity, issue
classification and quality characteristics, coupled with expectations regarding
the economy, movements in the general level and term of interest rates, currency
values, political developments, and variations in the supply of funds available
for investment in the world bond market relative to the demands placed upon it.
If market interest rates decline, fixed income securities generally appreciate
in value and vice versa. Fixed income securities denominated in currencies other
than the U.S. dollar or in multinational currency units are evaluated on the
strength of the particular currency against the U.S. dollar as well as on the
current and expected levels of interest rates in the country or countries. In
addition to the foregoing, a Fund may seek to take advantage of differences in
relative values of fixed income securities among various countries.
Since the Funds may invest substantially in securities denominated in currencies
other than the U.S. dollar, and since the Funds may hold foreign currencies, the
Funds will be affected favorably or unfavorably by exchange control regulations
or changes in the exchange rates between such currencies and the U.S. dollar.
Changes in currency exchange rates will influence the value of the Funds'
shares, and also may affect the value of dividends and interest earned by the
Funds and gains and losses they realize. Currencies generally are evaluated on
the basis of fundamental economic criteria (e.g., relative inflation and
interest rate levels and trends, growth rate forecasts, balance of payments
status and economic policies) as well as technical and political data. Exchange
rates are determined by the forces of supply and demand in the foreign exchange
markets. These forces are affected by the international balance of payments and
other economic and financial conditions, government intervention, speculation
and other factors. If the currency in which a security is denominated
appreciates against the U.S. dollar, the dollar value of the security will
increase. Conversely, a decline in the exchange rate of the currency would
adversely affect the value of the security expressed in dollars.
SPECIAL CONSIDERATIONS AFFECTING EMERGING MARKETS. Investing in the securities
of issuers domiciled in emerging markets, may entail special risks relating to
the potential political and economic instability and the risks of expropriation,
nationalization, confiscation or the imposition of restrictions on foreign
investment, converting of currencies into U.S. dollars and on repatriation of
capital invested. In the event of such expropriation, nationalization or other
confiscation by any country, a Fund could lose its entire investment in any such
country.
Emerging securities markets are substantially smaller, less developed, less
liquid and more volatile than the securities markets of the United States and
other more developed countries. The limited size of emerging securities markets
and limited trading volume in issuers compared to the volume of trading in U.S.
securities could cause prices to be erratic for reasons apart from factors that
affect the quality of the securities. In addition, settlement mechanisms in
emerging securities markets may be less efficient and reliable than in more
developed markets. Also, most Latin American countries have experienced
substantial, and in some periods extremely high, rates of inflation for many
years. Inflation and rapid fluctuations in inflation rates and corresponding
currency devaluations have had and may continue to have negative effects on the
economies and securities markets of certain Latin American countires.
While the America Fund's portfolio will include securities of established larger
capitalization issuers, the America Fund may also invest in securities of
smaller companies. Those smaller companies may involve greater risks than larger
companies to adverse business or economic developments. Smaller companies may
also have limited product lines, markets or financial resources, and may be
dependent on a relatively small management group. Securities of such companies
may be less liquid and are more volatile than securities of larger companies or
the market averages in general and therefore may involve greater risk than
investing in larger companies.
Prospectus Page 21
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G.T. GLOBAL GROWTH FUNDS
OPTIONS, FUTURES AND FORWARD CURRENCY TRANSACTIONS. Each Fund may use forward
currency contracts, futures contracts, options on securities, options on
indices, options on currencies and options on futures contracts to implement
strategies to attempt to hedge its portfolio, I.E., reduce the overall level of
investment risk normally associated with the Fund. These instruments are often
referred to as "derivatives," which may be defined as financial instruments
whose performance is derived, at least in part, from the performance of another
asset (such as a security, currency or an index of securities). Each Fund may
enter into such instruments up to the full value of its portfolio assets. There
can be no assurance that these hedging efforts will succeed. These techniques
are described below and are further detailed in the Statement of Additional
Information.
To attempt to hedge against adverse movements in exchange rates between
currencies, each Fund may enter into forward currency contracts for the purchase
or sale of a specified currency at a specified future date. Such contracts may
involve the purchase or sale of a foreign currency against the U.S. dollar or
may involve two foreign currencies. Each Fund may enter into forward currency
contracts either with respect to specific transactions or with respect to the
Fund's portfolio positions. For example, when a Fund anticipates making a
purchase or sale of a security, it may enter into a forward currency contract in
order to set the rate (either relative to the U.S. dollar or another currency)
at which a currency exchange transaction related to the purchase or sale will be
made. Further, when G.T. Capital believes that a particular currency may decline
compared to the U.S. dollar or another currency, each Fund may enter into a
forward contract to sell the currency G.T. Capital expects to decline in an
amount approximating the value of some or all of the Fund's portfolio securities
denominated in a foreign currency. Each Fund also may purchase and sell put and
call options on currencies, futures contracts on currencies and options on
futures contracts on currencies to hedge against movements in exchange rates.
In addition, each Fund may purchase and sell put and call options on equity and
debt securities to hedge against the risk of fluctuations in the prices of
securities held by the Fund or that G.T. Capital intends to include in the
Fund's portfolio. The Funds also may buy and sell put and call options on stock
indexes. Such stock index options serve to hedge against overall fluctuations in
the securities markets or market sectors generally, rather than anticipated
increases or decreases in the value of a particular security.
Further, the Funds may sell stock index futures contracts and may purchase put
options or write call options on such futures contracts to protect against a
general stock market or market sector decline that could adversely affect the
Fund's portfolio. The Funds also may buy stock index futures contracts and
purchase call options or write put options on such contracts to hedge against a
general stock market or market sector advance and thereby attempt to lessen the
cost of future securities acquisitions. A Fund may use interest rate futures
contracts and options thereon to hedge the debt portion of its portfolio against
changes in the general level of interest rates.
In addition, each Fund may purchase and sell put and call options on securities,
currencies and indices that are traded on recognized securities exchanges and
over-the-counter ("OTC") markets.
These practices may result in the loss of principal under certain conditions. In
addition, certain provisions of the Internal Revenue Code of 1986, as amended
("Code"), limit the extent to which a Fund may enter into forward contracts or
futures contracts, or engage in options transactions. See "Taxes" in the
Statement of Additional Information.
Although a Fund might not employ any of the foregoing strategies, the use of
forward currency contracts, options and futures would involve certain investment
risks and transaction costs to which it might not otherwise be subject. These
risks include: (1) dependence on G.T. Capital's ability to predict movements in
the prices of individual securities, fluctuations in the general securities
markets and movements in interest rates and currency markets; (2) imperfect
correlation, or even no correlation, between movements in the price of forward
contracts, options, futures contracts or options thereon and movements in the
price of the currency or security hedged or used for cover; (3) the fact that
skills and techniques needed to trade options, futures contracts and options
thereon or to use forward currency contracts are different from those needed to
select the securities in which the Funds invest; (4) lack of assurance that a
liquid secondary market will exist for any particular option, futures contract
or option thereon at any particular time; (5) the possible inability of a Fund
to purchase or sell a portfolio security at a time when it would otherwise be
favorable for it to do so, or the possible need for Fund to sell a security at a
disadvantageous time, due to the need for the
Prospectus Page 22
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G.T. GLOBAL GROWTH FUNDS
Fund to maintain "cover" or to segregate securities in connection with hedging
transactions; and (6) the possible need to defer closing out certain options,
futures contracts and options thereon and forward currency contracts in order to
continue to qualify for the beneficial tax treatment afforded regulated
investment companies under the Code. See "Dividends, Other Distributions and
Taxes" herein and "Taxes" in the Statement of Additional Information. If G.T.
Capital incorrectly forecasts securities market movements, currency exchange
rates or interest rates in utilizing a strategy for a Fund, the Fund would be in
a better position if it had not hedged at all. A Fund may also conduct its
foreign currency exchange transactions on a spot (I.E., cash) basis at the spot
rate prevailing in the foreign currency exchange market.
REPURCHASE AGREEMENTS. Repurchase agreements are transactions in which a Fund
purchases a security from a bank or recognized securities dealer and
simultaneously commits to resell that security to the bank or dealer at an
agreed-upon price, date and market rate of interest unrelated to the coupon rate
or maturity of the purchased security. Although repurchase agreements carry
certain risks not associated with direct investments in securities, including
possible decline in the market value of the underlying securities and delays and
costs to the Fund if the other party to the repurchase agreement becomes
bankrupt, the Funds intend to enter into repurchase agreements only with banks
and dealers believed by G.T. Capital to present minimal credit risks in
accordance with guidelines approved by the Company's Board of Trustees. G.T.
Capital reviews and monitors the creditworthiness of such institutions under the
Board's general supervision. See "Investment Objectives and Policies --
Repurchase Agreements" in the Statement of Additional Information.
OTHER INFORMATION. Each Fund's investment objective of long-term capital growth
may not be changed without the approval of a majority of the Fund's outstanding
voting securities. As defined in the Investment Company Act of 1940 ("1940 Act")
and as used in this Prospectus, a "majority of a Fund's outstanding voting
securities" means the lesser of (i) 67% of the Fund's shares represented at a
meeting at which more than 50% of the Fund's outstanding shares are represented,
or (ii) more than 50% of the Fund's outstanding shares. In addition, each Fund
has adopted certain investment limitations as fundamental policies which also
may not be changed without shareholder approval. A complete description of these
limitations is included in the Statement of Additional Information. Unless
specifically noted, the Funds' investment policies described in this Prospectus
and in the Statement of Additional Information, including each Fund's policy of
normally investing at least 80% of its assets in the equity securities of
issuers domiciled in its Primary Investment Area, are not fundamental policies
and may be changed by vote of the Company's Board of Trustees without
shareholder approval, provided that any such policies as so amended do not
conflict with the Fund's fundamental investment limitations. See "Investment
Limitations" in the Statement of Additional Information.
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HOW TO INVEST
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GENERAL. Advisor Class shares are offered through this Prospectus to (a)
trustees or other fiduciaries purchasing shares for employee benefit plans which
are sponsored by organizations which have at least 250 employees; (b) any
account investing at least $25,000 in one or more G.T. Global Mutual Funds if
(i) a financial planner, trust company, bank trust department or registered
investment adviser has investment discretion over such account, and (ii) the
account holder pays such person as compensation for its advice and other
services an annual fee of at least .50% on the assets in the account ("Advisory
Account"); (c) any account investing at least $25,000 in one or more G.T. Global
Mutual Funds if (i) such account is established under a "wrap fee" program, and
(ii) the account holder pays the sponsor of such program an annual fee of at
least .50% on the assets in the account ("Wrap Fee Account"); (d) accounts
advised by one of the companies comprising or affiliated with the G.T. Group;
and (e) any of the companies comprising or affiliated with the G.T. Group.
Financial planners, trust companies, bank trust companies and registered
investment advisers referenced in subpart (b) and sponsors of "wrap fee"
programs referenced in subpart (c) are collectively referred to
Prospectus Page 23
<PAGE>
G.T. GLOBAL GROWTH FUNDS
as "Financial Advisors." Investors in Wrap Fee Accounts and Advisory Accounts
may only purchase Advisor Class shares through Financial Advisors who have
entered into agreements with G.T. Global and certain of its affiliates.
Investors eligible to purchase Advisor Class shares will be sold only Advisor
Class shares rather than any other class of shares offered by a Fund.
Orders received by G.T. Global before the close of regular trading on the New
York Stock Exchange ("NYSE") (currently 4:00 p.m. Eastern time, unless weather,
equipment failure or other factors contribute to an earlier closing time) on any
Business Day will be executed at the public offering price for the applicable
class of shares determined that day. A "Business Day" is any day Monday through
Friday on which the NYSE is open for business. All purchase orders will be
executed at the public offering price next determined after the purchase order
is received. See "How to Invest -- Public Offering Price." The Funds and G.T.
Global reserve the right to reject any purchase order and to suspend the
offering of shares for a period of time.
Fiduciaries and Financial Advisors may be required to provide information
satisfactory to G.T. Global concerning their eligibility to purchase Advisor
Class shares. For specific information on opening an account, please contact
your Financial Advisor or G.T. Global.
PURCHASES BY BANK WIRE. Shares of the Funds may also be purchased through G.T.
Global by bank wire. Bank wire purchases will be effected at the next determined
public offering price after the bank wire is received. Accordingly, a bank wire
received by the close of regular trading on the NYSE on a Business Day will be
effected that day. A wire investment is considered received when the Transfer
Agent is notified that the bank wire has been credited to a Fund. Prior
telephonic or facsimile notice that a bank wire is being sent must be provided
to the Transfer Agent. A bank may charge a service fee for wiring money to the
Funds. The Transfer Agent currently does not charge a service fee for
facilitating wire purchases, but reserves the right to do so in the future. For
more information, please refer to the Shareholder Account Manual in this
Prospectus.
CERTIFICATES. In the interest of economy and convenience, physical certificates
representing a Fund's shares will not be issued unless a written request is
submitted to the Transfer Agent, or unless the investor's broker requests that
the Transfer Agent provide certificates. Shares of a Fund are recorded on a
register by the Transfer Agent, and shareholders who do not elect to receive
certificates have the same rights of ownership as if certificates had been
issued to them. Redemptions and exchanges by shareholders who hold certificates
may take longer to effect than similar transactions involving non-certificated
shares because the physical delivery and processing of properly executed
certificates is required. ACCORDINGLY, THE FUNDS AND G.T. GLOBAL RECOMMEND THAT
SHAREHOLDERS DO NOT REQUEST ISSUANCE OF CERTIFICATES.
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HOW TO MAKE EXCHANGES
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Advisor Class shares of any Fund may only be exchanged for Advisor Class shares
of any other Fund, and for Advisor Class shares of the other G.T. Global Mutual
Funds, based on their respective net asset values, provided that the
registration remains identical. This exchange privilege is available only in
those jurisdictions where the sale of G.T. Global Mutual Fund shares to be
acquired may be legally made. EXCHANGES ARE NOT TAX-FREE AND MAY RESULT IN A
SHAREHOLDER'S REALIZING A GAIN OR LOSS, AS THE CASE MAY BE, FOR TAX PURPOSES.
See "Dividends, Other Distributions and Federal Income Taxation."
Other than the Funds, the G.T. Global Mutual Funds currently include:
-- G.T. GLOBAL EMERGING MARKETS FUND
-- G.T. GLOBAL HEALTH CARE FUND
-- G.T. GLOBAL FINANCIAL SERVICES FUND
-- G.T. GLOBAL INFRASTRUCTURE FUND
-- G.T. GLOBAL NATURAL RESOURCES FUND
-- G.T. GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
-- G.T. GLOBAL TELECOMMUNICATIONS FUND
-- G.T. LATIN AMERICA GROWTH FUND
-- G.T. GLOBAL GROWTH & INCOME FUND
Prospectus Page 24
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G.T. GLOBAL GROWTH FUNDS
-- G.T. GLOBAL GOVERNMENT INCOME FUND
-- G.T. GLOBAL STRATEGIC INCOME FUND
-- G.T. GLOBAL HIGH INCOME FUND
-- G.T. GLOBAL DOLLAR FUND
Up to four exchanges each year may be made without charge. A $7.50 service
charge will be imposed on each subsequent exchange. Exchange requests received
in good order by the Transfer Agent before the close of regular trading on the
NYSE on any Business Day will be processed at the net asset value calculated on
that day.
EXCHANGES BY TELEPHONE. A shareholder may give exchange information to his or
her Financial Advisor. Exchange orders will be accepted by telephone provided
that the exchange involves only uncertificated shares on deposit in the
shareholder's account or for which certificates previously have been deposited.
Shareholders automatically have telephone privileges to authorize redemptions.
The Funds, G.T. Global and the Transfer Agent shall not be liable for any loss
or damage for acting in good faith upon instructions received by telephone and
reasonably believed to be genuine. The Fund employs reasonable procedures to
confirm that instructions communicated by telephone are genuine, including
requiring some form of personal identification prior to acting upon instructions
received by telephone, providing written confirmation of such transactions,
and/or tape recording of telephone instructions. The Funds may be liable for any
losses due to unauthorized or fraudulent instructions if they do not follow
reasonable procedures. Exchanges may also be made by mail.
Investors in Wrap Fee Accounts and Advisory Accounts interested in making an
exchange should contact their Financial Advisors to request the prospectus of
the other G.T. Global Mutual Fund(s) being considered. Other investors should
contact G.T. Global. See the Shareholder Account Manual in this Prospectus.
OTHER INFORMATION ABOUT EXCHANGES. Purchases, redemptions and exchanges should
be made for investment purposes only. A pattern of frequent exchanges, purchases
and sales is not acceptable and can be limited by a Fund's or G.T. Global's
refusal to accept further purchase and exchange orders. The terms of the
exchange offer described above may be modified at any time, on 60 days' prior
written notice.
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HOW TO REDEEM SHARES
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Fund shares may be redeemed at their net asset value and redemption proceeds
will be sent within seven days of the execution of a redemption request.
Redemption requests may be transmitted to the Transfer Agent by telephone or by
mail, in accordance with the instructions provided in the Shareholder Account
Manual. All redemptions will be effected at the net asset value next determined
after the Transfer Agent has received the request in good order and any required
supporting documentation. Redemption requests received before the close of
regular trading on the NYSE on any Business Day will be effected at the net
asset value calculated on that day. Redemption requests will not require a
signature guarantee if the redemption proceeds are to be sent either: (i) to the
redeeming shareholder at the shareholder's address of record as maintained by
the Transfer Agent, provided the shareholder's address of record has not been
changed within the preceding thirty days; or (ii) directly to a pre-designated
bank, savings and loan or credit union account ("Pre-Designated Account"). ALL
OTHER REDEMPTION REQUESTS MUST BE ACCOMPANIED BY A SIGNATURE GUARANTEE OF THE
REDEEMING SHAREHOLDER'S SIGNATURE. A signature guarantee can be obtained from
any bank, U.S. trust company, a member firm of a U.S. stock exchange or a
foreign branch of any of the foregoing or other eligible guarantor institution.
A notary public is not an acceptable guarantor.
Shareholders with Pre-Designated Accounts should request that redemption
proceeds be sent either by bank wire or by check. The minimum redemption amount
for a bank wire is $1,000. Shareholders requesting a bank wire should allow two
business days from the time the redemption request is effected for the proceeds
to be deposited in the shareholder's Pre-Designated Account. See "How to Redeem
Shares -- Other Important Redemption
Prospectus Page 25
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G.T. GLOBAL GROWTH FUNDS
Information." Shareholders may change their Pre-Designated Accounts only by a
letter of instruction to the Transfer Agent containing all account signatures,
each of which must be guaranteed. The Transfer Agent currently does not charge a
bank wire service fee on each wire redemption sent, but reserves the right to do
so in the future. The shareholder's bank may charge a bank wire service fee.
REDEMPTIONS BY TELEPHONE. Redemption requests may be made by telephone by
calling the Transfer Agent at the appropriate toll free number provided in the
Shareholder Account Manual. Shareholders who hold certificates for shares may
not redeem by telephone. REDEMPTION REQUESTS MAY NOT BE MADE BY TELEPHONE FOR
THIRTY DAYS FOLLOWING ANY CHANGE OF THE SHAREHOLDER'S ADDRESS OF RECORD.
Shareholders automatically have telephone privileges to authorize redemptions.
The Fund, G.T. Global and the Transfer Agent shall not be liable for any loss or
damage for acting in good faith upon instructions received by telephone and
reasonably believed to be genuine. The Fund employs reasonable procedures to
confirm that instructions communicated by telephone are genuine, including
requiring some form of personal identification prior to acting upon instructions
received by telephone, providing written confirmation of such transactions,
and/or tape recording of telephone instructions. The Funds may be liable for any
losses due to unauthorized or fraudulent instructions if they do not follow
reasonable procedures.
REDEMPTIONS BY MAIL. Redemption requests should be mailed directly to the
Transfer Agent at the appropriate address provided in the Shareholder Account
Manual. As discussed above, requests for payment of redemption proceeds to a
party other than the shareholder of record and/or requests that redemption
proceeds be mailed to an address other than the shareholder's address of record
require a signature guarantee. In addition, if the shareholder's address of
record has been changed within the preceding thirty days, a signature guarantee
is required. Redemptions of shares for which certificates have been issued must
be accompanied by properly endorsed share certificates.
OTHER IMPORTANT REDEMPTION INFORMATION. A request for redemption will not be
processed until all of the necessary documentation has been received in good
order. A shareholder in a Wrap Fee Account or Advisory Account who is in doubt
about what documents are required should contact his or her Financial Advisor.
Except in extraordinary circumstances and as permitted under the 1940 Act,
payment for shares redeemed by telephone or by mail will be made promptly after
receipt of a redemption request, if in good order, but not later than seven days
after the date the request is executed. Requests for redemption which are
subject to any special conditions or which specify a future or past effective
date cannot be accepted.
If the Transfer Agent is requested to redeem shares for which a Fund has not yet
received good payment, the Fund may delay payment of redemption proceeds until
it has assured itself that good payment has been collected for the purchase of
the shares. In the case of purchases by check, it can take up to 10 business
days to confirm that the check has cleared and good payment has been received.
Redemption proceeds will not be delayed when shares have been paid for by wire
or when the investor's account holds a sufficient number of shares for which
funds already have been collected.
G.T. Global reserves the right to redeem the shares of any Advisory Account or
Wrap Fee Account if the amount invested in G.T. Global Mutual Funds through such
account is reduced to less than $25,000 through redemptions or other action by
the shareholder. Written notice will be given to the shareholder at least 60
days prior to the date fixed for such redemption, during which time the
shareholder may increase the amount invested in G.T. Global Mutual Funds through
such account to an aggregate amount of $25,000 or more.
For additional information on how to redeem shares, see The Shareholder Account
Manual in this Prospectus, or contact your Financial Advisor.
Prospectus Page 26
<PAGE>
G.T. GLOBAL GROWTH FUNDS
SHAREHOLDER ACCOUNT MANUAL
- --------------------------------------------------------------------------------
Purchase, exchange and redemption orders may be placed in accordance with this
Manual. It is recommended that investors in Wrap Fee Accounts and Advisory
Accounts should make such orders through their Financial Advisor. PLEASE BE
CAREFUL TO REFERENCE "ADVISOR CLASS" IN ALL INSTRUCTIONS PROVIDED. See "How to
Invest;" "How to Make Exchanges;" "How to Redeem Shares;" and "Dividends, Other
Distributions and Federal Income Taxation -- Taxes" for more information.
Each Funds' Transfer Agent is G.T. GLOBAL INVESTOR SERVICES, INC.
INVESTMENTS BY MAIL
Send completed Account Application (if initial purchase) or letter stating Fund
name, class of shares, shareholder's registered name and account number (if
subsequent purchase) with a check to:
G.T. Global
P.O. Box 7345
San Francisco, California 94120-7345
INVESTMENTS BY BANK WIRE
A new account may be opened by calling 1-800-223-2138 to obtain an account
number. WITHIN SEVEN DAYS OF PURCHASE A COMPLETED ACCOUNT APPLICATION CONTAINING
THE APPROPRIATE TAXPAYER IDENTIFICATION NUMBER MUST BE SENT TO G.T. GLOBAL AT
THE ADDRESS PROVIDED ABOVE UNDER "INVESTMENTS BY MAIL." Wire instructions must
state Fund name, class of shares, shareholder's registered name and account
number. Bank wires should be sent through the Federal Reserve Bank Wire System
to:
WELLS FARGO BANK, N.A.
ABA 121000248
Attn: G.T. GLOBAL
ACCOUNT NO. 4023-050701
EXCHANGES BY TELEPHONE
Call G.T. Global at 1-800-223-2138
EXCHANGES BY MAIL
Send complete instructions, including name of Fund exchanging from, amount of
exchange, class of shares, name of the G.T. Global Mutual Fund exchanging into,
shareholder's registered name and account number, to:
G.T. Global
P.O. Box 7893
San Francisco, California 94120-7893
REDEMPTIONS BY TELEPHONE
Call G.T. Global at 1-800-223-2138
REDEMPTIONS BY MAIL
Send complete instructions, including name of Fund, class of shares, amount of
redemption, shareholder's registered name and account number, to:
G.T. Global
P.O. Box 7893
San Francisco, California 94120-7893
OVERNIGHT MAIL
Overnight mail services do not deliver to post office boxes. To send purchase,
exchange or redemption orders by overnight mail, comply with the above
instructions but send to the following:
G.T. Global Investor Services
California Plaza
2121 N. California Boulevard
Suite 450
Walnut Creek, CA 94596
ADDITIONAL QUESTIONS
Shareholders with additional questions regarding purchase, exchange and
redemption procedures may call G.T. Global at 1-800-223-2138.
Prospectus Page 27
<PAGE>
G.T. GLOBAL GROWTH FUNDS
CALCULATION OF NET ASSET VALUE
- --------------------------------------------------------------------------------
Each Fund calculates its net asset value as of the close of regular trading on
the NYSE (currently 4:00 p.m. Eastern Time, unless weather, equipment failure or
other factors contribute to an earlier closing time) each Business Day. Each
Fund's net asset value per share is computed by determining the value of its
total assets (the securities it holds plus any cash or other assets, including
interest and dividends accrued but not yet received), subtracting all the Fund's
liabilities (including accrued expenses), and dividing the result by the total
number of shares outstanding at such time. Net asset value is determined
separately for each class of shares of each Fund.
Equity securities held by a Fund are valued at the last sale price on the
exchange or in the principal over-the-counter market in which such securities
are traded, as of the close of business on the day the securities are being
valued or, lacking any sales, at the last available bid price. Long-term debt
obligations are valued at the mean of representative quoted bid or asked prices
for such securities, or, if such prices are not available, at prices for
securities of comparable maturity, quality and type; however, when G.T. Capital
deems it appropriate, prices obtained from a bond pricing service will be used.
Short-term debt investments are amortized to maturity based on their cost,
adjusted for foreign exchange translation and market fluctuations, provided that
such valuations represent fair value. When market quotations for futures and
options positions held by a Fund are readily available, those positions will be
valued based upon such quotations.
Securities and other assets for which market quotations are not readily
available are valued at fair value determined in good faith by or under
direction of the Company's Board of Trustees. Securities quoted in foreign
currencies will be valued in U.S. dollars based on the prevailing exchange rates
on that day.
Each Fund's portfolio securities, from time to time, may be traded primarily on
foreign exchanges or over-the-counter ("OTC") dealer markets which may trade on
days when the NYSE is closed (such as Saturday). As a result, the net asset
values of the Funds may be affected significantly by such trading on days when
shareholders have no access to the Funds.
Prospectus Page 28
<PAGE>
G.T. GLOBAL GROWTH FUNDS
DIVIDENDS, OTHER DISTRIBUTIONS
AND FEDERAL INCOME TAXATION
- --------------------------------------------------------------------------------
DIVIDENDS AND OTHER DISTRIBUTIONS. Each Fund annually declares as a dividend all
its net investment income, if any, which includes dividends, accrued interest
and earned discount (including both original issue and market discounts) less
applicable expenses. Each Fund also normally distributes for each fiscal year
substantially all of its realized net short-term capital gain (the excess of
short-term capital gains over short-term capital losses), net capital gain (the
excess of net long-term capital gain over net short-term capital loss) and net
gains from foreign currency transactions, if any. Each Fund may make an
additional dividend or other distribution if necessary to avoid a 4% excise tax
on certain undistributed income and gain.
Dividends and other distributions paid by each Fund with respect to all classes
of its shares are calculated in the same manner and at the same time. The per
share income dividends on Advisor Class shares of a Fund will be higher than the
per share income dividends on shares of other classes of that Fund as a result
of the service and distribution fee applicable to those other shares.
SHAREHOLDERS MAY ELECT:
/ / to have all dividends and other distributions automatically reinvested in
additional Advisor Class shares of the distributing Fund (or other G.T.
Global Mutual Funds) or
/ / to receive dividends in cash and have other distributions automatically
reinvested in additional Advisor Class shares of the distributing Fund (or
other G.T. Global Mutual Funds) or
/ / to receive other distributions in cash and have dividends automatically
reinvested in additional Advisor Class shares of the distributing Fund (or
other G.T. Global Mutual Funds) or
/ / to receive dividends and other distributions in cash.
Automatic reinvestments in additional Advisor Class shares are made at net asset
value. IF NO ELECTION IS MADE BY A SHAREHOLDER, ALL DIVIDENDS WITHOUT IMPOSITION
OF A SALES CHARGE AND OTHER DISTRIBUTIONS WILL BE AUTOMATICALLY REINVESTED IN
ADDITIONAL ADVISOR CLASS SHARES OF THE DISTRIBUTING FUND. Reinvestments in
another G.T. Global Mutual Fund may only be directed to an account with the
identical shareholder registration and account number. These elections may be
changed by a shareholder at any time; to be effective with respect to a
distribution, the shareholder or the shareholder's broker must contact the
Transfer Agent by mail or telephone at least 15 Business Days prior to the
payment date. THE FEDERAL INCOME TAX STATUS OF DIVIDENDS AND OTHER DISTRIBUTIONS
IS THE SAME WHETHER THEY ARE RECEIVED IN CASH OR REINVESTED IN ADDITIONAL
SHARES.
Any dividend or other distribution paid by a Fund has the effect of reducing the
net asset value per share on the ex-dividend date by the amount thereof.
Therefore, a dividend or other distribution paid shortly after a purchase of
shares would represent, in substance, a return of capital to the shareholder (to
the extent it is paid on the shares so purchased), even though subject to income
tax, as discussed below.
TAXES. Each Fund intends to continue to qualify for treatment as a regulated
investment company under the Code. In each taxable year that a Fund so
qualifies, the Fund (but not its shareholders) will be relieved of federal
income tax on that part of its investment company taxable income (consisting
generally of net investment income, net gains from certain foreign currency
transactions and net short-term capital gain) and net capital gain that is
distributed to its shareholders.
Dividends from a Fund's investment company taxable income (whether paid in cash
or reinvested in additional shares) are taxable to its shareholders as ordinary
income to the extent of the Fund's earnings and profits. Distributions of a
Fund's net capital gain, when designated as such, are taxable to its
shareholders as long-term capital gains, regardless of how long they have held
their Fund shares and whether such distributions are paid in cash or reinvested
in additional shares.
Each Fund provides federal tax information to its shareholders annually,
including information about dividends and other distributions paid during the
preceding year and, under certain circumstances, the shareholders' respective
shares of any foreign taxes paid by the Fund, in which event each shareholder
would be required to include in his or her gross income his or her pro rata
share of
Prospectus Page 29
<PAGE>
G.T. GLOBAL GROWTH FUNDS
those taxes but might be entitled to claim a credit or deduction for them.
Each Fund must withhold 31% from dividends, capital gain distributions and
redemption proceeds payable to any individuals and certain other noncorporate
shareholders who have not furnished to the Fund a correct taxpayer
identification number or a properly completed claim for exemption on Form W-8 or
W-9. Withholding at that rate also is required from dividends and capital gain
distributions payable to such shareholders who otherwise are subject to backup
withholding. Fund accounts opened via a bank wire purchase (see "How to Invest
- -- Purchases Through the Distributor") are considered to have uncertified
taxpayer identification numbers unless a completed Form W-8 or W-9 or Account
Application is received by the Transfer Agent within seven days after the
purchase. A shareholder should contact the Transfer Agent if the shareholder is
uncertain whether a proper taxpayer identification number is on file with a
Fund.
A redemption of Fund shares may result in taxable gain or loss to the redeeming
shareholder, depending upon whether the redemption proceeds are more or less
than the shareholder's adjusted basis for the redeemed shares. An exchange of
Fund shares for shares of another G.T. Global Mutual Fund generally will have
similar tax consequences. In addition, if Fund shares are purchased within 90
days before or after redeeming other shares of the same Fund (regardless of
class) at a loss, all or a part of the loss will not be deductible and instead
will increase the basis of the newly purchased shares.
The foregoing is only a summary of some of the important federal tax
considerations generally affecting each Fund and its shareholders. See "Taxes"
in the Statement of Additional Information for a further discussion. There may
be other federal, state, local or foreign tax considerations applicable to a
particular investor. Prospective investors therefore are urged to consult their
tax advisers.
- --------------------------------------------------------------------------------
MANAGEMENT
- --------------------------------------------------------------------------------
The Company's Board of Trustees has overall responsibility for the operation of
the Funds. Pursuant to such responsibility, the Board has approved contracts
with various financial organizations to provide, among other things, day to day
management services required by the Funds.
INVESTMENT MANAGEMENT AND ADMINISTRATION. Services provided by G.T. Capital as
each Fund's investment manager and administrator include, but are not limited
to, determining the composition of the Fund's portfolio and placing orders to
buy, sell or hold particular securities; furnishing corporate officers and
clerical staff; providing office space, services and equipment; and supervising
all matters relating to the Fund's operation. For these services, the America
Fund pays G.T. Capital investment management and administration fees, computed
daily and paid monthly, based on its average daily net assets, at the annualized
rate of .725% on the first $500 million, .70% on the next $500 million, .675% on
the next $500 million, and .65% on amounts thereafter. Each of the other Funds
pays G.T. Capital investment management and administration fees, computed daily
and paid monthly, based on its average daily net assets, at the annualized rate
of .975% on the first $500 million, .95% on the next $500 million, .925% on the
next $500 million, and .90% on amounts thereafter. These rates are higher than
those paid by most mutual funds.
G.T. Capital, organized in 1973, provides investment management and/or
administrative services to all the G.T. Global Mutual Funds as well as to other
institutional, corporate and individual clients. The offices of G.T. Capital are
located at 50 California Street, 27th Floor, San Francisco, California 94111.
G.T. Capital is the U.S. member of the G.T. Group, an international investment
advisory organization established in 1969 for the purpose of rendering
international portfolio management services to both institutional and individual
clients. Since the G.T. Group was established, it has gained a reputation as a
leader in identifying and investing in emerging and established markets around
the world. As of April 1, 1995, aggregate assets under G.T. Group management
exceeded $20 billion, of
Prospectus Page 30
<PAGE>
G.T. GLOBAL GROWTH FUNDS
which more than $17 billion was invested in the securities of non-U.S. issuers.
In addition to the San Francisco office, the G.T. Group maintains fully staffed
investment offices in London, Hong Kong, Tokyo, Toronto, Singapore and Sydney.
Many of G.T. Capital's investment managers are natives of the countries in which
they invest, and have the advantage of being close to the financial markets they
follow and speaking the languages of local corporate and government leaders.
G.T. Capital's experienced management team is situated to react quickly to
changes in foreign markets which are in time zones different from those in the
United States.
G.T. Capital and the other companies in the G.T. Group are subsidiaries of BIL
GT Group Limited ("BIL GT Group"), a financial services holding company. BIL GT
Group in turn is controlled by the Prince of Liechtenstein Foundation, which
serves as the parent organization for the various business enterprises of the
Princely Family of Liechtenstein. Its principal business address is Herrengasse
12, FL-9490, Vaduz, Liechtenstein.
In managing the Funds, G.T. Capital employs a team approach, taking advantage of
the resources of its various investment offices around the world in seeking to
achieve each Fund's investment objective. In addition, in managing the Funds
these individuals utilize the research and related work of other members of G.T.
Capital's investment staff.
The investment professionals primarily responsible for the portfolio management
of each Fund are as follows:
PACIFIC FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
Lawrence Yip Asset allocation and security Portfolio Manager for G.T. Management
Hong Kong selection for Asian countries (Asia) Ltd. and Portfolio Manager for
(excluding Japan) since 1993 G.T. Capital since 1993.
Nicholas W. Andrews Security selection for Australia and Portfolio Manager for G.T. Management
Sydney New Zealand since 1991 (Australia) Ltd. and G.T. Capital
since 1991. Prior thereto Mr. Andrews
was an Investment Analyst for Legal
and General Life of Australia
(Sydney).
</TABLE>
EUROPE FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
Anna Powell Security selection for Continental Portfolio Manager for G.T. Management
London Europe since 1995 PLC (London) and G.T. Capital since
March, 1995. From 1989 to 1995, Ms.
Powell was a Portfolio Manager for
Robert Fleming & Co. Ltd. (London).
Prior thereto, she was an Equity
Analyst for Charterhouse Bank Ltd.
(London).
Roger Yates Security selection for the UK since Portfolio Manager for G.T. Capital
London 1994 since 1994. Portfolio Manager for
G.T. Management PLC (London) since
1994. Prior thereto, Mr. Yates was an
Investment Manager for Morgan General
Asset Management.
</TABLE>
Prospectus Page 31
<PAGE>
G.T. GLOBAL GROWTH FUNDS
AMERICA FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
Kevin L. Wenck Portfolio manager since 1991 Portfolio Manager for G.T. Capital
San Francisco since 1991. Prior thereto Mr. Wenck
was a Portfolio Manager for Matuschka
& Co. (Greenwich, CT).
Richard M. Parower Investment analyst since 1993 Investment Analyst for G.T. Capital
San Francisco since 1993. From 1991 to 1993, Mr.
Parower was a student at Columbia
University Graduate School of
Business (where he received a Masters
for Business Administration). In
1991, he was an Analyst of Cowen
Asset Management (New York). Prior
thereto, Mr. Parower was an Analyst
at Matuschka & Co. (Greenwich, CT).
Jeanne M. Kraus Research analyst since 1993 Analyst for G.T. Capital since 1991.
From 1989 to 1991, Ms. Kraus was an
Assistant at Massachusetts Financial
Services.
</TABLE>
Prospectus Page 32
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INTERNATIONAL FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
F. Christian Wignall Overall supervision and asset Chief Investment Officer -- Global
San Francisco allocation since 1987 Equities for G.T. Capital.
Michael Lindsell Portfolio Manager since 1992 Chief Investment Officer -- Japan for
Tokyo G.T. Management (Japan) Ltd. as well
as Portfolio Manager for G.T. Capital
since 1992. Prior thereto Mr.
Lindsell was a Director of Warburg
Asset Management (Tokyo, Japan).
Malcolm Tulloch Portfolio Manager since 1994 Portfolio Manager for G.T. Management
London PLC (London) as well as Portfolio
Manager for G.T. Capital since 1994.
Prior thereto, Mr. Tulloch was
Managing Director of Tulloch Research
(London, England).
Soraya M. Betterton Security selection for Canada and Portfolio Manager for G.T. Capital.
San Francisco Latin America since 1989
Nicholas W. Andrews Security selection for Australia and Portfolio Manager for G.T. Management
Sydney New Zealand since 1991 (Australia) Ltd. and G.T. Capital
since 1991. Prior thereto Mr. Andrews
was an Investment Analyst for Legal
and General Life of Australia
(Sydney).
Peter Eadon-Clarke Security selection for Asian countries Chief Investment Officer for G.T.
Hong Kong (excluding Japan) since 1992 Management (Asia) Ltd. as well as
Portfolio Manager for G.T. Capital
since 1992. Prior thereto Mr.
Eadon-Clarke was an Associate
Director of Wardley Investment
Services (Hong Kong).
Roger Yates Security selection for the UK since Portfolio Manager for G.T. Capital
London 1994 since 1994. Portfolio Manager for
G.T. Management PLC (London) since
1994. Prior thereto, Mr. Yates was an
Investment Manager for Morgan General
Asset Management.
Serge Selfslagh Security selection for Continental Portfolio Manager for G.T. Management
London Europe since 1993 PLC (London) and G.T. Capital since
1993. Prior thereto Mr. Selfslagh was
a Portfolio Manager for Schroeder
Investment Management (London) and
its U.S. affiliate, SCMI.
</TABLE>
Prospectus Page 33
<PAGE>
G.T. GLOBAL GROWTH FUNDS
WORLDWIDE FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
F. Christian Wignall Overall supervision and asset Chief Investment Officer -- Global
San Francisco allocation since 1987 Equities for G.T. Capital.
Malcolm Tulloch Portfolio Manager since 1994 Portfolio Manager for G.T. Management
London PLC (London) as well as Portfolio
Manager for G.T. Capital since 1994.
Prior thereto, Mr. Tulloch was
Managing Director of Tulloch Research
(London, England).
Soraya M. Betterton Security selection for North and South Portfolio Manager for G.T. Capital.
San Francisco America since 1989
Nicholas W. Andrews Security selection for Australia and Portfolio Manager for G.T. Management
Sydney New Zealand since 1991 (Australia) Ltd. and G.T. Capital
since 1991. Prior thereto Mr. Andrews
was an Investment Analyst for Legal
and General Life of Australia
(Sydney).
Peter Eadon-Clarke Security selection for Asian countries Chief Investment Officer for G.T.
Hong Kong (excluding Japan) since 1992 Management (Asia) Ltd. as well as
Portfolio Manager for G.T. Capital
since 1992. Prior thereto Mr.
Eadon-Clarke was an Associate
Director of Wardley Investment
Services (Hong Kong).
Roger Yates Security selection for U.K. since 1994 Portfolio Manager for G.T. Capital
London since 1994. Portfolio Manager for
G.T. Management PLC (London) since
1994. Prior thereto, Mr. Yates was an
Investment Manager for Morgan General
Asset Management.
Serge Selfslagh Security selection for Continental Portfolio Manager for G.T. Management
London Europe since 1993 PLC (London) and G.T. Capital since
1993. Prior thereto Mr. Selfslagh was
a Portfolio Manager for Schroeder
Investment Management (London) and
its U.S. affiliate, SCMI.
Michael Lindsell Security selection for Japan since Chief Investment Officer -- Japan for
Tokyo 1992 G.T. Management (Japan) Ltd. as well
as Portfolio Manager for G.T. Capital
since 1992. Prior thereto Mr.
Lindsell was a Director of Warburg
Asset Management (Tokyo, Japan).
</TABLE>
JAPAN FUND
<TABLE>
<CAPTION>
RESPONSIBILITIES FOR BUSINESS EXPERIENCE
NAME/OFFICE THE FUND LAST FIVE YEARS
- -------------------------------------- -------------------------------------- --------------------------------------
<S> <C> <C>
Michael Lindsell Portfolio Manager since 1992 Chief Investment Officer -- Japan for
Tokyo G.T. Management (Japan) Ltd. as well
as Portfolio Manager for G.T. Capital
since 1992. Prior thereto Mr.
Lindsell was a Director of Warburg
Asset Management (Tokyo, Japan).
</TABLE>
Prospectus Page 34
<PAGE>
G.T. GLOBAL GROWTH FUNDS
In placing orders for the Funds' portfolio transactions, G.T. Capital seeks to
obtain the best net results. G.T. Capital has no agreement or commitment to
place orders with any broker/dealer. Commissions or discounts in foreign
securities exchanges and OTC markets often are fixed and generally are higher
than those in U.S. securities exchanges or markets. Debt securities generally
are traded on a "net" basis with a dealer acting as principal for its own
account without a stated commission, although the price of the security usually
includes a profit to the dealer. U.S. and foreign government securities and
money market instruments generally are traded in the OTC markets. In
underwritten offerings, securities usually are purchased at a fixed price which
includes an amount of compensation to the underwriter. On occasion, securities
may be purchased directly from an issuer, in which case no commissions or
discounts are paid. Broker/dealers may receive commissions on futures, currency
and options transactions. Consistent with its obligation to obtain the best net
results, G.T. Capital may consider a broker/dealer's sale of shares of the G.T.
Global Mutual Funds as a factor in considering through whom portfolio
transactions will be effected. Brokerage transactions for the Fund may be
executed through any of the BIL GT Group affiliates.
The Funds' portfolio turnover rates during the fiscal year ended December 31,
1994 ranged between 49% and 102%. See the sub-caption "Portfolio Trading and
Turnover" in the Statement of Additional Information. Increases in portfolio
turnover would involve correspondingly greater transaction costs in the form of
dealer spreads or brokerage commissions and other costs that a Fund will bear
directly, and could result in the realization of net capital gains which would
be taxable when distributed to shareholders.
DISTRIBUTION OF FUND SHARES. G.T. Global is the distributor, or principal
underwriter, of each Fund's Advisor Class shares. Like G.T. Capital, G.T. Global
is a subsidiary of BIL GT Group with offices at 50 California Street, 27th
Floor, San Francisco, California 94111.
G.T. Capital or an affiliate thereof may make ongoing payments to Financial
Advisors and others that facilitate the administration and servicing of Advisor
Class shareholder accounts.
G.T. Global, at its own expense, may also provide promotional incentives to
broker/dealers that sell shares of the Funds and/or shares of the other G.T.
Global Mutual Funds. In some instances compensation or promotional incentives
may be offered to broker/dealers that have sold or may sell significant amounts
of shares during specified periods of time. Such compensation and incentives may
include, but are not limited to, cash, merchandise, trips and financial
assistance to brokers in connection with preapproved conferences or seminars,
sales or training programs for invited sales personnel, payment for travel
expenses (including meals and lodging) incurred by sales personnel and members
of their families or other invited guests to various locations for such seminars
or training programs, seminars for the public, advertising and sales campaigns
regarding one or more of the G.T. Global Mutual Funds, and/or other events
sponsored by the broker/dealer.
The Glass-Steagall Act and other applicable laws, among other things, generally
prohibit federally chartered or supervised banks from engaging in the business
of underwriting or distributing securities. Accordingly, G.T. Global intends to
engage banks (if at all) only to perform administrative and shareholder
servicing functions. If a bank were prohibited from so acting, its shareholder
clients would be permitted to remain shareholders, and alternative means for
continuing the servicing of such shareholders would be sought. It is not
expected that shareholders would suffer any adverse financial consequences as a
result of any of these occurrences.
Prospectus Page 35
<PAGE>
G.T. GLOBAL GROWTH FUNDS
OTHER INFORMATION
- --------------------------------------------------------------------------------
CONFIRMATIONS AND REPORTS TO SHAREHOLDERS. Each time a transaction is made that
affects a shareholder's account in a Fund, such as an additional investment,
redemption or the payment of a dividend or other distribution, the shareholder
will receive from the Transfer Agent a confirmation statement reflecting the
transaction. Confirmations for transactions effected pursuant to a Fund's
automatic dividend reinvestment program may be provided quarterly. Shortly after
the end of the Funds' fiscal year on December 31 and fiscal half-year on June 30
of each year, shareholders will receive an annual and semiannual report,
respectively. These reports list the securities held by each Fund and includes
each Fund's financial statements. In addition, the federal income tax status of
distributions made by the Funds to shareholders will be reported after the end
of the fiscal year on Form 1099-DIV.
ORGANIZATION. The Company is organized as a Massachusetts business trust and is
registered with the SEC as a diversified open-end management investment company.
Each Fund corresponds to a distinct investment portfolio and a distinct series
of the Company's shares of beneficial interest. From time to time, the Company's
Board of Trustees may, in its discretion, establish additional funds and issue
shares of additional series of the Company's shares of beneficial interest.
Shares of each Fund are entitled to one vote per share (with proportional voting
for fractional shares) and are freely transferable. Shareholders have no
preemptive or conversion rights.
On any matter submitted to a vote of shareholders, shares of each Fund will be
voted by that Fund's shareholders individually when the matter affects the
specific interest of that Fund only, such as approval of that Fund's investment
management arrangements. In addition, each class of shares of a Fund has
exclusive voting rights with respect to its distribution plan. The shares of all
the Company's Funds will be voted in the aggregate on other matters, such as the
election of Trustees and ratification of the selection by the Board of Trustees
of the Company's independent accountants.
The Company normally will not hold meetings of shareholders, except as required
under the 1940 Act. The Company would be required to hold a shareholders meeting
in the event that at any time less than a majority of the Trustees holding
office had been elected by shareholders. Trustees shall continue to hold office
until their successors are elected and have qualified. Shares of the Company's
Funds do not have cumulative voting rights, which means that the holders of a
majority of the shares voting for the election of Trustees can elect all the
Trustees. A Trustee may be removed upon a majority vote of the shareholders
qualified to vote in the election. Shareholders holding 10% of the Company's
outstanding voting securities may call a meeting of shareholders for the purpose
of voting upon the question of removal of any Trustee or for any other purpose.
The 1940 Act requires the Company to assist shareholders in calling such a
meeting.
Advisor Class shares are offered through this Prospectus to certain investors.
There are two other classes of shares offered to investors through a separate
prospectus: Class A shares and Class B shares.
CLASS A. Class A shares are sold at net asset value plus an initial sales charge
of up to 4.75% of the public offering price imposed at the time of purchase.
This initial sales charge is reduced or waived for certain purchases. Class A
shares of each Fund also bear annual service and distribution fees of up to
0.35% of the average daily net assets of that class. For the fiscal year ended
December 31, 1994, total operating expenses for the Class A shares were 1.81%
for Worldwide Fund, 1.70% for International Fund, 1.91% for Japan Fund, 1.81%
for Pacific Fund, 1.73% for Europe Fund, and 1.58% for America Fund,
respectively, of average net assets.
CLASS B. Class B shares are sold at net asset value with no initial sales charge
at the time of purchase. Class B shares bear annual service and distribution
fees of up to 1.00% of the average daily net assets of that class, and investors
pay a contingent deferred sales charge of up to 5% of the lesser of the original
purchase price or the net asset value of such shares at the time of redemption.
This
Prospectus Page 36
<PAGE>
G.T. GLOBAL GROWTH FUNDS
deferred sales charge is waived for certain redemptions and is reduced for
shares held more than one year. For the fiscal year ended December 31, 1994,
total operating expenses for the Class B shares were 2.46% for Worldwide Fund,
2.35% for International Fund, 2.56% for Japan Fund, 2.46% for Pacific Fund,
2.38% for Europe Fund, and 2.23% for America Fund, respectively, of average net
assets.
The different expenses borne by each class of shares will result in different
net asset values and dividends. The per share net asset value of the Advisor
Class shares of a Fund generally will be higher than that of a Class A and B
shares of that Fund because of the higher expenses borne by the Class A and B
shares. The per share dividends on Advisor Class shares of a Fund will generally
be higher than the per share dividends on Class A and B shares of that Fund as a
result of the service and distribution fees applicable with respect to Class A
and B shares. Consequently, during comparable periods, the Funds expect the
total return on an investment in shares of the Advisor Class will be higher than
the total return on Class A or B shares.
Pursuant to the Company's Declaration of Trust, the Company may issue an
unlimited number of shares for each of the Funds, including an unlimited number
of Class A, Class B and Advisor Class shares of each Fund. Each share of a Fund
represents an interest in the Fund only, has no par value, represents an equal
proportionate interest in the Fund with other shares of the Fund and is entitled
to such dividends and distributions out of the income earned and gain realized
on the assets belonging to the Fund as may be declared by the Board of Trustees.
Each Class A, Class B and Advisor Class share of each Fund is equal as to
earnings, assets and voting privileges to each other share in such Fund, except
as noted above, and each class bears the expenses, if any, related to the
distribution of its shares. Shares of the Funds, when issued, are fully paid and
nonassessable.
Each Fund is classified as a "diversified" fund under the 1940 Act, which means
that, with respect to 75% of each Fund's total assets: (i) no more than 5% will
be invested in the securities of any one issuer, and (ii) each Fund will
purchase no more than 10% of the outstanding voting securities of any one
issuer.
SHAREHOLDER INQUIRIES. Shareholder inquiries may be made by calling the Funds
toll free at (800) 223-2138 or by writing to the Funds at P.O. Box 7893, San
Francisco, CA 94120-7893.
PERFORMANCE INFORMATION. Each Fund, from time to time, may include information
on its investment results and/or comparisons of its investment results to
various unmanaged indices or results of other mutual funds or groups of mutual
funds in advertisements, sales literature or reports furnished to present or
prospective shareholders.
In such materials, a Fund may quote its average annual total return
("Standardized Return"). Standardized Return is calculated separately for each
class of shares of each Fund. Standardized Return shows percentage rates
reflecting the average annual change in the value of an assumed investment in
the Fund at the end of a one-year period and at the end of five- and ten-year
periods, reduced by the maximum applicable sales charge imposed on sales of Fund
shares. If a one-, five- and/or ten-year period has not yet elapsed, data will
be provided as of the end of a shorter period corresponding to the life of the
Fund. Standardized Return assumes the reinvestment of all dividends and capital
gain distributions at net asset value on the reinvestment date established by
the Board of Trustees.
In addition, in order to more completely represent a Fund's performance or more
accurately compare such performance to other measures of investment return, a
Fund also may include in advertisements, sales literature and shareholder
reports other total return performance data ("Non-Standardized Return").
Non-Standardized Return reflects percentage rates of return encompassing all
elements of return (i.e., income and capital appreciation or depreciation); it
assumes reinvestment of all dividends and capital gain distributions.
Non-Standardized Return may be quoted for the same or different periods as those
for which Standardized Return is quoted; it may consist of an aggregate or
average annual percentage rate of return, actual year-by-year rates or any
combination thereof. Non-Standardized Return may or may not take sales charges
into account; performance data calculated without taking the effect of sales
charges into account will be higher than data including the effect of such
charges.
Each Fund's performance data reflects past performance and is not necessarily
indicative of future results. A Fund's investment results will vary from time to
time depending upon market conditions, the composition of its portfolio and its
operating expenses. These factors and possible differences
Prospectus Page 37
<PAGE>
G.T. GLOBAL GROWTH FUNDS
in calculation methods should be considered when comparing a Fund's investment
results with those published for other investment companies, other investment
vehicles and unmanaged indices. A Fund's results also should be considered
relative to the risks associated with its investment objective and policies.
Each Fund will include performance data for all classes of shares of the Fund in
any advertisement or information including performance data for such Fund. See
"Investment Results" in the Statement of Additional Information.
Each Fund's annual report contains additional information with respect to its
performance. The annual report is available to investors upon request and free
of charge.
TRANSFER AGENT. Shareholder servicing, reporting and general transfer agent
functions for the Funds are performed by G.T. Global Investor Services, Inc. The
Transfer Agent is an affiliate of G.T. Capital and G.T. Global, a subsidiary of
BIL GT Group and maintains offices at 50 California Street, 27th Floor, San
Francisco, California 94111.
CUSTODIAN AND ACCOUNTING AGENT. State Street Bank and Trust Company, 225
Franklin Street, Boston, Massachusetts 02110 is custodian of each Fund's assets
and serves as each Fund's accounting agent.
COUNSEL. The law firm of Kirkpatrick & Lockhart LLP 1800 M Street, N.W.,
Washington, D.C. 20036-5891, acts as counsel to the Company and the Funds.
Kirkpatrick & Lockhart LLP also acts as counsel to G.T. Capital, G.T. Global and
G.T. Global Investor Services, Inc. in connection with other matters.
INDEPENDENT ACCOUNTANTS. The Company's and each Fund's independent accountants
are Coopers & Lybrand L.L.P., One Post Office Square, Boston, Massachusetts
02109. Coopers & Lybrand L.L.P. conducts an annual audit of each Fund, assists
in the preparation of each Fund's federal and state income tax returns and
consults with the Company and each Fund as to matters of accounting, regulatory
filings, and federal and state income taxation.
MULTIPLE TRANSLATIONS OF THE PROSPECTUS. This Prospectus may be translated into
other languages. In the event of any inconsistency or ambiguity as to the
meaning of any word or phrase contained in a translation, the English text shall
prevail.
Prospectus Page 38
<PAGE>
<TABLE>
<S> <C> <C>
[G.T. GLOBAL LOGO]
G.T. GLOBAL
MUTUAL FUNDS
P.O. Box 7345 ADVISOR CLASS
SAN FRANCISCO, CA 94120-7345 ACCOUNT APPLICATION
800/223-2138
</TABLE>
<TABLE>
<S> <C> <C>
/ / INDIVIDUAL / / JOINT TENANT / / GIFT/TRANSFER FOR MINOR / / TRUST / / CORP.
ACCOUNT REGISTRATION / / NEW ACCOUNT / / ACCOUNT REVISION (Account No.: -------------------------------------)
NOTE: Trust registrations should specify name of trustee(s), beneficiary(ies) and date of trust instrument. Registration for
Uniform Gifts/Transfers to Minors accounts should be in the name of one custodian and one minor and include the state under
which the custodianship is created.
----------------------------------------------------------------
- ------------------------------------------------------------ Social Security Number / / or Tax I.D. Number / / (Check
Owner applicable box)
- ------------------------------------------------------------ If more than one owner, social security number or taxpayer
Co-owner 1 identification number should be provided for first owner listed.
- ------------------------------------------------------------ If a purchase is made under Uniform Gift/Transfer to Minors Act,
Co-owner 2 social security number of the minor must be provided.
Resident of / / U.S. / / Other (specify) ----------------
- -------------------------------------------------------------------------------------- ( )
Street Address ---------------------------
- -------------------------------------------------------------------------------------- Home Telephone
City, State, Zip Code ( )
---------------------------
Business Telephone
FUND SELECTION $25,000 total minimum initial investment is required. Checks should be made payable to "G.T. GLOBAL."
</TABLE>
<TABLE>
<S> <C> <C> <C>
INITIAL INITIAL
INVESTMENT INVESTMENT
407 / / G.T. GLOBAL WORLDWIDE GROWTH FUND $ 402 / / G.T. GLOBAL NEW PACIFIC GROWTH FUND $
---------- ----------
405 / / G.T. GLOBAL INTERNATIONAL GROWTH FUND $ 403 / / G.T. GLOBAL EUROPE GROWTH FUND $
---------- ----------
416 / / G.T. GLOBAL EMERGING MARKETS FUND $ 413 / / G.T. LATIN AMERICA GROWTH FUND $
---------- ----------
411 / / G.T. GLOBAL HEALTH CARE FUND $ 406 / / G.T. GLOBAL AMERICA GROWTH FUND $
---------- ----------
415 / / G.T. GLOBAL TELECOMMUNICATIONS FUND $ 404 / / G.T. GLOBAL JAPAN GROWTH FUND $
---------- ----------
419 / / G.T. GLOBAL INFRASTRUCTURE FUND $ 410 / / G.T. GLOBAL GROWTH & INCOME FUND $
---------- ----------
417 / / G.T. GLOBAL FINANCIAL SERVICES FUND $ 409 / / G.T. GLOBAL GOVERNMENT INCOME FUND $
---------- ----------
421 / / G.T. GLOBAL NATURAL RESOURCES FUND $ 408 / / G.T. GLOBAL STRATEGIC INCOME FUND $
---------- ----------
422 / / G.T. GLOBAL CONSUMER PRODUCTS $ 418 / / G.T. GLOBAL HIGH INCOME FUND $
AND SERVICES FUND ---------- ----------
401 / / G.T. GLOBAL DOLLAR FUND $
----------
TOTAL INITIAL INVESTMENT: $
----------
</TABLE>
AGREEMENTS & SIGNATURES
By the execution of this Account Application, I/we represent and warrant that
I/we have full right, power and authority and am/are of legal age in my/our
state of residence to make the investment applied for pursuant to this
Application. The person(s), if any, signing on behalf of the investor
represent and warrant that they are duly authorized to sign this Application
and to purchase, redeem or exchange shares of the Fund(s) on behalf of the
investor. I/WE HEREBY AFFIRM THAT I/WE HAVE RECEIVED A CURRENT ADVISOR CLASS
PROSPECTUS OF THE G.T. FUND(S) IN WHICH I/WE AM/ARE INVESTING AND I/WE AGREE
TO ITS TERMS AND CONDITIONS.
I/WE AND MY/OUR AGENTS, ASSIGNS AND SUCCESSORS UNDERSTAND AND AGREE THAT THE
ACCOUNT WILL BE SUBJECT TO THE TELEPHONE EXCHANGE AND TELEPHONE REDEMPTION
PRIVILEGES DESCRIBED IN THE CURRENT PROSPECTUS TO WHICH THIS APPLICATION IS
ATTACHED AND AGREE THAT G.T. GLOBAL FINANCIAL SERVICES, INC., G.T. GLOBAL
GROWTH SERIES, G.T. INVESTMENT FUNDS, INC., G.T. INVESTMENT PORTFOLIOS, INC.
AND THE FUNDS' TRANSFER AGENT, THEIR OFFICERS AND EMPLOYEES, WILL NOT BE
LIABLE FOR ANY LOSS OR DAMAGES ARISING OUT OF ANY SUCH TELEPHONE, TELEX OR
TELEGRAPHIC INSTRUCTIONS REASONABLY BELIEVED TO BE GENUINE, INCLUDING ANY SUCH
LOSS OR DAMAGES DUE TO NEGLIGENCE ON THE PART OF SUCH ENTITIES. THE
INVESTOR(S) CERTIFY(IES) AND AGREE(S) THAT THE CERTIFICATIONS, AUTHORIZATIONS,
DIRECTIONS AND RESTRICTIONS CONTAINED HEREIN WILL CONTINUE UNTIL G.T. GLOBAL
FINANCIAL SERVICES, INC., G.T. GLOBAL GROWTH SERIES, G.T. INVESTMENT FUNDS,
INC., G.T. INVESTMENT PORTFOLIOS, INC. OR THE FUNDS' TRANSFER AGENT RECEIVES
WRITTEN NOTICE OF ANY CHANGE OR REVOCATION. ANY CHANGE IN THESE INSTRUCTIONS
MUST BE IN WRITING AND IN SOME CASES, AS DESCRIBED IN THE PROSPECTUS, REQUIRES
THAT ALL SIGNATURES BE GUARANTEED.
PLEASE INDICATE THE NUMBER OF SIGNATURES REQUIRED TO PROCESS CHECKS OR
WRITTEN REDEMPTION REQUESTS: / / ONE / / TWO / / THREE / / FOUR.
(If you do not indicate the number of required signatures, ALL account
owners must sign checks and/or written redemption requests.)
Under penalties of perjury, I certify that the Taxpayer Identification
Number provided on this form is my (or my employer's, trust's, minor's or
other payee's) true, correct and complete Number and may be assigned to any
new account opened under the exchange privilege. I further certify that I am
(or the payee whose Number is given is) not subject to backup withholding
because: (a) I am (or the payee is) exempt from backup withholding; (b) the
Internal Revenue Service has not notified me that I am (or the payee is)
subject to backup withholding as a result of a failure to report all interest
or dividends; OR (c) the I.R.S. has notified me that I am (the payee is) no
longer subject to backup withholding;
OR, / / I am (the payee is) subject to backup withholding.
ALL ACCOUNT OWNERS MUST SIGN BELOW (Minors are not authorized signers)
Account revisions may require that signatures be guaranteed. Please see the
Prospectus.
<TABLE>
<S> <C>
----------------------------------------------------------
Date
X X
---------------------------------------------------------- ----------------------------------------------------------
X X
---------------------------------------------------------- ----------------------------------------------------------
</TABLE>
<PAGE>
ACCOUNT PRIVILEGES
CHECKWRITING PRIVILEGE
Checkwriting privilege available on Advisor Class shares of G.T. Global Dollar
Fund and G.T. Global Government Income Fund.
/ / Check here if desired. You will be sent a book of checks.
CAPITAL GAINS AND DIVIDEND DISTRIBUTIONS
All capital gains and dividend distributions will be reinvested in additional
shares of Advisor class unless appropriate boxes below are checked:
/ / Pay capital gain distributions only in cash / / Pay dividends only in
cash / / Pay capital gain distributions AND dividends in cash.
SPECIAL CAPITAL GAINS AND DIVIDEND DISTRIBUTIONS OPTION
Pay distributions noted above to another G.T. Global Fund: Fund Name
- -----------------------------------------
<TABLE>
<S> <C>
TELEPHONE EXCHANGE AND REDEMPTION AUTHORITY TO TRANSMIT REDEMPTION PROCEEDS TO
PRE-DESIGNATED ACCOUNT
I/We, either directly or through the Authorized Agent, if any, named By completing the following section, redemptions that
below, hereby authorize the Transfer Agent of the G.T. Global Mutual exceed $1,000 may be wired or mailed to a Pre-Designated
Funds, to honor any telephone, telex or telegraphic instructions Account at your bank. (Wiring instructions may be obtained
reasonably believed to be authentic for redemption and/or exchange from your bank.) A bank wire service fee may be charged.
between a similar class of shares of any of the Funds distributed by ----------------------------------------------------------
G.T. Global Financial Services, Inc. Name of Bank
----------------------------------------------------------
Bank Address
----------------------------------------------------------
Bank A.B.A Number Account Number
----------------------------------------------------------
Names(s) in which Bank Account is Established
A corporation (or partnership) must also submit a
"Corporate Resolution" (or "Certificate of Partnership")
indicating the names and titles of Officers authorized to
act on its behalf.
</TABLE>
<TABLE>
<S> <C> <C> <C>
FOR USE BY AUTHORIZED AGENT ONLY
We hereby submit this Account Application for the purchase of Advisor Class shares in accordance with the terms of our Advisor Class
Agreement with G.T. Global Financial Services, Inc. and with the Prospectus and Statement of Additional Information of each Fund
purchased.
- ------------------------------------------------------------------------------------------------------------------------------------
Advisor's Name
- ------------------------------------------------------------------------------------------------------------------------------------
Main Office Address Branch Number (if applicable) Representative's Number Representative's
Name
( )
- -------------------------------------------------------------------------------------------------------------------------
Branch Address Telephone
- -------------------------------------------------------------------------------------------------------------------------
Advisor's Authorized Signature Title
</TABLE>
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Prospectus Page 39
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Prospectus Page 40
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Prospectus Page 41
<PAGE>
G.T. GLOBAL GROWTH FUNDS
[LOGO]
G.T. GLOBAL GROUP OF FUNDS
G.T. GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY
INVESTORS' PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE
G.T. GLOBAL FUNDS, PLEASE CONTACT G.T. GLOBAL OR YOUR FINANCIAL ADVISOR.
GROWTH FUNDS
/ / GLOBALLY DIVERSIFIED FUNDS
G.T. GLOBAL: WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.
G.T. GLOBAL: INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside
the U.S.
G.T. GLOBAL: EMERGING MARKETS FUND
Gives access to the growth potential of developing economies
/ / GLOBAL THEME FUNDS
G.T. GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide
G.T. GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment
G.T. GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain a country's infrastructure
G.T. GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products
G.T. GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources
G.T. GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services
/ / REGIONALLY DIVERSIFIED FUNDS
G.T. GLOBAL: NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan
G.T. GLOBAL: EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe
G.T. LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America
/ / SINGLE COUNTRY FUNDS
G.T. GLOBAL: AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.
G.T. GLOBAL: JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market
GROWTH AND INCOME FUND
G.T. GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world
INCOME FUNDS
G.T. GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities
G.T. GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets
G.T. GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets
MONEY MARKET FUND
G.T. GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY G.T. GLOBAL GROWTH SERIES, G.T. CAPITAL
MANAGEMENT, INC. OR G.T. GLOBAL FINANCIAL SERVICES, INC. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF ANY OFFER TO BUY ANY
OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
<PAGE>
[LOGO]
G.T. GLOBAL GROWTH FUNDS:
ADVISOR CLASS
G.T. GLOBAL: WORLDWIDE GROWTH FUND
G.T. GLOBAL: INTERNATIONAL GROWTH FUND
G.T. GLOBAL: NEW PACIFIC GROWTH FUND
G.T. GLOBAL: EUROPE GROWTH FUND
G.T. GLOBAL: JAPAN GROWTH FUND
G.T. GLOBAL: AMERICA GROWTH FUND
50 California Street, 27th Floor
San Francisco, California 94111
(415) 392-6181
Toll Free: (800) 824-1580
Statement of Additional Information
March 1, 1995
- --------------------------------------------------------------------------------
This Statement of Additional Information relates to the Advisor Class shares of
G.T. Global: Worldwide Growth Fund ("Worldwide Fund"), G.T. Global:
International Growth Fund ("International Fund"), G.T. Global: New Pacific
Growth Fund ("Pacific Fund"), G.T. Global: Europe Growth Fund ("Europe Fund"),
G.T. Global: Japan Growth Fund ("Japan Fund") and G.T. Global: America Growth
Fund ("America Fund") (collectively, "Funds," or singly, a "Fund"). Each Fund is
a diversified series of G.T. Global Growth Series ("Company"), a multiple series
registered open-end management investment company. This Statement of Additional
Information concerning the Funds, which is not a prospectus, supplements and
should be read in conjunction with the Funds' current Advisor Class Prospectus
dated March 1, 1995, a copy of which is available without charge by writing to
the above address or calling the Funds at the toll-free telephone number printed
above.
G.T. Capital Management, Inc. ("G.T. Capital") serves as each Fund's investment
manager and administrator. The distributor of the shares of each Fund is G.T.
Global Financial Services, Inc. ("G.T. Global"). The Funds' transfer agent is
G.T. Global Investor Services, Inc. ("G.T. Services" or "Transfer Agent").
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Investment Objectives and Policies....................................................................................... 2
Options, Futures, and Currency Strategies................................................................................ 5
Risk Factors............................................................................................................. 13
Investment Limitations................................................................................................... 17
Execution of Portfolio Transactions...................................................................................... 19
Trustees and Executive Officers.......................................................................................... 21
Management............................................................................................................... 23
Valuation of Shares...................................................................................................... 24
Information Relating to Sales and Redemptions............................................................................ 25
Taxes.................................................................................................................... 27
Additional Information................................................................................................... 30
Investment Results....................................................................................................... 31
Description of Debt Ratings.............................................................................................. 49
Financial Statements..................................................................................................... 50
</TABLE>
Statement of Additional Information Page 1
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INVESTMENT OBJECTIVES
AND POLICIES
- --------------------------------------------------------------------------------
SELECTION OF INVESTMENTS
G.T. Capital is the investment manager of each Fund. In determining the
appropriate distribution of investments among various countries and geographic
regions for the Funds, as applicable, G.T. Capital ordinarily considers the
following factors: prospects for relative economic growth between the different
countries in which each Fund may invest; expected levels of inflation;
government policies influencing business conditions; the outlook for currency
relationships; and the range of the individual investment opportunities
available to international investors.
For investment purposes, an issuer typically is considered as domiciled in a
particular country if it is incorporated under the laws of that country, and
either (i) at least 50% of the value of its assets are located in that country,
or (ii) it normally derives at least 50% of its income from operations or sales
in that country.
In analyzing companies for investment by each Fund, G.T. Capital ordinarily
looks for one or more of the following characteristics: an above-average
earnings growth per share; high return on invested capital; a healthy balance
sheet; sound financial and accounting policies and overall financial strength;
strong competitive advantages; effective research and product development and
marketing; efficient service; pricing flexibility; strength of management; and
general operating characteristics which will enable the companies to compete
successfully in their respective marketplaces. In certain countries,
governmental restrictions and other limitations on investment may affect the
maximum percentage of equity ownership in any one company by a Fund or the Funds
in the aggregate. In addition, in some instances only special classes of
securities may be purchased by foreigners and the market prices, liquidity and
rights with respect to those securities may vary from shares owned by nationals.
There may be times when, in the opinion of G.T. Capital, prevailing market,
economic or political conditions warrant reducing the proportion invested in
equity securities of issuers domiciled in a Fund's Primary Investment Area (as
defined in the Prospectus) below 80% of the Fund's assets and increasing the
proportion held in cash (U.S. dollars, foreign currencies or multinational
currency units) or invested in debt securities or high quality money market
instruments issued by corporations, or the U.S., or a foreign government. A
portion of each Fund's assets normally will be held in cash (U.S. dollars,
foreign currencies or multinational currency units) or invested in foreign or
domestic high quality money market instruments pending investment of proceeds
from new sales of Fund shares, to provide for ongoing expenses and redemptions.
At this time, G.T. Capital is not aware of the existence of any investment or
exchange control regulations which might substantially impair the operations of
the Funds as described in the Prospectus and this Statement of Additional
Information. Although restrictions may in the future make it undesirable to
invest in certain countries, G.T. Capital does not believe that any current
repatriation restrictions would affect its decisions to invest in the countries
eligible for investment by any Fund. It should be noted, however, that this
situation could change at any time.
INVESTMENTS IN OTHER INVESTMENT COMPANIES
With respect to certain countries (e.g., Taiwan) investments by a Fund presently
may be made only by acquiring shares of other investment companies with local
governmental approval to invest in those countries. At such time as direct
investment in these countries is allowed, the Funds anticipate investing
directly in these markets. The Funds may also invest in the securities of
closed-end investment companies within the limits of the Investment Company Act
of 1940, as amended ("1940 Act"). These limitations currently provide that, in
general, each Fund may purchase shares of a closed-end investment company unless
(a) such a purchase would cause a Fund to own more than 3% of the total
outstanding voting stock of the investment company or (b) such a purchase would
cause a Fund to have more than 5% of its assets invested in the investment
company or more than 10% of its assets invested in an aggregate of all such
investment companies. Investment in investment companies may involve the payment
of substantial premiums above the value of such companies' portfolio securities.
The Funds do not intend to invest in such vehicles or funds unless G.T. Capital
determines that the potential benefits of such investments justify the payment
of any applicable premiums. The yield of such securities will be reduced by
operating expenses of such companies including payments to the investment
managers of those investment companies.
Statement of Additional Information Page 2
<PAGE>
G.T. GLOBAL GROWTH FUNDS
SAMURAI AND YANKEE BONDS
The International Fund, the Japan Fund, the Pacific Fund and the Worldwide Fund
may invest in yen-denominated bonds sold in Japan by non-Japanese issuers
("Samurai bonds"), and the Worldwide Fund and the America Fund may invest in
dollar-denominated bonds sold in the United States by non-U.S. issuers ("Yankee
bonds"). As compared with bonds issued in their countries of domicile, such bond
issues normally carry a higher interest rate but are less actively traded. It is
the policy of each Fund to invest in Samurai or Yankee bond issues only after
taking into account considerations of quality and liquidity, as well as yield.
These bonds are issued by governments which are members of the Organization for
Economic Cooperation and Development ("O.E.C.D.") or have AAA ratings. None of
the Funds has invested in Samurai or Yankee bonds since 1982.
DEPOSITORY RECEIPTS
Each Fund other than the America Fund may hold securities of foreign issuers in
the form of American Depository Receipts ("ADRs"), American Depository Shares
("ADSs") and European Depository Receipts ("EDRs"), or other securities
convertible into securities of eligible European or Far Eastern issuers. These
securities may not necessarily be denominated in the same currency as the
securities for which they may be exchanged. ADRs and ADSs typically are issued
by an American bank or trust company which evidences ownership of underlying
securities issued by a foreign corporation. EDRs, which are sometimes referred
to as Continental Depository Receipts ("CDRs"), are receipts issued in Europe
typically by foreign banks and trust companies that evidence ownership of either
foreign or domestic securities. Generally, ADRs and ADSs in registered form are
designed for use in United States securities markets and EDRs in bearer form are
designed for use in European securities markets. For purposes of a Fund's
investment policies, the Fund's investments in ADRs, ADSs and EDRs will be
deemed to be investments in the equity securities representing securities of
foreign issuers into which they may be converted.
ADR facilities may be established as either "unsponsored" or "sponsored." While
ADRs issued under these two types of facilities are in some respects similar,
there are distinctions between them relating to the rights and obligations of
ADR holders and the practices of market participants. A depository may establish
an unsponsored facility without participation by (or even necessarily the
acquiescence of) the issuer of the deposited securities, although typically the
depository requests a letter of non-objection from such issuer prior to the
establishment of the facility. Holders of unsponsored ADRs generally bear all
the costs of such facilities. The depository usually charges fees upon the
deposit and withdrawal of the deposited securities, the conversion of dividends
into U.S. dollars, the disposition of non-cash distributions, and the
performance of other services. The depository of an unsponsored facility
frequently is under no obligation to distribute shareholder communications
received from the issuer of the deposited securities or to pass through voting
rights to ADR holders with respect to the deposited securities. Sponsored ADR
facilities are created in generally the same manner as unsponsored facilities,
except that the issuer of the deposited securities enters into a deposit
agreement with the depository. The deposit agreement sets out the rights and
responsibilities of the issuer, the depository and the ADR holders. With
sponsored facilities, the issuer of the deposited securities generally will bear
some of the costs relating to the facility (such as dividend payment fees of the
depository), although ADR holders continue to bear certain other costs (such as
deposit and withdrawal fees). Under the terms of most sponsored arrangements,
depositories agree to distribute notices of shareholder meetings and voting
instructions, and to provide shareholder communications and other information to
the ADR holders at the request of the issuer of the deposited securities. The
Funds may invest in sponsored and unsponsored ADRs.
WARRANTS OR RIGHTS
Warrants or rights may be acquired by a Fund in connection with other securities
or separately and provide the Fund with the right to purchase at a later date
other securities of the issuer. In addition, each Fund (except the America Fund)
has given an undertaking to the Texas Securities Commission that it will not
purchase warrants in excess of 10% of the Fund's net assets taken at cost or at
market value, whichever is lower. With respect to the America Fund, investments
in warrants may not exceed 5% of the value of the Fund's net assets, and not
more than 2% of such assets may be invested in warrants or rights which are not
listed on the New York or American Stock Exchange. Warrants or rights acquired
by the Fund in units or attached to securities will be deemed to be without
value for purpose of this restriction. These limits are not fundamental policies
of the Fund and may be changed by a vote of the Company's Board of Trustees
without shareholder approval.
LENDING OF PORTFOLIO SECURITIES
For the purpose of realizing additional income, each Fund may make secured loans
of portfolio securities amounting to not more than 30% of its total assets.
Securities loans are made to broker/dealers or institutional investors pursuant
to agreements requiring that the loans continuously be secured by collateral at
least equal at all times to the value of the securities lent, plus any accrued
interest, "marked to market" on a daily basis. The collateral received will
consist of cash,
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G.T. GLOBAL GROWTH FUNDS
U.S. short-term government securities, bank letters of credit or such other
collateral as may be permitted under the Fund's investment policies and by
regulatory agencies and approved by the Company's Board of Trustees. The Funds
may pay reasonable administrative and custodial fees in connection with the
loans of their securities. While the securities loans are outstanding, the Funds
will continue to receive the equivalent of the interest or dividends paid by the
issuer on the securities, as well as interest on the investment of the
collateral or a fee from the borrower. If the borrower failed to maintain the
requisite amount of collateral, the loan would terminate automatically and the
Fund could use the collateral to replace the securities while holding the
borrower liable for any excess of the replacement cost over the value of the
collateral. Each Fund has a right to call each loan at any time and obtain the
securities on five business days' notice. The Funds will not have the right to
vote equity securities while they are being lent, but they retain the right to
call for the return of the loaned securities at any time on reasonable notice
and will call in a loan in anticipation of any important vote. The Funds also
will be able to call such loans if G.T. Capital made the investment decision
that the loaned securities should be sold. On termination of a loan, the
borrower would be required to return the securities to the Fund and any gain or
loss in market price during the loan would inure to the Fund. The risks in
lending portfolio securities, as with other extensions of secured credit,
consist of possible delays in receiving additional collateral or in recovery of
the securities or possible loss of rights in the collateral should the borrower
fail financially. In the event of the default or bankruptcy by such party, the
Funds would seek promptly to liquidate the collateral. To the extent that the
proceeds from any such sale of such collateral upon a default in the obligation
to repurchase were less than the repurchase price, the Funds would suffer a
loss. The law regarding the rights of the Funds is unsettled with respect to a
borrower becoming subject to bankruptcy or similar proceeding. Under these
circumstances, there may be a restriction on the Funds' ability to sell the
collateral and the Funds could suffer a loss. Loans, however, only will be made
to firms deemed by G.T. Capital to be of good standing and will not be made
unless, in the judgment of G.T. Capital, the consideration to be earned from
such loans would justify the risk.
COMMERCIAL BANK OBLIGATIONS
For the purposes of each Fund's investment policies with respect to bank
obligations, obligations of foreign branches of U.S. banks and of foreign banks
are obligations of the issuing bank and may be general obligations of the parent
bank. Such obligations, however, may be limited by the terms of a specific
obligation and by government regulation. As with investment in non-U.S.
securities in general, investments in the obligations of foreign branches of
U.S. banks and of foreign banks may subject the Funds to investment risks that
are different in some respects from those of investments in obligations of
domestic issuers. Although a Fund typically will acquire obligations issued and
supported by the credit of U.S. or foreign banks having total assets at the time
of purchase of $1 billion or more, this $1 billion figure is not an investment
policy or restriction of any Fund. For the purposes of calculation with respect
to the $1 billion figure, the assets of a bank will be deemed to include the
assets of its U.S. and non-U.S. branches.
REPURCHASE AGREEMENTS
The Fund will invest only in repurchase agreements collateralized at all times
in an amount at least equal to the repurchase price plus accrued interest. To
the extent that the proceeds from any sale of such collateral upon a default in
the obligation to repurchase were less than the repurchase price, the Fund would
suffer a loss. If the financial institution which is party to the repurchase
agreement petitions for bankruptcy or otherwise becomes subject to bankruptcy or
other liquidation proceedings, there may be restrictions on the Fund's ability
to sell the collateral and the Fund could suffer a loss. However, with respect
to financial institutions whose bankruptcy or liquidation proceedings are
subject to the U.S. Bankruptcy Code, the Fund intends to comply with provisions
under the U.S. Bankruptcy Code that would allow it immediately to resell the
collateral. There is no limitation on the amount of the Fund's assets that may
be subject to repurchase agreements at any given time. The Fund will not enter
into a repurchase agreement with a maturity of more than seven days if, as a
result, more than 15% of the value of its net assets would be invested in such
repurchase agreements and other illiquid investments.
BORROWING, REVERSE REPURCHASE AGREEMENTS AND "ROLL" TRANSACTIONS
Each Fund's borrowings will not exceed 33 1/3% of its total assets, i.e., each
Fund's total assets at all times will equal at least 300% of the amount of
outstanding borrowings. No Fund will purchase securities while borrowings are
outstanding. If market fluctuations in the value of a Fund's portfolio holdings
or other factors cause the ratio of the Fund's total assets to outstanding
borrowings to fall below 300%, within three days (excluding Sundays and
holidays) of such event the Fund may be required to sell portfolio securities to
restore the 300% asset coverage, even though from an investment standpoint such
sales might be disadvantageous. Each Fund also may borrow up to 5% of its total
assets for temporary or emergency purposes other than to meet redemptions. Any
borrowing by a Fund may cause greater fluctuation in the value of its shares
than would be the case if the Fund did not borrow.
Each Fund's fundamental investment limitations permit the Fund to borrow money
for leveraging purposes. Each Fund, however, currently is prohibited, pursuant
to a non-fundamental investment policy, from borrowing money in order to
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G.T. GLOBAL GROWTH FUNDS
purchase securities. Nevertheless, this policy may be changed in the future by
the Company's Board of Trustees. In the event that a Fund employs leverage in
the future, it would be subject to certain additional risks. Use of leverage
creates an opportunity for greater growth of capital but would exaggerate any
increases or decreases in a Fund's net asset value. When the income and gains on
securities purchased with the proceeds of borrowings exceed the costs of such
borrowings, a Fund's earnings or net asset value will increase faster than
otherwise would be the case; conversely, if such income and gains fail to exceed
such costs, a Fund's earnings or net asset value would decline faster than would
otherwise be the case.
Each Fund may enter into reverse repurchase agreements. A reverse repurchase
agreement is a borrowing transaction in which the Fund transfers possession of a
security to another party, such as a bank or broker/dealer in return for cash,
and agrees to repurchase the security in the future at an agreed upon price,
which includes an interest component. Each Fund also may engage in "roll"
borrowing transactions which involve the Fund's sale of Government National
Mortgage Association ("GNMA") certificates or other securities together with a
commitment (for which a Fund may receive a fee) to purchase similar, but not
identical, securities at a future date. A Fund will maintain, in a segregated
account with a custodian, cash, U.S. government securities or other liquid, high
grade debt securities in an amount sufficient to cover its obligations under
"roll" transactions and reverse repurchase agreements with broker/dealers. No
segregation is required for reverse repurchase agreements with banks.
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OPTIONS, FUTURES AND CURRENCY
STRATEGIES
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SPECIAL RISKS OF OPTIONS, FUTURES AND CURRENCY STRATEGIES
The use of options, futures contracts and forward currency contracts ("Forward
Contracts") involves special considerations and risks, as described below. Risks
pertaining to particular instruments are described in the sections that follow.
(1) Successful use of most of these instruments depends upon G.T.
Capital's ability to predict movements of the overall securities and
currency markets, which requires different skills than predicting changes in
the prices of individual securities. While G.T. Capital is experienced in
the use of these instruments, there can be no assurance that any particular
strategy adopted will succeed.
(2) There might be imperfect correlation, or even no correlation,
between price movements of an instrument and price movements of the
investments being hedged. For example, if the value of an instrument used in
a short hedge increased by less than the decline in value of the hedged
investment, the hedge would not be fully successful. Such a lack of
correlation might occur due to factors unrelated to the value of the
investments being hedged, such as speculative or other pressures on the
markets in which the hedging instrument is traded. The effectiveness of
hedges using hedging instruments on indices will depend on the degree of
correlation between price movements in the index and price movements in the
investments being hedged.
(3) Hedging strategies, if successful, can reduce risk of loss by wholly
or partially offsetting the negative effect of unfavorable price movements
in the investments being hedged. However, hedging strategies can also reduce
opportunity for gain by offsetting the positive effect of favorable price
movements in the hedged investments. For example, if a Fund entered into a
short hedge because G.T. Capital projected a decline in the price of a
security in the Fund's portfolio, and the price of that security increased
instead, the gain from threat increase might by wholly or partially offset
by a decline in the price of the hedging instrument. Moreover, if the price
of the hedging instrument declined by more than the increase in the price of
the security, the Fund could suffer a loss. In either such case, the Fund
would have been in a better position had it not hedged at all.
(4) As described below, a Fund might be required to maintain assets as
"cover," maintain segregated accounts or make margin payments when it takes
positions in instruments involving obligations to third parties (I.E.,
instruments other than purchased options). If the Fund were unable to close
out its positions in such instruments, it might be required to continue to
maintain such assets or accounts or make such payments until the position
expired or matured. The requirements might impair the Fund's ability to sell
a portfolio security or make an investment at a time when it would otherwise
be favorable to do so, or require that the Fund sell a portfolio security at
a disadvantageous time. The Fund's ability to close out a position in an
instrument prior to expiration or maturity depends on the existence of a
liquid secondary market or, in the absence of such a market, the ability and
willingness of the other
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G.T. GLOBAL GROWTH FUNDS
party to the transaction ("contra party") to enter into a transaction
closing out the position. Therefore, there is no assurance that any position
can be closed out at a time and price that is favorable to the Fund.
WRITING CALL OPTIONS
A Fund may write (sell) call options on securities, indices and currencies. Call
options generally will be written on securities and currencies that, in the
opinion of G.T. Capital, are not expected to make any major price moves in the
near future but that, over the long term, are deemed to be attractive
investments for the Fund.
A call option gives the holder (buyer) the right to purchase a security or
currency at a specified price (the exercise price) at any time until (American
style) or on (European style) a certain date (the expiration date). So long as
the obligation of the writer of a call option continues, he may be assigned an
exercise notice, requiring him to deliver the underlying security or currency
against payment of the exercise price. This obligation terminates upon the
expiration of the call option, or such earlier time at which the writer effects
a closing purchase transaction by purchasing an option identical to that
previously sold.
Portfolio securities or currencies on which call options may be written will be
purchased solely on the basis of investment considerations consistent with each
Fund's investment objectives. When writing a call option, a Fund, in return for
the premium, gives up the opportunity for profit from a price increase in the
underlying security or currency above the exercise price, and retains the risk
of loss should the price of the security or currency decline. Unlike one who
owns securities or currencies not subject to an option, a Fund has no control
over when it may be required to sell the underlying securities or currencies,
since most options may be exercised at any time prior to the option's
expiration. If a call option that a Fund has written expires, the Fund will
realize a gain in the amount of the premium; however, such gain may be offset by
a decline in the market value of the underlying security or currency during the
option period. If the call option is exercised, the Fund will realize a gain or
loss from the sale of the underlying security or currency, which will be
increased or offset by the premium received. The Fund does not consider a
security or currency covered by a call option to be "pledged" as that term is
used in the Fund's policy that limits the pledging or mortgaging of its assets.
Writing call options can serve as a limited short hedge because declines in the
value of the hedged investment would be offset to the extent of the premium
received for writing the option. However, if the security or currency
appreciates to a price higher than the exercise price of the call option, it can
be expected that the option will be exercised and a Fund will be obligated to
sell the security or currency at less than its market value.
The premium that a Fund receives for writing a call option is deemed to
constitute the market value of an option. The premium a Fund will receive from
writing a call option will reflect, among other things, the current market price
of the underlying investment, the relationship of the exercise price to such
market price, the historical price volatility of the underlying investment, and
the length of the option period. In determining whether a particular call option
should be written, G.T. Capital will consider the reasonableness of the
anticipated premium and the likelihood that a liquid secondary market will exist
for those options.
Closing transactions will be effected in order to realize a profit on an
outstanding call option, to prevent an underlying security or currency from
being called, or to permit the sale of the underlying security or currency.
Furthermore, effecting a closing transaction will permit the Fund to write
another call option on the underlying security or currency with either a
different exercise price or expiration date or both.
The Funds will pay transaction costs in connection with the writing of options
and in entering into closing purchase contracts. Transaction costs relating to
options activity normally are higher than those applicable to purchases and
sales of portfolio securities.
The exercise price of the options may be below, equal to or above the current
market values of the underlying securities or currencies at the time the options
are written. From time to time, a Fund may purchase an underlying security or
currency for delivery in accordance with the exercise of an option, rather than
delivering such security or currency from its portfolio. In such cases,
additional costs will be incurred.
A Fund will realize a profit or loss from a closing purchase transaction if the
cost of the transaction is less or more, respectively, than the premium received
from writing the option. Because increases in the market price of a call option
generally will reflect increases in the market price of the underlying security
or currency, any loss resulting from the repurchase of a call option is likely
to be offset in whole or in part by appreciation of the underlying security or
currency owned by the Fund.
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G.T. GLOBAL GROWTH FUNDS
WRITING PUT OPTIONS
The Funds may write put options on securities, indices and currencies. A put
option gives the purchaser of the option the right to sell, and the writer
(seller) the obligation to buy, the underlying security or currency at the
exercise price at any time until (American style) or on (European style) the
expiration date. The operation of put options in other respects, including their
related risks and rewards, is substantially identical to that of call options.
A Fund generally would write put options in circumstances where G.T. Capital
wishes to purchase the underlying security or currency for the Fund's portfolio
at a price lower than the current market price of the security or currency. In
such event, the Fund would write a put option at an exercise price that, reduced
by the premium received on the option, reflects the lower price it is willing to
pay. Since the Fund also would receive interest on debt securities or currencies
maintained to cover the exercise price of the option, this technique could be
used to enhance current return during periods of market uncertainty. The risk in
such a transaction would be that the market price of the underlying security or
currency would decline below the exercise price, less the premium received.
Writing put options can serve as a limited long hedge because increases in the
value of the hedged investment would be offset to the extent of the premium
received for writing the option. However, if the security or currency
depreciates to a price lower than the exercise price of the put option, it can
be expected that the put option will be exercised and a Fund will be obligated
to purchase the security or currency at more than its market value.
PURCHASING PUT OPTIONS
Each Fund may purchase put options on securities, indices and currencies. As the
holder of a put option, a Fund would have the right to sell the underlying
security or currency at the exercise price at any time until (American style) or
on (European style) the expiration date. A Fund may enter into closing sale
transactions with respect to such option, exercise such option or permit such
option to expire.
A Fund may purchase a put option on an underlying security or currency
("protective put") owned by the Fund in order to protect against an anticipated
decline in the value of the security or currency. Such hedge protection is
provided only during the life of the put option when the Fund, as the holder of
the put option, is able to sell the underlying security or currency at the put
exercise price regardless of any decline in the underlying security's market
price or currency's exchange value. For example, a put option may be purchased
in order to protect unrealized appreciation of a security or currency when G.T.
Capital deems it desirable to continue to hold the security or currency because
of tax considerations. The premium paid for the put option and any transaction
costs would reduce any profit otherwise available for distribution when the
security or currency eventually is sold.
A Fund also may purchase put options at a time when the Fund does not own the
underlying security or currency. By purchasing put options on a security or
currency it does not own, a Fund seeks to benefit from a decline in the market
price of the underlying security or currency. If the put option is not sold when
it has remaining value, and if the market price of the underlying security or
currency remains equal to or greater than the exercise price during the life of
the put option, the Fund will lose its entire investment in the put option. In
order for the purchase of a put option to be profitable, the market price of the
underlying security or currency must decline sufficiently below the exercise
price to cover the premium and transaction costs, unless the put option is sold
in a closing sale transaction.
PURCHASING CALL OPTIONS
Each Fund may purchase call options on securities, indices and currencies. As
the holder of a call option, a Fund would have the right to purchase the
underlying security or currency at the exercise price at any time until
(American style) or on (European style) the expiration date. A Fund may enter
into closing sale transactions with respect to such option, exercise such option
or permit such option to expire.
Call options may be purchased by a Fund for the purpose of acquiring the
underlying security or currency for its portfolio. Utilized in this fashion, the
purchase of call options would enable a Fund to acquire the security or currency
at the exercise price of the call option plus the premium paid. At times, the
net cost of acquiring the security or currency in this manner may be less than
the cost of acquiring the security or currency directly. This technique also may
be useful to the Funds in purchasing a large block of securities that would be
more difficult to acquire by direct market purchases. As long as it holds such a
call option, rather than the underlying security or currency itself, a Fund is
partially protected from any unexpected decline in the market price of the
underlying security or currency and, in such event, could allow the call option
to expire, incurring a loss only to the extent of the premium paid for the
option.
Each Fund also may purchase call options on underlying securities or currencies
it owns in order to protect unrealized gains on call options previously written
by it. A call option could be purchased for this purpose where tax
considerations make it inadvisable to realize such gains through a closing
purchase transaction. Call options also may be purchased at
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G.T. GLOBAL GROWTH FUNDS
times to avoid realizing losses that would result in a reduction of a Fund's
current return. For example, where a Fund has written a call option on an
underlying security or currency having a current market value below the price at
which such security or currency was purchased by the Fund, an increase in the
market price could result in the exercise of the call option written by the Fund
and the realization of a loss on the underlying security or currency.
Accordingly, the Fund could purchase a call option on the same underlying
security or currency, which could be exercised to fulfill the Fund's delivery
obligations under its written call (if it is exercised). This strategy could
allow the Fund to avoid selling the portfolio security or currency at a time
when it has an unrealized loss; however, the Fund would have to pay a premium to
purchase the call option plus transaction costs.
Aggregate premiums paid for put and call options will not exceed 5% of such
Fund's total assets at the time of purchase.
Each Fund may attempt to accomplish objectives similar to those involved in
using Forward Contracts by purchasing put or call options on currencies. A put
option gives a Fund as purchaser the right (but not the obligation) to sell a
specified amount of currency at the exercise price at any time until (American
style) or on (European style) the expiration of the option. A call option gives
a Fund as purchaser the right (but not the obligation) to purchase a specified
amount of currency at the exercise price at any time until (American style) or
on (European style) the expiration date of the option. A Fund might purchase a
currency put option, for example, to protect itself against a decline in the
dollar value of a currency in which it holds or anticipates holding securities.
If the currency's value should decline against the dollar, the loss in currency
value should be offset, in whole or in part, by an increase in the value of the
put. If the value of the currency instead should rise against the dollar, any
gain to the Fund would be reduced by the premium it had paid for the put option.
A currency call option might be purchased, for example, in anticipation of, or
to protect against, a rise in the value against the dollar of a currency in
which the Fund anticipates purchasing securities.
Options may be either listed on an exchange or traded over-the-counter ("OTC").
Listed options are third-party contracts (I.E., performance of the obligations
of the purchaser and seller is guaranteed by the exchange or clearing
corporation), and have standardized strike prices and expiration dates. OTC
options are two-party contracts with negotiated strike prices and expiration
dates. A Fund will not purchase an OTC option unless it believes that daily
valuations for such options are readily obtainable. OTC options differ from
exchange-traded options in that OTC options are transacted with dealers directly
and not through a clearing corporation (which guarantees performance).
Consequently, there is a risk of non-performance by the dealer. Since no
exchange is involved, OTC options are valued on the basis of a quote provided by
the dealer. In the case of OTC options, there can be no assurance that a liquid
secondary market will exist for any particular option at any specific time.
The Securities and Exchange Commission's ("SEC") staff considers purchased OTC
options to be illiquid securities. A Fund may also sell OTC options and, in
connection therewith, segregate assets or cover its obligations with respect to
OTC options written by the Fund. The assets used as cover for OTC options
written by a Fund will be considered illiquid unless the OTC options are sold to
qualified dealers who agree that the Fund may repurchase any OTC option it
writes at a maximum price to be calculated by a formula set forth in the option
agreement. The cover for an OTC option written subject to this procedure would
be considered illiquid only to the extent that the maximum repurchase price
under the formula exceeds the intrinsic value of the option.
A Fund's ability to establish and close out positions in exchange-listed options
depends on the existence of a liquid market. A Fund intends to purchase or write
only those exchange-traded options for which there appears to be a liquid
secondary market. However, there can be no assurance that such a market will
exist at any particular time. Closing transactions can be made for OTC options
only by negotiating directly with the contra party, or by a transaction in the
secondary market if any such market exists. Although a Fund will enter into OTC
options only with contra parties that are expected to be capable of entering
into closing transactions with the Fund, there is no assurance that the Fund
will in fact be able to close out an OTC option position at a favorable price
prior to expiration. In the extent of insolvency of the contra party, the Fund
might be unable to close out an OTC option position at any time prior to its
expiration.
INDEX OPTIONS
Puts and calls on indices are similar to puts and calls on securities or futures
contracts except that all settlements are in cash and gain or loss depends on
changes in the index in question (and thus on price movements in the securities
market or a particular market sector generally) rather than on price movements
in individual securities or futures contracts. When a Fund writes a call on an
index, it receives a premium and agrees that, prior to the expiration date, the
purchaser of the call, upon exercise of the call, will receive from the Fund an
amount of cash if the closing level of the index upon which the call is based is
greater than the exercise price of the call. The amount of cash is equal to the
difference between the closing price of the index and the exercise price of the
call times a specified multiple (the "multiplier"), which determines the total
dollar value for each point of such difference. When a Fund buys a call on an
index, it pays a premium and has the same
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G.T. GLOBAL GROWTH FUNDS
rights as to such calls as are indicated above. When a Fund buys a put on an
index, it pays a premium and has the right, prior to the expiration date, to
require the seller of the put, upon the Fund's exercise of the put, to deliver
to the Fund an amount of cash if the closing level of the index upon which the
put is based is less than the exercise price of the put, which amount of cash is
determined by the multiplier, as described above for calls. When a Fund writes a
put on an index, it receives a premium and the purchaser has the right, prior to
the expiration date, to require the Fund to deliver to it an amount of cash
equal to the difference between the closing level of the index and the exercise
price times the multiplier, if the closing level is less than the exercise
price.
The risks of investment in index options may be greater than options on
securities. Because index options are settled in cash, when a Fund writes a call
on an index it cannot provide in advance for its potential settlement
obligations by acquiring and holding the underlying securities. A Fund can
offset some of the risk of writing a call index option position by holding a
diversified portfolio of securities similar to those on which the underlying
index is based. However, a Fund cannot, as a practical matter, acquire and hold
a portfolio containing exactly the same securities as underlie the index and, as
a result, bears a risk that the value of the securities held will vary from the
value of the index.
Even if a Fund could assemble a securities portfolio that exactly reproduced the
composition of the underlying index, it still would not be fully covered from a
risk standpoint because of the "timing risk" inherent in writing index options.
When an index option is exercised, the amount of cash that the holder is
entitled to receive is determined by the difference between the exercise price
and the closing index level on the date when the option is exercised. As with
other kinds of options, the Fund as the call writer will not know that it has
been assigned until the next business day at the earliest. The time lag between
exercise and notice of assignment poses no risk for the writer of a covered call
on a specific underlying security, such as common stock, because there the
writer's obligation is to deliver the underlying security, not to pay its value
as of a fixed time in the past. So long as the writer already owns the
underlying security, it can satisfy its settlement obligations by simply
delivering it, and the risk that its value may have declined since the exercise
date is borne by the exercising holder. In contrast, even if the writer of an
index call holds securities that exactly match the composition of the underlying
index, it will not be able to satisfy its assignment obligations by delivering
those securities against payment of the exercise price. Instead, it will be
required to pay cash in an amount based on the closing index value on the
exercise date; and by the time it learns that it has been assigned, the index
may have declined, with a corresponding decline in the value of its securities
portfolio. This "timing risk" is an inherent limitation on the ability of index
call writers to cover their risk exposure by holding securities positions.
If a Fund has purchased an index option and exercises it before the closing
index value for that day is available, it runs the risk that the level of the
underlying index may subsequently change. If such a change causes the exercised
option to fall out-of-the-money, the Fund will be required to pay the difference
between the closing index value and the exercise price of the option (times the
applicable multiplier) to the assigned writer.
INTEREST RATE, CURRENCY AND STOCK INDEX FUTURES CONTRACTS
The Funds may enter into interest rate, currency or stock index futures
contracts ("Futures" or "Futures Contracts") as a hedge against changes in
prevailing levels of interest rates, currency exchange rates or stock price
levels in order to establish more definitely the effective return on securities
or currencies held or intended to be acquired by the Funds. The Funds' hedging
may include sales of Futures as an offset against the effect of expected
increases in interest rates, or decreases in currency exchange rates and stock
prices, and purchases of Futures as an offset against the effect of expected
declines in interest rates, or increases in currency exchange rates or stock
prices.
The Funds only will enter into Futures Contracts that are traded on futures
exchanges and are standardized as to maturity date and underlying financial
instrument. Futures exchanges and trading thereon in the United States are
regulated under the Commodity Exchange Act by the Commodity Futures Trading
Commission ("CFTC"). Futures are exchanged in London at the London International
Financial Futures Exchange.
Although techniques other than sales and purchases of Futures Contracts could be
used to reduce the Funds' exposure to interest rate and currency exchange rate
fluctuations, the Funds may be able to hedge its exposure more effectively and
at a lower cost through using Futures Contracts.
A Futures Contract provides for the future sale by one party and purchase by
another party of a specified amount of a specific financial instrument (security
or currency) for a specified price at a designated date, time and place. A stock
index Futures Contract provides for the delivery, at a designated date, time and
place, of an amount of cash equal to a specified dollar amount times the
difference between the stock index value at the close of trading on the contract
and the price at which the Futures Contract is originally struck; no physical
delivery of stocks comprising the index is made. Brokerage fees
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G.T. GLOBAL GROWTH FUNDS
are incurred when a Futures Contract is bought or sold, and margin deposits must
be maintained at all times the Futures Contract is outstanding.
Although Futures Contracts typically require future delivery of and payment for
financial instruments or currencies, Futures Contracts usually are closed out
before the delivery date. Closing out an open Futures Contract sale or purchase
is effected by entering into an offsetting Futures Contract purchase or sale,
respectively, for the same aggregate amount of the identical financial
instrument or currency and the same delivery date. If the offsetting purchase
price is less than the original sale price, the Fund realizes a gain; if it is
more, the Fund realizes a loss. Conversely, if the offsetting sale price is more
than the original purchase price, the Fund realizes a gain; if it is less, the
Fund realizes a loss. The transaction costs also must be included in these
calculations. There can be no assurance, however, that the Funds will be able to
enter into an offsetting transaction with respect to a particular Futures
Contract at a particular time. If a Fund is not able to enter into an offsetting
transaction, the Fund will continue to be required to maintain the margin
deposits on the Futures Contract.
As an example of an offsetting transaction, the contractual obligations arising
from the sale of one Futures Contract of September Deutschemarks on an exchange
may be fulfilled at any time before delivery under the Futures Contract is
required (I.E., on a specified date in September, the "delivery month") by the
purchase of another Futures Contract of September Deutschemarks on the same
exchange. In such instance, the difference between the price at which the
Futures Contract was sold and the price paid for the offsetting purchase, after
allowance for transaction costs, represents the profit or loss to the Fund.
The Funds' Futures transactions will be entered into for hedging purposes; that
is, Futures Contracts will be sold to protect against a decline in the price of
securities or currencies that the Funds own, or Futures Contracts will be
purchased to protect the Funds against an increase in the price of securities or
currencies it has committed to purchase or expects to purchase.
"Margin" with respect to Futures Contracts is the amount of funds that must be
deposited by a Fund in order to initiate Futures trading and to maintain the
Fund's open positions in Futures Contracts. A margin deposit made when the
Futures Contract is entered into ("initial margin") is intended to ensure the
Fund's performance under the Futures Contract. The margin required for a
particular Futures Contract is set by the exchange on which the Futures Contract
is traded and may be significantly modified from time to time by the exchange
during the term of the Futures Contract.
Subsequent payments, called "variation margin," to and from the futures
commission merchant through which the Fund entered into the Futures Contract
will be made on a daily basis as the price of the underlying security, currency
or index fluctuates making the Futures Contract more or less valuable, a process
known as marking-to-market.
RISKS OF USING FUTURES CONTRACTS. The prices of Futures Contracts are
volatile and are influenced by, among other things, actual and anticipated
changes in interest and currency rates, which in turn are affected by fiscal and
monetary policies and national and international political and economic events.
There is a risk of imperfect correlation between changes in prices of Futures
Contracts and prices of the securities or currencies in the Fund's portfolio
being hedged. The degree of imperfection of correlation depends upon
circumstances such as: variations in speculative market demand for Futures and
for securities or currencies, including technical influences in Futures trading;
and differences between the financial instruments being hedged and the
instruments underlying the standard Futures Contracts available for trading. A
decision of whether, when and how to hedge involves skill and judgment, and even
a well-conceived hedge may be unsuccessful to some degree because of unexpected
market behavior or interest or currency rate trends.
Because of the low margin deposits required, Futures trading involves an
extremely high degree of leverage. As a result, a relatively small price
movement in a Futures Contract may result in immediate and substantial loss, as
well as gain, to the investor. For example, if at the time of purchase, 10% of
the value of the Futures Contract is deposited as margin, a subsequent 10%
decrease in the value of the Futures Contract would result in a total loss of
the margin deposit, before any deduction for the transaction costs, if the
account were then closed out. A 15% decrease would result in a loss equal to
150% of the original margin deposit, if the Futures Contract were closed out.
Thus, a purchase or sale of a Futures Contract may result in losses in excess of
the amount invested in the Futures Contract.
Most U.S. Futures exchanges limit the amount of fluctuation permitted in Futures
Contract and option on Futures Contract prices during a single trading day. The
daily limit establishes the maximum amount that the price of a Futures Contract
or option may vary either up or down from the previous day's settlement price at
the end of a trading session. Once the daily limit has been reached in a
particular type of Futures Contract or option, no trades may be made on that day
at a price beyond that limit. The daily limit governs only price movement during
a particular trading day and
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G.T. GLOBAL GROWTH FUNDS
therefore does not limit potential losses, because the limit may prevent the
liquidation of unfavorable positions. Futures Contract and option prices
occasionally have moved to the daily limit for several consecutive trading days
with little or no trading, thereby preventing prompt liquidation of positions
and subjecting some traders to substantial losses.
If a Fund were unable to liquidate a Futures or option on Futures position due
to the absence of a liquid secondary market or the imposition of price limits,
it could incur substantial losses. The Fund would continue to be subject to
market risk with respect to the position. In addition, except in the case of
purchased options, the Fund would continue to be required to make daily
variation margin payments and might be required to maintain the position being
hedged by the Future or option or to maintain cash or securities in a segregated
account.
Certain characteristics of the Futures market might increase the risk that
movements in the prices of Futures Contracts or options on Futures might not
correlate perfectly with movements in the prices of the investments being
hedged. For example, all participants in the Futures and options on Futures
markets are subject to daily variation margin calls and might be compelled to
liquidate Futures or options on Futures positions whose prices are moving
unfavorably to avoid being subject to further calls. These liquidations could
increase price volatility of the instruments and distort the normal price
relationship between the Futures or options and the investments being hedged.
Also, because initial margin deposit requirements in the Futures market are less
onerous than margin requirements in the securities markets, there might be
increased participation by speculators in the Futures markets. This
participation also might cause temporary price distortions. In addition,
activities of large traders in both the Futures and securities markets involving
arbitrage, "program trading" and other investment strategies might result in
temporary price distortions.
OPTIONS ON FUTURES CONTRACTS
Options on Futures Contracts are similar to options on securities or currencies,
except that options on Futures Contracts give the purchaser the right, in return
for the premium paid, to assume a position in a Futures Contract (a long
position if the option is a call and a short position if the option is a put) at
a specified exercise price at any time during the period of the option. Upon
exercise of the option, the delivery of the Futures position by the writer of
the option to the holder of the option will be accompanied by delivery of the
accumulated balance in the writer's Futures margin account, which represents the
amount by which the market price of the Futures Contract, at exercise, exceeds
(in the case of a call) or is less than (in the case of a put) the exercise
price of the option on the Futures Contract. If an option is exercised on the
last trading day prior to the expiration date of the option, the settlement will
be made entirely in cash equal to the difference between the exercise price of
the option and the closing level of the securities, currencies or index upon
which the Futures Contract is based on the expiration date. Purchasers of
options who fail to exercise their options prior to the exercise date suffer a
loss of the premium paid.
The purchase of call options on Futures can serve as a long hedge, and the
purchase of put options on Futures can serve as a short hedge. Writing call
options on Futures can serve as a limited short hedge, and writing put options
on Futures can serve as a limited long hedge, using a strategy similar to that
used for writing options on securities, foreign currencies or indices.
If a Fund writes an option on a Futures Contract, it will be required to deposit
initial and variation margin pursuant to requirements similar to those
applicable to Futures Contracts. Premiums received from the writing of an option
on a Futures Contract are included in the initial margin deposit.
The Funds may seek to close out an option position by selling an option covering
the same Futures Contract and having the same exercise price and expiration
date. The ability to establish and close out positions on such options is be
subject to the maintenance of a liquid secondary market.
LIMITATION ON USE OF FUTURES, OPTIONS ON FUTURES AND CERTAIN OPTIONS ON
CURRENCIES
To the extent that a Fund enters into Futures Contracts, options on Futures
Contracts, and options on foreign currencies traded on a CFTC-regulated
exchange, in each case other than for BONA FIDE hedging purposes (as defined by
the CFTC), the aggregate initial margin and premiums required to establish those
positions (excluding the amount by which options are "in-the-money") will not
exceed 5% of the liquidation value of the Fund's portfolio, after taking into
account unrealized profits and unrealized losses on any contracts the Fund has
entered into. In general, a call option on a Futures Contract is "in-the-money"
if the value of the underlying Futures Contract exceeds the strike, I.E.,
exercise, price of the call; a put option on a Futures Contract is
"in-the-money" if the value of the underlying Futures Contract is exceeded by
the strike price of the put. This guideline may be modified by the Company's
Board of Trustees without a shareholder vote. This limitation does not limit the
percentage of a Fund's assets at risk to 5%.
Statement of Additional Information Page 11
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G.T. GLOBAL GROWTH FUNDS
FORWARD CURRENCY CONTRACTS
A Forward Contract is an obligation, usually arranged with a commercial bank or
other currency dealer, to purchase or sell a currency against another currency
at a future date and price as agreed upon by the parties. A Fund may either
accept or make delivery of the currency at the maturity of the Forward Contract.
A Fund may also if its contra party agrees prior to maturity, enter into a
closing transaction involving the purchase or sale of an offsetting contract.
A Fund engages in forward currency transactions in anticipation of or to protect
itself against fluctuations in exchange rates. A Fund might sell a particular
foreign currency forward, for example, when it holds bonds denominated in a
foreign currency but anticipates, and seeks to be protected against, a decline
in the currency against the U.S. dollar. Similarly, a Fund might sell the U.S.
dollar forward when it holds bonds denominated in U.S. dollars but anticipates,
and seeks to be protected against, a decline in the U.S. dollar relative to
other currencies. Further, a Fund might purchase a currency forward to "lock in"
the price of securities denominated in that currency that it anticipates
purchasing.
Forward Contracts are traded in the interbank market conducted directly between
currency traders (usually large commercial banks) and their customers. A Forward
Contract generally has no deposit requirement, and no commissions are charged at
any stage for trades. Each Fund will enter into such Forward Contracts with
major U.S. or foreign banks and securities or currency dealers in accordance
with guidelines approved by the Company's Board of Trustees.
Each Fund may enter into Forward Contracts either with respect to specific
transactions or with respect to the overall investments of the Fund. The precise
matching of the Forward Contract amounts and the value of specific securities
generally will not be possible because the future value of such securities in
foreign currencies will change as a consequence of market movements in the value
of those securities between the date the Forward Contract is entered into and
the date it matures. Accordingly, it may be necessary for a Fund to purchase
additional foreign currency on the spot (I.E., cash) market (and bear the
expense of such purchase) if the market value of the security is less than the
amount of foreign currency the Fund is obligated to deliver and if a decision is
made to sell the security and make delivery of the foreign currency. Conversely,
it may be necessary to sell on the spot market some of the foreign currency the
Fund is obligated to deliver. The projection of short-term currency market
movements is extremely difficult, and the successful execution of a short-term
hedging strategy is highly uncertain. Forward Contracts involve the risk that
anticipated currency movements will not be predicted accurately, causing a Fund
to sustain losses on these contracts and transaction costs.
At or before the maturity of a Forward Contract requiring a Fund to sell a
currency, the Fund either may sell a portfolio security and use the sale
proceeds to make delivery of the currency or retain the security and offset its
contractual obligation to deliver the currency by purchasing a second contract
pursuant to which the Fund will obtain, on the maturity date, the same amount of
the currency that it is obligated to deliver. Similarly, a Fund may close out a
Forward Contract requiring it to purchase a specified currency by, if its contra
party agrees, entering into a second contract entitling it to sell the same
amount of the same currency on the maturity date of the first contract. The Fund
would realize a gain or loss as a result of entering into such an offsetting
Forward Contract under either circumstance to the extent the exchange rate or
rates between the currencies involved moved between the execution dates of the
first contract and the offsetting contract.
The cost to a Fund of engaging in Forward Contracts varies with factors such as
the currencies involved, the length of the contract period and the market
conditions then prevailing. Because Forward Contracts usually are entered into
on a principal basis, no fees or commissions are involved. The use of Forward
Contracts does not eliminate fluctuations in the prices of the underlying
securities a Fund owns or intends to acquire, but it does establish a rate of
exchange in advance. In additional, while Forward Contracts limit the risk of
loss due to a decline in the value of the hedged currencies, they also limit any
potential gain that might result should the value of the currencies increase.
FOREIGN CURRENCY STRATEGIES -- SPECIAL CONSIDERATIONS
A Fund may use options on foreign currencies, Futures on foreign currencies,
options on Futures on foreign currencies and Forward Contracts to hedge against
movements in the values of the foreign currencies in which the Fund's securities
are denominated. Such currency hedges can protect against price movements in a
security that a Fund owns or intends to acquire that are attributable to changes
in the value of the currency in which it is denominated. Such hedges do not,
however, protect against price movements in the securities that are attributable
to other causes.
A Fund might seek to hedge against changes in the value of a particular currency
when no Futures Contract, Forward Contract or option involving that currency is
available or one of such contracts is more expensive than certain other
contracts. In such cases, the Fund may hedge against price movements in that
currency by entering into a contract on another currency or basket of
currencies, the values of which G.T. Capital believes will have a positive
correlation to the value of the currency being hedged. The risk that movements
in the price of the contract will not correlate perfectly with movements in the
price of the currency being hedged is magnified when this strategy is used.
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G.T. GLOBAL GROWTH FUNDS
The value of Futures Contracts, options on Futures Contracts, Forward Contracts
and options on foreign currencies depends on the value of the underlying
currency relative to the U.S. dollar. Because foreign currency transactions
occurring in the interbank market might involve substantially larger amounts
than those involved in the use of Futures Contracts, Forward Contracts or
options, a Fund could be disadvantaged by dealing in the odd lot market
(generally consisting of transactions of less than $1 million) for the
underlying foreign currencies at prices that are less favorable than for round
lots.
There is no systematic reporting of last sale information for foreign currencies
or any regulatory requirements that quotations available through dealers or
other market sources be firm or revised on a timely basis. Quotation information
generally is representative of very large transactions in the interbank market
and thus might not reflect odd-lot transactions where rates might be less
favorable. The interbank market in foreign currencies is a global,
round-the-clock market. To the extent the U.S. options or Futures markets are
closed while the markets for the underlying currencies remain open, significant
price and rate movements might take place in the underlying markets that cannot
be reflected in the markets for the Futures contracts or options until they
reopen.
Settlement of Futures Contracts, Forward Contracts and options involving foreign
currencies might be required to take place within the country issuing the
underlying currency. Thus, a Fund might be required to accept or make delivery
of the underlying foreign currency in accordance with any U.S. or foreign
regulations regarding the maintenance of foreign banking arrangements by U.S.
residents and might be required to pay any fees, taxes and charges associated
with such delivery assessed in the issuing country.
COVER
Transactions using Forward Contracts, Futures Contracts and options (other than
options that a Fund has purchased) expose the Fund to an obligation to another
party. A Fund will not enter into any such transactions unless it owns either
(1) an offsetting ("covered") position in securities, currencies, or other
options, Forward Contracts or Futures Contracts, or (2) cash, receivables and
short-term debt securities with a value sufficient at all times its potential
obligations not covered as provided in (1) above. Each Fund will comply with SEC
guidelines regarding cover for these instruments and, if the guidelines so
require, set aside cash, U.S. government securities or other liquid, high-grade
debt securities in a segregated account with its custodian in the prescribed
amount.
Assets used as cover or held in a segregated account cannot be sold while the
position in the corresponding Forward Contract, Futures Contract or option is
open, unless they are replaced with other appropriate assets. If a large portion
of a Fund's assets are used for cover or segregated accounts, it could affect
portfolio management or the Fund's ability to meet redemption requests or other
current obligations.
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RISK FACTORS
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POLITICAL, SOCIAL AND ECONOMIC RISKS. Investing in securities of non-U.S.
companies may entail additional risks due to the potential political, social and
economic instability of certain countries and the risks of expropriation,
nationalization, confiscation or the imposition of restrictions on foreign
investment, convertibility of currencies into U.S. dollars and on repatriation
of capital invested. In the event of such expropriation, nationalization or
other confiscation by any country, a Fund could lose its entire investment in
any such country.
Certain countries in which a Fund may invest may have groups that advocate
radical religious or revolutionary philosophies or support ethnic independence.
Any disturbance on the part of such individuals could carry the potential for
widespread destruction or confiscation of property owned by individuals and
entities foreign to such country and could cause the loss of the Fund's
investment in those countries. Instability may also result from, among other
things: (i) authoritarian governments or military involvement in political and
economic decision-making, including changes in government through
extra-constitutional means; (ii) popular unrest associated with demands for
improved political, economic and social conditions; and (iii) hostile relations
with neighboring or other countries. Such political, social and economic
instability could disrupt the principal financial markets in which a Fund
invests and adversely affect the value of the Fund's assets.
Statement of Additional Information Page 13
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G.T. GLOBAL GROWTH FUNDS
ILLIQUID SECURITIES. A Fund may invest up to 15% of its net assets in
illiquid securities. Securities may be considered illiquid if a Fund cannot
reasonably expect within seven days to sell the securities for approximately the
amount at which the Fund values such securities. See "Investment Limitations."
The sale of illiquid securities if they can be sold at all, generally will
require more time and result in higher brokerage charges or dealer discounts and
other selling expenses than the sale of liquid securities such as securities
eligible for trading on U.S. securities exchanges or in the OTC markets.
Moreover, restricted securities, which may be illiquid for purposes of this
limitation, often sell, if at all, at a price lower than similar securities that
are not subject to restrictions on resale.
With respect to liquidity determinations generally, the Company's Board of
Trustees has the ultimate responsibility for determining whether specific
securities, including restricted securities eligible for resale to qualified
institutional buyers pursuant to Rule 144A under the Securities Act of 1933, are
liquid or illiquid. The Board of Trustees has delegated the function of making
day-to-day determinations of liquidity to G.T. Capital in accordance with
procedures approved by the Company's Board of Trustees. G.T. Capital takes into
account a number of factors in reaching liquidity decisions, including, but not
limited to: (i) the frequency of trading in the security; (ii) the number of
dealers who make quotes for the security; (iii) the number of dealers who have
undertaken to make a market in the security; (iv) the number of other potential
purchasers; and (v) the nature of the security and how trading is effected
(e.g., the time needed to sell the security, how offers are solicited, and the
mechanics of transfer.) G.T. Capital monitors the liquidity of securities in
each Fund's portfolio and periodically reports such determinations to the
Company's Board of Trustees. Moreover, as noted in the Prospectus, certain
securities, such as those subject to repatriation restrictions of more than
seven days, will generally be treated as illiquid.
FOREIGN INVESTMENT RESTRICTIONS. Certain countries prohibit or impose
substantial restrictions on investments in their capital markets, particularly
their equity markets, by foreign entities such as a Fund. These restrictions or
controls may at times limit or preclude investment in certain securities and may
increase the cost and expenses of the Fund. For example, certain countries
require prior governmental approval before investments by foreign persons may be
made, or may limit the amount of investment by foreign persons in a particular
company, or limit the investment by foreign persons to only a specific class of
securities of a company that may have less advantageous terms than securities of
the company available for purchase by nationals. Moreover, the national policies
of certain countries may restrict investment opportunities in issuers or
industries deemed sensitive to national interests. In addition, some countries
require governmental approval for the repatriation of investment income, capital
or the proceeds of securities sales by foreign investors. In addition, if there
is a deterioration in a country's balance of payments or for other reasons, a
country may impose restrictions on foreign capital remittances abroad. A Fund
could be adversely affected by delays in, or a refusal to grant, any required
governmental approval for repatriation, as well as by the application to it of
other restrictions on investments.
NON-UNIFORM CORPORATE DISCLOSURE STANDARDS AND GOVERNMENTAL
REGULATION. Foreign companies are subject to accounting, auditing and financial
standards and requirements that differ, in some cases significantly, from those
applicable to U.S. companies. In particular, the assets, liabilities, and
profits appearing on the financial statements of such a company may not reflect
its financial position or results of operations in the way they would be
reflected had such financial statements been prepared in accordance with U.S.
generally accepted accounting principles. Most of the securities held by a Fund
(other than the America Fund) will not be registered with the SEC or regulators
of any foreign country, nor will the issuers thereof be subject to the SEC's
reporting requirements. Thus, there will be less available information
concerning most foreign issuers of securities held by a Fund than is available
concerning U.S. issuers. In instances where the financial statements of an
issuer are not deemed to reflect accurately the financial situation of the
issuer, G.T. Capital will take appropriate steps to evaluate the proposed
investment, which may include on-site inspection of the issuer, interviews with
its management and consultations with accountants, bankers and other
specialists. There is substantially less publicly available information about
foreign companies than there are reports and ratings published about U.S.
companies and the U.S. government. In addition, where public information is
available, it may be less reliable than such information regarding U.S. issuers.
Issuers of securities in foreign jurisdictions are generally not subject to the
same degree of regulation as are U.S. issuers with respect to such matters as
restrictions on market manipulation, insider trading rules, shareholder proxy
requirements and timely disclosure of information.
CURRENCY FLUCTUATIONS. Because each Fund, other than the America Fund, under
normal circumstances will invest a substantial portion of its total assets in
the securities of foreign issuers which are denominated in foreign currencies,
the strength or weakness of the U.S. dollar against such foreign currencies will
account for a significant part of the Fund's investment performance. A decline
in the value of any particular currency against the U.S. dollar will cause a
decline in the U.S. dollar value of a Fund's holdings of securities and cash
denominated in such currency and, therefore, will cause an overall decline in
the Fund's net asset value and any net investment income and capital gains
derived from such securities to be distributed in U.S. dollars to shareholders
of the Fund. Moreover, if the value of the foreign currencies in which a
Statement of Additional Information Page 14
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G.T. GLOBAL GROWTH FUNDS
Fund receives its income declines relative to U.S. dollars between the receipt
of income and the making of Fund distributions, the Fund may be required to
liquidate securities in order to make distributions if the Fund has insufficient
cash in U.S. dollars to meet distribution requirements.
The rate of exchange between the U.S. dollar and other currencies is determined
by several factors, including the supply and demand for particular currencies,
central bank efforts to support particular currencies, the relative movement of
interest rates and pace of business activity in the other countries and the
United States, and other economic and financial conditions affecting the world
economy.
Although each Fund values its assets daily in terms of U.S. dollars, the Funds
do not intend to convert their holdings of foreign currencies into U.S. dollars
on a daily basis. Each Fund will do so, from time to time, and investors should
be aware of the costs of currency conversion. Although foreign exchange dealers
do not charge a fee for conversion, they do realize a profit based on the
difference ("spread") between the prices at which they buy and sell various
currencies. Thus, a dealer may offer to sell a foreign currency to a Fund at one
rate, while offering a lesser rate of exchange should a Fund desire to sell that
currency to the dealer.
ADVERSE MARKET CHARACTERISTICS. Securities of many foreign issuers may be
less liquid and their prices more volatile than securities of comparable U.S.
issuers. In addition, foreign securities markets and brokers generally are
subject to less governmental supervision and regulation than in the United
States, and foreign securities transactions usually are subject to fixed
commissions, which generally are higher than negotiated commissions on U.S.
transactions. In addition, foreign securities transactions may be subject to
difficulties associated with the settlement of such transactions. Delays in
settlement could result in temporary periods when assets of a Fund are
uninvested and no return is earned thereon. The inability of a Fund to make
intended security purchases due to settlement problems could cause the Fund to
miss attractive investment opportunities. Inability to dispose of a portfolio
security due to settlement problems either could result in losses to a Fund due
to subsequent declines in value of the portfolio security or, if a Fund has
entered into a contract to sell the security, could result in possible liability
to the purchaser. G.T. Capital will consider such difficulties when determining
the allocation of each Fund's assets, although G.T. Capital does not believe
that such difficulties will have a material adverse effect on the Funds'
portfolio trading activities.
The Funds may use foreign custodians, which may involve risks in addition to
those related to the use of U.S. custodians. Such risks include uncertainties
relating to: (i) determining and monitoring the financial strength, reputation
and standing of the foreign custodian; (ii) maintaining appropriate safeguards
to protect the Funds' investments and (iii) possible difficulties in obtaining
and enforcing judgments against such custodians.
WITHHOLDING TAXES. A Fund's net investment income from foreign issuers may
be subject to non-U.S. withholding taxes by the foreign issuer's country,
thereby reducing the Fund's net investment income or delaying the receipt of
income whose those taxes may be recaptured. See "Taxes."
SPECIAL CONSIDERATIONS AFFECTING EUROPE. The countries that are members of
the European Economic Community ("Common Market") (Belgium, Denmark, France,
Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, and
the United Kingdom) eliminated certain import tariffs and quotas and other trade
barriers with respect to one another over the past several years. G.T. Capital
believes that this deregulation should improve the prospects for economic growth
in many European countries. Among other things, the deregulation could enable
companies domiciled in one country to avail themselves of lower labor costs
existing in other countries. In addition, this deregulation could benefit
companies domiciled in one country by opening additional markets for their goods
and services in other countries. Since, however, it is not clear at this time
what the exact form or effect of these Common Market reforms will be on business
in Western Europe or the emerging European markets, it is impossible to predict
the long-term impact of the implementation of these programs on the securities
owned by the Fund.
SPECIAL CONSIDERATIONS AFFECTING JAPAN AND HONG KONG. Investment in
securities of issuers domiciled in Japan and Hong Kong entails special
considerations. Overseas trade is important to Japan's economy. Japan has few
natural resources and must export to pay for its imports of these basic
requirements. Because of the concentration of Japanese exports in highly visible
products, Japan has had difficult relations with its trading partners,
particularly the U.S., where the trade imbalance is the greatest. It is possible
that trade sanctions or other protectionist measures could impact Japan
adversely in both the short and the long term. The Japanese securities markets
are less regulated than those in the United States. Evidence has emerged from
time to time of distortion of market prices to serve political or other
purposes. Shareholders' rights are not always equally enforced.
Hong Kong is a British colony which will transfer sovereignty to the Peoples
Republic of China in 1997. China has espoused policies antagonistic to free
enterprise capitalism and democracy. There can be no guarantee that property
Statement of Additional Information Page 15
<PAGE>
G.T. GLOBAL GROWTH FUNDS
rights will continue to be safeguarded in Hong Kong after 1997, although
recently, China has moved toward free enterprise, and has established stock
exchanges of its own.
SPECIAL CONSIDERATIONS AFFECTING EMERGING MARKETS. Investing in the
securities of issuers domiciled in emerging markets, including the markets of
Latin America and certain Asian markets such as Taiwan, Malaysia and Indonesia,
may entail special risks relating to the potential political and economic
instability and the risks of expropriation, nationalization, confiscation or the
imposition of restrictions on foreign investment, converting of currencies into
U.S. dollars and on repatriation of capital invested. In the event of such
expropriation, nationalization or other confiscation by any country, a Fund
could lose its entire investment in any such country.
Emerging securities markets are substantially smaller, less developed, less
liquid and more volatile than the major securities markets. The limited size of
emerging securities markets and limited trading volume in issuers compared to
the volume of trading in U.S. securities could cause prices to be erratic for
reasons apart from factors that affect the quality of the securities. For
example, limited market size may cause prices to be unduly influenced by traders
who control large positions. Adverse publicity and investors' perceptions,
whether or not based on fundamental analysis, may decrease the value and
liquidity of portfolio securities in these markets. In addition, securities
traded in certain emerging markets may be subject to risks due to the
inexperience of financial intermediaries, a lack of modern technology, the lack
of a sufficient capital base to expand business operations, and the possibility
of permanent or temporary termination of trading.
Settlement mechanisms in emerging securities markets may be less efficient and
reliable than in more developed markets. In such emerging securities markets
there may be share registration and delivery delays or failures.
Most Latin American countries have experienced substantial, and in some periods
extremely high, rates of inflation for many years. Inflation and rapid
fluctuations in inflation rates and corresponding currency devaluations have had
and may continue to have negative effects on the economies and securities
markets of certain Latin American countries.
Statement of Additional Information Page 16
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INVESTMENT LIMITATIONS
- --------------------------------------------------------------------------------
Each Fund has adopted the following fundamental investment limitations as
fundamental policies which (unless otherwise noted) may not be changed without
approval by the holders of the lesser of (i) 67% of that Fund's shares
represented at a meeting at which more than 50% of the outstanding shares are
represented, and (ii) more than 50% of the Fund's outstanding shares. No Fund
may:
(1) Invest in companies for the purpose of exercising control or
management;
(2) Purchase or sell real estate; provided that a Fund may invest in
securities secured by real estate or interests therein or issued by
companies that invest in real estate or interests therein;
(3) Purchase or sell interests in oil, gas or other mineral exploration
or development programs, except that the Fund may invest in the securities
of companies that engage in these activities;
(4) Purchase or sell commodities or commodity contracts, except that the
Fund may purchase and sell financial and currency futures contracts and
options thereon, and may purchase and sell currency forward contracts,
options on foreign currencies and may otherwise engage in other transactions
in foreign currencies;
(5) Mortgage, pledge or in any other manner transfer as security for any
indebtedness, any of its assets except to secure permitted borrowings.
Collateral arrangements with respect to initial or variation margin for
futures contracts will not be deemed to be a pledge of a Fund's assets;
(6) Borrow money in excess of 33 1/3% of the Fund's total assets
(including the amount borrowed), less all liabilities and indebtedness
(other than borrowing). Transactions involving options, futures contracts,
options on futures contracts and forward currency contracts, and collateral
arrangements relating thereto will not be deemed to be borrowings;
(7) Purchase securities on margin or effect short sales, except that a
Fund may obtain such short-term credits as may be necessary for the
clearance of purchases or sales of securities and except in connection with
the use of options, futures contracts, options thereon or forward currency
contracts. The Funds may make deposits of margin in connection with futures
and forward contracts and options thereon;
(8) Participate on a joint or a joint and several basis in any trading
account in securities. (The "bunching" of orders for the sale or purchase of
marketable portfolio securities with other accounts under the management of
G.T. Capital to save brokerage costs or average prices among them is not
deemed to result in a securities trading account);
(9) Make loans, except that the Fund may purchase debt securities and
enter into repurchase agreements and make loans of portfolio securities;
(10) Purchase or retain the securities of an issuer if, to the Fund's
knowledge, one or more of the Trustees or officers of the Company or G.T.
Capital individually own beneficially more than 1/2 of 1% of the securities
of such issuer and together own beneficially more than 5% of such
securities;
(11) Underwrite securities of other issuers, except to the extent that,
in connection with the disposition of portfolio securities, the Fund may be
deemed an underwriter under federal or state securities laws; and
(12) Invest more than 25% of the value of the Fund's total assets in
securities of issuers conducting their principal business activities in any
one industry, except that this limitation shall not apply to securities
issued or guaranteed as to principal and interest by the U.S. government or
any of its agencies or instrumentalities.
For purposes of the concentration policy of the Fund contained in limitation
(12) above, the Fund intends to comply with the SEC staff position that
securities issued or guaranteed as to principal and interest by any single
foreign government or any supranational organizations in the aggregate are
considered to be securities of issuers in the same industry.
Statement of Additional Information Page 17
<PAGE>
G.T. GLOBAL GROWTH FUNDS
The following investment restrictions of each Fund are not fundamental policies
and may be changed by vote of the Company's Board of Trustees without
shareholder approval. Each Fund may not:
(1) Invest more than 15% of its net assets in illiquid securities, a
term which means securities that cannot be disposed of within seven days in
the normal course of business at approximately the amount at which the Fund
has valued the securities and includes, among other things, repurchase
agreements maturing in more than seven days;
(2) Invest more than 5% of its assets in securities of companies which,
together with any predecessors, have been in operation for less than three
years;
(3) Borrow money except for temporary or emergency purposes (not for
leveraging) not in excess of 33 1/3% of the value of the Fund's total
assets; or
(4) Enter into a futures contract, an option on a future contract, or an
option on foreign currency traded on a CFTC-regulated exchange, in each case
other than for BONA FIDE hedging purposes (as defined by the CFTC), if the
aggregate initial margin and premiums required to establish all of these
positions (excluding the amount by which options are "in-the-money") exceeds
5% of the liquidation value of the Fund's portfolio, after taking into
account unrealized profits and unrealized losses on any contracts the Fund
has entered into.
----------------------------
A Fund will not knowingly exercise rights or otherwise acquire securities when
to do so would jeopardize the Fund's status under the 1940 Act as a diversified
investment company. If a percentage restriction on investment or utilization of
assets in a fundamental policy or restriction is adhered to at the time an
investment is made, a later change in percentage ownership of a security or kind
of securities resulting from changing market values or a similar type of event
will not be considered a violation of a Fund's investment policies or
restrictions. A Fund may exchange securities, exercise conversion or
subscription rights, warrants, or other rights to purchase common stock or other
equity securities and may hold, except to the extent limited by the 1940 Act,
any such securities so acquired without regard to the Fund's investment policies
and restrictions. The original cost of the securities so acquired will be
included in any subsequent determination of a Fund's compliance with the
investment percentage limitations referred to above and in the Prospectus.
Investors should refer to the Prospectus for further information with respect to
each Fund's investment objective, which may not be changed without the approval
of shareholders, and other investment policies, techniques and limitations which
may be changed without shareholder approval.
Statement of Additional Information Page 18
<PAGE>
G.T. GLOBAL GROWTH FUNDS
EXECUTION OF PORTFOLIO
TRANSACTIONS
- --------------------------------------------------------------------------------
Subject to policies established by the Company's Board of Trustees, G.T. Capital
is responsible for the execution of the Funds' portfolio transactions and the
selection of brokers/dealers who execute such transactions on behalf of the
Funds. In executing portfolio transactions, G.T. Capital seeks the best net
results for each Fund, taking into account such factors as the price (including
the applicable brokerage commission or dealer spread), size of the order,
difficulty of execution and operational facilities of the firm involved.
Although G.T. Capital generally seeks reasonably competitive commission rates
and spreads, payment of the lowest commission or spread is not necessarily
consistent with the best net results. While the Funds may engage in soft dollar
arrangements for research services, as described below, the Funds have no
obligation to deal with any broker/dealer or group of broker/dealers in the
execution of portfolio transactions.
Consistent with the interests of the Funds, G.T. Capital may select brokers to
execute the Fund's portfolio transactions on the basis of the research services
they provide to G.T. Capital for its use in managing the Funds and its other
advisory accounts. Such services may include furnishing analysis, reports and
information concerning issuers, industries, securities, geographic regions,
economic factors and trends, portfolio strategy, and performance of accounts;
and effecting securities transactions and performing functions incidental
thereto (such as clearance and settlement). Research and brokerage services
received from such broker is in addition to, and not in lieu of, the services
required to be performed by G.T. Capital under the Management Contract (defined
below). A commission paid to such broker may be higher than that which another
qualified broker would have charged for effecting the same transaction, provided
that G.T. Capital determines in good faith that such commission is reasonable in
terms either of that particular transaction or the overall responsibility of
G.T. Capital to the Funds and its other clients and that the total commissions
paid by each Fund will be reasonable in relation to the benefits received by the
Funds over the long term. Research services may also be received from dealers
who execute Fund transactions in over-the-counter markets.
G.T. Capital may allocate brokerage transactions to broker/dealers who have
entered into arrangements under which the broker/dealer allocates a portion of
the commissions paid by the Fund toward payment of the Fund's expenses, such as
transfer agent and custodian fees.
Investment decisions for each Fund and for other investment accounts managed by
G.T. Capital are made independently of each other in light of differing
conditions. However, the same investment decision occasionally may be made for
two or more of such accounts, including one or more Funds. In such cases,
simultaneous transactions may occur. Purchases or sales are then allocated as to
price or amount in a manner deemed fair and equitable to all accounts involved.
While in some cases this practice could have a detrimental effect upon the price
or value of the security as far as a Fund is concerned, in other cases G.T.
Capital believes that coordination and the ability to participate in volume
transactions will be beneficial to the Funds.
Under a policy adopted by the Company's Board of Trustees, and subject to the
policy of obtaining the best net results, G.T. Capital may consider a
broker/dealer's sale of the shares of the Funds and the other funds for which
G.T. Capital serves as investment manager and/or administrator in selecting
broker/dealers for the execution of portfolio transactions. This policy does not
imply a commitment to execute portfolio transactions through all broker/dealers
that sell shares of the Funds and such other funds.
Each Fund contemplates purchasing most foreign equity securities in OTC markets
or stock exchanges located in the countries in which the respective principal
offices of the issuers of the various securities are located, if that is the
best available market. The fixed commissions paid in connection with most such
foreign stock transactions generally are higher than negotiated commissions on
United States transactions. There generally is less government supervision and
regulation of foreign stock exchanges and brokers than in the United States.
Foreign security settlements may in some instances be subject to delays and
related administrative uncertainties.
Foreign equity securities may be held by a Fund in the form of ADRs, ADSs, EDRs,
CDRs or securities convertible into foreign equity securities. ADRs, ADSs, EDRs
and CDRs may be listed on stock exchanges, or traded in the OTC markets in the
United States or Europe, as the case may be. ADRs, like other securities traded
in the United States, will be subject to negotiated commission rates. The
foreign and domestic debt securities and money market instruments in which the
Funds may invest are generally traded in the OTC markets.
Statement of Additional Information Page 19
<PAGE>
G.T. GLOBAL GROWTH FUNDS
The Fund contemplates that, consistent with the policy of obtaining the best net
results, brokerage transactions may be conducted through certain companies that
are members of the BIL GT Group. The Company's Board of Trustees has adopted
procedures in conformity with Rule 17e-1 under the 1940 Act to ensure that all
brokerage commissions paid to such affiliates are reasonable and fair in the
context of the market in which they are operating. Any such transactions will be
effected and related compensation paid only in accordance with applicable SEC
regulations. For the fiscal year ended December 31, 1994, the Europe Fund paid
to BIL Frankfurt and BIL Vaduz, each an "affiliated" broker as defined in the
1940 Act, aggregate brokerage commissions of $58,346 and $26,599 respectively
for transactions involving purchases and sales of portfolio securities which
represented 2.67% and 1.22%, respectively, of the total brokerage commissions
paid by the Europe Fund and 1.20% and 0.71%, respectively, of the aggregate
dollar amount of transactions involving payment of commissions by the Europe
Fund.
Aggregate brokerage commissions paid by the Funds for their three most recent
fiscal years were:
<TABLE>
<CAPTION>
FUND 1994 1993 1992
- ---------------------------------------------------------------------------- ------------- ------------- -------------
<S> <C> <C> <C>
America
Fund....................................................................... $ 1,082,311 185,402 174,319
Europe
Fund...................................................................... $ 2,185,831 1,935,775 2,278,856
International
Fund...................................................................... $ 1,090,763 2,163,843 1,922,811
Japan
Fund...................................................................... $ 838,666 133,436 424,159
Pacific
Fund...................................................................... $ 2,746,761 3,832,898 1,415,883
Worldwide
Fund...................................................................... $ 954,962 711,034 514,210
</TABLE>
PORTFOLIO TRADING AND TURNOVER
Although the Funds generally do not intend to trade for short-term profits, the
securities in a Fund's portfolio will be sold whenever G.T. Capital believes it
is appropriate to do so, without regard to the length of time a particular
security may have been held, except when doing so could violate the Short-Short
Limitation described below in "Taxes."
Each Fund engages in portfolio trading when G.T. Capital has concluded that the
sale of a security owned by the Fund and/ or the purchase of another security of
better value can enhance principal and/or increase income. A security may be
sold to avoid any prospective decline in market value, or a security may be
purchased in anticipation of a market rise. Consistent with each Fund's
investment objective or objectives, a security also may be sold and a comparable
security purchased coincidentally in order to take advantage of what is believed
to be a disparity in the normal yield and price relationship between the two
securities.
Each Fund anticipates that its annual portfolio turnover rate should not exceed
200%; however, the portfolio turnover rate will not be a limiting factor when
management deems portfolio changes appropriate. A 200% portfolio turnover rate,
which would be considered high for a long-term growth fund, would occur if the
lesser of the value of purchases or sales of portfolio securities for a Fund for
a year (excluding purchases of U.S. Treasury and other securities with a
maturity at the date of purchase of one year or less) were equal to 200% of the
average monthly value of the securities, excluding short-term investments, held
by that Fund during such year. Higher portfolio turnover involves
correspondingly greater brokerage commissions and other transaction costs that a
Fund will bear directly. The portfolio turnover rates for the fiscal years ended
December 31, 1994 and 1993 were as follows:
<TABLE>
<CAPTION>
1994 1993
---------- ----------
<S> <C> <C>
America Fund.......................................................................................... 102% 92.0 %
Europe Fund........................................................................................... 91 67.0
International Fund.................................................................................... 96 90.0
Japan Fund............................................................................................ 49 104.0
Pacific Fund.......................................................................................... 87 117.0
Worldwide Fund........................................................................................ 86 92.0
</TABLE>
Statement of Additional Information Page 20
<PAGE>
G.T. GLOBAL GROWTH FUNDS
TRUSTEES AND EXECUTIVE OFFICERS
- --------------------------------------------------------------------------------
The Company's Trustees and Executive Officers are listed below.
<TABLE>
<CAPTION>
NAME, POSITION(S) WITH THE PRINCIPAL OCCUPATIONS AND BUSINESS
COMPANY AND ADDRESS EXPERIENCE FOR PAST 5 YEARS
- --------------------------------------- ------------------------------------------------------------------------------------------
<S> <C>
David A. Minella*, 42 Director of BIL G.T. Group Limited (holding company of the various international G.T.
Trustee, Chairman of the Board and companies) since 1990; Director and President of G.T. Capital since 1989; Director and
President President of G.T. Global since 1987; and Director and President of G.T. Services since
50 California St. 1990. Prior to 1987 Mr. Minella held various positions with the Putnam Companies (a mutual
San Francisco, CA 94111 fund and investment advisory organization). Mr. Minella also is a director or trustee of
each of the other investment companies registered under the 1940 Act that is managed or
administered by G.T. Capital.
C. Derek Anderson, 53 Chairman, Anderson Capital Management, Inc. from 1988 to present; Chairman, Plantagenet
Trustee Holdings, Ltd. from 1991 to present; Director Munsingwear, Inc.; Director, American
220 Sansome Street Heritage Group Inc.; Director, T.L. Higgins Inc. and various other companies. Mr. Anderson
Suite 400 also is a director or trustee of each of the other investment companies registered under
San Francisco, CA 94104 the 1940 Act that is managed or administered by G.T. Capital.
Frank S. Bayley, 55 A partner of Baker & McKenzie (a law firm), and serves as Director and Chairman of C.D.
Trustee Stimson Company (a private investment company); Trustee, Seattle Art Museum. Mr. Bayley
2 Embarcadero Center also is a director or trustee of each of the other investment companies registered under
Suite 2400 the 1940 Act that is managed or administered by G.T. Capital.
San Francisco, CA 94111
Arthur C. Patterson, 52 Managing Partner of Accel Partners (a venture capital firm). Mr. Patterson also serves as
Trustee a director of various computing and software companies. Mr. Patterson also is a director
One Embarcadero Center or trustee of each of the other investment companies registered under the 1940 Act that is
Suite 3820 managed or administered by G.T. Capital.
San Francisco, CA 94111
Ruth H. Quigley, 59 Private investor. From 1984 to 1986, Miss Quigley was President of Quigley Friedlander &
Trustee Co., Inc. (a financial advisory services firm). Ms. Quigley also is a director or trustee
1055 California Street of each of the other investment companies registered under the 1940 Act that is managed or
San Francisco, CA 94108 administered by G.T. Capital.
F. Christian Wignall, 39 Senior Vice President, Chief Investment Officer -- Global Equities and a Director of G.T.
Vice President and Chief Investment Capital since 1987, and Chairman of the Investment Policy Committee of the affiliated
Officer -- international G.T. companies since 1990.
Global Equities
50 California Street
San Francisco, CA 94111
Gary Kreps, 40 Senior Vice President and Chief Investment Officer -- Global Fixed Income Investments and
Vice President and Chief Investment a Director of G.T. Capital since 1992. Prior to joining G.T. Capital, Mr. Kreps was Senior
Officer -- Global Fixed Income Vice President of the Putnam Companies from 1988 to 1992.
50 California Street
San Francisco, CA 94111
</TABLE>
Statement of Additional Information Page 21
<PAGE>
G.T. GLOBAL GROWTH FUNDS
<TABLE>
<CAPTION>
NAME, POSITION(S) WITH THE PRINCIPAL OCCUPATIONS AND BUSINESS
COMPANY AND ADDRESS EXPERIENCE FOR PAST 5 YEARS
- --------------------------------------- ------------------------------------------------------------------------------------------
Helge K. Lee, 48 Senior Vice President, General Counsel and Secretary of G.T. Capital, G.T. Global and G.T.
Vice President and Secretary Services since May, 1994. Mr. Lee was the Senior Vice President, General Counsel and
50 California Street Secretary of Strong/Corneliuson Management, Inc. and Secretary of each of the Strong Funds
San Francisco, CA 94111 from October, 1991 through May, 1994. For more than five years prior to October, 1991, he
was a shareholder in the law firm of Godfrey & Kahn, S.C., Milwaukee, Wisconsin.
<S> <C>
Peter R. Guarino, 36 Assistant General Counsel of G.T. Capital, G.T. Global and G.T. Services since 1991. From
Assistant Secretary 1989 to 1991, Mr. Guarino was an attorney at The Dreyfus Corporation. Prior thereto, he
50 California Street was associated with Colonial Management Associates, Inc.
San Francisco, CA 94111
David J. Thelander, 39 Assistant General Counsel of G.T. Capital since January 1995. From 1993 to 1994, Mr.
Assistant Secretary Thelander was an associate at Kirkpatrick & Lockhart LLP (a law firm). Prior thereto, he
50 California Street was an attorney with the U.S. Securities and Exchange Commission.
San Francisco, CA 94111
James R. Tufts, 37 Senior Vice President -- Finance and Administration of G.T. Capital, G.T. Global and G.T.
Vice President and Chief Financial Services since 1994. Prior thereto, Mr. Tufts was Vice President -- Finance of G.T.
Officer Capital and G.T. Global since 1987; Vice President -- Finance of G.T. Services since 1990;
50 California Street and a Director of G.T. Capital, G.T Global and G.T. Services since 1991.
San Francisco, CA 94111
Kenneth W. Chancey, 50 Vice President of G.T. Capital and G.T. Global since 1992. Mr. Chancey was Vice President
Vice President and Principal Accounting of Putnam Fiduciary Trust Company from 1989 to 1992.
Officer
50 California Street
San Francisco, CA 94111
<FN>
- ------------------
* Mr. Minella is an "interested person" of the Company as defined by the 1940
Act due to his affiliation with the G.T. companies.
</TABLE>
The Board of Trustees has a Nominating and Audit Committee, comprised of Miss
Quigley and Messrs. Anderson, Bayley and Patterson, which is responsible for
nominating persons to serve as Trustees, reviewing audits of the Company and its
Funds and recommending firms to serve as independent auditors of the Company.
Each of the Trustees and Officers of the Company is also a Director and Officer
of G.T. Investment Portfolios, Inc., G.T. Investment Funds, Inc. and G.T. Global
Developing Markets Fund, Inc. and a Trustee and Officer of G.T. Greater Europe
Fund, G.T. Global Variable Investment Trust, G.T. Global Variable Investment
Series, and G.T. Global High Income Portfolio, which also are registered
investment companies managed by G.T. Capital. Each Trustee and Officer serves in
total as a Director and or Trustee and Officer, respectively, of 9 registered
investment companies with 38 series managed or administered by G.T. Capital. The
Company pays each Trustee who is not a director, officer or employee of G.T.
Capital or any affiliated company $5,000 per annum plus $300 per Fund for each
meeting of the Board attended by the Trustee, and reimburses travel and other
expenses incurred in connection with attendance at such meetings. Other Trustees
and officers receive no compensation or expense reimbursements from the Company.
For the fiscal year ended December 31, 1994, the Company paid Mr. Anderson, Mr.
Bayley, Mr. Patterson and Ms. Quigley Trustees' fees and expense reimbursements
of $22,887, $23,518, $19,104 and $19,941, respectively. For the fiscal year
ended December 31, 1994, Mr. Anderson, Mr. Bayley, Mr. Patterson and Ms.
Quigley, who are not directors, officers or employees of G.T. Capital or any
affiliated company, each received total compensation of $86,260.80, $91,278.79,
$74,492.00 and $78,665.19, respectively, from the 38 G.T. Funds for which he or
she serves as a Director or Trustee. Fees and expenses disbursed to the Trustees
contained no accrued or payable pension, or retirement benefits. As of the date
of this Statement of Additional Information, the officers and Trustees and their
families as a group owned in the aggregate beneficially or of record less than
1% of the outstanding shares of any Fund or of all the Company's Funds, except
in the Worldwide Growth Fund, in the aggregate. As of the date of this Statement
of Additional Information, the officers and Directors and their families as a
group owned in aggregate beneficially or of record 1.12% of the outstanding
shares of the Worldwide Growth Fund.
Statement of Additional Information Page 22
<PAGE>
G.T. GLOBAL GROWTH FUNDS
MANAGEMENT
- --------------------------------------------------------------------------------
INVESTMENT MANAGEMENT AND ADMINISTRATION SERVICES
G.T. Capital serves as each Fund's investment manager and administrator under an
Investment Management and Administration Contract ("Management Contract")
between the Company and G.T. Capital. As investment manager and administrator,
G.T. Capital makes all investment decisions for each Fund and administers each
Fund's affairs. Among other things, G.T. Capital furnishes the services and pays
the compensation and travel expenses of persons who perform the executive,
administrative, clerical and bookkeeping functions of the Company and the Funds,
and provides suitable office space, and necessary small office equipment and
utilities. Prior to July 1, 1993, each Fund other than the America Fund paid
investment management and administration fees to G.T. Capital at the annualized
rate of 1.00% of each Fund's average daily net assets. The America Fund paid
investment management and administration fees to G.T. Capital at the annualized
rate of 0.75% of the Fund's average daily net assets. The America Fund pays G.T.
Capital investment management and administration fees, computed daily and paid
monthly, based on its average daily net assets, at the annualized rate of .725%
on the first $500 million, .70% on the next $500 million, .675% on the next $500
million, and .65% on amounts thereafter. Each of the other Funds pay G.T.
Capital investment management and administration fees, computed daily and paid
monthly, based on its average daily net assets, at the annualized rate of .975%
on the first $500 million, .95% on the next $500 million, .925% on the next $500
million, and .90% on amounts thereafter.
The Management Contract took effect on May 1, 1989 and had an initial two-year
term with respect to each Fund. The Management Contract may be renewed for
additional one-year terms thereafter with respect to each Fund, provided that
any such renewal has been specifically approved at least annually by: (i) the
Company's Board of Trustees, or by the vote of a majority of the Fund's
outstanding voting securities (as defined in the 1940 Act), and (ii) a majority
of Trustees who are not parties to the Management Contract or "interested
persons" of any such party (as defined in the 1940 Act), cast in person at a
meeting called for the specific purpose of voting on such approval. The
Management Contract most recently was approved on June 15, 1994 by the Board of
Trustees of the Company, including a majority of Trustees who are not parties to
the Management Agreement or "interested persons" of any such party. With respect
to any Fund either the Company or G.T. Capital may terminate the Management
Contract without penalty upon sixty (60) days' written notice to the other
party. The Management Contract terminates automatically in the event of its
assignment (as defined in the 1940 Act).
Under the Management Contract, G.T. Capital has agreed to reimburse each Fund if
that Fund's annual ordinary expenses exceed the most stringent limits prescribed
by any state in which the Fund's shares are offered for sale. Currently, the
most restrictive applicable limitation provides that a Fund's expenses may not
exceed an annual rate of 2 1/2% of the first $30 million of average net assets,
2% of the next $70 million of average net assets and 1 1/2% of assets in excess
of that amount. Expenses which are not subject to this limitation are interest,
taxes, brokerage commissions, the amortization of organizational expenses,
payments of distribution fees, in part, and extraordinary expenses. In addition,
G.T. Capital and G.T. Global voluntarily have undertaken to limit the expenses
of each Fund, other than those of the America Fund (exclusive of brokerage
commissions, taxes, interest and extraordinary expenses) to the maximum annual
level of 1.90% of the average daily net assets of each Fund's Advisor Class
shares. Similarly, G.T. Capital and G.T. Global have undertaken to limit the
America Fund's expenses (exclusive of brokerage commissions, taxes, interest and
extraordinary expenses) to the maximum annual level of 1.65% of the average
daily net assets of the Fund's Advisor Class shares.
Statement of Additional Information Page 23
<PAGE>
G.T. GLOBAL GROWTH FUNDS
The amounts of investment management and administration fees paid by each Fund
to G.T. Capital during the Funds' three most recent fiscal years were as
follows:
<TABLE>
<CAPTION>
FUND 1994 1993 1992
- ------------------------------------------------------------ --------------- --------------- ---------------
<S> <C> <C> <C>
America Fund................................................ $ 1,283,893 1,058,534 796,850
Europe Fund................................................. $ 8,319,087 7,839,132 9,952,613*
International Fund.......................................... $ 5,368,669 4,488,221 4,543,544
Japan Fund.................................................. $ 1,345,064 1,058,002 683,869*
Pacific Fund................................................ $ 5,563,245 3,820,147 3,125,059
Worldwide Fund.............................................. $ 3,355,681 1,665,771 1,406,291
<FN>
- ------------------
* Net of reimbursement of Europe Fund and Japan Fund operating expenses by
G.T. Capital of $67,704 and $79,440, respectively.
</TABLE>
DISTRIBUTION SERVICES
Each Fund's Advisor Class shares are offered continuously through the Funds'
principal underwriter and distributor, G.T. Global, on a "best efforts" basis
without a sales charge or a contingent deferred sales charge.
TRANSFER AGENCY SERVICES
G.T. Global Investor Services, Inc. ("Transfer Agent") has been retained by the
Funds to perform shareholder servicing, reporting and general transfer agent
functions for the Funds. For these services, the Transfer Agent receives an
annual maintenance fee of $17.50 per account, a new account fee of $4.00 per
account, a per transaction fee of $1.75 for all transactions other than
exchanges and a per exchange fee of $2.25. The Transfer Agent also is reimbursed
by the Funds for its out-of-pocket expenses for such items as postage, forms,
telephone charges, stationery and office supplies.
EXPENSES OF THE FUNDS
Each Fund pays all expenses not assumed by G.T. Capital, G.T. Global and other
agents. These expenses include, in addition to the advisory, distribution,
transfer agency and brokerage fees discussed above, legal and audit expenses,
custodian fees, trustees' fees, organizational fees, fidelity bond and other
insurance premiums, taxes, extraordinary expenses and expenses of reports and
prospectuses sent to existing investors. Certain of these expenses, such as
custodial fees and brokerage fees generally are higher for non-U.S. securities.
The allocation of general Company expenses and expenses shared by the Funds with
one another, are made on a basis deemed fair and equitable, and may be based on
the relative net assets of the Funds or the nature of the services performed and
relative applicability to each Fund. Expenditures, including costs incurred in
connection with the purchase or sale of portfolio securities, which are
capitalized in accordance with generally accepted accounting principles
applicable to investment companies, are accounted for as capital items and not
as expenses. The ratio of each Fund's, other than America Fund's, expenses to
its relative net assets can be expected to be higher than the expense ratios of
funds investing solely in domestic securities, since the cost of maintaining the
custody of foreign securities and the rate of investment management fees paid by
each Fund generally are higher than the comparable expenses of such other funds.
- --------------------------------------------------------------------------------
VALUATION OF SHARES
- --------------------------------------------------------------------------------
As described in the Prospectus, each Fund's net asset value per share for each
class of shares is determined at the close of regular trading on The New York
Stock Exchange, Inc. ("NYSE") (currently, 4:00 P.M. Eastern time, unless
weather, equipment failure or other factors contribute to an earlier closing
time). Currently, the NYSE is closed on weekends and on certain days relating to
the following holidays: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, July 4th, Labor Day, Thanksgiving Day and Christmas Day.
The Funds' portfolio securities and other assets are valued as follows:
Equity securities, including ADRs, ADSs and EDRs, which are traded on stock
exchanges, are valued at the last sale price on the exchange on which such
securities are traded, as of the close of business on the day the securities are
being valued or, lacking any sales, at the last available bid price. In cases
where securities are traded on more than one exchange, the securities are valued
on the exchange determined by G.T. Capital to be the primary market. Securities
traded in the OTC market are valued at the last available bid price prior to the
time of valuation. Securities and assets for which market
Statement of Additional Information Page 24
<PAGE>
G.T. GLOBAL GROWTH FUNDS
quotations are not readily available (including restricted securities which are
subject to limitations as to their sale) are valued at fair value as determined
in good faith by or under the direction of the Board of Trustees.
Long-term debt obligations are valued at the mean of representative quoted bid
or asked prices for such securities or, if such prices are not available, at
prices for securities of comparable maturity, quality and type; however, when
G.T. Capital deems it appropriate, prices obtained for the day of valuation from
a bond pricing service will be used. Short-term debt investments are amortized
to maturity based on their cost, adjusted for foreign exchange translation,
provided that such valuations represent fair value.
Options on indices, securities and currencies purchased by the Funds are valued
at their last bid price in the case of listed options or at the average of the
last bid prices obtained from dealers in the case of OTC options. The value of
each security denominated in a currency other than U.S. dollars will be
translated into U.S. dollars at the prevailing exchange rate as determined by
G.T. Capital on that day. When market quotations for futures and options on
futures held by a Fund are readily available, those positions will be valued
based upon such quotations.
Securities and other assets for which market quotations are not readily
available are valued at fair value as determined in good faith by or under the
direction of the Company's Board of Trustees. The valuation procedures applied
in any specific instance are likely to vary from case to case. However,
consideration generally is given to the financial position of the issuer and
other fundamental analytical data relating to the investment and to the nature
of the restrictions on disposition of the securities (including any registration
expenses that might be borne by a Fund in connection with such disposition). In
addition, other factors, such as the cost of the investment, the market value of
any unrestricted securities of the same class (both at the time of purchase and
at the time of valuation), the size of the holding, the prices of any recent
transactions or offers with respect to such securities and any available
analysts' reports regarding the issuer, generally are considered.
The fair value of any other assets is added to the value of all securities
positions to arrive at the value of a Fund's total assets. A Fund's liabilities,
including accruals for expenses, are deducted from its total assets. Once the
total value of a Fund's net assets is so determined, that value is then divided
by the total number of shares outstanding (excluding treasury shares), and the
result, rounded to the nearer cent, is the net asset value per share.
Any assets or liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the official exchange rate or, alternatively, at
the mean of the current bid and asked prices of such currencies against the U.S.
dollar last quoted by a major bank that is a regular participant in the foreign
exchange market or on the basis of a pricing service that takes into account the
quotes provided by a number of such major banks. If none of these alternatives
are available or none are deemed to provide a suitable methodology for
converting a foreign currency into U.S. dollars, the Board of Trustees, in good
faith, will establish a conversion rate for such currency.
European, Far Eastern or Latin American securities trading may not take place on
all days on which the NYSE is open. Further, trading takes place in Japanese
markets on certain Saturdays and in various foreign markets on days on which the
NYSE is not open. In addition, trading in securities on European and Far Eastern
securities exchanges and OTC markets generally is completed well before the
close of the business day in New York. Consequently, the calculation of the
Funds' net asset values may not take place contemporaneously with the
determination of the prices of securities held by the Funds. Events affecting
the values of portfolio securities that occur between the time their prices are
determined and the close of regular trading on the NYSE will not be reflected in
the Funds' net asset values unless G.T. Capital, under the supervision of the
Company's Board of Trustees, determines that the particular event would
materially affect net asset value. As a result, a Fund's net asset value may be
significantly affected by such trading on days when a shareholder has no access
to the Fund.
- --------------------------------------------------------------------------------
INFORMATION RELATING TO SALES
AND REDEMPTIONS
- --------------------------------------------------------------------------------
PAYMENT AND TERMS OF OFFERING
Payment for Advisor Class shares purchased should accompany the purchase order,
or funds should be wired to the Transfer Agent as described in the Prospectus.
Payment, other than by wire transfer, must be made by check or money order drawn
on a U.S. bank. Checks or money orders must be payable in U.S. dollars.
Statement of Additional Information Page 25
<PAGE>
G.T. GLOBAL GROWTH FUNDS
As a condition of this offering, if an order to purchase either class of shares
is cancelled due to nonpayment (for example, because a check is returned for
"not sufficient funds"), the person who made the order will be responsible for
any loss incurred by a Fund by reason of such cancellation, and if such
purchaser is a shareholder, that Fund shall have the authority as agent of the
shareholder to redeem shares in his or her account at their then-current net
asset value per share to reimburse that Fund for the loss incurred. Investors
whose purchase orders have been cancelled due to nonpayment may be prohibited
from placing future orders.
The Funds reserve the right at any time to waive or increase the minimum
requirements applicable to initial or subsequent investments with respect to any
person or class of persons. An order to purchase shares is not binding on a Fund
until it has been confirmed in writing by the Transfer Agent (or other
arrangements made with the Fund, in the case of orders utilizing wire transfer
of funds, as described above) and payment has been received. To protect existing
shareholders, the Funds reserve the right to reject any offer for a purchase of
shares by any individual.
SALES OUTSIDE THE UNITED STATES
Sales of Fund shares made through brokers outside the United States will be at
net asset value plus a sales commission, if any, established by that broker or
by local law. Such commission, if any, may be more or less than the sales
charges listed in the sales charge table included in the Prospectus.
EXCHANGES BETWEEN FUNDS
Shares of a Fund may be exchanged for shares of other G.T. Global Mutual Funds,
based on their respective net asset values without imposition of any sales
charges provided that the registration remains identical. Advisor Class shares
may be exchanged only for Advisor Class shares of other G.T. Global Mutual
Funds. The exchange privilege is not an option or right to purchase shares but
is permitted under the current policies of the respective G.T. Global Mutual
Funds. The privilege may be discontinued or changed at any time by any of the
Funds upon 60 days' prior written notice to the shareholders of such Fund and is
available only in states where the exchange may be made legally. Before
purchasing shares through the exercise of the exchange privilege, a shareholder
should obtain and read a copy of the Prospectus of the Fund to be purchased and
should consider the investment objective(s) of that Fund.
TELEPHONE REDEMPTIONS
A corporation or partnership wishing to utilize telephone redemption services
must submit a "Corporate Resolution" or "Certificate of Partnership" indicating
the names, titles and the required number of signatures of persons authorized to
act on its behalf. The certificate must be signed by a duly authorized
officer(s) and, in the case of a corporation, the corporate seal must be
affixed. All shareholders may request that redemption proceeds be transmitted by
bank wire directly to the shareholder's predesignated account at a domestic bank
or savings institution if the proceeds are at least $1,000. Costs in connection
with the administration of this service, including wire charges, will be borne
by the Funds. Proceeds of less than $1,000 will be mailed to the shareholder's
registered address of record. The Funds and the Transfer Agent reserve the right
to refuse any telephone instructions and may discontinue the aforementioned
redemption options upon 30 days' written notice.
SUSPENSION OF REDEMPTION PRIVILEGES
The Funds may suspend redemption privileges or postpone the date of payment for
more than seven days after a redemption or der is received during any period:
(1) when the NYSE is closed other than customary weekend and holiday closings,
or when trading on the NYSE is restricted as directed by the SEC; (2) when an
emergency exists, as defined by the SEC, which will prohibit the Funds from
disposing of portfolio securities owned by them or in fairly determining the
value of their assets; or (3) as the SEC may otherwise permit.
REDEMPTIONS IN KIND
It is possible that conditions may arise in the future which would, in the
opinion of the Company's Board of Trustees, make it undesirable for a Fund to
pay for all redemptions in cash. In such cases, the Board may authorize payment
to be made in portfolio securities or other property of a Fund, so called
"redemptions in kind." Payment of redemptions in kind will be made in readily
marketable securities. Such securities delivered in payment of redemptions would
be valued at the same value assigned to them in computing the net asset value
per share. Shareholders receiving such securities would incur brokerage costs in
selling any such securities so received and would be subject to any increase or
decrease in the value of the securities until they were sold.+
Statement of Additional Information Page 26
<PAGE>
G.T. GLOBAL GROWTH FUNDS
TAXES
- --------------------------------------------------------------------------------
GENERAL
Each Fund is treated as a separate corporation for federal income purposes. In
order to continue to qualify for treatment as a regulated investment company
("RIC") under the Internal Revenue Code of 1986, as amended ("Code"), each Fund
must distribute to its shareholders for each taxable year at least 90% of its
investment company taxable income (consisting generally of net investment
income, net short-term capital gain and net gains from certain foreign currency
transactions) ("Distribution Requirement") and must meet several additional
requirements. With respect to each Fund, these requirements include the
following: (1) the Fund must derive at least 90% of its gross income each
taxable year from dividends, interest, payments with respect to securities loans
and gains from the sale or other disposition of securities or foreign
currencies, or other income (including gains from options, Futures or Forward
Contracts) derived with respect to its business of investing in securities or
those currencies ("Income Requirement"); (2) the Fund must derive less than 30%
of its gross income each taxable year from the sale or other disposition of
securities, or any of the following, that were held for less than three
months--options or Futures (other than those on foreign currencies), or foreign
currencies (or options, Futures or Forward Contracts thereon) that are not
directly related to the Fund's principal business of investing in securities (or
options and Futures with respect to securities) ("Short-Short Limitation"); (3)
at the close of each quarter of the Fund's taxable year, at least 50% of the
value of its total assets must be represented by cash and cash items, U.S.
government securities, securities of other RICs and other securities, with these
other securities limited, with respect to any one issuer, to an amount that does
not exceed 5% of the value of the Fund's total assets and that does not
represent more than 10% of the issuer's outstanding voting securities; and (4)
at the close of each quarter of the Fund's taxable year, not more than 25% of
the value of its total assets may be invested in securities (other than U.S.
government securities or the securities of other RICs) of any one issuer.
Dividends and other distributions declared by a Fund in, and payable to
shareholders of record as of a date in, October, November or December of any
year will be deemed to have been paid by the Fund and received by the
shareholders on December 31 of that year if the distributions are paid by the
Fund during the following January. Accordingly, those distributions will be
taxed to shareholders for the year in which that December 31 falls.
A portion of the dividends from a Fund's investment company taxable income
(whether paid in cash or reinvested in additional shares) may be eligible for
the dividends-received deduction allowed to corporations. The eligible portion
may not exceed the aggregate dividends received by a Fund from U.S.
corporations. However, dividends received by a corporate shareholder and
deducted by it pursuant to the dividends-received deduction are subject
indirectly to the alternative minimum tax.
If Fund shares are sold at a loss after being held for six months or less, the
loss will be treated as long-term, instead of short-term, capital loss to the
extent of any capital gain distributions received on those shares. Investors
also should be aware that if shares are purchased shortly before the record date
for any dividend or other distribution, the shareholder will pay full price for
the shares and receive some portion of the price back as a taxable distribution.
Each Fund will be subject to a nondeductible 4% excise tax ("Excise Tax") to the
extent it fails to distribute by the end of any calendar year substantially all
of its ordinary income for that year and capital gain net income for the
one-year period ending on October 31 of that year, plus certain other amounts.
FOREIGN TAXES
Dividends and interest received by a Fund may be subject to income, withholding
or other taxes imposed by foreign countries that would reduce the yield on its
securities. Tax conventions between certain countries and the United States may
reduce or eliminate these foreign taxes, however, and many foreign countries do
not impose taxes on capital gains in respect of investments by foreign
investors. If more than 50% of the value of a Fund's total assets at the close
of its taxable year consists of securities of foreign corporations, the Fund
will be eligible to, and may, file an election with the Internal Revenue Service
that will enable its shareholders, in effect, to receive the benefit of the
foreign tax credit with respect to any foreign income taxes paid by it. Pursuant
to the election, a Fund will treat those taxes as dividends paid to its
shareholders and each shareholder will be required to (1) include in gross
income, and treat as paid by him, his
Statement of Additional Information Page 27
<PAGE>
G.T. GLOBAL GROWTH FUNDS
proportionate share of those taxes, (2) treat his share of those taxes and of
any dividend paid by the Fund that represents income from foreign sources as his
own income from those sources, and (3) either deduct the taxes deemed paid by
him in computing his taxable income or, alternatively, use the foregoing
information in calculating the foreign tax credit against his federal income
tax. Each Fund will report to its shareholders shortly after each taxable year
their respective shares of the Fund's income from sources within, and taxes paid
to, foreign countries if it makes this election.
PASSIVE FOREIGN INVESTMENT COMPANIES
Each Fund (other than the America Fund) may invest in the stock of "passive
foreign investment companies" ("PFICs"). A PFIC is a foreign corporation that,
in general, meets either of the following tests: (1) at least 75% of its gross
income is passive or (2) an average of at least 50% of its assets produce, or
are held for the production of, passive income. Under certain circumstances, a
Fund will be subject to federal income tax on a portion of any "excess
distribution" received on, or of any gain from disposition of, stock of a PFIC
(collectively "PFIC income"), plus interest thereon, even if the Fund
distributes the PFIC income as a taxable dividend to its shareholders. The
balance of the PFIC income will be included in the Fund's investment company
taxable income and, accordingly, will not be taxable to the Fund to the extent
that income is distributed to its shareholders.
If a Fund invests in a PFIC and elects to treat the PFIC as a "qualified
electing fund" ("QEF"), then in lieu of the foregoing tax and interest
obligation, the Fund will be required to include in income each year its pro
rata share of the QEF's annual ordinary earnings and net capital gain (the
excess of net long-term capital gain over net short-term capital loss) -- which
most likely would have to be distributed to satisfy the Distribution Requirement
and to avoid imposition of the Excise Tax -- even if those earnings and gain
were not received by the Fund. In most instances, it will be very difficult, if
not impossible, to make this election because of certain requirements thereof.
The "Tax Simplification and Technical Corrections Bill of 1993," passed in May
1994 by the House of Representatives, would substantially modify the taxation of
U.S. shareholders of foreign corporations, including eliminating the provisions
described above dealing with PFICs and replacing them (and other provisions)
with a regulatory scheme involving entities called "passive foreign
corporations." Three similar bills were passed by Congress in 1991 and 1992 and
vetoed. It is unclear at this time whether, and in what form, the proposed
modifications may be enacted into law.
Pursuant to proposed regulations, open-end RICs, such as the Funds, would be
entitled to elect to "mark-to-market" their stock in certain PFICs.
"Marking-to-market," in this context, means recognizing as gain for each taxable
year the excess, as of the end of that year, of the fair market value of each
such PFIC's stock over the adjusted basis in that stock (including
mark-to-market gain for each prior year for which an election was in effect).
NON-U.S. SHAREHOLDERS
Dividends paid by a Fund to a shareholder who, as to the United States, is a
nonresident alien individual, nonresident alien fiduciary of a trust or estate,
foreign corporation or foreign partnership ("foreign shareholder") will be
subject to U.S. withholding tax (at a rate of 30% or lower treaty rate).
Withholding will not apply if a dividend paid by a Fund to a foreign shareholder
is "effectively connected with the conduct of a U.S. trade or business," in
which case the reporting and withholding requirements applicable to domestic
shareholders will apply. Distributions of net capital gain are not subject to
withholding, but in the case of a foreign shareholder who is a nonresident alien
individual, such distributions ordinarily will be subject to U.S. income tax at
a rate of 30% (or lower treaty rate) if the individual is physically present in
the United States for more than 182 days during the taxable year and the
distributions are attributable to a fixed place of business maintained by the
individual in the United States.
OPTIONS, FUTURES AND FOREIGN CURRENCY TRANSACTIONS
The use of hedging transactions, such as selling (writing) and purchasing
options and Futures Contracts and entering into Forward Contracts, involves
complex rules that will determine, for federal income tax purposes, the
character and timing of recognition of the gains and losses a Fund realizes in
connection therewith. Income from foreign currencies (except certain gains
therefrom that may be excluded by future regulations), and income from
transactions in options, Futures and Forward Contracts derived by a Fund with
respect to its business of investing in securities or foreign currencies, will
qualify as permissible income under the Income Requirement. However, income from
the disposition by a Fund of options and Futures (other than those on foreign
currencies) will be subject to the Short-Short Limitation if they are held for
less than three months. Income from the disposition by a Fund of foreign
currencies, and options, Futures and Forward Contracts on foreign currencies,
that are not directly related to the Fund's principal business of investing in
securities (or options and Futures with respect thereto) also will be subject to
the Short-Short Limitation if they are held for less than three months.
If a Fund satisfies certain requirements, any increase in value of a position
that is part of a "designated hedge" will be offset by any decrease in value
(whether realized or not) of the offsetting hedging position during the period
of the hedge for
Statement of Additional Information Page 28
<PAGE>
G.T. GLOBAL GROWTH FUNDS
purposes of determining whether the Fund satisfies the Short-Short Limitation.
Thus, only the net gain (if any) from the designated hedge will be included in
gross income for purposes of that limitation. Each Fund intends that, when it
engages in hedging transactions, it will qualify for this treatment, but at the
present time it is not clear whether this treatment will be available for all
those transactions. To the extent this treatment is not available, a Fund may be
forced to defer the closing out of certain options, Future, Forward Contracts or
foreign currency positions beyond the time when it otherwise would be
advantageous to do so, in order for the Fund to continue to qualify as a RIC.
Futures and Forward Contracts that are subject to section 1256 of the Code
(other than those that are part of a "mixed straddle") ("Section 1256
Contracts") and that are held by a Fund at the end of its taxable year generally
will be deemed to have been sold at market value for federal income tax
purposes. Sixty percent of any net gain or loss recognized on these deemed
sales, and 60% of any net realized gain or loss from any actual sales of Section
1256 Contracts, will be treated as long-term capital gain or loss, and the
balance will be treated as short-term capital gain or loss. Section 988 of the
Code also may apply to gains and losses from transactions in foreign currencies,
foreign-currency-denominated debt securities and options, Futures and Forward
Contracts on foreign currencies. Each section 988 gain or loss generally is
computed separately and treated as ordinary income or loss. In the case of
overlap between sections 1256 and 988, special provisions determine the
character and timing of any income, gain or loss. Each Fund attempts to monitor
section 988 transactions to minimize any adverse tax impact.
The foregoing is a general and abbreviated summary of certain federal income tax
considerations affecting the Funds and their shareholders. Investors are urged
to consult their own tax advisers for more detailed information and for
information regarding any foreign, state and local taxes applicable to
distributions received from a Fund.
Statement of Additional Information Page 29
<PAGE>
G.T. GLOBAL GROWTH FUNDS
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
BIL GT GROUP
Other subsidiaries of the BIL GT Group include the Bank in Liechtenstein AG, an
international financial services institution founded in 1920, with over $17
billion in assets under administration and principal offices in Vaduz,
Liechtenstein, Bank of Liechtenstein (Frankfurt) GmbH, and Bilfinanz und
Verwaltung AG located in Zurich, Switzerland. In total, BIL GT Group encompasses
over $43 billion in assets under management and administration.
CUSTODIAN
State Street Bank and Trust Company ("State Street"), 225 Franklin Street,
Boston, Massachusetts 02110, acts as custodian of the Funds' assets. State
Street is authorized to establish and has established separate accounts in
foreign currencies and to cause securities of the Company to be held in separate
accounts outside the United States in the custody of non-U.S. banks.
INDEPENDENT ACCOUNTANTS
The Company's and the Funds' independent accountants are Coopers & Lybrand,
L.L.P., One Post Office Square, Boston, Massachusetts 02109. Coopers & Lybrand,
L.L.P., conducts annual audits of the Funds, assists in the preparation of the
Funds' federal and state income tax returns and consults with the Company and
the Funds as to matters of accounting,
regulatory filings and federal and state income taxation.
The audited financial statements of the Company included in this Statement of
Additional Information have been examined by Coopers & Lybrand, L.L.P., as
stated in their opinion appearing herein and are included in reliance upon such
opinion given upon the authority of said firm as experts in accounting and
auditing.
USE OF NAME
G.T. Capital has granted the Company the right to use the "G.T." name and has
reserved the right to withdraw its consent to the use of such name by the
Company and/or any of the Funds at any time, or to grant the use of such name to
any other company.
SHAREHOLDER LIABILITY
Under certain circumstances, shareholders of a Fund may be held personally
liable for the obligations of the Fund. The Company's Declaration of Trust
provides that shareholders shall not be subject to any personal liability for
the acts or obligations of a Fund or the Company and that every written
agreement, obligation or other undertaking made or issued by a Fund or the
Company shall contain a provision to the effect that shareholders are not
personally liable thereunder. The Declaration of Trust provides for
indemnification out of the Company's assets under certain circumstances, and
further provides that the Company shall, upon request, assume the defense of any
act or obligation of a Fund or the Company and that the Fund in which the
shareholder holds shares will indemnify the shareholder for all legal and other
expenses incurred therewith. Thus, the risk of any shareholder's incurring
financial loss beyond his or her investment, because of this theoretical
shareholder liability, is limited to circumstances in which the Fund or the
Company itself would be unable to meet its obligations.
Statement of Additional Information Page 30
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INVESTMENT RESULTS
- --------------------------------------------------------------------------------
A Fund's "Standardized Return", as referred to in the Prospectus (see "Other
Information -- Performance Information" in the Prospectus), is calculated
separately for Class A, Class B and Advisor Class shares of each Fund as
follows: Standardized Return ("T") is computed by using the value at the end of
the period ("EV") of a hypothetical initial investment of $1,000 ("P") over a
period of years ("n") according to the following formula as required by the
Securities and Exchange Commission: P(1+T) to the (n)th power = EV. The
following assumptions will be reflected in computations made in accordance with
this formula: (1) for Class A shares deduction of the maximum sales charge of
4.75% from the $1,000 initial investment; (2) for Class B shares, deduction of
the applicable contingent deferred sales charge imposed on a redemption of Class
B shares held for the period; (3) reinvestment of dividends and distributions at
net asset value on the reinvestment date determined by the Board; and (4) a
complete redemption at the end of any period illustrated.
The Standardized Returns of the Funds' Class A shares, stated as average
annualized total returns, for the periods indicated were as follows:
AMERICA FUND
-- For the year ended December 31, 1994: 10.19%
-- For the five years ended December 31, 1994: 11.68%
-- For the period June 9, 1987 (commencement of operations)
through December 31, 1994: 13.22%
EUROPE FUND
-- For the year ended December 31, 1994: -10.28%
-- For the five years ended December 31, 1994: -1.89%
-- For the period July 19, 1985 (commencement of operations)
through December 31, 1994: 11.97%
INTERNATIONAL FUND
-- For the year ended December 31, 1994: -12.16%
-- For the five years ended December 31, 1994: 1.50%
-- For the period July 19, 1985 (commencement of operations)
through December 31, 1994: 14.59%
JAPAN FUND
-- For the year ended December 31, 1994: 1.50%
-- For the five years ended December 31, 1994: -5.93%
-- For the period July 19, 1985 (commencement of operations)
through December 31, 1994: 16.93%
PACIFIC FUND
-- For the year ended December 31, 1994: -23.54%
-- For the five years ended December 31, 1994: 2.62%
-- For the ten years ended December 31, 1994: 15.09%
-- For the period January 19, 1977 (commencement of operations)
through December 31, 1994: 13.47%
Statement of Additional Information Page 31
<PAGE>
G.T. GLOBAL GROWTH FUNDS
WORLDWIDE FUND
-- For the year ended December 31, 1994: -11.09%
-- For the five years ended December 31, 1994: 4.26%
-- For the period June 9, 1987 (commencement of operations)
through December 31, 1994: 7.62%
The Standardized Returns of the Fund's Class A shares, stated as aggregate total
return, for the periods from the commencement of each Fund's operations through
December 31, 1994, were as follows:
AMERICA FUND
-- From inception on June 9, 1987: 155.81%
EUROPE FUND
-- From inception on July 19, 1985: 191.29%
INTERNATIONAL FUND
-- From inception on July 19, 1985: 262.56%
JAPAN FUND
-- From inception on July 19, 1985: 338.91%
PACIFIC FUND
-- From inception on January 19, 1977: 866.98%
WORLDWIDE FUND
-- From inception on June 9, 1987: 74.30%
The Standardized Returns of the Fund's Class B shares, which were first offered
on April 1, 1993, stated as average annualized total returns, for the periods
indicated, were as follows:
AMERICA FUND
-- For the year ended December 31, 1994: 10.06%
-- For the period April 1, 1993 through December 31, 1994: 15.94%
EUROPE FUND
-- For the year ended December 31, 1994: -11.00%
-- For the period April 1, 1993 through December 31, 1994: 4.94%
INTERNATIONAL FUND
-- For the year ended December 31, 1994: -12.49%
-- For the period April 1, 1993 through December 31, 1994: 6.21%
JAPAN FUND
-- For the year ended December 31, 1994: 0.81%
-- For the period April 1, 1993 through December 31, 1994: 11.13%
PACIFIC FUND
-- For the year ended December 31, 1994: -24.09%
-- For the period April 1, 1993 through December 31, 1994: 7.01%
WORLDWIDE FUND
-- For the year ended December 31, 1994: -11.73%
-- For the period April 1, 1993 through December 31, 1994: 2.71%
The Standardized Returns for the Funds' Class B shares, which were first offered
on April 1, 1993, stated as aggregate total return, for the period April 1, 1993
through December 31, 1994, were as follows:
AMERICA FUND
-- For the period April 1, 1993 through December 31, 1994: 29.56%
EUROPE FUND
-- For the period April 1, 1993 through December 31, 1994: 8.81%
Statement of Additional Information Page 32
<PAGE>
G.T. GLOBAL GROWTH FUNDS
INTERNATIONAL FUND
-- For the period April 1, 1993 through December 31, 1994: 11.13%
JAPAN FUND
-- For the period April 1, 1993 through December 31, 1994: 20.28%
PACIFIC FUND
-- For the period April 1, 1993 through December 31, 1994: 12.60%
WORLDWIDE FUND
-- For the period April 1, 1993 through December 31, 1994: 4.79%
Performance of the Funds is historical and does not necessarily indicate future
results. The Funds operated in prior periods under different investment policies
and limitations including different Primary Investment Areas. For example in
January, 1994 Japan was eliminated from the Primary Investment Area of the
Pacific Fund. Such policies, limitations and Primary Investment Areas may change
in the future.
As discussed in the Prospectus, each Fund may quote Non-Standardized Total
Returns that do not reflect the effect of sales charges. Non-Standardized
Returns may be quoted for the same or different time periods for which
Standardized Returns are quoted. The Non-Standardized Returns for the Funds'
Class A shares, quoted as average annual returns and as aggregate total returns,
for the periods from the commencement of each Fund's operations through December
31, 1994, were as follows:
<TABLE>
<CAPTION>
AVERAGE
ANNUAL AGGREGATE
RETURN RETURN
---------- ----------
<S> <C> <C>
America Fund -- from inception on June 9, 1987: 13.95 % 168.57 %
Europe Fund -- from inception on July 19, 1985: 12.55 % 205.81 %
International Fund -- from inception on July 19, 1985: 15.18 % 280.64 %
Japan Fund -- from inception on July 19, 1985: 17.63 % 360.79 %
New Pacific Fund -- from inception on January 19, 1977: 13.78 % 915.21 %
Worldwide Fund -- from inception on June 9, 1987: 8.31 % 82.99 %
</TABLE>
The Non-Standardized Returns for the Funds' Class B shares, which were first
offered on April 1, 1993, quoted as average annual returns and aggregate total
return, for the period April 1, 1993, through December 31, 1994, were as
follows:
<TABLE>
<CAPTION>
AVERAGE ANNUAL RETURN AGGREGATE RETURN
----------------------- -------------------
<S> <C> <C>
AMERICA FUND 17.97% 35.56%
EUROPE FUND 7.13% 12.81%
INTERNATIONAL FUND 8.38% 15.13%
JAPAN FUND 13.22% 24.28%
PACIFIC FUND 9.17% 16.60%
WORLDWIDE FUND 4.88% 8.70%
</TABLE>
Standardized Returns and Non-Standardized Returns are not presented for the
Advisor Class shares because no shares of that class were outstanding during
fiscal year ended December 31, 1994.
Each Fund's investment results will vary from time to time depending upon market
conditions, the composition of the Fund's portfolio and operating expenses of a
Fund, so that current or past yield or total return should not be considered
representative of what an investment in a Fund may earn in any future period.
These factors and possible differences in the methods used in calculating
investment results should be considered when comparing a Fund's investment
results with those published for other investment companies and other investment
vehicles. A Fund's results also should be considered relative to the risks
associated with such Fund's investment objective and policies. A Fund will
include performance data for all classes of shares of that Fund in any
advertisement or information including performance data for the Fund.
In advertising and sales materials, G.T. Global may make reference to or discuss
its products, services and accomplishments. Among these accomplishments are that
in 1983 G.T. Global provided assistance to the government of Hong Kong in
linking its currency to the U.S. dollar, and that in 1987 Japan's Ministry of
Finance licensed G.T. Management (Japan) Ltd. as one of the first foreign
discretionary investment managers for Japanese investors. Such accomplishments,
however, should not be viewed as an endorsement of G.T. Global by the government
of Hong Kong, Japan's Ministry of Finance or
Statement of Additional Information Page 33
<PAGE>
G.T. GLOBAL GROWTH FUNDS
any other government or government agency. Nor do any such accomplishments of
G.T. Global provide any assurance that the G.T. Global Mutual Funds' investment
objectives will be achieved.
IMPORTANT POINTS TO NOTE ABOUT THE FOLLOWING WORLD FINANCIAL AND ECONOMIC DATA
The following information is based on sources believed to be reliable, but which
may be subject to revision and which has not been independently verified by the
Company or G.T. Global. The authors and publishers of such material are not to
be considered as "experts" under the Securities Act of 1933, on account of the
inclusion of such information herein.
A portion of the performance figures for each market includes the positive or
negative effects of the currency exchange rates effective at December 31 of each
year between the U.S. dollar and currency of the foreign market (e.g. Japanese
Yen, German Deutschemark, Hong Kong Dollar). A foreign currency which has
strengthened or weakened against the U.S. dollar will positively or negatively
affect the reported returns, as the case may be.
G.T. Global believes that this information may be useful to investors
considering whether and to what extent to diversify their investments through
the purchase of mutual funds investing in securities on a global basis. However,
this data is not a representation of the past performance of any of these Funds,
nor is it a prediction of such performance. The performance of the Funds will
differ from the historical performance of the indices represented above. The
performance of indices does not take expenses into account, while each Fund
incurs expenses in its operations, which will reduce performance. Each Fund is
actively managed, I.E., G.T. Capital, as each Fund's investment manager,
actively purchases and sells securities in seeking each Fund's investment
objective. Moreover, each Fund may invest a portion of its assets in corporate
bonds, while the below data relates only to government bonds. Each of these
factors will cause the performance of each Fund to differ from the indices shown
below.
Each Fund and G.T. Global may from time to time compare the Fund with the
following:
(1) The Salomon Brothers Non-U.S. Dollars Indices, which are measures of
the total return performance of high quality non-U.S. dollar denominated
securities in major sectors of the worldwide bond markets.
(2) The Shearson Lehman Hutton Government/Corporate Bond Index, which is
a comprehensive measure of all public obligations of the U.S. Treasury
(excluding flower bonds and foreign targeted issues), all publicly issued
debt of agencies of the U.S. Government (excluding mortgage backed
securities), and all public, fixed rate, non-convertible investment grade
domestic corporate debt rated at least Baa by Moody's Investors Service,
Inc. or BBB by Standard and Poor's Ratings Group, or, in the case of
nonrated bonds, BBB by Fitch Investors Service (excluding Collateralized
Mortgage Obligations).
(3) The Consumer Price Index, which is a measure of the average change
in prices over time in a fixed market basket of goods and services (e.g.,
food, clothing, shelter, fuels, transportation fares, charges for doctors'
and dentists' services, prescription medicines, and other goods and services
that people buy for day-to-day living). There is inflation risk which does
not affect a security's value but its purchasing power i.e. the risk of
changing price levels in the economy that affects security prices or the
price of goods and services.
(4) Data and mutual fund rankings published or prepared by Lipper
Analytical Data Services, Inc. ("Lipper"), CDA/Wiesenberger Investment
Company Services ("CDA/Wiesenberger"), Morningstar, Inc. and/or other
companies that rank and/or compare mutual funds by overall performance,
investment objectives, assets, expense levels, periods of existence and/or
other factors. In this regard each Fund may be compared to the Fund's "peer
group" as defined by Lipper, CDA/Wiesenberger, Morningstar and/or other
firms, as applicable, or to specific funds or groups of funds within or
without such peer group. Lipper generally ranks funds on the basis of total
return, assuming reinvestment of distributions, but does not take sales
charges or redemption fees into consideration, and is prepared without
regard to tax consequences. In addition to the mutual fund rankings, the
Fund's performance may be compared to mutual fund performance indices
prepared by Lipper. Morningstar is a mutual fund rating service that also
rates mutual funds on the basis of risk-adjusted performance. Morningstar
ratings are calculated from a fund's three, five and ten year average annual
returns with appropriate fee adjustments and a risk factor that reflects
fund performance relative to the three-month U.S. Treasury bill monthly
returns. Ten percent of the funds in an investment category receive five
stars and 22.5% receive four stars. The ratings are subject to change each
month.
(5) Bear Stearns Foreign Bond Index, which provides simple average
returns for individual countries and GNP-weighted index, beginning in 1975.
The returns are broken down by local market and currency.
(6) Ibbottson Associates International Bond Index, which provides a
detailed breakdown of local market and currency returns since 1960.
Statement of Additional Information Page 34
<PAGE>
G.T. GLOBAL GROWTH FUNDS
(7) Standard & Poor's 500 Composite Stock Price Index which is a widely
recognized index composed of the capitalization-weighted average of the
price of 500 of the largest publicly traded stocks in the U.S.
(8) Salomon Brothers Broad Investment Grade Index which is a widely used
index composed of U.S. domestic government, corporate and mortgage-backed
fixed income securities.
(9) Dow Jones Industrial Average.
(10) CNBC/Financial News Composite Index.
(11) Morgan Stanley Capital International World Indices, including, among
others, the Morgan Stanley Capital International Europe, Australia, Far East
Index ("EAFE Index"). The EAFE index is an unmanaged index of more than
1,000 companies of Europe, Australia and the Far East.
(12) Salomon Brothers World Government Bond Index and Salomon Brothers
World Government Bond Index-Non-U.S. are each a widely used index composed
of world government bonds.
(13) The World Bank Publication of Trends in Developing Countries (TIDE).
TIDE provides brief reports on most of the World Bank's borrowing members.
The World Development Report is published annually and looks at global and
regional economic trends and their implications for the developing
economies.
(14) Salomon Brothers Global Telecommunications Index is composed of
telecommunications companies in the developing and emerging countries.
(15) Datastream and Worldscope each is an on-line database retrieval
service for information including, but not limited to, international
financial and economic data.
(16) International Financial Statistics, which is produced by the
International Monetary Fund.
(17) Various publications and annual reports, produced by the World Bank
and its affiliates.
(18) Various publications from the International Bank for Reconstruction
and Development.
(19) Various publications including, but not limited to ratings agencies
such as Moody's Investors Service, Fitch Investors Service, Standard &
Poor's Ratings Group.
(20) Wilshire Associates which is an on-line database for international
financial and economic data including performance measure for a wide range
of securities.
(21) Bank Rate National Monitor Index, which is an average of the quoted
rates for 100 leading banks and thrifts in ten U.S. cities.
(22) International Finance Corporation (IFC) Emerging Markets Data Base
which provides detailed statistics on stock and bond markets in developing
countries.
(23) Various publications from the Organization for Economic Cooperation
and Development (OECD).
(24) Average of Savings Accounts, which is a measure of all kinds of
savings deposits, including longer-term certificates (based on figures
supplied by the U.S. League of Savings Institutions). Savings accounts offer
a guaranteed rate of return on principal, but no opportunity for capital
growth. During a portion of the period, the maximum rates paid on some
savings deposits were fixed by law.
Indices, economic and financial data prepared by the research departments of
such financial organizations as Salomon Brothers, Inc., Lehman Brothers, Merrill
Lynch, Pierce, Fenner & Smith, Inc., J. P. Morgan, Morgan Stanley, Smith Barney
Shearson, S.G. Warburg, Jardine Flemming, Barings Securities, The Bank for
International Settlements, Asian Development Bank, Bloomberg, L.P., and
Ibbottson Associates may be used, as well as information reported by the Federal
Reserve and the respective Central Banks of various nations. In addition, G.T.
Global may use performance rankings, ratings and commentary reported
periodically in national financial publications, including but not limited to
Money Magazine, Smart Money, Global Finance, EuroMoney, Financial World, Forbes,
Fortune, Business Week, Latin Finance, the Wall Street Journal, Emerging Markets
Weekly, Kiplinger's Guide To Personal Finance, Barron's, The Financial Times,
USA Today, The New York Times, Far Eastern Economic Review, The Economist and
Investors Business Digest. Each Fund may compare its performance to that of
other compilations or indices of comparable quality to those listed above and
other indices which may be developed and made available in the future.
Statement of Additional Information Page 35
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may refer to the number of
shareholders in the Funds or the aggregate number of shareholders in all G.T.
Global Mutual Funds or the dollar amount of each Fund's assets under management
in advertising materials.
G.T. Global believes each Fund is an appropriate investment for long-term
investment goals including, but not limited to funding retirement, paying for
education or purchasing a house. G.T. Global may provide information designed to
help individuals understand their investment goals and explore various financial
strategies. For example, G.T. Global may describe general principles of
investing, such as asset allocation, diversification and risk tolerance. Each
Fund does not represent a complete investment program and the investors should
consider each Fund as appropriate for a portion of their overall investment
portfolio with regard to their long-term investment goals. There is no assurance
that any such information will lead to achieving these goals or guarantee future
results.
From time to time, G.T. Global may refer to or advertise the names of such
companies, or their products although there can be no assurance that any G.T.
Global Mutual Fund may own the securities of these companies.
Ibbotson Associates of Chicago, Illinois (Ibbotson) provides historical returns
of the capital markets in the United States, including common stocks, small
capitalization stocks, long-term corporate bonds, intermediate-term government
bonds, long-term government bonds, Treasury bills, the U.S. rate of inflation
(based on the CPI), and combinations of various capital markets. The performance
of these capital markets are based on the returns of different indices.
G.T. Global Funds may use the performance of these capital markets in order to
demonstrate general risk-versus-reward investment scenarios. Performance
comparisons may also include the value of a hypothetical investment in any of
these capital markets. The risks associated with the security types in any
capital market may or may not correspond directly to those of the funds.
Ibbotson calculates total returns in the same method as the funds. The funds may
also compare performance to that of other compilations or indices that may be
developed and made available in the future.
Each Fund may quote various measures of volatility and benchmark correlation
such as beta, standard deviation and R(2) in advertising. In addition, each Fund
may compare these measures to those of other funds. Measures of volatility seek
to compare each Fund's historical share price fluctuations or total returns
compared to those of a benchmark. All measures of volatility and correlation are
calculated using averages of historical data.
Each Fund may advertise examples of the effects of periodic investment plans,
including the principle of dollar cost averaging programs. In such a program, an
investor invests a fixed dollar amount in a fund at periodic intervals, thereby
purchasing fewer shares when prices are high and more shares when prices are
low. While such a strategy does not assure a profit or guard against loss in a
declining market, the investor's average cost per share can be lower than if
fixed numbers of shares are purchased at the same intervals. In evaluating such
a plan, investors should consider their ability to continue purchasing shares
through periods of low price levels.
Each Fund may be available for purchase through retirement plans or other
programs offering deferral of or exemption from income taxes, which may produce
superior after tax returns over time. For example, a $10,000 investment earning
a taxable return of 10% annually would have an after-tax value of $17,976 after
ten years, assuming tax was deducted from the return each year at a 39.6% rate.
An equivalent tax-deferred investment would have an after-tax value of $19,626
after ten years, assuming tax was deducted at a 39.6% rate from the deferred
earnings at the end of the ten-year period.
Each Fund may describe in its sales material and advertisements how an investor
may invest in the G.T. Global Funds through various retirement plans that offer
deferral of income taxes on investment earnings and may also enable an investor
to make pre-tax contributions. Because of their advantages, these retirement
plans may produce returns superior to comparable non-retirement investments. The
Funds may also discuss these plans, which include:
INDIVIDUAL RETIREMENT ACCOUNTS (IRAS): Any individual who receives earned income
from employment (including self-employment) can contribute up to $2,000 each
year to an IRA (or if less, 100% of compensation). If your spouse is not
employed, a total of $2,250 may be contributed each year to IRAs set up for you
and your spouse (subject to the maximum of $2,000 to either IRA). Some
individuals may be able to take an income tax deduction for the contribution.
Regular contributions may not be made for the year you become 70 1/2, or
thereafter. Please consult your tax advisor for more information.
ROLLOVER IRAS: Individuals who receive distributions from qualified retirement
plans (other than required distributions) and who wish to keep their savings
growing tax-deferred can rollover (or make a direct transfer of) their
distribution to a Rollover IRA. These accounts can also receive rollovers or
transfers from an existing IRA. If an "eligible roll-over distribution" from a
qualified employer-sponsored retirement plan is not directly rolled over to an
IRA (or certain qualified plans), withholding at the rate of 20% will be
required for federal income tax purposes. A distribution from a
Statement of Additional Information Page 36
<PAGE>
G.T. GLOBAL GROWTH FUNDS
qualified plan that is not an "eligible rollover distribution," including a
distribution that is one of a series of substantially equal periodic payments,
generally is subject to regular wage withholding or withholding at the rate of
10% (depending on the type and amount of the distribution), unless you elect not
to have any withholding apply. Please consult your tax advisor for more
information.
SEP-IRAS AND SALARY-REDUCTION SEP-IRAS: Simplified employee pension (SEP) plans
and salary-reduction SEPs provide self-employed individuals (and any eligible
employees) with benefits similar to Keogh-type plans or 401(k) plans, but with
fewer administrative requirements and therefore potential lower annual
administration expenses.
403(B)(7) CUSTODIAL ACCOUNTS: Employees of public schools and most other
not-for-profit organizations can make pre-tax salary reduction contributions to
these accounts.
PROFIT-SHARING (INCLUDING 401(K)) AND MONEY PURCHASE PENSION PLANS: Corporations
can sponsor these qualified defined contribution plans for their employees. A
401(k) plan, a type of profit-sharing plan, additionally permits the eligible,
participating employees to make pre-tax salary reduction contributions to the
plan (up to certain limitations).
G.T. Global may from time to time in its sales materials and advertising discuss
the risks inherent in investing. The major types of investment risk are market
risk, industry risk, credit risk, interest rate risk and inflation risk. Risk
represents the possibility that you may lose some or all of your investment over
a period of time. A basic tenet of investing is the greater the potential
reward, the greater the risk.
From time to time, the Funds and G.T. Global will quote information including
but not limited to data regarding: individual countries, regions, world stock
exchanges, and economic and demographic statistics from sources G.T. Global
deems reliable including but not limited to the economic and financial data of
the referenced financial organizations such as:
1) Stock market capitalization: Morgan Stanley Capital International World
Indices, International Finance Corporation and Datastream.
2) Stock market trading volume: Morgan Stanley Capital International World
Indices, International Finance Corporation.
3) The number of listed companies: International Finance Corporation, G.T.
Guide to World Equity Markets, Salomon Brothers, Inc., S.G. Warburg and
Barings Securities.
4) Wage rates: U.S. Department of Labor Statistics and Morgan Stanley Capital
International World Indices.
5) International industry performance: Morgan Stanley Capital International
World Indices, Wilshire Associates and Salomon Brothers, Inc.
6) Stock market performance: Morgan Stanley Capital International World
Indices, International Finance Corporation and Datastream.
7) The Consumer Price Index and inflation rate: The World Bank, Datastream and
International Finance Corporation.
8) Gross Domestic Product (GDP): Datastream and The World Bank.
9) GDP growth rate: International Finance Corporation, The World Bank and
Datastream.
10) Population: The World Bank, Datastream and United Nations.
11) Average annual growth rate (%) of population: The World Bank, Datastream and
United Nations.
12) Age distribution within populations: Organization for Economic Cooperation
and Development and United Nations.
13) Total exports and imports by year: International Finance Corporation, The
World Bank and Datastream.
14) Top three companies by country or market: International Finance Corporation,
G.T. Guide to World Equity Markets, Salomon Brothers Inc., S.G. Warburg and
Barings Securities.
15) Foreign direct investments to developing countries: The World Bank and
Datastream.
16) Supply, consumption, demand and growth in demand of certain products,
services and industries, including, but not limited to electricity, water,
transportation, construction materials, natural resources, financial
services, health care services and supplies, consumer products and services
and telecommunications equipment and services (sources of such information
may include, but would not be limited to, The World Bank, OECD, IMF,
Bloomberg and Datastream).
From time to time, G.T. Global may include in its advertisement and sales
material, information about privatization which is an economic process involving
the sale of state-owned companies to the private sector.
Statement of Additional Information Page 37
<PAGE>
G.T. GLOBAL GROWTH FUNDS
In advertising and sales materials, G.T. Global may make reference to or discuss
its products, services and accomplishments. Among these accomplishments are that
in 1983 G.T. Global provided assistance to the government of Hong Kong in
linking its currency to the U.S. dollar, and that in 1987 Japan's Ministry of
Finance licensed G.T. Management (Japan) Ltd. as one of the first foreign
discretionary investment managers for Japanese investors. Such accomplishments,
however, should not be viewed as an endorsement of G.T. Global by the government
of Hong Kong, Japan's Ministry of Finance or any other government or government
agency. Nor do any such accomplishments of G.T. Global provide any assurance
that the G.T. Global Mutual Fund's investment objectives will be achieved.
THE G.T. ADVANTAGE
G.T. Capital has developed a unique team approach to its global money management
which we call the G.T. Advantage. G.T Capital's money management style combines
the best of the "top-down" and "bottom-up" investment manager strategies. The
top-down approach is implemented by G.T. Capital's Investment Policy Committee,
which sets broad guidelines for asset allocation and currency management, based
on G.T. Capital's own macroeconomic forecasts and research from our worldwide
offices. The bottom-up approach utilizes regional teams of individual portfolio
managers to implement the committee's guidelines by selecting local securities
that offer strong growth and income potential.
Statement of Additional Information Page 38
<PAGE>
G.T. GLOBAL GROWTH FUNDS
HISTORICAL WORLD BOND PERFORMANCE
The following chart shows the yield to maturity (including interest payments and
principal repayment at par) of 10 year government bonds, as priced by Salomon
Brothers, Inc. This data is based on U.S. dollar values on December 31 of the
years shown. The actual total returns of foreign bonds held to maturity will
differ depending on exchange rates during a bond's life.
GOVERNMENT BONDS
YEAR-END YIELDS TO MATURITY
<TABLE>
<CAPTION>
U.S. Canada Germany Japan U.K. Switz.
--------- ----------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
1994............................................... 7.82 9.14 7.62 4.57 8.71 5.22
1993............................................... 6.35 6.61 5.54 3.18 6.39 4.06
1992............................................... 6.67 7.95 7.27 4.70 8.16 5.85
1991............................................... 6.70 8.26 7.92 5.51 9.80 6.30
1990............................................... 8.09 10.27 8.70 6.53 10.93 6.37
1989............................................... 7.90 9.63 7.27 5.57 10.58 5.67
1988............................................... 9.19 10.17 6.54 4.70 10.07 4.11
1987............................................... 8.86 10.09 6.56 4.90 9.65 3.74
1986............................................... 7.23 8.75 6.05 5.30 10.54 4.32
1985............................................... 9.01 9.65 6.28 6.18 10.96 4.46
<CAPTION>
Neth. France Austl.
--------- ----------- ---------
<S> <C> <C> <C>
1994............................................... 7.75 8.27 9.99
1993............................................... 5.56 5.60 6.68
1992............................................... 7.29 8.09 8.95
1991............................................... 8.33 8.40 9.35
1990............................................... 8.98 10.00 12.04
1989............................................... 7.59 8.93 12.93
1988............................................... 6.46 8.43 12.85
1987............................................... 6.74 9.82 12.84
1986............................................... 6.25 8.87 13.27
1985............................................... 6.81 10.10 14.86
</TABLE>
The following charts show total returns as of December 31 for the years 1985
through 1994, on bonds issued by various governments. All returns are calculated
in U.S. dollars and include reinvestment of gross yields, and do not assure
deduction of any withholding taxes. These charts were prepared by G.T. Capital
based on Salomon Brothers, Inc. indexes of government bonds with remaining
maturities of at least one year. The time periods shown were generally a period
of decreasing interest rates and increasing market prices for Global fixed
income securities.
GOVERNMENT BONDS
ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
AUSTRALIA BELGIUM CANADA FRANCE GERMANY ITALY JAPAN UK USA
--------- ------- ------ ------ ------- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1994...................................... 6.88% 12.22% -9.86% 4.37% 9.98% 4.57% 8.88% -1.54% -3.36%
1993...................................... 15.66% 4.00% 12.01% 13.15% 6.70% 11.08% 27.58% 19.53% 10.69%
1992...................................... -0.26% 7.64% -0.42% 4.27% 5.94% -13.88% 10.84% -4.12% 7.21%
1991...................................... 23.49% 10.89% 21.59% 12.51% 9.75% 13.24% 22.46% 12.65% 15.30%
1990...................................... 16.24% n/a 7.69% 23.52% 16.36% n/a 7.83% 30.88% 8.62%
1989...................................... 5.62% n/a 16.23% 9.14% 6.35% n/a -14.26% -3.91% 14.40%
1988...................................... 28.80% n/a 19.41% 1.63% -7.12% n/a 3.04% 2.44% 7.07%
1987...................................... 28.99% n/a 10.00% 26.58% 29.38% n/a 38.12% 46.61% 1.93%
1986...................................... 16.64% n/a 15.72% 34.09% 37.17% n/a 40.09% 14.77% 15.73%
1985...................................... -12.06% n/a 14.80% 50.51% 43.02% n/a 36.85% 40.18% 20.94%
10 Year Average Annualized Returns from 12/85-12/94
12.28% N/A 10.32% 17.10% 14.81% N/A 16.88% 14.47% 9.64%
<FN>
- --------------
Source: Salomon Brothers, Inc. Countries Identified As "N/A" Were Not Part of
the Salomon Brothers World Government Bond Index During the Years Indicated.
</TABLE>
Statement of Additional Information Page 39
<PAGE>
G.T. GLOBAL GROWTH FUNDS
EQUITY MARKET DIVERSIFICATION
As indicated by the following table, a globally diversified equity portfolio for
the ten year period ended December 31, 1994, resulted in greater return and
reduced risk (as measured by price volatility) relative to a portfolio
consisting solely of U.S. equities. The following chart was prepared by G.T.
Capital. It uses the Morgan Stanley Capital International EAFE Index as a
"proxy" for the non-North America investment universe ("Non-U.S.") and the
Standard & Poor's 500 Index as a "proxy" for the universe of U.S. stocks
("U.S."). All dividends and distributions were assumed to be reinvested. The
time period shown was generally a period of increasing market prices for global
equity securities.
EQUITY MARKET DIVERSIFICATION
10 YEARS ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
PORTFOLIO STANDARD AVERAGE ANNUAL
% NON-U.S./% U.S. DEVIATION (%) TOTAL RETURN (%)
- ------------------- --------------- -----------------
<S> <C> <C>
100/0 19.35 17.89
90/10 18.15 17.59
80/20 17.06 17.27
70/30 16.11 16.95
60/40 15.32 16.61
50/50 14.73 16.27
40/60 14.35 15.92
30/70 14.20 15.56
20/80 14.29 15.19
10/90 14.61 14.81
0/100 15.16 14.42
<FN>
- --------------
Source: Morgan Stanley Capital International (MSCI) Europe, Australia, Far East
(EAFE) Index vs. MSCI U.S. Index, December 31, 1994. Prepared by G.T. Capital
Management, Inc.
</TABLE>
Standard deviation of returns is a statistical measure of the degree to which a
value tends to vary from its average annual mean. In general, greater risk must
be assumed to generate greater returns. This data will not correspond to the
actual performance of any of the G.T. Global Mutual Funds. There is no guarantee
that stock market diversification will provide greater total return and/or less
volitility than non-diversification during a particular time.
Statement of Additional Information Page 40
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote information on stock
market capitalization and total returns for, but not limited to, the following
Morgan Stanley Capital International stock market indices:
MORGAN STANLEY CAPITAL INTERNATIONAL
INTERNATIONAL INDICES 12/31/94 (US$, GROSS DIVIDENDS REINVESTED)
<TABLE>
<CAPTION>
MARKET ANNUALIZED RETURNS (%)
CAPITALIZATION ------------------------------------
(US$BN) 1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C>
International Indices
THE WORLD............................. 7,592.9 5.58 7.42 4.24 15.51
NORTH AMERICA......................... 2,918.2 1.73 6.07 8.52 13.94
EAFE.................................. 4,661.8 8.06 8.19 1.82 17.89
EUROPE 14............................. 2,084.1 2.66 8.46 6.98 18.99
NORDIC COUNTRIES...................... 156.2 20.57 11.62 5.06 19.79
PACIFIC............................... 2,577.6 13.03 7.93 -1.62 17.06
FAR EAST.............................. 2,436.8 13.45 7.78 -2.07 17.22
Free Indices
THE WORLD FREE........................ 7,602.4 5.57 7.43 4.27
EAFE FREE............................. 4,671.3 -4.17 7.57 1.78
EUROPE 14 FREE........................ 2,080.5 -3.09 8.28 7.11
EUROPE 14 FREE EX UK.................. -0.57 10.02 6.44
NORDIC COUNTRIES FREE................. 152.6 4.91 12.16 6.51
PACIFIC FREE.......................... 2,590.0 -5.04 7.06 -1.76
PACIFIC FREE EX JAPAN................. -18.65 14.34 14.00
FAR EAST FREE......................... -4.81 6.91 -2.18
Special Areas
THE WORLD EX USA...................... 7.64 7.93 1.76 17.13
EAFE + CANADA......................... 7.65 7.89 1.76 17.29
KOKUSAI (WORLD EX JAPAN).............. 0.55 7.85 8.35 15.51
EASEA (EAFE EX JAPAN)................. -0.77 9.83 8.05 18.98
PACIFIC EX JAPAN...................... -13.99 18.42 15.31 18.80
THE WORLD EX THE UK................... 6.48 7.63 3.82 15.21
EAFE EX THE UK........................ 10.22 8.74 0.70 17.97
EUROPE 14 EX THE UK................... 1,351.6 5.27 10.22 6.08 19.87
THE WORLD EX AUSTRALIA................ 5.57 7.39 4.19 15.51
National Indices
AUSTRALIA............................. 122.8 6.48 9.48 8.37 15.98
AUSTRIA............................... 17.5 -6.05 2.74 0.40 23.31
BELGIUM............................... 48.5 9.43 10.92 7.23 24.90
CANADA................................ 168.1 -2.43 0.76 0.12 8.17
DENMARK............................... 34.4 4.25 0.09 3.17 17.17
FINLAND............................... 25.9 52.47 34.70 6.81
FINLAND FREE.......................... 25.9 52.47 33.65 7.77
FRANCE................................ 275.0 -4.70 6.20 4.23 20.83
GERMANY............................... 290.1 5.11 8.95 5.09 18.73
GREECE................................ 7.6 -0.78 -0.81 8.05
HONG KONG............................. 154.1 -28.90 26.79 27.18 26.50
IRELAND............................... 12.1 14.50 8.71 3.71
ITALY................................. 98.5 12.13 4.52 -1.54 17.14
JAPAN................................. 2,121.1 21.62 6.36 -3.43 16.86
MALAYSIA.............................. 105.3 -19.94 25.57 13.86
NETHERLANDS........................... 163.9 12.66 16.74 13.18 22.05
NEW ZEALAND........................... 18.1 10.27 23.39 7.57
NORWAY................................ 18.5 24.07 11.39 3.49 16.03
NORWAY FREE........................... 14.8 27.41 13.14 4.78
PORTUGAL.............................. 8.5 11.95 8.01 -3.48
SINGAPORE............................. 56.3 6.68 23.95 16.02 16.50
SINGAPORE FREE........................ 69.5 5.81 24.23 18.65
</TABLE>
Statement of Additional Information Page 41
<PAGE>
G.T. GLOBAL GROWTH FUNDS
<TABLE>
<CAPTION>
MARKET ANNUALIZED RETURNS (%)
CAPITALIZATION ------------------------------------
(US$BN) 1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C>
SPAIN................................. 80.0 -3.93 -0.08 0.37 20.05
SWEDEN................................ 77.4 18.80 12.22 5.37 21.43
SWEDEN FREE........................... 77.4 18.80 15.40 7.70
SWITZERLAND........................... 210.0 4.18 21.77 14.81 21.32
SWITZERLAND FREE...................... 210.0 4.18 21.97 14.85
UNITED KINGDOM........................ 732.6 -1.63 5.65 8.58 17.73
USA................................... 2,750.1 2.00 6.42 9.16 14.36
EAFE (GDP WEIGHTED)................... 8.21 9.65 3.97 19.91
EMERGING MARKETS
EMG (EMERGING MARKETS GLOBAL)......... 840.4 -1.07 20.41 9.52
EMG FAR EAST.......................... 469.4 1.05 21.99 2.43
EMG LATIN AMERICA..................... 281.0 -3.69 19.73 32.62
EMF (EMERGING MARKETS FREE)........... 594.2 -7.32 21.76 20.89
EMF FAR EAST.......................... 235.5 -13.97 26.90 13.12
EMF LATIN AMERICA..................... 268.7 0.64 20.66 32.23
INDIA................................. 55.2 9.93
INDONESIA............................. 22.1 -25.92 14.98 -2.15
KOREA................................. 121.5 23.67 18.17 0.26
MALAYSIA.............................. 105.3 -19.94 25.57 13.86
PAKISTAN.............................. 6.9 -7.09 0.00 0.00
PHILIPPINES........................... 20.9 0.80 47.51 21.44
PHILIPPINES FREE...................... 13.2 -7.88 41.69 23.46
SRI LANKA............................. 1.3 -3.03
TAIWAN................................ 129.0 20.78 19.40 -2.98
THAILAND.............................. 70.6 -9.03 35.86 17.47
ARGENTINA............................. 24.2 -23.63 -9.39 28.67
BRAZIL................................ 94.8 65.73 46.49 26.87
CHILE................................. 38.8 44.76 34.06 46.83
COLOMBIA.............................. 7.3 21.30
MEXICO................................ 108.4 -43.39 2.94 29.69
MEXICO FREE........................... 96.7 -40.55 3.53 32.47
PERU.................................. 4.3 45.42
VENEZUELA............................. 3.0 -34.14
VENEZUELA FREE........................ 2.4 -14.55
GREECE................................ 7.6 -0.78 -0.81 8.05
ISRAEL................................ 13.2
ISRAEL - DOMESTIC..................... 10.9
ISRAEL - NON DOMESTIC................. 2.3
JORDAN................................ 1.2 -8.70 15.66 10.60
PORTUGAL.............................. 8.5 11.95 8.01 -3.48
TURKEY................................ 9.3 -50.49 -4.23 -7.47
COMBINED FAR EAST FREE................ 2,580.2 12.07 8.44 -1.68
COMBINED FAR EAST EX JAPAN............ 679.8 -7.40 24.17 9.17
COMBINED FAR EAST FREE EX JAPAN....... 459.2 -17.48 26.91 20.14
EAFE + EMG............................ 5,396.8 6.42 8.79 2.22
EAFE + EMF............................ 5,150.7 5.91 8.39 2.25
ALL-COUNTRY WORLD INDEX............... 8,344.7 3.85 7.50 4.21
</TABLE>
The Fund and G.T. Global may also quote information similar to that shown above
from other sources, but not limited to, the International Finance Corporation
(IFC) S.G. Warburg, Salomon Brothers, Wilshire Associates, Inc. and Datastream.
Market capitalization is not a measure of investment performance. Accordingly,
the above market capitalization figures are not intended to illustrate
investment performance in any individual developing market. Although the period
from December 31, 1984 to December 31, 1994 was one of growing market
capitalization throughout the world, market capitalization in certain emerging
markets encountered periods of volatility rather than a steadily increasing
trend.
The investment objectives and policies of the G.T. Global Mutual Funds and their
portfolios will not correspond to the composition and performance of MSCI
industry indices.
Statement of Additional Information Page 42
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote information on
sector/industry stock market capitalization and total returns for the Morgan
Stanley Capital International industry indices.
MORGAN STANLEY CAPITAL INTERNATIONAL
INTERNATIONAL INDUSTRY INDICES DECEMBER 31, 1994 (US$ WITHOUT DIVIDENDS)
<TABLE>
<CAPTION>
ANNUALIZED RETURNS (%)
MARKET CAPITALIZATION ------------------------------------
(US$ BN) 1 YEAR 3 YEARS 5 YEARS 10 YEARS
--------------------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C>
ENERGY
Energy Sources.................................. 447.6 5.40 4.05 2.35 10.72
Utilities -- Electrical & Gas................... 412.8 -11.94 -0.05 -1.03 9.88
Sector........................................ 860.4
MATERIALS
Building Materials & Components................. 107.9 -4.87 5.17 -1.34 13.68
Chemicals....................................... 303.5 15.59 7.33 2.47 14.06
Forest Products & Paper......................... 111.2 9.97 5.74 0.96 10.76
Metals -- Non Ferrous........................... 92.1 12.77 9.54 1.49 10.42
Metals -- Steel................................. 109.8 26.99 6.24 -7.78 13.56
Misc. Materials & Commodities................... 73.1 9.52 6.97 -0.72 12.00
Sector........................................ 797.6
CAPITAL EQUIPMENT
Aerospace & Military Technology................. 59.1 6.34 8.97 6.06 7.13
Construction & Housing.......................... 103.1 2.36 -5.42 -9.33 16.82
Data Processing & Reproduction.................. 107.0 22.96 -0.53 -3.43 -1.20
Electrical & Electronics........................ 264.9 3.77 7.35 2.80 11.80
Electronic Components & Instruments............. 177.2 15.59 7.33 2.47 14.06
Energy Equipment & Services..................... 20.7 -13.03 -3.86 -3.90 3.21
Industrial Components........................... 126.7 16.11 14.02 2.49 12.22
Machinery & Engineering......................... 177.8 18.97 9.29 0.32 14.45
Sector........................................ 1036.5
CONSUMER GOODS
Appliances & Household Durables................. 136.5 18.11 10.40 0.39 11.20
Automobiles..................................... 233.7 12.06 15.36 2.61 12.27
Beverages & Tobacco............................. 260.5 4.93 -1.30 6.57 18.26
Food & Household Products....................... 277.8 5.12 2.10 4.68 17.21
Health & Personal Care.......................... 517.4 9.54 -0.91 8.69 17.09
Recreation, Other Consumer Goods................ 93.5 9.20 4.78 1.49 9.86
Textiles & Apparel.............................. 30.9 5.21 -3.29 -5.32 11.12
Sector........................................ 1550.3
SERVICES
Broadcasting & Publishing....................... 145.4 0.80 13.97 5.08 13.77
Business & Public Services...................... 267.2 9.71 10.04 5.61 13.82
Leisure & Tourism............................... 114.3 -2.56 11.13 3.04 15.59
Merchandising................................... 389.4 -2.54 2.66 5.45 15.15
Telecommunications.............................. 375.5 -5.99 5.72 3.36 11.47
Transportation -- Airlines...................... 50.1 4.61 0.86 -3.68 10.67
Transportation -- Road & Rail................... 103.8 -0.70 3.59 -4.67 12.25
Transportation -- Shipping...................... 36.5 7.17 4.04 -4.12 15.00
Wholesale & International Trade................. 66.0 35.10 9.31 -3.01 14.63
Sector........................................ 1546.2
FINANCE
Banking......................................... 1008.9 0.71 4.63 -0.66 15.28
Financial Services.............................. 181.9 8.01 5.29 -2.93 13.77
Insurance....................................... 282.9 -2.55 5.06 1.34 13.21
Real Estate..................................... 110.6 -20.78 6.62 0.21 15.36
Sector........................................ 1584.3
MULTI INDUSTRY
Multi-Industry.................................. 237.6 -6.75 7.70 4.66 11.80
Sector........................................ 237.6
GOLD MINES
Gold Mines...................................... 37.8 -11.16 14.07 0.20 2.37
Sector........................................ 37.8
<FN>
- --------------
The Fund(s) and G.T. Global may also quote information from, but not limited to,
the International Finance Corporation (IFC), S.G. Warburg, Salomon Brothers,
World Scope, Bloomberg, Datastream and Wilshire Associates, Inc.
</TABLE>
The investment objectives and policies of the G.T. Global Mutual Funds and their
portfolios will not correspond to the composition and performance of MSCI
indicies.
Statement of Additional Information Page 43
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote the most currently
available data for GDP, GDP Growth, Population Per Capita GDP, Total Exports,
Total Imports and Inflation Rates for, but not limited to, the following
countries:
<TABLE>
<CAPTION>
GDP (US$ GDP GROWTH POPULATION TOTAL EXPORTS TOTAL IMPORTS INFLATION
MILLIONS) RATE (%) (MILLIONS) (US$ MILLIONS) (US$ MILLIONS) RATE (%)
-------------- ---------- ---------- -------------- -------------- --------
<S> <C> <C> <C> <C> <C> <C>
Hong Kong............................... 77,828 5.5 5.8 30,251 123,427 8.5
China................................... 506,075 13.1 1162.2 84,940 80,585 13.0
South Korea............................. 296,136 5.3 43.7 76,394 81,413 4.8
Taiwan.................................. n/a 5.7 n/a 88,337 70,071 2.9
Singapore............................... 46,025 9.8 2.8 63,386 72,067 2.4
Malaysia................................ 57,568 7.4 18.6 40,705 38,361 3.6
Indonesia............................... 126,364 6.5 184.3 33,815 27,280 9.7
Thailand................................ 110,337 7.8 58.0 32,473 40,466 3.3
Philippines............................. 52,462 1.8 64.3 9,790 15,465 7.6
India................................... 214,598 4.1 883.6 19,795 22,530 9.9
Pakistan................................ 41,904 5.1 119.3 7,264 9,360 8.7
Australia............................... 294,760 3.0 17.5 38,045 42,140 1.1
New Zealand............................. 41,304 3.7 3.4 9,338 9,200 1.6
Japan................................... 3,670,979 0.1 124.5 339,492 230,975 1.3
Brazil.................................. 360,405 5.0 153.9 35,956 23,115 2,103.3
Mexico.................................. 329,011 0.4 85.0 27,166 47,877 9.8
Argentina............................... n/a 6.0 33.1 12,235 14,864 10.6
Venezuela............................... 61,137 -1.0 20.2 13,997 12,222 38.7
Chile................................... 41,203 6.0 13.6 9,646 9,456 12.7
Portugal................................ 79,547 -0.8 9.8 18,541 30,482 6.8
Turkey.................................. 99,696 6.8 58.5 14,715 22,871 65.5
Poland.................................. 83,823 4.0 38.4 13,324 15,309 35.3
Hungary................................. 35,218 -1.6 10.3 10,700 11,078 22.5
Greece.................................. 67,278 n/a 10.3 9,842 23,407 14.0
United Kingdom.......................... 903,126 1.9 57.8 190,481 221,658 3.4
France.................................. 1,319,883 -0.7 57.4 231,452 238,299 2.1
Netherlands............................. 320,290 3.0 15.2 139,919 134,376 1.5
Spain................................... 574,844 -1.0 39.1 64,302 99,473 4.3
Italy................................... 1,222,962 -7.0 57.8 178,349 184,510 4.4
Switzerland............................. 241,406 -0.7 6.9 65,616 65,603 2.3
Sweden.................................. 220,834 -1.7 8.7 55,933 49,849 2.9
Norway.................................. 112,906 1.8 4.3 35,178 25,897 2.4
Finland................................. 93,869 -2.6 5.0 23,515 20,741 1.2
Denmark................................. 123,546 0.3 5.2 39,570 33,601 1.2
United States........................... 5,920,199 3.0 255.4 420,812 551,591 3.0
<FN>
- --------------
Sources: 1992 GDP, mid-1992 population, 1992 exports and 1992 imports, The World
Development Report 1994. The World Bank, June 1994; 1993 GDP Growth Rate and
1993 Inflation Rate, World Economic Outlook -- October 1994, International
Monetary Fund, October 1994.
</TABLE>
G.T. Global and each Fund may also quote information similar to that shown above
from other sources such as, but not limited to, International Financial
Statistics, an IMF publication, and Trends in Developing Economies, a World Bank
publication.
Statement of Additional Information Page 44
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote information on the top
companies listed on an exchange or index for countries around the world such as,
but not limited to, those listed below.
<TABLE>
<CAPTION>
THREE LARGEST COMPANIES
<S> <C>
MEXICO Telmex
Banacci
Tlevisa
CHILE Telefonos
Endesa
Enersis
ARGENTINA YPF
Telefonica de Argentina
Telecom Arg. Stet-France Telecom.
BRAZIL Telebras
Electrobras
Petrobras
JAPAN Mitsubishi Bank
Industrial Bank of Japan
Toyota Motor
HONG KONG HSBC Holdings plc
Hong Kong Telecommunications
Sun Hung Kai Properties
SOUTH KOREA KEPCO
POSCO
Samsung Electronics
TAIWAN Cathjay Life Insurance Co. Ltd.
Hua Nan Commercial Bank
First Commercial Bank
SINGAPORE Singapore Telecom Ltd.
OCBC Bank Ltd.
Singapore Airlines Ltd.
MALAYSIA TNB
Telekom
Resorts
THAILAND Telecomasia
Bangkok Bank
Shinawatra
INDONESIA Barito Pacific Timber
Astra Int'l Inc
H M Sampoerna
PHILIPPINES San Miguel Corp. (A & B)
Philippine Long Distance Telephone Co.
Ayala Corp. (A & B)
AUSTRALIA BHP
News Corporation
National Australia Bank
<CAPTION>
THREE LARGEST COMPANIES
<S> <C>
NEW ZEALAND Telecom Corporation of New Zealand Ltd.
Carter Holt Harvey Ltd.
Fletcher Challenge Ltd - Ordinary Division
UNITED KINGDOM British Telecommunications
HSBC Holdings
Shell Transport & Trading Co. (The)
GERMANY Allianz AG Holding N-AKT
Siemens AG
Deutsche Bank AG
FRANCE Alcatel Alsthom
Elf Aquitaine
Eaux (Cie Gie des)
NETHERLANDS Royal Dutch
Unilever Cert.
Internationale Nederlanden Groep
SPAIN Endesa
Telefonica
Bayer AG
ITALY Generali Assicurazioni
Sip
Stet
SWITZERLAND Roche
Nestle
UBS
SWEDEN Astra
Ericsson
ASEA
DENMARK Novo Nordisk B
Den Danske Bank
Sophus Berendsen
NORWAY Norsk Hydro
Hafslund Nycomed
Kvaerner
FINLAND Nokia Corporation
Repola Ltd.
Kymmene Corporation
U.S. (NYSE) Exxon Corp.
General Electric Co.
Coca Cola Co.
CANADA General Motors
Mobil Corporation
Ford Motor Co.
<FN>
- ------------------
Source: The G. T. Guide to World Equity Markets 1994-1995. Euromoney
Publications Plc, 1994.
</TABLE>
Further, from time to time, G.T. Global and each Fund will quote information
similar to that described above from sources other than G.T. Capital Management,
Inc. such as, but not limited to, S.G. Warburg, Morgan Stanley Capital
International, Wilshire Associates and World Scope. There can be no assurance
that any of the G.T. Global Mutual Funds will own or will continue to own the
securities of the companies listed above.
Statement of Additional Information Page 45
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote and compare real GDP
growth rates of emerging and established countries.
REAL GDP GROWTH RATES (ANNUAL PERCENT CHANGE)
<TABLE>
<CAPTION>
ESTABLISHED EMERGING
COUNTRIES COUNTRIES
----------- ---------
<S> <C> <C>
1993................................................................................... 1.2% 6.1%
1992................................................................................... 1.6% 5.9%
1991................................................................................... 0.6% 4.4%
1990................................................................................... 2.4% 3.7%
1989................................................................................... 3.3% 4.0%
1988................................................................................... 4.4% 5.3%
1987................................................................................... 3.2% 5.7%
1986................................................................................... 2.9% 5.0%
<FN>
- --------------
Source: International Monetary Fund, World Economic Outlook -- October 1994,
October 1994.
</TABLE>
Statement of Additional Information Page 46
<PAGE>
G.T. GLOBAL GROWTH FUNDS
WAGE RATES
From time to time the Fund and G.T. Global may quote data on wage rates for, but
not limited to, the following countries:
<TABLE>
<CAPTION>
US$ PER
HOUR
-----------
<S> <C>
Germany.............................................................................................. $ 25.56
Switzerland.......................................................................................... $ 22.66
Japan................................................................................................ $ 19.20
Sweden............................................................................................... $ 17.91
U.S.................................................................................................. $ 16.79
Canada............................................................................................... $ 16.36
France............................................................................................... $ 16.31
Italy................................................................................................ $ 15.97
UK................................................................................................... $ 12.82
Australia............................................................................................ $ 12.25
Spain................................................................................................ $ 11.53
New Zealand.......................................................................................... $ 8.01
Singapore............................................................................................ $ 5.38
South Korea.......................................................................................... $ 5.37
Taiwan............................................................................................... $ 5.23
Asian NIE's.......................................................................................... $ 5.15
Portugal............................................................................................. $ 4.60
Hong Kong............................................................................................ $ 4.31
Mexico............................................................................................... $ 2.65
<FN>
- --------------
Source: U.S. Department of Labor, Bureau of Labor Statistics, International
Comparison of Hourly Compensation Costs for Production Workers in Manufacturing,
1993, Report 873, June 1994.
</TABLE>
G.T. Global and each Fund may also quote information similar to that shown above
from other sources such as, but not limited to, Morgan Stanley and S.G. Warburg.
Statement of Additional Information Page 47
<PAGE>
G.T. GLOBAL GROWTH FUNDS
From time to time, each Fund and G.T. Global may quote data for stock market
trading volume and number of listed companies for various countries, from
information provided by the International Finance Corporation (IFC).
NUMBER OF LISTED COMPANIES AND TRADING VOLUME
<TABLE>
<CAPTION>
NUMBER OF ANNUAL
LISTED TRADING VOLUME
COMPANIES (US$ MILLIONS)
----------- ---------------
<S> <C> <C>
Canada............................................................................. 1,124 142,222
U.S................................................................................ 7,607 3,507,223
Argentina.......................................................................... 180 10,339
Brazil............................................................................. 550 57,409
Chile.............................................................................. 263 2,797
Colombia........................................................................... 89 732
Mexico............................................................................. 190 62,454
Venezuela.......................................................................... 93 1,874
Korea.............................................................................. 693 211,710
Philippines........................................................................ 180 6,785
Taiwan............................................................................. 183 43,395
India.............................................................................. 6,800 21,879
Indonesia.......................................................................... 174 9,158
Malaysia........................................................................... 410 153,661
Pakistan........................................................................... 653 1,844
Hong Kong.......................................................................... 450 131,550
Singapore.......................................................................... 178 81,623
Japan.............................................................................. 2,155 954,341
Australia.......................................................................... 1,070 67,711
New Zealand........................................................................ 136 6,785
Greece............................................................................. 143 2,713
Jordan............................................................................. 101 1,377
Nigeria............................................................................ 174 10
Portugal........................................................................... 183 4,835
Turkey............................................................................. 152 23,242
UK................................................................................. 1,646 423,526
France............................................................................. 472 174,283
Germany............................................................................ 426 302,985
<FN>
- --------------
Source: Emerging Stock Markets Factbook 1994, International Finance Corporation
(IFC), June 1994.
</TABLE>
Further, from time to time, each Fund and G.T. Global may also quote information
similar to that described above from, but not limited to, other sources, such as
S.G. Warburg, Salomon Brothers, Inc. and Datastream.
Statement of Additional Information Page 48
<PAGE>
G.T. GLOBAL GROWTH FUNDS
IMPORTANT POINTS TO NOTE ABOUT THE ABOVE DATA RELATING TO WORLD EQUITY AND BOND
MARKET PERFORMANCE AND EQUITY MARKET DIVERSIFICATION
The information contained above relating to foreign market performance and
diversification is based on sources believed to be reliable, but is neither
all-inclusive nor warranted as to accuracy by the Company or G.T. Capital. The
authors and publishers of such material are not to be considered as "experts"
under the Securities Act of 1933 on account of the inclusion of such information
herein.
A portion of the performance figures for each market includes the positive or
negative effects of the currency exchange rates effective at December 31 of each
year between the U.S. dollar and currency of the foreign market (e.g. Japanese
Yen, German Deutschemark, Hong Kong Dollar). A foreign currency which has
strengthened or weakened against the U.S. dollar will positively or negatively
affect the reported returns, as the case may be.
G.T. Global believes that the above information relating to foreign market
performance and diversification may be useful to investors considering whether
and to what extent to diversify their investments through the purchase of mutual
funds investing in securities on a global basis. However, this data is not a
representation of the past performance of the Fund, nor is it a prediction of
such performance. The performance of the Fund will differ from the historical
performance of the indices represented above. The performance of indices does
not take expenses into account, while the Fund incurs expenses in its operations
which will reduce performance. The Fund is actively managed, I.E. G.T. Capital,
as the Fund's investment manager, actively purchases and sells securities in
seeking the Fund's investment objective. Moreover, the Fund may invest a portion
of its assets in corporate bonds, while the above data relates only to
government bonds. Each of these factors will cause the performance of the Fund
to differ from the indices shown above.
- --------------------------------------------------------------------------------
DESCRIPTION OF DEBT RATINGS
- --------------------------------------------------------------------------------
COMMERCIAL PAPER RATINGS
Standard & Poor's Ratings Group ("S&P"). "A-1" and "A-2" are the two highest
commercial paper rating categories:
A-1. This highest category indicates that the degree of safety regarding
timely payment is strong. Issues determined to possess extremely strong
safety characteristics are denoted with a plus sign (+) designation.
A-2. Capacity for timely payment on issues with this designation is
satisafactory. However, the relative degree of safety is not as high as for
issues designated A-1.
Moody's Investors Service, Inc. ("Moody's"). "Prime-1" and "Prime-2" are the two
highest commercial paper rating categories.
Prime-1. Issuers (or supporting institutions) assigned this highest
rating have a superior ability for repayment of short-term debt obligations.
Prime-1 repayment ability will often be evidenced by the following
chargacgteristics: leading market positions in well established industries;
high rates of return on funds employed; conservative capitalization
structure with moderate reliance on debt and ample asset protection; broad
margins in earnings coverage of fixed financial charges and high internal
cash generation; well established access to a range of financial markets and
assured sources of alternate liquidity.
Prime-2. Issuers (or supporting institutions) assigned this rating have
a strong ability for repayment of short-term debt obligations. This will
normally be evidenced by mny of the chargacteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affect by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF BOND RATINGS
MOODY'S rates the long-term debt securities issued by various entities from
"Aaa" to "C." Investment grade ratings are as follows:
Aaa -- Best quality. These securities carry the smallest degree of
investment risk and are generally referred to as "gilt edge." Interest
payments are protected by a large, or by an exceptionally stable margin and
principal is secure.
Statement of Additional Information Page 49
<PAGE>
G.T. GLOBAL GROWTH FUNDS
While the various protective elements are likely to change, such changes as
can be visualized are most unlikely to impair the fundamentally strong
position of such issues.
Aa -- High quality by all standards. Together with the Aaa group they
comprise what generally are known as high yield bonds. They are rated lower
than the best bond because margins of protection may not be as large as in
Aaa securities, fluctuation of protective elements may be of greater
amplitude, or there may be other elements present which make the long-term
risks appear somewhat greater than for securities rated Aaa.
A -- Upper medium grade obligations. These bonds possess many favorable
investment attributes. Factors giving security to principal and interest are
considered adequate, but elements may be present which suggest a
susceptibility to impairment sometime in the future.
Baa -- Medium grade obligations (i.e., they are neither highly protected
nor poorly secured). Interest payments and principal security appear
adequate for the present but certain protective elements may be lacking or
may be characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and, in fact, have
speculative characteristics as well.
S&P rates the long-term securities debt of various entities in categories
ranging from "AAA" to "D" according to quality. Investment grade ratings are as
follows:
AAA -- Highest rating. Capacity to pay interest and repay principal is
extremely strong.
AA -- High grade. Very strong capacity to pay interest and repay
principal. Generally, these bonds differ from AAA issues only in a small
degree.
A -- Have a strong capacity to pay interest and repay principal,
although they are somewhat more susceptible to the adverse effects of change
in circumstances and economic conditions, than debt in higher rated
categories.
BBB -- Regarded as having adequate capacity to pay interest and repay
principal. These bonds normally exhibit adequate protection parameters, but
adverse economic conditions or changing circumstances are more likely to
lead to a weakened capacity to pay interest and repay principal than for
debt in higher rated categories.
Further, both Moody's and S&P provide sovereign assessments and implied debt
ratings to sovereign governments. These assessments and ratings are broad
qualitative statements about that government's capacity to meet its senior debt
obligations. These assessments and ratings are then translated to the letter
grade debt ratings described above.
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The audited financial statements of each Fund at December 31, 1994 and for the
year then ended appear on the following pages.
Statement of Additional Information Page 50
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global Worldwide Growth Fund, one of the funds organized as a series of G.T.
Global Growth Series, including the schedule of portfolio of investments, as of
December 31, 1994 and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended and the financial highlights for each of the three years in
the period then ended. These financial statements and the financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and financial highlights based
on our audits. The financial highlights for each of the two years in the period
ended December 31, 1991 were audited by other auditors whose report dated
January 31, 1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Worldwide Growth Fund as of December 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the three years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
Statement of Additional Information Page 51
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Services (16.7%)
- -----------------------------------------------
Shimamura Co. Ltd. JPN 100,000 $5,022,602 2.1
RETAILERS-APPAREL
Tandy Corporation US 66,700 3,343,338 1.4
RETAILERS - OTHER
Pacific Telesis
Group US 113,500 3,234,750 1.4
TELEPHONE - REGIONAL/LOCAL
Viacom, Inc. (c) US 75,100 3,050,938 1.3
BROADCASTING & PUBLISHING
Granada Group PLC UK 300,000 2,405,262 1.0
BROADCASTING & PUBLISHING
Reuters Holdings PLC UK 327,200 2,397,895 1.0
BROADCASTING & PUBLISHING
Grupo Televisa, S.A.
de C.V. GDR (b) MEX 74,800 2,374,900 1.0
BROADCASTING & PUBLISHING
Vodafone Group PLC UK 645,000 2,141,246 0.9
WIRELESS COMMUNICATIONS
Elsevier N.V. NETH 200,000 2,085,974 0.9
BROADCASTING & PUBLISHING
Compass Group PLC UK 394,007 2,079,241 0.9
RESTAURANTS
La Quinta Inns Inc.
(c) US 96,663 2,066,161 0.9
LEISURE & TOURISM
Manpower Inc. US 68,700 1,932,188 0.8
BUSINESS & PUBLIC SERVICES
British Sky
Broadcasting PLC
(c) UK 396,100 1,587,873 0.7
CABLE TELEVISION
Penney (J.C.) Co.
Inc. US 32,000 1,428,000 0.6
RETAILERS - OTHER
EMAP PLC UK 228,000 1,420,983 0.6
BROADCASTING & PUBLISHING
MacIntosh N.V. NETH 37,500 961,594 0.4
RETAILERS - OTHER
Thai Airways
International Ltd.
(Foreign) THAI 360,000 781,829 0.3
TRANSPORTATION - AIRLINES
Sembawang Corp. Ltd. SING 75,000 561,470 0.3
TRANSPORTATION - SHIPPING
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Foodland Associated
Ltd. AUSL 75,000 $229,794 0.1
RETAILERS - FOOD
Lojas Americanas
S.A. (Preferred) BRZL 7,480,000 221,040 0.1
RETAILERS - OTHER
News Corp. Ltd. AUSL 294 1,152 --
BROADCASTING & PUBLISHING
--------------
39,328,230
--------------
Finance (15.8%)
- -----------------------------------------------
Swiss Reinsurance
Co. (Registered)
(c) SWTZ 6,500 3,919,373 1.7
INSURANCE - MULTI-LINE
Skandia Forsakrings
AB Free SWDN 210,000 3,633,218 1.6
INSURANCE - MULTI-LINE
Lehman Brothers
Holding, Inc. US 235,100 3,467,725 1.5
INVESTMENT MANAGEMENT
National Westminster
Bank PLC UK 390,000 3,132,947 1.3
BANKS - MONEY CENTER
Barclays PLC UK 315,000 3,013,858 1.3
BANKS - MONEY CENTER
Thai Farmers Bank,
Ltd. (Foreign) THAI 341,000 2,772,026 1.2
BANKS - MONEY CENTER
Banco Popular
Espanol S.A. SPN 22,000 2,617,256 1.1
BANKS - MONEY CENTER
Citicorp US 57,700 2,387,338 1.0
BANKS - MONEY CENTER
Warburg (S.G.) Group
PLC UK 215,000 2,329,784 1.0
INVESTMENT MANAGEMENT
Land and House Co.
Ltd. (Foreign) THAI 110,000 1,963,738 0.8
REAL ESTATE
Axa (Ex-Cie Du Midi) FR 36,031 1,669,458 0.7
INSURANCE - MULTI-LINE
Development Bank of
Singapore Ltd.
(Foreign) SING 156,250 1,609,718 0.7
BANKS - MONEY CENTER
Swedbank (d) SWDN 160,000 1,234,365 0.5
BANKS - MONEY CENTER
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 52
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
M & G Group PLC UK 80,000 $1,223,927 0.5
INVESTMENT MANAGEMENT
Provident Financial
PLC UK 142,500 1,209,443 0.5
INSURANCE - MULTI-LINE
Grupo Financiero
Banamex Accival
S.A. de C.V. Class
"C" MEX 321,600 974,746 0.4
BANKS - MONEY CENTER
--------------
37,158,920
--------------
Materials/Basic Industries (11.6%)
- -----------------------------------------------
Siam Cement Co. Ltd.
(Foreign) THAI 59,000 3,536,003 1.5
CEMENT
British Steel PLC UK 1,450,000 3,496,712 1.5
METALS - STEEL
Compania Siderurgica
Nacional S.A. (CSN)
144A ADR (b)(e) BRZL 55,500 1,890,447 0.8
METALS - STEEL
Imperial Chemical
Industries PLC UK 160,000 1,875,352 0.8
CHEMICALS
Tarmac PLC UK 966,000 1,807,657 0.8
BUILDING MATERIALS & COMPONENTS
Aluminum Company of
America US 20,600 1,784,475 0.8
METALS - NON-FERROUS
St Laurent
Paperboard Inc. CAN 139,500 1,728,455 0.7
FOREST PRODUCTS
Amcor Ltd. AUSL 212,567 1,536,708 0.6
PAPER/PACKAGING
Western Mining Corp.
Holdings Ltd. AUSL 260,632 1,512,199 0.6
METALS - NON-FERROUS
Broken Hill
Proprietary Co.
Ltd. AUSL 81,516 1,238,042 0.5
MISC. MATERIALS & COMMODITIES
Hercules Inc. US 10,500 1,211,438 0.5
CHEMICALS
Construcciones y
Auxiliar de
Ferrocarriles S.A.
(CAF) SPN 21,500 1,160,395 0.5
BUILDING MATERIALS & COMPONENTS
NOVA Corporation CAN 124,200 1,151,394 0.5
CHEMICALS
Ttolmex S.A. de C.V.
Class "B" MEX 132,900 1,150,887 0.5
BUILDING MATERIALS & COMPONENTS
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Cementos Mexicanos,
S.A. de C.V. -
Cemex "B" MEX 171,000 $918,464 0.4
CEMENT
Stelco, Inc. Class
"A" (c) CAN 158,000 915,460 0.4
METALS - STEEL
Pasminco Ltd. AUSL 286,400 399,876 0.2
METALS - NON-FERROUS
Dofasco Inc. CAN 384 5,169 --
METALS - STEEL
--------------
27,319,133
--------------
Capital Goods (10.5%)
- -----------------------------------------------
Fuji Machine
Manufacturing Co. JPN 183,000 6,029,533 2.6
MACHINE TOOLS
Canon Inc. JPN 300,000 5,092,918 2.2
OFFICE EQUIPMENT
Toshiba Corp. JPN 467,000 3,391,673 1.5
ELECTRICAL PLANT/EQUIPMENT
Futaba Corp. JPN 63,000 3,379,407 1.4
ELECTRICAL PLANT/EQUIPMENT
Boeing Company US 53,400 2,496,450 1.1
AEROSPACE/DEFENSE
Nokia AB (Preferred) FIN 16,100 2,375,103 1.0
TELECOM EQUIPMENT
Weir Group PLC UK 175,000 772,784 0.3
MACHINERY & ENGINEERING
Empresas ICA
Sociedad
Controladora S.A.
de C.V. ADR (b) MEX 46,100 714,550 0.3
CONSTRUCTION
E.R.G. Australia
Ltd. AUSL 202,000 336,876 0.1
ELECTRICAL PLANT/EQUIPMENT
--------------
24,589,294
--------------
Consumer Durables (8.6%)
- -----------------------------------------------
Volkswagen AG GER 16,000 4,401,111 1.9
AUTOMOBILES
Autobacs Seven JPN 34,000 4,064,289 1.7
AUTO PARTS
Bridgestone Corp. JPN 250,000 3,917,629 1.7
AUTO PARTS
Volvo AB Class "B"
Free SWDN 130,150 2,453,247 1.0
AUTOMOBILES
Samsung Electronics: KOR -- -- 0.9
CONSUMER ELECTRONICS
Preferred -- 14,434 1,091,155 --
Common -- 7,000 1,016,172 --
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 53
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Hyundai Motor Co.
Ltd. 144A GDR
(b)(c)(e) KOR 109,300 $2,049,375 0.9
AUTOMOBILES
Brasmotor S.A.
(Preferred) (c) BRZL 3,250,000 1,317,671 0.5
APPLIANCES & HOUSEHOLD DURABLES
--------------
20,310,649
--------------
Multi-Industry/Miscellaneous (7.7%)
- -----------------------------------------------
Tomkins PLC UK 1,000,000 3,421,547 1.5
CONGLOMERATE
ITT Corp. US 35,700 3,163,913 1.3
CONGLOMERATE
Straits Steamship
Land Ltd. SING 900,000 3,090,659 1.3
CONGLOMERATE
BTR PLC UK 425,000 1,956,624 0.8
CONGLOMERATE
Canadian Pacific
Ltd. CAN 120,000 1,786,351 0.8
MULTI-INDUSTRY
Wassall (J.W.) PLC UK 391,250 1,739,978 0.7
CONGLOMERATE
Grupo Carso S.A. de
C.V. Class "A1" (c) MEX 203,000 1,527,732 0.7
CONGLOMERATE
Korea Equity Fund
Inc. (b) KOR 150,000 1,312,500 0.6
COUNTRY FUNDS
--------------
17,999,304
--------------
Technology (7.6%)
- -----------------------------------------------
Kyocera Corp. JPN 70,000 5,196,384 2.2
SEMICONDUCTORS
International
Business Machines
Corp. US 69,400 5,100,900 2.2
COMPUTERS & PERIPHERALS
Tokyo Electron Co.
Ltd. JPN 160,000 4,982,421 2.1
SEMICONDUCTORS
Japan Digital
Laboratory JPN 86,100 2,490,889 1.1
COMPUTERS & PERIPHERALS
--------------
17,770,594
--------------
Telephone Networks (4.2%)
- -----------------------------------------------
Telecom Italia
S.P.A. ITLY 1,580,000 4,114,533 1.7
Telecomunicacoes
Brasileiras S.A.: BRZL -- -- 0.9
Preferred -- 43,200,000 1,935,319 --
ADR (b) -- 1,600 71,595 --
Preferred - New -- 1,098,816 44,303 --
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Telecom Corporation
of New Zealand Ltd. NZ 426,000 $1,391,087 0.6
Royal PTT Nederland
N.V. NETH 38,500 1,297,828 0.6
Compania de
Telefonos de Chile
S.A. ADR (b) CHLE 12,800 1,008,000 0.4
--------------
9,862,665
--------------
Consumer Non-Durables (3.6%)
- -----------------------------------------------
Reliance Industries
Ltd. 144A GDR
(b)(c)(e) IND 113,500 2,213,250 0.9
TEXTILES & APPAREL
Zale Corp. (c) US 174,900 2,098,800 0.9
OTHER CONSUMER GOODS
Bic FR 16,000 2,010,675 0.9
OTHER CONSUMER GOODS
Matthew Clark PLC UK 227,200 1,892,740 0.8
BEVERAGES - ALCOHOLIC
Chocolates COL 17,535 185,667 0.1
FOOD
--------------
8,401,132
--------------
Energy (3.1%)
- -----------------------------------------------
Yukong Ltd. KOR 45,920 2,222,612 0.9
OIL
Motor Columbus Ltd. SWTZ 1,400 1,990,065 0.9
ELECTRICAL & GAS UTILITIES
Korea Electric Power
Corp. (c) KOR 40,500 1,481,096 0.6
ELECTRICAL & GAS UTILITIES
C.A. La Electricidad
de Caracas VENZ 672,171 960,809 0.4
ELECTRICAL & GAS UTILITIES
Archer Resources
Ltd. (c) CAN 79,000 668,990 0.3
GAS PRODUCTION & DISTRIBUTION
--------------
7,323,572
--------------
Health Care (2.7%)
- -----------------------------------------------
Takeda Chemical
Industries Ltd. JPN 300,000 3,646,409 1.5
PHARMACEUTICALS
Humana Inc. US 76,300 1,726,288 0.7
HEALTH CARE SERVICES
Foundation Health
Corp. (c) US 35,000 1,085,000 0.5
HEALTH CARE SERVICES
--------------
6,457,697
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Equity Investments
(cost $198,691,851)........................... 216,521,190 92.1
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 54
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
<TABLE>
<CAPTION>
Fixed Income Principal Market % of Net
Investments Currency Amount Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Corporate Bonds (0.6%)
- -----------------------------------------------
Daewoo Corp. Conv.
Bond, 0% due
12/31/04 USD 1,900,000 $1,320,500 0.6
KOREAN CORPORATE BOND
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Fixed Income Investments (cost
$1,855,413)................................... 1,320,500 0.6
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
No. of
Warrants (0.0%) Ctry Warrants
- -------------------- ----------- ------------
<S> <C> <C> <C> <C>
Swiss Reinsurance Co.
Class "B" expires
6/30/95 (c) SWTZ 4,000 36,683 --
INSURANCE - MULTI-LINE
BTR UK 1 1 --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Warrants (cost $0)............................ 36,684 --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<CAPTION>
Market % of Net
Short-Term Investments Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Repurchase Agreement (5.2%)
- -----------------------------------------------
Dated December 30, 1994 with State Street Bank
and Trust Company, due January 3, 1995, for an
effective yield of 5.25% collateralized by
$12,220,000 United States Treasury Notes,
6.25% due 8/31/96. (Market value $12,223,650
including accrued interest) (cost
$12,218,563)..................................
$12,218,563 5.2
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Investments
(cost $212,765,827)*.......................... 230,096,937 97.9
Other Assets and Liabilities................... 4,936,910 2.1
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Net Assets..................................... $235,033,847 100.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $235,033,847.
(b) U.S. currency denominated.
(c) Non-income producing security.
(d) The following is a restricted security bought from a private placement.
This security is not registered under the Securities Act of 1933 and is
subject to restriction from public resale:
Market Value
Acquisition Per Share
Date Shares Cost at 12/31/94
----------- ------- ---------- --------------
Swedbank............ 03/14/94 160,000 $1,167,318 $ 7.71
(e) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
Abbreviations:
ADR -- American Depository Receipt
GDR -- Global Depositary Receipt
* For Federal income tax purposes, cost is $213,328,867 and appreciation
(depreciation) of securities is as follows:
Unrealized appreciation: $ 31,669,666
Unrealized depreciation: (14,901,596)
------------
Net unrealized appreciation: $ 16,768,070
------------
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Market Value
(U.S. Contract Delivery Unrealized
Contracts to Sell: Dollars) Price Date Appreciation
- ----------------------------------------------------------------------------- ------------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
Deutsche Marks............................................................... 4,394,468 1.49493 03-Feb-95 $ 154,233
French Francs................................................................ 5,057,790 5.12720 03-Feb-95 208,242
Japanese Yen................................................................. 12,329,935 97.70000 18-Jan-95 208,448
Japanese Yen................................................................. 13,623,057 96.16000 10-Feb-95 416,044
------------- -------------
Total Contracts to Sell (Receivable amount $36,392,217)...................... 35,405,250 986,967
------------- -------------
The value of Contracts to Sell as a Percentage of Net Assets is 15.1%.
Total Open Forward Foreign Currency Contracts............................ $ 986,967
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 55
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
The Fund's Portfolio of Investments at December 31, 1994, was concentrated in
the following countries:
<TABLE>
<CAPTION>
Percentage of Net Assets(a)
------------------------------------------------------------
Short Term &
Country Equity Fixed Income Other Total
- ----------------------------- ----------- ----------------- ----------------- ---------
<S> <C> <C> <C> <C>
Australia.................... 2.1 2.1
Brazil....................... 2.3 2.3
Canada....................... 2.7 2.7
Chile........................ 0.4 0.4
Columbia..................... 0.1 0.1
Finland...................... 1.0 1.0
France....................... 1.6 1.6
Germany...................... 1.9 1.9
India........................ 0.9 0.9
Italy........................ 1.7 1.7
Japan........................ 20.1 20.1
Korea........................ 3.9 3.9
Mexico....................... 3.3 3.3
Netherlands.................. 1.9 1.9
New Zealand.................. 0.6 0.6
Singapore.................... 2.3 2.3
Spain........................ 1.6 1.6
Sweden....................... 3.1 3.1
Switzerland.................. 2.6 2.6
Thailand..................... 3.8 3.8
United Kingdom............... 16.9 16.9
United States................ 16.9 0.6 7.3 24.8
Venezuela.................... 0.4 0.4
-- --
--- ---------
Total........................ 92.1 0.6 7.3 100.0
-- --
-- --
--- ---------
--- ---------
<FN>
- ----------------
(a) Percentages are based on net assets of $235,033,847.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 56
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C> <C>
Investments in securities, at value (cost $212,765,827) (Note 1)..................................... $ 230,096,937
U.S. currency............................................................................
$ 87
Foreign currency (cost $5,314,420).......................................................
5,279,928 5,280,015
----------
Receivable for Fund shares sold...................................................................... 1,385,304
Receivable for open forward foreign currency contracts, net (Note 1)................................. 986,967
Receivable for securities sold....................................................................... 647,911
Dividends and dividend withholding tax reclaims receivable........................................... 401,306
Receivable for closed forward foreign currency contracts (Note 1).................................... 3,132
Cash held as collateral for securities loaned (Note 1)............................................... 11,466,000
-------------
Total assets......................................................................................... 250,267,572
-------------
Liabilities:
Payable for securities purchased..................................................................... 2,847,374
Payable for Fund shares repurchased.................................................................. 373,261
Payable for investment management and administration fees (Note 2)................................... 196,390
Payable for service and distribution expenses (Note 2)............................................... 99,374
Payable for transfer agent fees (Note 2)............................................................. 81,998
Payable for printing and postage expenses............................................................ 65,683
Payable for custodian fees (Note 1).................................................................. 44,107
Payable for professional fees........................................................................ 31,302
Payable for registration fees........................................................................ 8,666
Payable for Trustees' fees (Note 2).................................................................. 3,937
Accrued expenses..................................................................................... 15,633
Collateral for securities loaned (Note 1)............................................................ 11,466,000
-------------
Total liabilities.................................................................................... 15,233,725
-------------
Net assets............................................................................................. $ 235,033,847
-------------
-------------
Class A:
Net asset value and redemption price per share
($182,466,689 DIVIDED BY 11,751,574 shares outstanding)............................................ $ 15.53
-------------
-------------
Maximum offering price per share
(100/95.25 of $15.53)*.............................................................................. $ 16.30
-------------
-------------
Class B:+
Net asset value and offering price per share
($52,567,158 DIVIDED BY 3,425,932 shares outstanding).............................................. $ 15.34
-------------
-------------
Net assets consist of:
Paid in capital (Note 4)............................................................................. $ 218,003,498
Undistributed net investment income.................................................................. 452,325
Accumulated net realized loss on investments, options, and foreign currency transactions............. (1,733,159)
Net unrealized appreciation on translation of dividends and dividend withholding tax reclaims
receivable, securities purchased and sold, foreign currency, and forward foreign currency 980,073
contracts...........................................................................................
Net unrealized appreciation of investments........................................................... 17,331,110
-------------
Total -- representating net assets applicable to capital shares outstanding.......................... $ 235,033,847
-------------
-------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 57
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income: (Note 1)
Dividends (net of foreign withholding tax of $482,261)............................................... $ 3,657,635
Interest............................................................................................. 612,611
------------
Total investment income.............................................................................. $ 4,270,246
------------
Expenses:
Investment management and administration fees (Note 2)............................................... 2,355,681
Service and distribution expenses: (Note 2)
Class A.............................................................................. $ 693,569
Class B.............................................................................. 434,484 1,128,053
------------
Transfer agent fees (Note 2)......................................................................... 636,075
Custodian fees (Note 1).............................................................................. 366,605
Professional fees.................................................................................... 87,061
Printing and postage expenses........................................................................ 73,971
Registration fees.................................................................................... 50,381
Trustees' fees and expenses (Note 2)................................................................. 17,102
Other................................................................................................ 16,740
------------
Total expenses before expense reductions............................................................. 4,731,669
Expense reductions (Notes 1 & 5)................................................................... (96,785)
------------
Total net expenses................................................................................... 4,634,884
------------
Net investment loss.................................................................................... (364,638)
------------
Net realized and unrealized gain (loss) on investments and foreign currencies: (Note 1)
Net realized gain on investments......................................................... 13,342,673
Net realized loss on foreign currency transactions....................................... (2,172,817)
------------
Net realized gain during the period.................................................................... 11,169,856
Net change in unrealized appreciation on translation of dividends and dividend
withholding tax reclaims receivable, securities purchased and sold, foreign currency,
and forward foreign currency contracts.................................................. (439,209)
Net change in unrealized appreciation of investments..................................... (27,662,950)
------------
Net unrealized depreciation during the year............................................................ (28,102,159)
------------
Net realized and unrealized loss on investments and foreign currencies................................. (16,932,303)
------------
Net decrease in net assets resulting from operations................................................... $(17,296,941)
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 58
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
Increase in net assets
Operations:
Net investment income (loss).............................................................
$ (364,638) $ 1,463,294
Net realized gain on investments and foreign currency transactions.......................
11,169,856 14,196,277
Net change in unrealized appreciation (depreciation) on translation of dividends and
dividend withholding tax reclaims receivable, securities purchased and sold, foreign
currency, and forward foreign currency contracts........................................
(439,209) 1,040,873
Net change in unrealized appreciation (depreciation) of investments......................
(27,662,950) 24,406,413
------------------ ------------------
Net increase (decrease) in net assets resulting from operations..........................
(17,296,941) 41,106,857
------------------ ------------------
Class A:+
Distributions to shareholders from: (Note 1)...............................................
-- --
Net realized gain on investments.........................................................
(8,774,504) (10,096,182)
Class B:++
Distributions to shareholders from: (Note 1)...............................................
-- --
Net realized gain on investments.........................................................
(2,518,790) (1,016,179)
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.........................................
146,805,682 129,785,425
Decrease from capital shares repurchased.................................................
(97,769,940) (86,501,439)
------------------ ------------------
Net increase from capital share transactions...............................................
49,035,742 43,283,986
------------------ ------------------
Total increase in net assets...............................................................
20,445,507 73,278,482
Net assets:
Beginning of year........................................................................
214,588,340 141,309,858
------------------ ------------------
End of year..............................................................................
$ 235,033,847 $ 214,588,340
------------------
------------------ ------------------
------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 59
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------
1994 1993* 1992 1991 1990
--------- ---------- ---------- ---------- ---------
Per Share Operating Performance:
Net asset value, beginning of period.............. $17.47 $14.47 $14.07 $11.83 $13.63
--------- ---------- ---------- ---------- ---------
Net investment income (loss)...................... (0.00) 0.04 0.07 0.10 0.11
Net realized and unrealized gain (loss)
on investments................................... (1.16) 3.92 0.39 2.29 (1.82)
--------- ---------- ---------- ---------- ---------
Net increase (decrease) in net asset value
resulting from investment operations............. (1.16) 3.96 0.46 2.39 (1.71)
--------- ---------- ---------- ---------- ---------
Distributions:
Net investment income........................... (0.00) (0.00) (0.00) (0.15) (0.09)
Net realized gain on investments................ (0.78) (0.96) (0.06) (0.00) (0.00)
--------- ---------- ---------- ---------- ---------
Total distributions........................... (0.78) (0.96) (0.06) (0.15) (0.09)
--------- ---------- ---------- ---------- ---------
Net asset value, end of period.................... $15.53 $17.47 $14.47 $14.07 $11.83
--------- ---------- ---------- ---------- ---------
--------- ---------- ---------- ---------- ---------
Total investment return (c)....................... (6.65)% 27.6% 3.3% 20.3% (12.5)%
--------- ---------- ---------- ---------- ---------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $182,467 $193,997 $141,310 $126,868 $85,894
Ratio of net investment income (loss) to average
net assets....................................... (0.01)% 0.9% 0.5% 0.8% 0.7%
Ratio of expenses to average net assets........... 1.81% 1.9% 2.1% 2.0% 2.1%
Ratio of expenses to average net assets
before expense reductions........................ 1.84% --% --% --% --%
Portfolio turnover rate+++........................ 86% 92% 95% 122% 107%
<CAPTION>
CLASS B++
-----------------------
<S> <C> <C>
APRIL 1,
1993
TO
DECEMBER 31,
1994 1993*
-------- ------------
Per Share Operating Performance:
Net asset value, beginning of period.............. $17.39 $15.67
-------- ------------
Net investment income (loss)...................... (0.11) (0.04)
Net realized and unrealized gain (loss)
on investments................................... (1.16) 2.72
-------- ------------
Net increase (decrease) in net asset value
resulting from investment operations............. (1.27) 2.68
-------- ------------
Distributions:
Net investment income........................... (0.00) (0.00)
Net realized gain on investments................ (0.78) (0.96)
-------- ------------
Total distributions........................... (0.78) (0.96)
-------- ------------
Net asset value, end of period.................... $15.34 $17.39
-------- ------------
-------- ------------
Total investment return (c)....................... (7.32)% 17.3%(a)
-------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $52,567 $20,592
Ratio of net investment income (loss) to average
net assets....................................... (0.66)% (0.4)%(b)
Ratio of expenses to average net assets........... 2.46% 2.5%(b)
Ratio of expenses to average net assets
before expense reductions........................ 2.49% --%
Portfolio turnover rate+++........................ 86% 92%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Calculated based upon weighted average shares outstanding during the
period.
(a) Not annualized.
(b) Annualized.
(c) Total investment return does not include sales charges.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 60
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Worldwide Growth Fund ("Fund"), formerly G.T. Worldwide Growth Fund,
is a separate series of G.T. Global Growth Series ("Company"). The Company is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended ("1940 Act"), as a diversified,
open-end management investment company. The Company has six series of shares of
beneficial interest outstanding, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sales price on the exchange on which
such securities are traded, or in the principal over-the-counter market in which
such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital, the Fund's investment manager, deems it appropriate, prices obtained
for the day of valuation from a bond pricing service will be used. Short-term
investments with a maturity of 60 days or less are valued at amortized cost,
adjusted for foreign exchange translation and market fluctuations, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Fund's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when earned or incurred.
As of January 1, 1994, the Fund adopted Statement of Position 93-4: "Foreign
Currency Accounting and Financial Statement Presentation for Investment
Companies." As permitted under the SOP, the Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of forward foreign currency contracts, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
securities transactions, the difference between the amount of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains or losses arise from changes in the value of assets and
liabilities other than investments in securities at fiscal year end, resulting
from changes in exchange rates.
Statement of Additional Information Page 61
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
Certain 1993 amounts have been reclassified for consistency in financial
statement presentation.
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, U.S. government securities or other
high quality debt securities of which the value, including accrued interest, is
at least equal to the amount to be paid to the Fund under each agreement at its
maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of a contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or in the case of an over-the-counter option is valued at the
bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. The
Fund uses options in order to manage its exposure to currency levels and
interest rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in the value
of the contract. Such receipts or payments are known as "variation margin" and
are recorded by the Fund as unrealized gains or losses. When the contract is
closed, the Fund records a realized gain or loss equal to the difference between
the value of the contract at the time it was opened and the value at the time it
was closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
Statement of Additional Information Page 62
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Fund may trade securities on other than normal
settlement terms. This may increase the risk of the other party to the
transaction fails to deliver and cause the Fund to subsequently invest at less
advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At December 31, 1994, stocks with an aggregate value of approximately
$10,935,034 were on loan to brokers. The loans were secured by cash collateral
of $11,466,000, received by the Fund. Cash collateral is received by the Fund
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For the year ended December 31, 1994,
the Fund received fees of $90,428 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, or excise tax on income
and capital gains.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Fund's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign markets may include foreign currency exchange rate fluctuations,
perceived credit risk, adverse political and economic developments and possible
adverse foreign government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the year, restricted securities
(excluding 144A issues) are shown at the end of the Portfolio of Investments.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and administrator. The Fund pays
investment management and administration fees at the following annualized rates:
0.975% on the first $500 million of average daily net assets of the Fund; 0.95%
on the next $500 million; 0.925% on the next $500 million and 0.90% on amounts
thereafter. These fees are computed daily and paid monthly, and are subject to
reduction in any year to the extent that the Fund's expenses (exclusive of
brokerage commissions, taxes, interest, distribution-related expenses and
extraordinary expenses) exceed the most stringent limits prescribed by the laws
or regulations of any state in which the Fund's shares are offered for sale,
based on the average net asset value of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$89,742 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges
Statement of Additional Information Page 63
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
("CDSCs"), in accordance with the Fund's current prospectus. For the year ended
December 31, 1994, G.T. Global collected CDSCs in the amount of $92,285. In
addition, G.T. Global makes ongoing shareholder servicing and trail commission
payments to dealers whose clients hold Class B shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for its expenditures incurred in servicing
and maintaining shareholder accounts, and may pay G.T. Global a distribution fee
at the annualized rate of up to 0.35% of the average daily net assets of the
Fund's Class A shares, less any amounts paid by the Fund as the aforementioned
service fee, for its expenditures incurred in providing services as distributor.
All expenses for which G.T. Global is reimbursed under the Class A Plan will
have been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay G.T. Global a distribution fee at the
annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for its expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest and extraordinary
items) to the maximum annual level of 2.25% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $211,178,375 and $189,494,060, respectively. There were
no purchases or sales of U.S. government obligations by the Fund during the
period.
Statement of Additional Information Page 64
<PAGE>
G.T. GLOBAL WORLDWIDE GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------------ -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold................................................................... 5,542,867 $ 94,463,212 6,116,435 $ 100,434,722
Shares issued in connection with reinvestment of distributions................ 455,250 7,079,197 484,147 8,230,454
---------- ------------ ---------- -------------
5,998,117 101,542,409 6,600,582 108,665,176
Shares repurchased............................................................ (5,352,193) (90,753,350) (5,261,665) (85,672,226)
---------- ------------ ---------- -------------
Net increase.................................................................. 645,924 $ 10,789,059 1,338,917 $ 22,992,950
---------- ------------ ---------- -------------
---------- ------------ ---------- -------------
<CAPTION>
APRIL 1, 1993
YEAR ENDED TO
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------------ -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- -------------
<S> <C> <C> <C> <C>
CLASS B
Shares sold................................................................... 2,513,641 $ 43,054,428 1,178,965 $ 20,214,438
Shares issued in connection with reinvestment of distributions................ 143,692 2,208,845 53,535 905,811
---------- ------------ ---------- -------------
2,657,333 45,263,273 1,232,500 21,120,249
Shares repurchased............................................................ (415,621) (7,016,590) (48,280) (829,213)
---------- ------------ ---------- -------------
Net increase.................................................................. 2,241,712 $ 38,246,683 1,184,220 $ 20,291,036
---------- ------------ ---------- -------------
---------- ------------ ---------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1994, the Fund's
expenses were reduced by $6,357 under these arrangements.
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$11,049,278 as capital gain dividends for the taxable year ended December 31,
1994.
Pursuant to Section 853 of the Internal Revenue Code, the Fund designates
$482,361 of foreign taxes paid and $3,313,419 of gross income earned from
foreign sources in the taxable year ended December 31, 1994.
Statement of Additional Information Page 65
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global International Growth Fund, one of the funds organized as a series of G.T.
Global Growth Series, including the schedule of portfolio investments, as of
December 31, 1994 and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended and the financial highlights for each of the three years in
the period then ended. These financial statements and the financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and the financial highlights
based on our audits. The financial highlights for each of the two years in the
period ended December 31, 1991 were audited by other auditors whose report dated
January 31, 1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global International Growth Fund as of December 31, 1994, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended and the financial highlights for each
of the three years in the period then ended, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
Statement of Additional Information Page 66
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Services (19.1%)
- -----------------------------------------------
DDI Corp. JPN 1,610 $13,908,589 2.8
WIRELESS COMMUNICATIONS
Compass Group PLC UK 1,715,650 9,053,775 1.8
RESTAURANTS
Asatsu JPN 155,600 7,627,604 1.5
BUSINESS & PUBLIC SERVICES
Elsevier N.V. NETH 700,000 7,300,910 1.5
BROADCASTING & PUBLISHING
Reuters Holdings
PLC UK 835,000 6,119,324 1.2
BROADCASTING & PUBLISHING
Telecom Italia
S.P.A. ITLY 2,198,000 5,723,888 1.1
TELEPHONE NETWORKS
Philippine Long
Distance
Telephone
Company ADR (b) PHIL 100,400 5,534,550 1.1
TELEPHONE - LONG DISTANCE
Grupo Televisa,
S.A. de C.V. GDR
(b) MEX 163,200 5,181,600 1.0
BROADCASTING & PUBLISHING
Telecomunicacoes
Brasileiras S.A.
- Telebras: BRZL -- -- 0.9
TELEPHONE NETWORKS
(Preferred) -- 98,600,000 4,417,187 --
(Preferred) New -- 3,045,682 122,799 --
Sponsored ADR
(b) -- 2,600 116,025 --
Stet Societa
Finanziaria
Telefonica
S.P.A. ITLY 1,450,000 4,277,075 0.9
TELEPHONE NETWORKS
Granada Group PLC UK 500,000 4,008,769 0.8
LEISURE & TOURISM
EMAP PLC UK 640,000 3,988,725 0.8
BROADCASTING & PUBLISHING
British Sky
Broadcasting (c) UK 842,000 3,375,384 0.7
CABLE TELEVISION
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Thai Airways
International
Ltd. THAI 1,351,800 $2,935,768 0.6
TRANSPORTATION - AIRLINES
Koninklijke PTT
Nederland N.V. NETH 83,000 2,797,914 0.6
TELEPHONE NETWORKS
Compania de
Telefonos de
Chile S.A. ADR
(b) CHLE 31,900 2,512,125 0.5
TELEPHONE NETWORKS
Securitas
AB-B (c) SWDN 91,700 2,469,269 0.5
BUSINESS & PUBLIC SERVICES
News Corporation
Ltd. AUSL 577,318 2,269,638 0.5
BROADCASTING & PUBLISHING
Telecom
Corporation of
New Zealand Ltd. NZ 352,000 1,149,443 0.2
TELEPHONE NETWORKS
ASSA Abloy
AB-B (c) SWDN 91,700 308,659 0.1
BUSINESS & PUBLIC SERVICES
--------------
95,199,020
--------------
Finance (16.1%)
- -----------------------------------------------
United Overseas
Bank Ltd.
(Foreign) SING 1,113,750 11,780,048 2.3
BANKS-MONEY CENTER
Swiss Reinsurance
Co. (Registered)
(c) SWTZ 15,800 9,527,092 1.9
INSURANCE - MULTI-LINE
Banco Popular
Espanol S.A. SPN 51,783 6,160,425 1.2
BANKS-MONEY CENTER
National
Westminster Bank
PLC UK 738,000 5,928,500 1.2
BANKS-MONEY CENTER
Thai Farmers
Bank, Ltd.
(Foreign) THAI 691,000 5,617,215 1.1
BANKS-MONEY CENTER
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 67
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Skandia
Forsakrings AB
Free SWDN 324,000 $5,605,536 1.1
INSURANCE - MULTI-LINE
Barclays PLC UK 505,000 4,831,741 1.0
BANKS-MONEY CENTER
Cardif S.A. FR 32,900 4,350,108 0.9
INSURANCE - MULTI-LINE
S.G. Warburg
Group PLC UK 400,000 4,334,482 0.9
INVESTMENT MANAGEMENT
Provident
Financial PLC UK 412,500 3,501,018 0.7
INVESTMENT MANAGEMENT
Land and House
Company Ltd.
(Foreign) THAI 185,000 3,302,650 0.7
REAL ESTATE
Swedbank (Private
Placement) (e) SWDN 365,000 2,815,895 0.6
BANKS-MONEY CENTER
M & G Group PLC UK 180,000 2,753,837 0.5
INVESTMENT MANAGEMENT
National
Australia Bank
Ltd. AUSL 291,393 2,337,111 0.5
BANKS-MONEY CENTER
PT Bank
International
Indonesia
(Foreign) (c) INDO 700,000 2,230,314 0.4
BANKS-MONEY CENTER
Grupo Financiero
Banamex Accival,
S.A. de C.V. "C" MEX 686,600 2,081,035 0.4
BANKS-MONEY CENTER
CMIC Finance &
Securities Co.
(Local) THAI 214,500 2,068,500 0.4
SECURITIES BROKER
MDX Company Ltd.
(Foreign) THAI 230,000 779,040 0.2
REAL ESTATE
Cetelem Group FR 4,055 725,260 0.1
CONSUMER FINANCE
--------------
80,729,807
--------------
Retailers (11.5%)
- -----------------------------------------------
Autobacs Seven JPN 150,600 18,002,411 3.6
RETAILERS-OTHER
Seven-Eleven
Japan, Ltd. (c) JPN 187,000 15,046,409 3.0
RETAILERS-OTHER
Aoyama Trading JPN 400,000 9,121,045 1.8
RETAILERS-APPAREL
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Great Universal
Stores PLC UK 965,000 $8,220,482 1.6
RETAILERS-OTHER
Cortefiel SA SPN 179,000 5,374,762 1.1
RETAILERS-APPAREL
MacIntosh N.V. NETH 87,500 2,243,719 0.4
RETAILERS-OTHER
--------------
58,008,828
--------------
Materials/Basic Industry (9.2%)
- -----------------------------------------------
Siam Cement Co.
Ltd. (Foreign) THAI 150,000 8,989,839 1.8
CEMENT
Broken Hill
Proprietary
Company Ltd. AUSL 404,034 6,136,353 1.2
MISC. MATERIALS & COMMODITIES
Imperial Chemical
Industries PLC UK 503,000 5,895,639 1.2
CHEMICALS
British Steel PLC UK 2,439,000 5,881,710 1.2
METALS - STEEL
Compania
Siderurgica
Nacional - CSN
ADR (b)(c) BRZL 121,100 4,124,920 0.8
METALS - STEEL
Tarmac PLC UK 1,730,000 3,237,316 0.6
BUILDING MATERIALS & COMPONENTS
PT Semen Gresik
(Foreign) INDO 600,000 2,812,927 0.6
CEMENT
Ttolmex S.A. de
C.V. Series B2 MEX 266,600 2,308,701 0.5
BUILDING MATERIALS & COMPONENTS
Construcciones y
Auxiliar de
Ferrocarriles
S.A. (CAF) SPN 38,600 2,083,314 0.4
BUILDING MATERIALS & COMPONENTS
Cementos
Mexicanos, S.A.
de C.V. - Cemex
"B" MEX 373,000 2,003,433 0.4
CEMENT
Amcor Ltd. AUSL 236,282 1,708,151 0.3
PAPER/PACKAGING
Pasminco Limited
(c) AUSL 595,500 831,446 0.2
METALS - NON-FERROUS
Dofasco, Inc. CAN 1,150 15,479 --
METALS - STEEL
--------------
46,029,228
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 68
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Consumer Durables (9.0%)
- -----------------------------------------------
Volkswagen AG GER 38,000 $10,452,638 2.1
AUTOMOBILES
Samsung
Electronics Co.: KOR -- -- 1.6
CONSUMER ELECTRONICS
Preferred (c) -- 32,803 2,479,780 --
144A GDR
(b)(c)(d) -- 90,000 4,500,000 --
Common -- 8,000 1,161,339 --
New GDR (b)(c) -- 3,729 186,450 --
Volvo AB-B Free SWDN 295,000 5,560,567 1.1
AUTOMOBILES
Bayerische
Motoren Werke
(BMW) AG GER 10,900 5,391,231 1.1
AUTOMOBILES
National House
Industrial JPN 300,000 4,550,477 0.9
HOUSING
TDK Corp. JPN 90,000 4,366,650 0.9
CONSUMER ELECTRONICS
Arbonia Forster
Holding (Bearer)
(c) SWTZ 3,065 3,419,870 0.7
APPLIANCES & HOUSEHOLD DURABLES
PT Astra
International
(Foreign) INDO 1,200,000 2,294,037 0.5
AUTOMOBILES
Futuris
Corporation Ltd. AUSL 856,524 737,466 0.1
AUTO PARTS
--------------
45,100,505
--------------
Technology (8.8%)
- -----------------------------------------------
Hosiden
Electronics JPN 740,000 15,907,584 3.2
COMPUTERS & PERIPHERALS
Matsushita-
Kotobuki
Electronics
Industries Ltd. JPN 390,000 10,185,836 2.0
COMPUTERS & PERIPHERALS
Tokyo Electron
Ltd. JPN 230,000 7,162,230 1.4
SEMICONDUCTORS
Kyushu-Matsushita
Electric
Industrial JPN 250,000 6,127,574 1.2
COMPUTERS & PERIPHERALS
Keyence
Corporation JPN 30,000 3,405,324 0.7
INSTRUMENTATION & TEST
Koei Co., Ltd. JPN 41,000 1,425,013 0.3
SOFTWARE
--------------
44,213,561
--------------
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Health Care (4.5%)
- -----------------------------------------------
Takeda Chemical
Industries JPN 750,000 $9,116,022 1.8
PHARMACEUTICALS
Sankyo Co. Ltd. JPN 310,000 7,722,752 1.5
PHARMACEUTICALS
Essilor
International FR 42,000 5,781,440 1.2
MEDICAL TECHNOLOGY & SUPPLIES
--------------
22,620,214
--------------
Conglomerate/Country Funds (3.8%)
- -----------------------------------------------
Tomkins PLC UK 1,400,000 4,790,166 1.0
CONGLOMERATE
Wassall PLC UK 1,063,750 4,730,739 0.9
CONGLOMERATE
BTR PLC UK 840,000 3,867,210 0.8
CONGLOMERATE
Grupo Carso, S.A.
de C.V. "A1" (c) MEX 451,000 3,394,124 0.7
CONGLOMERATE
Korea Equity Fund
(b) KOR 250,000 2,187,500 0.4
COUNTRY FUNDS
--------------
18,969,739
--------------
Consumer Non-Durables (3.4%)
- -----------------------------------------------
Bic FR 45,800 5,755,558 1.1
OTHER CONSUMER GOODS
Matthew Clark PLC UK 635,200 5,291,676 1.1
BEVERAGES - ALCOHOLIC
Reliance
Industries Ltd.
144A GDR
(b)(c)(d) IND 244,400 4,765,800 0.9
TEXTILES & APPAREL
Panamerican
Beverages, Inc.
"A" (b) MEX 55,000 1,739,375 0.3
BEVERAGES - NON ALCOHOLIC
Chocolates COL 17,535 185,667 0.0
FOOD
--------------
17,738,076
--------------
Capital Goods (3.4%)
- -----------------------------------------------
Daifuku JPN 373,000 6,294,726 1.3
MACHINERY & ENGINEERING
Nokia AB
(Preferred) FIN 38,400 5,664,842 1.1
TELECOM EQUIPMENT
Weir Group PLC UK 525,000 2,318,353 0.5
MACHINERY & ENGINEERING
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 69
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Empresas ICA
Sociedad
Controladora
S.A. de C.V. ADR
(b) MEX 102,400 $1,587,200 0.3
CONSTRUCTION
E.R.G. Australia
Limited (c) AUSL 523,000 872,208 0.2
ELECTRICAL PLANT/EQUIPMENT
--------------
16,737,329
--------------
Energy (2.4%)
- -----------------------------------------------
Yukong Ltd. KOR 95,790 4,636,411 0.9
OIL
Korea Electric
Power
Corporation (c) KOR 110,100 4,026,387 0.8
ELECTRICAL & GAS UTILITIES
C.A. La
Electricidad de
Caracas VENZ 1,535,503 2,194,864 0.4
ELECTRICAL & GAS UTILITIES
Oil Search Ltd.
(c) AUSL 2,302,000 1,660,611 0.3
OIL
--------------
12,518,273
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Equity Investments (cost $424,634,115)...
457,864,580 91.2
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Fixed Income Principal
Investments Currency Amount
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Corporate Bonds (1.2%)
- -----------------------------------------------
Daewoo
Corporation,
Conv. Bond, 0%
due 12/31/04 KRW $ 5,005,000 3,478,475 0.7
KOREAN CORPORATE BOND
Koei Co. Ltd.,
Conv. Bond, 1.2%
due 9/29/95 JPY 215,000,000 2,125,163 0.4
JAPANESE CORPORATE BOND
<CAPTION>
Fixed Income Principal Market % of Net
Investments Currency Amount Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Siam Syntech
Construction
Co., Conv. Bond,
4.5% due 2/25/02 THB 570,000 $367,650 0.1
THAI CORPORATE BOND
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Corporate Bonds
(cost $8,145,052)............................. 5,971,288 1.2
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Options (0.5%) Ctry No. of Options
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
USD Call/ JPY Put
Option, Strike
100, expires
10/9/95 (c) US 140,000,000 2,758,000 0.5
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Options (cost $3,934,000)................ 2,758,000 0.5
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Warrants (0.0%) No. of Warrants
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Swiss Reinsurance
Co. Wts "B"
expires 6/30/95
(c) SWTZ 10,000 91,708 --
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Warrants (cost $0)....................... 91,708 --
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<CAPTION>
Short-Term
Investments
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Repurchase Agreement (3.4%)
- -----------------------------------------------
Dated December 30, 1994, with State Street Bank
and Trust Company, due January 3, 1995, for an
effective yield of 5.25% collateralized by
$15,145,000 U.S. Treasury Bond, 8.875% due
08/15/17. (Market value $17,067,808 including
accrued interest.)
(Cost $17,046,971)............................
17,046,971 3.4
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Investments
(cost $453,760,138)*.......................... 483,732,547 96.3
Other Assets and Liabilities................... 18,762,824 3.7
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Net Assets..................................... $502,495,371 100.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $502,495,371.
(b) U.S. currency-denominated.
(c) Non-income producing security.
(d) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(e) The following is a restricted security bought from a private placement.
This security is not registered under the Securities Act of 1933 and is
subject to restriction from public resale:
Market Value
Acquisition Per Share
Date Shares Cost at 12/31/94
----------- ------- ---------- --------------
Swedbank............ 3/14/94 365,000 2,662,945 $ 7.71
Abbreviations:
ADR -- American Depository Receipt.
GDR -- Global Depository Receipt.
* For Federal income tax purposes, cost is $455,431,526 and appreciation
(depreciation) of the securities is as follows:
Unrealized appreciation: $ 68,698,843
Unrealized depreciation: (40,397,822)
------------
Net unrealized
appreciation: $ 28,301,021
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 70
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
The Fund's Portfolio of Investments at December 31, 1994 was concentrated in the
following countries:
<TABLE>
<CAPTION>
Percentage of Net Assets(a)
-------------------------------------------------------------------
Fixed Options & Short-Term &
Country Equity Income Warrants Other Total
- ---------------------------- ----------- ----------- ------------- --------------- ---------
<S> <C> <C> <C> <C> <C>
Australia................... 3.3 3.3
Brazil...................... 1.7 1.7
Chile....................... 0.5 0.5
Finland..................... 1.1 1.1
France...................... 3.3 3.3
Germany..................... 3.2 3.2
India....................... 0.9 0.9
Indonesia................... 1.5 1.5
Italy....................... 2.0 2.0
Japan....................... 27.9 0.4 28.3
Korea....................... 3.7 0.7 4.4
Mexico...................... 3.6 3.6
Netherlands................. 2.5 2.5
New Zealand................. 0.2 0.2
Philippines................. 1.1 1.1
Singapore................... 2.3 2.3
Spain....................... 2.7 2.7
Sweden...................... 3.4 3.4
Switzerland................. 2.6 2.6
Thailand.................... 4.8 0.1 4.9
U.K......................... 18.5 18.5
U.S......................... 0.5 7.1 7.6
Venezuela................... 0.4 0.4
-- -- --
--- ---------
Total....................... 91.2 1.2 0.5 7.1 100.0
-- -- --
-- -- --
--- ---------
--- ---------
<FN>
- ----------------
(a) Percentages indicated are based on net assets of $502,495,371.
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Unrealized
Market Value Contract Delivery Appreciation
Contracts to Sell: (US Dollars) Price Date (Depreciation)
- ------------------------------------------------------------------------------- ------------ --------- --------- -------------
<S> <C> <C> <C> <C>
Deutsche Marks................................................................. 15,509,888 1.49493 2/03/95 $ 544,350
French Francs.................................................................. 16,484,648 5.12720 2/03/95 678,715
------------ -------------
Total Contracts to Sell (Receivable amount $33,217,601)........................ 31,994,536 1,223,065
------------ -------------
The value of Contracts to Sell as a Percentage of Net Assets is 6.6%.
Contracts to Buy:
- -------------------------------------------------------------------------------
Deutsche Marks................................................................. 7,263,797 1.53030 2/03/95 (81,168)
French Francs.................................................................. 8,289,156 5.26400 2/03/95 (116,999)
------------ -------------
Total Contracts to Buy (Payable amount $15,751,120)............................ 15,552,953 (198,167)
------------ -------------
The value of Contracts to Buy as a Percentage of Net Assets is 3.1%.
Total Open Forward Foreign Currency Contracts, Net......................... $ 1,024,898
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
WRITTEN OPTION CONTRACTS OUTSTANDING
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Expiration
Strike Date Shares Currency
--------- ---------- ------------- ---------
<S> <C> <C> <C> <C>
JPY Call/USD Put (Cost 3,934,000)..................................... 92.92 10/09/95 140,000,000 USD
<CAPTION>
Market Value
------------
<S> <C>
JPY Call/USD Put (Cost 3,934,000)..................................... $3,094,000
<FN>
- ----------------
See Notes 1 and 6 of the financial statements.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 71
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C> <C>
Investments in securities, at value (cost $453,760,138) (Note 1).................................... $ 483,732,547
Cash...................................................................................
$ 73
Foreign currency (cost $14,201,617)....................................................
13,914,154 13,914,227
-----------
Receivable for securities sold...................................................................... 9,434,937
Receivable for Fund shares sold..................................................................... 3,943,955
Receivable for forward foreign currency contracts -- open (Note 1).................................. 1,024,898
Dividends and dividend withholding tax reclaims receivable.......................................... 1,176,733
Receivable for forward foreign currency contracts -- closed (Note 1)................................ 11,554
Interest receivable................................................................................. 11,034
Cash held as collateral for securities loaned (Note 1).............................................. 37,772,286
-------------
Total assets........................................................................................ 551,022,171
-------------
Liabilities:
Payable for securities purchased.................................................................... 5,783,415
Payable for written options (premium received $3,934,000)........................................... 3,094,000
Payable for Fund shares repurchased................................................................. 832,247
Payable for investment management and administration fees (Note 2).................................. 418,240
Payable for service and distribution expenses (Note 2).............................................. 188,736
Payable for transfer agent fees (Note 2)............................................................ 148,251
Payable for printing and postage expenses........................................................... 136,969
Payable for registration fees....................................................................... 51,936
Payable for professional fees....................................................................... 30,012
Payable for custodian fees (Note 1)................................................................. 20,493
Payable for Trustees' fees and expenses............................................................. 20,176
Accrued expenses.................................................................................... 30,039
Collateral for securities loaned (Note 1)........................................................... 37,772,286
-------------
Total liabilities................................................................................... 48,526,800
-------------
Net assets............................................................................................ $ 502,495,371
-------------
-------------
Class A:
Net asset value and redemption price per share
($430,701,260 DIVIDED BY 46,950,099 shares outstanding)............................................. $ 9.17
-------------
-------------
Maximum offering price per share
(100/95.25 of $9.17)*................................................................................ $ 9.63
-------------
-------------
Class B:+
Net asset value and offering price per share
($71,794,111 DIVIDED BY 7,918,790 shares outstanding)............................................... $ 9.07
-------------
-------------
Net assets consist of:
Paid in capital (Note 4)............................................................................ $ 464,470,873
Accumulated net realized gain on investments, options and foreign currency transactions............. 6,396,142
Net unrealized appreciation on translation of dividends and dividend withholding tax reclaims
receivable, interest receivable, securities purchased and sold, foreign currency, and forward 815,947
foreign currency contracts.........................................................................
Net unrealized appreciation of investments and options.............................................. 30,812,409
-------------
Total -- representing net assets applicable to capital shares outstanding........................... $ 502,495,371
-------------
-------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 72
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income: (Note 1)
Dividends (net of foreign withholding tax of $1,735,771)............................................ $ 8,354,195
Interest............................................................................................ 726,265
-------------
Total investment income............................................................................. 9,080,460
-------------
Expenses:
Investment management and administration fees (Note 2).............................................. 5,368,669
Service and distribution expenses: (Note 2)
Class A............................................................................ $ 1,719,303
Class B............................................................................ 599,931 2,319,234
-------------
Transfer agent fees (Note 2)........................................................................ 1,204,461
Custodian fees (Note 1)............................................................................. 771,287
Printing and postage expenses....................................................................... 159,805
Professional fees................................................................................... 82,647
Registration fees................................................................................... 97,772
Trustees' fees and expenses (Note 2)................................................................ 11,625
-------------
Total expenses before reductions.................................................................... 10,015,500
Expense reductions (Notes 1 & 5).................................................................. (316,826)
-------------
Total net expenses.................................................................................. 9,698,674
-------------
Net investment income (loss).......................................................................... (618,214)
-------------
Net realized and unrealized gain (loss) on investments and foreign currencies: (Note 1)
Net realized gain on investments....................................................... 72,125,469
Net realized loss on foreign currency transactions..................................... (5,888,177)
-------------
Net realized gain during the period................................................................... 66,237,292
Net change in unrealized appreciation on translation of dividends and dividend
withholding tax reclaims receivable, interest receivable, securities purchased and
sold, foreign currency, and forward foreign currency contracts........................ (4,100,341)
Net change in unrealized appreciation of investments and options....................... (100,302,042)
-------------
Net unrealized depreciation during the year........................................................... (104,402,383)
-------------
Net realized and unrealized loss on investments and foreign currencies................................ (38,165,091)
-------------
Net decrease in net assets resulting from operations.................................................. $ (38,783,305)
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 73
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993+
------------------ -------------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss)............................................................
$ (618,214) $ 1,188,982
Net realized gain on investments and foreign currency transactions......................
66,237,292 22,635,141
Net change in unrealized appreciation (depreciation) on translation of dividends and
dividend withholding tax reclaims receivable, interest receivable, securities purchased
and sold, foreign currency, and forward foreign currency contracts.....................
(4,100,341) 3,745,210
Net change in unrealized appreciation (depreciation) of investments and options.........
(100,302,042) 108,913,334
------------------ -------------------
Net increase (decrease) in net assets resulting from operations.........................
(38,783,305) 136,482,667
------------------ -------------------
Class A:
Distributions to shareholders from: (Note 1)
Net investment income...................................................................
(1,684,749) --
Net realized gain on investments........................................................
(40,336,515) --
Class B:
Distributions to shareholders from: (Note 1)
Net investment income...................................................................
(280,442) --
Net realized gain on investments........................................................
(6,714,382) --
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested........................................
1,036,090,550 383,499,693
Decrease from capital shares repurchased................................................
(999,937,817) (387,533,793)
------------------ -------------------
Net increase (decrease) from capital share transactions...................................
36,152,733 (4,034,100)
------------------ -------------------
Total increase (decrease) in net assets...................................................
(51,646,660) 132,448,567
Net assets:
Beginning of year.......................................................................
554,142,031 421,693,464
------------------ -------------------
End of year.............................................................................
$ 502,495,371 $ 554,142,031
------------------
------------------ -------------------
-------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares. Commencing April 1, 1993, the Fund began
offering Class B shares. There were no Class B distributions made to Class
B shareholders for the nine month period ended December 31, 1993.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 74
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
--------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1994 1993(A) 1992 1991 1990
---------- ---------- ---------- ---------- ----------
Per Share Operating Performance:
Net asset value, beginning of period.............. $11.02 $8.21 $8.74 $7.82 $9.25
---------- ---------- ---------- ---------- ----------
Net investment income (loss)...................... (0.04) 0.03 0.11 0.14 0.10
Net realized and unrealized gain (loss) on
investments and foreign currencies.............. (0.82) 2.78 (0.62) 0.89 (1.42)
---------- ---------- ---------- ---------- ----------
Net increase (decrease) in net asset value
resulting from investment operations............ (0.86) 2.81 (0.51) 1.03 (1.32)
---------- ---------- ---------- ---------- ----------
Distributions:
Net investment income........................... (0.04) (0.00) (0.02) (0.11) (0.11)
Net realized gain on investments................ (0.95) (0.00) (0.00) (0.00) (0.00)
---------- ---------- ---------- ---------- ----------
Total distributions........................... (0.99) (0.00) (0.02) (0.11) (0.11)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period.................... $9.17 $11.02 $8.21 $8.74 $7.82
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return (d)....................... (7.78)% 34.2% (5.8)% 13.2% (14.3)%
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $430,701 $523,397 $421,693 $463,851 $343,949
Ratio of net investment income (loss) to average
net assets after expense reductions............. (0.04)% 0.3% 1.2% 1.5% 1.4%
Ratio of expenses to average net assets after
expense reductions.............................. 1.70% 1.8% 1.9% 1.9% 1.9%
Ratio of expenses to average net assets before
expense reductions.............................. 1.75% -- -- -- --
Portfolio turnover rate+++........................ 96% 90% 89% 83% 58%
<CAPTION>
CLASS B++
---------------------
<S> <C> <C>
APRIL 1,
1993
TO
DECEMBER 31,
1994 1993(A)
------- ------------
Per Share Operating Performance:
Net asset value, beginning of period.............. $ 10.98 $8.74
------- ------------
Net investment income (loss)...................... (0.10) (0.01)
Net realized and unrealized gain (loss) on
investments and foreign currencies.............. (0.82) 2.25
------- ------------
Net increase (decrease) in net asset value
resulting from investment operations............ (0.92) 2.24
------- ------------
Distributions:
Net investment income........................... (0.04) (0.00)
Net realized gain on investments................ (0.95) (0.00)
------- ------------
Total distributions........................... (0.99) (0.00)
------- ------------
Net asset value, end of period.................... $9.07 $10.98
------- ------------
------- ------------
Total investment return (d)....................... (8.36)% 25.6%(b)
------- ------------
------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $71,794 $30,745
Ratio of net investment income (loss) to average
net assets after expense reductions............. (0.69)% (0.4)%(c)
Ratio of expenses to average net assets after
expense reductions.............................. 2.35% 2.4%(c)
Ratio of expenses to average net assets before
expense reductions.............................. 2.40% --
Portfolio turnover rate+++........................ 96% 90%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(a) Calculated based upon weighted average shares outstanding during the
period.
(b) Not annualized.
(c) Annualized.
(d) Total investment return does not include sales charges.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 75
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global International Growth Fund ("Fund"), formerly G.T. International
Growth Fund, is a separate series of G.T. Global Growth Series ("Company"). The
Company is organized as a Massachusetts business trust and is registered under
the Investment Company Act of 1940, as amended ("1940 Act"), as a diversified,
open-end management investment company. The Company has six series of shares of
beneficial interest outstanding, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of Fund shares and completes orders to
purchase, exchange or repurchase Fund shares on each business day, with the
exception of those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or, in the principal over-the-counter market in
which such securities are traded as of the closing business on the day the
securities are being valued, or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by GT Capital Management, Inc.
("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
asked prices for such investments or, if such prices are not available, at
prices for investments of comparative maturity, quality and type; however, when
G.T. Capital, the Fund's investment manager, deems it appropriate, prices are
obtained for the day of valuation from a bond pricing service will be used.
Short-term investments with a maturity of 60 days or less are valued at
amortized cost, adjusted for foreign exchange translation and market
fluctuations, if any.
Investments which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Fund's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when accrued or incurred.
As of January 1, 1994, the Fund adopted Statement of Position 93-4: "Foreign
Currency Accounting and Financial Statement Presentation for Investment
Companies." As permitted under the SOP, the Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of forward foreign currency contracts, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
securities transactions, the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains or losses arise from changes in the value of assets and
liabilities other than investments in securities at fiscal year end, resulting
from changes in exchange rates.
Statement of Additional Information Page 76
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
Certain 1993 amounts have been reclassified for consistency in financial
statement presentation.
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, U.S. government securities or other
high quality debt securities of which the value, including accrued interest, is
at least equal to the amount to be paid to the Fund under each agreement at its
maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of a contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or in the case of an over-the-counter option is valued at the
bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. The
Fund uses options in order to manage its exposure to currency levels or interest
rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
Statement of Additional Information Page 77
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Fund may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Fund to subsequently invest at less
advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At December 31, 1994, stocks with an aggregate value of approximately
$35,972,532 were on loan to brokers. The loans were secured by cash collateral
of $37,772,286, received by the Fund. Cash collateral is received by the Fund
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For the year ended December 31, 1994,
the Fund received fees of $291,598 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, or excise tax on income
and capital gains.
(J) DISTRIBUTION TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. These risks of investing in foreign markets may
include foreign currency exchange rate fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the year, restricted securities
(excluding 144A issues) are shown at the end of the Portfolio of Investments.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees at
the following annualized rates: 0.975% on the first $500 million of average
daily net assets of the Fund; 0.95% on the next $500 million; 0.925% on the next
$500 million and 0.90% on amounts thereafter. These fees are computed daily and
paid monthly, and are subject to reduction in any year to the extent that the
Fund's expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary expenses) exceed the most
stringent limits prescribed by the laws or regulations of any state in which the
Fund's shares are offered for sale, based on the average total net asset value
of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$106,490 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. During the year ended December
31, 1994, G.T. Global collected CDSCs in the amount of
Statement of Additional Information Page 78
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
$32,916. In addition, G.T. Global makes ongoing shareholder servicing and trail
commission payments to dealers whose clients hold Class B shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for its expenditures incurred in servicing
and maintaining shareholder accounts, and may pay G.T. Global a distribution fee
at the annualized rate of up to 0.35% of the average daily net assets of the
Fund's Class A shares, less any amounts paid by the Fund as the aforementioned
service fee, for its expenditures incurred in providing services as distributor.
All expenses for which G.T. Global is reimbursed under the Class A Plan will
have been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay G.T. Global a distribution fee at the
annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for its expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest and extraordinary
items) to the maximum annual level of 2.25% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $484,953,165 and $526,563,537, respectively. There were
no purchases or sales of U.S. government obligations by the Fund during the
year.
Statement of Additional Information Page 79
<PAGE>
G.T. GLOBAL INTERNATIONAL GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold............................................................... 86,542,390 $ 926,900,205 37,875,872 $ 354,505,275
Shares issued in connection with reinvestment of distributions............ 3,799,540 34,613,815 -- --
----------- ------------- ----------- -------------
90,341,930 961,514,020 37,875,872 354,505,275
Shares repurchased........................................................ (90,893,714) (979,657,620) (41,717,561) (386,224,759)
----------- ------------- ----------- -------------
Net decrease.............................................................. (551,784) $ (18,143,600) (3,841,689) $ (31,719,484)
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
<CAPTION>
YEAR ENDED APRIL 1, 1993 TO DECEMBER
DECEMBER 31, 1994 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS B
Shares sold............................................................... 6,350,365 $ 68,347,089 2,933,602 $ 28,994,418
Shares issued in connection with reinvestment of distributions............ 691,392 6,229,441 -- --
----------- ------------- ----------- -------------
7,041,757 74,576,530 2,933,602 28,994,418
Shares repurchased........................................................ (1,924,260) (20,280,197) (132,309) (1,309,034)
----------- ------------- ----------- -------------
Net increase.............................................................. 5,117,497 $ 54,296,333 2,801,293 $ 27,685,384
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1994, the Fund's
expenses were reduced by $25,228 under these arrangements.
6. COVERED CALL OPTIONS WRITTEN
The Fund's written options contracts activity for the year ended December 31,
1994, was as follows:
<TABLE>
<CAPTION>
SHARES PREMIUMS
----------- ----------
<S> <C> <C>
Options outstanding at December 31, 1993.................................................................. -- $ --
Options written during the year ended December 31, 1994................................................... 140,000,000 3,934,000
Options cancelled in closing purchase transactions........................................................ -- --
Options expired prior to exercise......................................................................... -- --
Options exercised......................................................................................... -- --
----------- ----------
Options outstanding at December 31, 1994.................................................................. 140,000,000 $3,934,000
----------- ----------
----------- ----------
</TABLE>
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$47,050,896 as capital gain dividends for the taxable year ended December 31,
1994.
Pursuant to Section 853 of the Internal Revenue Code, the Fund designates
$1,735,771 of foreign taxes paid and $10,277,558 of gross income earned from
foreign sources in the taxable year ended December 31, 1994.
Statement of Additional Information Page 80
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global New Pacific Growth Fund, a series of shares of beneficial interest of
G.T. Global Growth Series, including the schedule of portfolio investments, as
of December 31, 1994, the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the three years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits. The financial highlights for each of the two years in the period ended
December 31, 1991 were audited by other auditors whose report dated January 31,
1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of G.T.
Global New Pacific Growth Fund as of December 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the three years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
Statement of Additional Information Page 81
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Banks-Money Center (22.6%)
- ----------------------------------------------
HSBC Holdings PLC HK 1,925,600 $ 20,782,985 3.9
BANKS-MONEY CENTER
Hang Seng Bank HK 2,485,100 17,827,577 3.4
BANKS-MONEY CENTER
Public Bank Berhad
(Foreign) MAL 8,500,000 16,986,677 3.2
BANKS-MONEY CENTER
Krung Thai Bank Ltd.
(Foreign) THAI 5,051,400 16,707,161 3.2
BANKS-MONEY CENTER
Development &
Commercial Bank
Berhad MAL 5,595,000 13,592,868 2.6
BANKS-MONEY CENTER
Development Bank of
Singapore (Foreign) SING 1,209,555 12,461,075 2.4
BANKS-MONEY CENTER
United Overseas Bank
Ltd. (Foreign) SING 850,000 8,990,385 1.7
BANKS-MONEY CENTER
National Australia
Bank Ltd. AUSL 833,950 6,693,474 1.3
BANKS-MONEY CENTER
PT Bank International
Indonesia
(Foreign)(c) INDO 950,000 3,026,855 0.6
BANKS-MONEY CENTER
Bank of East Asia
Ltd. HK 247,000 986,531 0.2
BANKS-MONEY CENTER
Malayan Banking
Berhad MAL 70,500 425,431 0.1
BANKS-MONEY CENTER
--------------
118,481,019
--------------
Materials/Basic Industries (19.2%)
- ----------------------------------------------
Western Mining Corp.
Holdings Ltd. AUSL 3,278,381 19,023,841 3.6
METALS-NON-FERROUS
Broken Hill
Proprietary Co. Ltd. AUSL 1,037,422 15,763,991 3.0
MISC. MATERIALS & COMMODITIES
Pohang Iron & Steel
Co. Ltd.(c) KOR 100,000 9,857,179 1.9
METALS-STEEL
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Siam City Cement Co.
Ltd. (Foreign) THAI 500,000 $ 8,527,595 1.7
CEMENT
CRA Ltd. AUSL 551,000 7,607,664 1.4
METALS-NON-FERROUS
PT Indocement Tunggal
Prakarsa (Foreign) INDO 2,619,000 7,539,907 1.4
CEMENT
Amcor Ltd. AUSL 882,085 6,388,246 1.2
PAPER/PACKAGING
Ssangyong Cement
Company Ltd. KOR 123,200 4,719,229 0.9
CEMENT
PT Barito Pacific
Timber (Foreign)(c) INDO 2,755,000 4,357,590 0.8
FOREST PRODUCTS
Siam Pulp & Paper
(Foreign) THAI 1,144,284 4,103,828 0.8
PAPER/PACKAGING
Pasminco Ltd. AUSL 2,138,500 2,985,805 0.6
METALS-NON-FERROUS
Carter Holt Harvey
Ltd. NZ 1,374,842 2,816,938 0.5
FOREST PRODUCTS
Siam Cement Co. Ltd.
(Foreign) THAI 33,500 2,007,731 0.4
CEMENT
Newcrest Mining Ltd. AUSL 426,700 1,903,138 0.4
GOLD
Ashton Mining Ltd. AUSL 496,700 828,347 0.2
GOLD
PT Indah Kiat Pulp &
Paper Corp.
(Foreign) INDO 673,000 796,450 0.2
PAPER/PACKAGING
Australian National
Industries Ltd. AUSL 393,752 439,810 0.1
METALS-STEEL
Mitani Sangyo JPN 31,000 280,261 0.1
CHEMICALS
--------------
99,947,550
--------------
Services (11.8%)
- ----------------------------------------------
Hong Kong
Telecommunications
Ltd. HK 6,018,200 11,473,980 2.2
TELEPHONE NETWORKS
News Corp. Ltd. AUSL 2,264,844 8,901,323 1.7
BROADCASTING & PUBLISHING
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 82
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Advanced Information
Service (Foreign) THAI 578,900 $ 8,027,782 1.5
WIRELESS COMMUNICATIONS
Philippine Long
Distance Telephone
Company ADR (b) PHIL 125,000 6,890,625 1.3
TELEPHONE-LONG DISTANCE
Singapore Press
Holdings SING 250,000 4,550,137 0.9
BROADCASTING & PUBLISHING
Faber Group Berhad(c) MAL 4,500,000 3,986,951 0.8
LEISURE & TOURISM
Resorts World Berhad MAL 540,000 3,173,981 0.6
LEISURE & TOURISM
TNT Ltd.(c) AUSL 1,800,000 3,069,764 0.6
TRANSPORTATION-ROAD & RAIL
Hong Kong & Shanghai
Hotels HK 2,500,000 2,892,135 0.6
LEISURE & TOURISM
Telecom Corporation
of New Zealand Ltd. NZ 801,300 2,649,086 0.5
TELEPHONE NETWORKS
Autobacs Seven JPN 14,300 1,709,392 0.3
RETAILERS-OTHER
Dusit Thani Corp.
Ltd. (Foreign)(c) THAI 913,000 1,036,880 0.2
LEISURE & TOURISM
Matichon Newspaper
Group (Foreign)(c) THAI 154,800 999,307 0.2
BROADCASTING & PUBLISHING
Thai Airways
International Ltd. THAI 402,100 873,260 0.2
TRANSPORTATION-AIRLINES
Malaysian Helicopter
Services Berhad MAL 400,000 752,351 0.1
TRANSPORTATION-AIRLINES
International
Cosmetics Co. Ltd.
(Foreign) THAI 30,030 634,226 0.1
WHOLESALE & INTERNATIONAL TRADE
Shun Tak Holdings
Ltd. HK 160,000 113,747 --
TRANSPORTATION-SHIPPING
Aoyama Trading JPN 3,000 68,408 --
RETAILERS-APPAREL
Singapore Airlines
Ltd. (Foreign)(c) SING 5,000 46,016 --
TRANSPORTATION-AIRLINES
--------------
61,849,351
--------------
Other Finance (9.5%)
- ----------------------------------------------
Wharf (Holdings) Ltd. HK 3,500,000 11,807,665 2.2
REAL ESTATE
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Hysan Development Co.
Ltd. HK 3,019,000 $ 5,990,002 1.1
REAL ESTATE
Sun Hung Kai
Properties Ltd. HK 764,000 4,562,373 0.9
REAL ESTATE
Samsung Securities
Co. Ltd.(c) KOR 104,400 4,502,283 0.9
SECURITIES BROKER
City Developments
Ltd. SING 751,000 4,203,743 0.8
REAL ESTATE
Henderson Investment
Ltd. HK 5,000,000 3,296,064 0.6
REAL ESTATE
Amoy Properties Ltd. HK 3,613,500 3,269,502 0.6
REAL ESTATE
Rashid Hussain Berhad MAL 1,020,000 2,677,900 0.5
SECURITIES BROKER
Malaysian Resources
Corp. Berhad MAL 1,220,000 2,256,426 0.4
REAL ESTATE
Kay Hian James Capel
Holdings Ltd.
(Foreign) SING 984,000 1,243,516 0.2
SECURITIES BROKER
Hong Kong Land
Holdings Ltd. HK 592,000 1,155,458 0.2
REAL ESTATE
Olympia Industries
Berhad MAL 1,000,000 1,081,505 0.2
REAL ESTATE
Taiping Consolidated
Berhad(c) MAL 603,000 1,011,301 0.2
REAL ESTATE
Great Eagle Holding
Company HK 2,343,000 938,835 0.2
REAL ESTATE
Somprasong Land Co.
Ltd. (Local) THAI 235,400 905,204 0.2
REAL ESTATE
Shin Young Securities
Co. (Preferred)(c) KOR 50,000 799,087 0.2
SECURITIES BROKER
Hang Lung Development
Co. HK 365,000 518,969 0.1
REAL ESTATE
Cheung Kong
(Holdings) Ltd. HK 60,000 244,297 --
REAL ESTATE
Bangkok Land Co. Ltd.
(Foreign) THAI 19,500 48,565 --
REAL ESTATE
--------------
50,512,695
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 83
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Banks-Regional (8.7%)
- ----------------------------------------------
Siam Commercial Bank
Co. Ltd. (Foreign) THAI 2,564,600 $ 23,505,001 4.5
BANKS-REGIONAL
Bank of Ayudhya Ltd.
(Foreign) THAI 1,512,600 6,148,045 1.2
BANKS-REGIONAL
Overseas-Chinese
Banking Corp. Ltd.
(Foreign) SING 500,000 5,151,099 1.0
BANKS-REGIONAL
Shinhan Bank(c) KOR 170,000 4,835,426 0.9
BANKS-REGIONAL
Public Bank Berhad
(Foreign) MAL 2,200,000 4,563,187 0.9
BANKS-REGIONAL
Thai Farmers Bank
Ltd. (Foreign) THAI 155,000 1,260,012 0.2
BANKS-REGIONAL
--------------
45,462,770
--------------
Consumer Durables (6.7%)
- ----------------------------------------------
Samsung Electronics
Co.: KOR -- -- 4.1
CONSUMER ELECTRONICS
Common(c) -- 118,820 17,248,794 --
New(c) -- 6,780 984,235 --
Preferred(c) -- 43,850 3,314,891 --
Reliance Industries
Ltd. 144A
GDR(b)(c)(d) IND 210,000 4,095,000 0.8
TEXTILES & APPAREL
Daewoo Electronics
Co.(c) KOR 226,472 3,705,592 0.7
CONSUMER ELECTRONICS
Hyundai Motor Co.
Ltd.144A
GDR(b)(c)(d) KOR 133,000 2,493,750 0.5
AUTOMOBILES
Futuris Corp. Ltd. AUSL 1,883,363 1,621,574 0.3
AUTO PARTS
PT Unilever Indonesia
(Foreign) INDO 70,414 1,121,752 0.2
HOUSEHOLD PRODUCTS
PT Astra
International
(Foreign) INDO 261,600 500,100 0.1
AUTO PARTS
--------------
35,085,688
--------------
Multi-Industry (6.4%)
- ----------------------------------------------
Hutchison Whampoa
Ltd. HK 2,310,000 9,345,699 1.8
CONGLOMERATE
Renong Berhad MAL 6,150,000 7,603,022 1.4
CONGLOMERATE
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Swire Pacific Ltd.
Class "A" HK 900,000 $ 5,607,187 1.1
CONGLOMERATE
ROC Taiwan Fund(b)(c) TWN 438,700 5,209,563 1.0
COUNTRY FUNDS
Arab Malaysian Corp. MAL 1,713,000 4,799,353 0.9
CONGLOMERATE
JG Summit Holdings
Inc. Class "B" PHIL 748,000 278,182 0.1
CONGLOMERATE
Java Fund
Cayman(b)(c) INDO 30,000 261,000 0.1
COUNTRY FUNDS
Jardine Matheson
Holdings Ltd. HK 36,000 257,093 --
CONGLOMERATE
Berjaya Industrial
Berhad MAL 450,000 373,970 --
MULTI-INDUSTRY
Indonesian Capital
Fund (b)(c) INDO 5,000 52,500 --
COUNTRY FUNDS
Korea Fund Inc.(b)(c) KOR 716 16,289 --
COUNTRY FUNDS
--------------
33,803,858
--------------
Energy (4.5%)
- ----------------------------------------------
Yukong Ltd.: KOR -- -- 1.5
OIL
Common(c) -- 160,000 7,427,702 --
New (b)(c) -- 9,629 466,061 --
Hong Kong Electric
Holdings Ltd. HK 1,789,000 4,890,758 0.9
ELECTRICAL & GAS UTILITIES
Korea Electric Power
Corp. (c) KOR 100,000 3,657,027 0.7
ELECTRICAL & GAS UTILITIES
Tenaga Nasional
Berhad MAL 922,000 3,648,981 0.7
ELECTRICAL & GAS UTILITIES
Oil Search Ltd.(c) AUSL 4,652,000 3,355,849 0.7
OIL
--------------
23,446,378
--------------
Capital Goods (1.7%)
- ----------------------------------------------
Bandar Raya
Development
Berhad(c) MAL 1,548,000 2,620,439 0.5
CONSTRUCTION
Hyundai Engineering &
Construction Co.(c) KOR 47,200 2,553,973 0.5
CONSTRUCTION
E.R.G. Australia Ltd.
(c) AUSL 1,390,000 2,318,104 0.4
ELECTRICAL PLANT/EQUIPMENT
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 84
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Daewoo Heavy
Industries(c) KOR 88,757 $ 1,384,717 0.3
INDUSTRIAL COMPONENTS
United Engineers
(Malaysia) Ltd.,
Conv. Unsecured Loan
Stock MAL 653,500 279,120 --
CONSTRUCTION
--------------
9,156,353
--------------
Health Care (0.0%)
- ----------------------------------------------
Prasit Development
Co. Ltd. (Local) THAI 50,000 83,682 --
HEALTH CARE SERVICES
--------------
83,682
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Equity Investments
(cost $449,645,495).......................... 477,829,344 91.1
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
<CAPTION>
No. of
Warrants (1.4%) Warrants
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Rashid Hussain Berhad
TSR expires 5/27/95
(c) MAL 2,730,000 4,300,392 0.8
SECURITIES BROKER
Swiss Bank Corp-HSBC
expires 8/10/95(c) HK 9,116,000 1,531,804 0.3
BANKS-MONEY CENTER
SG Warburg OTC-China
Light & Power
expires 1/2/96(c) HK 19,470,000 1,107,322 0.2
ELECTRICAL & GAS UTILITIES
Peregrine Der-Sun
Hung Kai Properties
expires 5/4/95(c) HK 1,440,000 294,086 0.1
REAL ESTATE
Hong Kong Electric
Holdings expires
06/02/96(c) HK 3,125,000 83,613 --
ELECTRICAL & GAS UTILITIES
Hang Lung Development
Co. expires
10/31/97(c) HK 36,500 5,473 --
REAL ESTATE
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Warrants (cost $14,558,907)............. 7,322,690 1.4
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
<CAPTION>
No. of Market % of Net
Rights (0.0%) Ctry Rights Value Assets(a)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Olympia Industries
Berhad expires
1/20/95 (c) MAL 300,000 $ 48,197 --
REAL ESTATE
Henderson
Investment Ltd.
expires 01/01/02
(c) HK 500,000 5,041 --
REAL ESTATE
Development &
Commercial Bank
expires 1994(c) MAL 1,398,750 1 --
BANKS-MONEY CENTER
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Rights (cost $0)........................ 53,239 0.0
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
<CAPTION>
Fixed Income Principal
Investments Currency Amount
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------
Corporate Bonds (1.9%)
- ----------------------------------------------
Reliance Industries
Conv. Bond, 3.5%
due 11/03/99 USD 4,510,000 $ 5,006,100 1.0
INDIAN CORPORATE BOND
Global Mark
International
Ltd., 144A Bond,
3.5% due 2/9/95(d) USD 3,000,000 3,082,500 0.6
INDONESIAN CORPORATE BOND
ACER Inc., Conv.
Bond, 4% due
6/10/01 USD 750,000 1,803,750 0.3
TAIWANESE CORPORATE BOND
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Fixed Income Investments
(cost $10,254,010)........................... 9,892,350 1.9
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Short-Term Investments
- ----------------------------------------------
Repurchase Agreement (5.7%)
- ----------------------------------------------
Dated December 30, 1994, with State Street
Bank and Trust Company due January 3, 1995,
for an effective yield of 5.25%
collateralized by $30,120,000 U.S. Treasury
Note, 6.25% due 8/31/96. (Market Value
$30,128,996 including accrued interest)
(cost $30,123,784)...........................
30,123,784 5.7
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Total Investments
(cost $504,582,196)*......................... 525,221,407 100.1
Other Assets and Liabilities.................. (370,446) (0.1)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Net Assets.................................... 524,850,961 100.0
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 85
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
<TABLE>
<S> <C> <C> <C> <C>
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $524,850,961.
(b) U.S. currency-denominated.
(c) Non-income producing security.
(d) Security exempt from registration under Rule 144A of the securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
Abbreviations:
ADR -- American Depository Receipt.
GDR -- Global Depository Receipt.
* For Federal income tax purposes, cost is $505,326,733 and appreciation
(depreciation) of securities is as follows:
Unrealized appreciation: $ 72,704,804
Unrealized depreciation: (52,810,130)
-------------
Net unrealized
appreciation: $ 19,894,674
-------------
-------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at December 31, 1994, was concentrated in
the following countries:
<TABLE>
<CAPTION>
Percentage of Net Assets (a)
----------------------------------------------------
Fixed Short-Term
Country Equity Income & Other Total
- ------------------------------- ----------- ----------- --------------- ---------
<S> <C> <C> <C> <C>
Australia...................... 15.5 15.5
Hong Kong...................... 20.0 0.6 20.6
India.......................... 1.2 1.2
Indonesia...................... 3.4 3.4
Korea.......................... 13.1 13.1
Malaysia....................... 13.1 0.8 13.9
New Zealand.................... 1.0 1.0
Philippines.................... 1.4 1.4
Singapore...................... 7.0 7.0
Taiwan......................... 1.0 1.0
Thailand....................... 14.4 14.4
United States.................. 1.9 5.6 7.5
-- --
--- ---------
Total.......................... 91.1 1.9 7.0 100.0
-- --
-- --
--- ---------
--- ---------
<FN>
- ----------------
(a) Percentages indicated are based on net assets of $524,850,961.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 86
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C> <C>
Investments in securities, at value (cost $504,582,196) (Note 1)..................................... $ 525,221,407
U.S. currency............................................................................
$ 318
Foreign currency (cost $4,969,037).......................................................
4,953,131 4,953,449
----------
Receivable for securities sold....................................................................... 8,680,120
Receivable for Fund shares sold...................................................................... 5,435,190
Dividends and dividend withholding tax reclaims receivable........................................... 586,768
Interest receivable.................................................................................. 187,617
Cash held as collateral for securities loaned (Note 1)............................................... 38,153,886
-------------
Total assets......................................................................................... 583,218,437
-------------
Liabilities:
Payable for securities purchased..................................................................... 15,529,722
Payable for Fund shares repurchased.................................................................. 3,738,102
Payable for investment management and administration fees (Note 2)................................... 449,909
Payable for service and distribution expenses (Note 2)............................................... 228,122
Payable for printing and postage expenses............................................................ 123,512
Payable for professional fees........................................................................ 68,981
Payable for registration fees........................................................................ 37,403
Payable for custodian fees (Note 1).................................................................. 19,504
Payable for transfer agent fees (Note 2)............................................................. 18,335
Collateral for securities loaned (Note 1)............................................................ 38,153,886
-------------
Total liabilities.................................................................................... 58,367,476
-------------
Net assets............................................................................................. $ 524,850,961
-------------
-------------
Class A:
Net asset value and redemption price per share
($404,679,778 DIVIDED BY 33,438,817 shares outstanding).............................................. $ 12.10
-------------
-------------
Maximum offering price per share
(100/95.25 of $12.10)*................................................................................ $ 12.70
-------------
-------------
Class B:+
Net asset value and offering price per share
($120,171,183 DIVIDED BY 10,047,652 shares outstanding).............................................. $ 11.96
-------------
-------------
Net assets consist of:
Paid in capital (Note 4)............................................................................. $ 506,512,253
Accumulated net realized loss on investments, options, futures, and forward foreign currency (2,297,888)
translations........................................................................................
Net unrealized depreciation on translation of dividends and dividend withholding tax reclaims
receivable, interest receivable, securities purchased and sold, and foreign currency................ (2,615)
Net unrealized appreciation of investments........................................................... 20,639,211
-------------
Total -- representing net assets applicable to capital shares outstanding............................ $ 524,850,961
-------------
-------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 87
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income: (Note 1)
Dividends (net of foreign withholding tax of $728,778).............................................. $ 8,229,939
Interest............................................................................................ 2,759,460
-------------
Total investment income............................................................................. 10,989,399
-------------
Expenses:
Investment management and administration fees (Note 2).............................................. 5,563,245
Service and distribution expenses: (Note 2)
Class A............................................................................ $ 1,615,636
Class B............................................................................ 1,108,574 2,724,210
-------------
Transfer agent fees (Note 2)........................................................................ 1,510,823
Custodian fees (Note 1)............................................................................. 1,175,408
Printing and postage expenses....................................................................... 113,910
Registration fees................................................................................... 112,796
Professional fees................................................................................... 94,526
Trustees' fees and expenses (Note 2)................................................................ 14,227
-------------
Total expenses before expense reductions............................................................ 11,309,145
Expense reductions (Note 1)....................................................................... (291,126)
-------------
Total net expenses.................................................................................. 11,018,019
-------------
Net investment loss................................................................................... (28,620)
-------------
Net realized and unrealized gain (loss) on investments and foreign currencies: (Note 1)
Net realized gain on investments....................................................... 9,868,860
Net realized gain on foreign currency transactions..................................... 2,345,528
-------------
Net realized gain...................................................................... 12,214,388
Net change in unrealized depreciation on translation of dividends and dividend
withholding tax reclaims receivable, interest receivable, securities purchased and
sold, foreign currency, and forward foreign currency contracts........................ 25,326
Net change in unrealized appreciation of investments................................... (129,412,169)
-------------
Net unrealized depreciation........................................................................... (129,386,843)
-------------
Net realized and unrealized loss on investments and foreign currencies................................ (117,172,455)
-------------
Net decrease in net assets resulting from operations.................................................. $(117,201,075)
-------------
-------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 88
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment loss......................................................................
$ (28,620) $ (1,072,288)
Net realized gain on investments, options, futures, and forward foreign currency
transactions............................................................................
12,214,388 50,199,220
Net change in unrealized appreciation (depreciation) on translation of dividends and
dividend withholding tax reclaims receivable, interest receivable, securities purchased
and sold, foreign currency, and forward foreign currency contracts......................
25,326 16,302
Net change in unrealized appreciation (depreciation) of investments......................
(129,412,169) 142,646,599
------------------ ------------------
Net increase (decrease) in net assets resulting from operations..........................
(117,201,075) 191,789,833
------------------ ------------------
Class A:+
Distributions to shareholders from: (Note 1)
Net investment income....................................................................
(202,019) --
Net realized gain on investments.........................................................
(18,250,328) (19,333,572)
In excess of net realized gain on investments............................................
(2,341,796) --
Class B:++
Distributions to shareholders from: (Note 1)
Net realized gain on investments.........................................................
(5,228,855) (2,490,704)
In excess of net realized gain on investments............................................
(670,942) --
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.........................................
1,372,467,962 667,812,844
Decrease from capital shares repurchased.................................................
(1,274,742,064) (548,176,350)
------------------ ------------------
Net increase from capital share transactions...............................................
97,725,898 119,636,494
------------------ ------------------
Total increase (decrease) in net assets....................................................
(46,169,117) 289,602,051
Net assets:
Beginning of year........................................................................
571,020,078 281,418,027
------------------ ------------------
End of year..............................................................................
$ 524,850,961 $ 571,020,078
------------------
------------------ ------------------
------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 89
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
--------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1994 1993 1992 1991 1990
---------- ---------- ---------- ---------- ----------
Per Share Operating Performance:
Net asset value, beginning of period.............. $15.86 $10.31 $11.30 $10.57 $12.61
---------- ---------- ---------- ---------- ----------
Net investment income (loss)...................... 0.02 (0.03) 0.07 0.11 0.13
Net realized and unrealized gain (loss) on
investments..................................... (3.15) 6.23 (0.97) 1.25 (1.51)
---------- ---------- ---------- ---------- ----------
Net increase (decrease) from investment
operations...................................... (3.13) 6.20 (0.90) 1.36 (1.38)
---------- ---------- ---------- ---------- ----------
Distributions to shareholders from:
Net investment income........................... (0.01) (0.00) (0.06) (0.08) (0.12)
Net realized gain on investments................ (0.55) (0.65) (0.03) (0.55) (0.54)
In excess of net realized gain on investments... (0.07) -- -- -- --
---------- ---------- ---------- ---------- ----------
Total distributions........................... (0.63) (0.65) (0.09) (0.63) (0.66)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period.................... $12.10 $15.86 $10.31 $11.30 $10.57
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Total investment return (c)....................... (19.73)% 60.6% (8.0)% 13.1% (11.0)%
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $404,680 $498,898 $281,418 $333,800 $234,793
Ratio of net investment income (loss) to average
net assets...................................... 0.11% (0.3)% 0.6% 1.0% 1.1%
Ratio of expenses to average net assets........... 1.81% 1.9% 2.0% 2.0% 2.1%
Portfolio turnover rate+++........................ 87% 117% 72% 85% 75%
<CAPTION>
CLASS B++
-------------------------
<S> <C> <C>
APRIL 1,
1993
TO
DECEMBER 31,
1994 1993
---------- ------------
Per Share Operating Performance:
Net asset value, beginning of period.............. $15.79 $11.27
---------- ------------
Net investment income (loss)...................... (0.06) (0.10)
Net realized and unrealized gain (loss) on
investments..................................... (3.15) 5.27
---------- ------------
Net increase (decrease) from investment
operations...................................... (3.21) 5.17
---------- ------------
Distributions to shareholders from:
Net investment income........................... (0.00) (0.00)
Net realized gain on investments................ (0.55) (0.65)
In excess of net realized gain on investments... (0.07) --
---------- ------------
Total distributions........................... (0.62) (0.65)
---------- ------------
Net asset value, end of period.................... $11.96 $15.79
---------- ------------
---------- ------------
Total investment return (c)....................... (20.30)% 46.3%(a)
---------- ------------
---------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's).............. $120,171 $72,122
Ratio of net investment income (loss) to average
net assets...................................... (0.54)% (0.9)%(b)
Ratio of expenses to average net assets........... 2.46% 2.5%(b)
Portfolio turnover rate+++........................ 87% 117%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(a) Not annualized.
(b) Annualized.
(c) Total investment return does not include sales charges.
</TABLE>
Statement of Additional Information Page 90
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global New Pacific Growth Fund ("Fund") is a separate series of G.T. Global
Growth Series ("Company"). The Company is organized as a Massachusetts business
trust and is registered under the Investment Company Act of 1940, as amended
("1940 Act"), as a diversified, open-end management investment company. The
Company has six series of shares of beneficial interest outstanding, each series
corresponding to a distinct portfolio of investments. The following is a summary
of significant accounting policies consistently followed by the Fund in the
preparation of the financial statements. The policies are in conformity with
generally accepted accounting principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Securities traded on stock exchanges are valued at the last quoted sales price
on the exchange on which such securities are traded or, on the principal
over-the-counter market, as of the close of business on the day the securities
are being valued or, lacking any sales, at the last available bid price. In
cases where securities are traded on more than one exchange, the securities are
valued on the exchange determined by G.T. Capital Management Inc. ("G.T.
Capital") to be the primary market.
Fixed income securities are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for securities of comparative maturity, quality and type. However, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost, adjusted for foreign exchange
translation and market fluctuation, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rate, except that when an occurrence subsequent to the time
a value was so established is likely to have materially changed such value, then
the fair value of those securities will be determined by consideration of other
factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when earned or incurred.
As of January 1, 1994, the Fund adopted Statement of Position 93-4: "Foreign
Currency Accounting and Financial Statement Presentation for Investment
Companies." As permitted under the SOP, the Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of forward foreign currency contracts, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
securities transactions, the difference between the amount of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains or losses arise from changes in the value of assets and
liabilities other than investments in securities at fiscal year end, resulting
from changes in exchange rates.
Certain 1993 amounts have been reclassified for consistency in financial
statement presentation.
Statement of Additional Information Page 91
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, U.S. government securities or other
high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be paid to the
Fund under each agreement at its maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of a contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or in the case of an over-the-counter option is valued at the
bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. The
Fund uses options in order to manage its exposure to currency levels or interest
rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The
Statement of Additional Information Page 92
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
cost of securities sold is determined on an identified cost basis. Dividends are
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Where a high level of uncertainty exists as to its collection, income is
recorded net of all withholding tax with any rebate recorded when received. The
Fund may trade securities on other than normal settlement terms. This may
increase the risk if the other party to the transaction fails to deliver and
causes the Fund to subsequently invest at less advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At December 31, 1994, stocks with an aggregate value of approximately
$36,020,059 were on loan to brokers. The loans were secured by cash collateral
of $38,153,886, received by the Fund. Cash collateral is received by the Fund
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For the year ended December 31, 1994,
the Fund received fees of $291,126 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, or excise tax on income
and capital gains.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. These risks of investing in foreign markets may
include foreign currency exchange rate fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees at
the following annualized rates: 0.975% on the first $500 million of average
daily net assets on the Fund; 0.95% on the next $500 million; 0.925% on the next
$500 million and 0.90% on amounts thereafter. These fees are computed daily and
paid monthly, and are subject to reduction in any year to the extent that the
Fund's expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary expenses) exceed the most
stringent limits prescribed by the laws or regulations of any state in which the
Fund's shares are offered for sale, based on the average total net asset value
of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$260,474 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. For the year ended December 31,
1994, G.T. Global collected CDSCs in the amount of $280,905. In addition, G.T.
Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate
Statement of Additional Information Page 93
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
distribution plans with respect to the Fund's Class A shares ("Class A Plan")
and Class B shares ("Class B Plan"), pursuant to which the Fund reimburses G.T.
Global for a portion of its shareholder servicing and distribution expenses.
Under the Class A Plan, the Fund may pay G.T. Global a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class A shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay G.T. Global a distribution fee at the
annualized rate of up to 0.35% of the average daily net assets of the Fund's
Class A shares, less any amounts paid by the Fund as the aforementioned service
fee, for its expenditures incurred in providing services as distributor. All
expenses for which G.T. Global is reimbursed under the Class A Plan will have
been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay G.T. Global a distribution fee at the
annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for its expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest and extraordinary
items) to the maximum annual level of 2.25% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $531,800,983 and $444,840,237, respectively. There were
no purchases or sales of U.S. government obligations during the year.
Statement of Additional Information Page 94
<PAGE>
G.T. GLOBAL NEW PACIFIC GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
---------------------------- --------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
----------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................. 75,474,666 $ 1,050,741,703 45,708,317 $ 580,807,068
Shares issued in connection with reinvestment of distributions.......... 1,507,455 18,168,232 1,128,287 16,653,064
----------- --------------- ----------- -------------
76,982,121 1,068,909,935 46,836,604 597,460,132
Shares repurchased...................................................... (75,002,452) (1,047,474,403) (42,668,167) (539,777,327)
----------- --------------- ----------- -------------
Net increase............................................................ 1,979,669 $ 21,435,532 4,168,437 $ 57,682,805
----------- --------------- ----------- -------------
----------- --------------- ----------- -------------
<CAPTION>
APRIL 1, 1993
YEAR ENDED TO
DECEMBER 31, 1994 DECEMBER 31, 1993
---------------------------- --------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
----------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................. 21,680,848 $ 298,469,013 5,008,493 $ 68,230,701
Shares issued in connection with reinvestment of distributions.......... 427,074 5,089,014 144,354 2,122,010
----------- --------------- ----------- -------------
22,107,922 303,558,027 5,152,847 70,352,711
Shares repurchased...................................................... (16,628,905) (227,267,661) (584,212) (8,399,022)
----------- --------------- ----------- -------------
Net increase............................................................ 5,479,017 $ 76,290,366 4,568,635 $ 61,953,689
----------- --------------- ----------- -------------
----------- --------------- ----------- -------------
</TABLE>
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$24,723,218 as capital gain dividends for the taxable year ended December 31,
1994.
Pursuant to Section 853 of the Internal Revenue Code, the Fund designates
$728,778 of foreign taxes paid and $8,352,383 of gross income earned from
foreign sources in the taxable year ended December 31, 1994.
Statement of Additional Information Page 95
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global Europe Growth Fund, one of the funds organized as a series of G.T. Global
Growth Series, including the schedule of portfolio investments, as of December
31, 1994, and the related statement of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended and the financial highlights for each of the three years in the period
then ended. These financial statements and the financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and the financial highlights based on our
audits. The financial highlights for each of the two years in the period ended
December 31, 1991 were audited by other auditors whose report dated January 31,
1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global Europe Growth Fund as of December 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the three years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
Statement of Additional Information Page 96
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Finance (23.8%)
- -----------------------------------------------
Skandia Forsakrings
AB - Free SWDN 1,270,100 $21,974,048 3.0
INSURANCE - MULTI-LINE
Swiss Reinsurance
Co. (Regis-
tered) (b) SWTZ 29,300 17,667,329 2.4
INSURANCE - MULTI-LINE
Warburg (SG) Group
PLC UK 1,626,000 17,619,668 2.4
INVESTMENT MANAGEMENT
National
Westminster Bank
PLC UK 1,978,750 15,895,690 2.2
BANKS - MONEY CENTER
Barclays PLC UK 1,650,000 15,786,878 2.2
BANKS - MONEY CENTER
Assicurazioni
Generali S.P.A. ITLY 668,000 15,726,134 2.2
INSURANCE - MULTI-LINE
Bank of Ireland IRL 2,800,000 13,153,774 1.8
BANKS - MONEY CENTER
Banco Central
Hispano-
Americano S.A. SPN 525,000 12,571,266 1.7
BANKS - MONEY CENTER
Banco
InterContinental
Espanol SPN 134,000 11,092,816 1.5
BANKS - MONEY CENTER
M & G Group PLC UK 600,000 9,179,455 1.3
INVESTMENT MANAGEMENT
Singer &
Friedlander UK 6,250,000 8,318,979 1.1
INVESTMENT MANAGEMENT
Provident Financial
PLC UK 900,000 7,638,584 1.0
INSURANCE - MULTI-LINE
Axa (Ex-Cie Du
Midi) FR 158,503 7,344,066 1.0
INSURANCE - MULTI-LINE
--------------
173,968,687
--------------
Services (18.3%)
- -----------------------------------------------
Telecom Italia
S.P.A. (b) ITLY 7,000,000 18,228,942 2.5
TELEPHONE NETWORKS
Lufthansa (b) GER 132,900 16,733,712 2.3
TRANSPORTATION - AIRLINES
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Compass Group PLC UK 2,739,544 $14,457,036 2.0
RESTAURANTS
Tele Danmark AS "B" DEN 264,287 13,430,587 1.8
TELEPHONE NETWORKS
Costa Crociere
S.P.A. ITLY 5,330,700 12,829,207 1.8
LEISURE & TOURISM
Granada Group PLC UK 1,390,000 11,144,378 1.5
LEISURE & TOURISM
Great Universal
Stores PLC UK 1,238,000 10,546,070 1.5
RETAILERS-OTHER
Prosegur, Compania
de Seguridad S.A.
(Registered) SPN 436,589 8,297,016 1.1
BUSINESS & PUBLIC SERVICES
Cortefiel SA SPN 256,000 7,686,811 1.1
RETAILERS-APPAREL
Royal PTT Nederland
N.V. NETH 225,000 7,584,707 1.0
TELEPHONE NETWORKS
British Sky
Broadcasting (b) UK 1,238,600 4,965,262 0.7
CABLE TELEVISION
Bergesen
DY AS "B" N.V. NOR 134,400 3,261,074 0.5
TRANSPORTATION - SHIPPING
EffJohn OY-A Free
(b) FIN 290,000 3,248,441 0.4
TRANSPORTATION - SHIPPING
Hagemeyer N.V. NETH 11,100 904,706 0.1
WHOLESALE & INTERNATIONAL TRADE
--------------
133,317,949
--------------
Materials/Basic Industries (16.6%)
- -----------------------------------------------
British Steel PLC UK 6,347,500 15,307,156 2.1
METALS - STEEL
Imperial Chemical
Industries PLC UK 1,300,000 15,237,238 2.1
CHEMICALS
SSAB Svenskt Stal
AB (Free): SWDN -- -- 1.8
METALS - STEEL
"A" -- 234,000 10,239,252 --
"B" -- 71,000 3,106,782 --
DSM N.V. NETH 153,800 12,221,401 1.7
CHEMICALS
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 97
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Koninklijke
Nederlandsche
Hoogovens en
Staalfabrieken
N.V. (b) NETH 265,800 $12,069,287 1.7
METALS - STEEL
Glynwed Inter-
national PLC UK 2,025,000 10,622,847 1.5
METALS - STEEL
RTZ Corporation PLC
(Registered) (b) UK 800,374 10,377,539 1.4
METALS - NON-FERROUS
Meyer Inter-
national PLC UK 1,793,000 10,023,505 1.4
BUILDING MATERIALS & COMPONENTS
Castorama Dubois
Investisse FR 70,693 8,830,833 1.2
BUILDING MATERIALS & COMPONENTS
Tarmac PLC UK 4,700,000 8,795,020 1.2
BUILDING MATERIALS & COMPONENTS
Construcciones y
Auxiliar de
Ferrocarriles S.A.
(CAF) SPN 73,300 3,956,138 0.5
BUILDING MATERIALS & COMPONENTS
--------------
120,786,998
--------------
Consumer Durables (10.4%)
- -----------------------------------------------
Volkswagen AG GER 76,400 21,015,303 2.9
AUTOMOBILES
Bayerische Motoren
Werke (BMW) AG GER 39,970 19,769,497 2.7
AUTOMOBILES
Lucas Industries
PLC UK 5,500,000 17,741,935 2.4
AUTO PARTS
Volvo AB-B Free SWDN 464,000 8,746,112 1.2
AUTOMOBILES
Arbonia Forster
Holding (Bearer) SWTZ 4,160 4,641,651 0.6
APPLIANCES & HOUSEHOLD DURABLES
Porsche AG (Non-
voting Preferred) GER 10,000 4,355,266 0.6
AUTOMOBILES
--------------
76,269,764
--------------
Broadcasting & Publishing (9.0%)
- -----------------------------------------------
Pearson PLC UK 2,065,000 18,011,352 2.5
Reuters Holdings
PLC UK 2,095,000 15,353,273 2.1
Elsevier N.V. NETH 1,450,000 15,123,315 2.1
EMAP PLC UK 1,093,000 6,811,995 0.9
Societe Television
Francaise 1 FR 62,002 5,622,506 0.8
Euro RSCG
Worldwide, S.A. FR 40,461 4,167,722 0.6
--------------
65,090,163
--------------
<CAPTION>
Equity Market % of Net
Investments Ctry Shares Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
Multi-Industry/Miscellaneous (8.8%)
- -----------------------------------------------
Tomkins PLC UK 5,000,000 $17,107,736 2.4
CONGLOMERATE
Hanson PLC UK 4,225,000 15,283,041 2.1
CONGLOMERATE
BTR PLC UK 3,165,487 14,573,335 2.0
CONGLOMERATE
Veba AG GER 25,000 8,716,988 1.2
CONGLOMERATE
Wassall (J.W.) PLC UK 1,857,500 8,260,727 1.1
CONGLOMERATE
--------------
63,941,827
--------------
Capital Goods (6.0%)
- -----------------------------------------------
Sandvik AB-B Free SWDN 615,000 9,894,915 1.4
MACHINE TOOLS
Nokia AB
(Preferred) FIN 57,100 8,423,502 1.2
TELECOM EQUIPMENT
Alcatel Alsthom FR 94,300 8,053,338 1.1
TELECOM EQUIPMENT
Krones AG
(Preferred) GER 8,708 4,891,819 0.7
MACHINE TOOLS
Weir Group PLC UK 950,000 4,195,114 0.6
MACHINERY & ENGINEERING
Celsius Industries
Corp. AB-B SWDN 172,000 3,821,039 0.5
AEROSPACE/DEFENSE
Ansaldo Transporti ITLY 1,100,000 3,801,296 0.5
ELECTRICAL PLANT/EQUIPMENT
--------------
43,081,023
--------------
Consumer Non-Durables (1.8%)
- -----------------------------------------------
Matthew Clark PLC UK 948,600 7,902,524 1.1
BEVERAGES - ALCOHOLIC
Bic FR 40,700 5,114,655 0.7
OTHER CONSUMER GOODS
--------------
13,017,179
--------------
Health Care (1.1%)
- -----------------------------------------------
Medeva PLC UK 3,000,000 7,704,353 1.1
PHARMACEUTICALS
--------------
7,704,353
--------------
Energy (0.4%)
- -----------------------------------------------
RJB Mining PLC UK 611,640 3,198,994 0.4
COAL
--------------
3,198,994
--------------
Technology (0.4%)
- -----------------------------------------------
Benefon OY (b) FIN 9,620 3,151,432 0.4
TELECOM TECHNOLOGY
--------------
3,151,432
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Equity Investments
(cost $668,890,276)........................... 703,528,369 96.6
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 98
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
<TABLE>
<CAPTION>
No. of Market % of Net
Warrants (0.1)% Ctry Warrants Value Assets(a)
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Costa Crociere
S.P.A. expires
11/30/99 (b) ITLY 1,693,510 $464,736 0.1
LEISURE & TOURISM
Swiss Reinsurance
Co. "B" expires
6/30/95 (b) SWTZ 18,192 166,835 0.0
INSURANCE - MULTI-LINE
<CAPTION>
No. of Market % of Net
Warrants Ctry Warrants Value Assets(a)
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------
BTR PLC expires
11/26/98 (b) UK 1 $1 0.0
CONGLOMERATE
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Warrants (cost $0)....................... 631,572 0.1
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Total Investments
(cost $668,890,276)*.......................... 704,159,941 96.7
Other Assets and Liabilities................... 23,754,609 3.3
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Net Assets..................................... $727,914,550 100.0
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $727,914,550.
(b) Non-income producing security.
* For Federal income tax purposes, cost is $672,299,411 and appreciation
(depreciation) of securities is as follows:
Unrealized appreciation: $ 74,913,111
Unrealized depreciation: (43,052,581)
------------
Net unrealized appreciation: $ 31,860,530
------------
------------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund's Portfolio of Investments at December 31, 1994, was concentrated in
the following countries:
<TABLE>
<CAPTION>
% of Net Assets(a)
------------------------------------------------------
Short-Term
Country Equity Warrants & Other Total
- ------------------------------- ----------- ------------- --------------- ---------
<S> <C> <C> <C> <C>
Denmark........................ 1.8 1.8
Finland........................ 2.0 2.0
France......................... 5.4 5.4
Germany........................ 10.4 10.4
Ireland........................ 1.8 1.8
Italy.......................... 7.0 0.1 7.1
Netherlands.................... 6.6 6.6
Norway......................... 0.5 0.5
Spain.......................... 5.9 5.9
Sweden......................... 7.9 7.9
Switzerland.................... 3.0 3.0
United Kingdom................. 44.3 44.3
United States.................. 3.3 3.3
-- --
--- ---------
Total.......................... 96.6 0.1 3.3 100.0
-- --
-- --
--- ---------
--- ---------
<FN>
- ----------------
(a) Percentages are based on net assets of $727,914,550.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 99
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income (Note 1):
Dividends (net of foreign withholding tax of $3,225,473)............................................. $ 19,482,026
Interest............................................................................................. 799,977
------------
Total investment income.............................................................................. 20,282,003
------------
Expenses:
Investment management and administration fees (Note 2)............................................... 8,319,087
Service and distribution expenses: (Note 2)
Class A.............................................................................. $ 2,748,240
Class B.............................................................................. 773,242 3,521,482
------------
Transfer agent fees (Note 2)......................................................................... 2,586,834
Custodian fees (Note 1).............................................................................. 1,124,144
Printing and postage expenses........................................................................ 294,657
Professional fees.................................................................................... 100,492
Registration and filing fees......................................................................... 97,903
Trustees' fees and expenses (Note 2)................................................................. 16,476
Other................................................................................................ 27,001
------------
Total expenses before reductions..................................................................... 16,088,076
Expense reductions (Notes 1 and 5)................................................................. (635,718)
------------
Total net expenses................................................................................... 15,452,358
------------
Net investment income.................................................................................. 4,829,645
------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
Net realized gain on investments......................................................... 61,816,736
Net realized loss on foreign currency transactions....................................... (16,663,054)
------------
Net realized gain during the period.................................................................... 45,153,682
Net change in unrealized appreciation on translation of dividends and dividend
withholding tax reclaims receivable, securities purchased and sold, foreign currency,
and forward foreign currency contracts.................................................. (6,292,249)
Net change in unrealized appreciation of investments..................................... (91,044,462)
------------
Net unrealized depreciation during the period.......................................................... (97,336,711)
------------
Net realized and unrealized loss on investments and foreign currencies................................. (52,183,029)
------------
Net decrease in net assets resulting from operations................................................... $(47,353,384)
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 100
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income....................................................................
$ 4,829,645 $ 4,381,074
Net realized gain on investments and foreign currency transactions.......................
45,153,682 66,059,815
Net change in unrealized appreciation (depreciation) on translation of dividends and
dividend withholding tax reclaims receivable, securities purchased and sold, foreign
currency, and forward foreign currency contracts........................................
(6,292,249) (8,083,993)
Net change in unrealized appreciation (depreciation) of investments......................
(91,044,462) 136,515,626
------------------ ------------------
Net increase (decrease) in net assets resulting from operations..........................
(47,353,384) 198,872,522
------------------ ------------------
Class A:+
Distributions to shareholders from: (Note 1)
Net investment income....................................................................
(3,125,751) (4,231,520)
In excess of net realized gain on investments............................................
(8,333,619) (1,830,576)
Class B:++
Distributions to shareholders from: (Note 1)
Net investment income....................................................................
-- (149,554)
In excess of net realized gain on investments............................................
(1,040,571) (64,698)
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.........................................
1,287,884,918 584,014,629
Decrease from capital shares repurchased.................................................
(1,388,865,472) (669,469,810)
------------------ ------------------
Net decrease from capital share transactions...............................................
(100,980,554) (85,455,181)
------------------ ------------------
Total increase (decrease) in net assets....................................................
(160,833,879) 107,140,993
Net assets:
Beginning of year........................................................................
888,748,429 781,607,436
------------------ ------------------
End of year..............................................................................
$ 727,914,550 $ 888,748,429
------------------
------------------ ------------------
------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 101
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------
1994(A) 1993(A) 1992(A) 1991 1990
------------ --------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period......... $10.84 $ 8.51 $9.59 $9.33 $10.94
------------ --------- ----------- ----------- -----------
Net investment income........................ 0.06 0.05 0.11** 0.21 0.10
Net realized and unrealized gain (loss) on
investments................................. (0.69) 2.36 (1.19) 0.19 (1.71)
------------ --------- ----------- ----------- -----------
Net increase (decrease) in net asset value
resulting from investment operations........ (0.63) 2.41 (1.08) 0.40 (1.61)
------------ --------- ----------- ----------- -----------
Distributions:
Net investment income...................... (0.05) (0.06) (0.00) (0.14) (0.00)
In excess of net investment income......... -- (0.02) -- -- --
In excess of net realized gain on
investments............................... (0.13) -- -- -- --
------------ --------- ----------- ----------- -----------
Total distributions.................... (0.18) (0.08) (0.00) (0.14) (0.00)
------------ --------- ----------- ----------- -----------
Net asset value, end of period............... $10.03 $10.84 $8.51 $9.59 $ 9.33
------------ --------- ----------- ----------- -----------
------------ --------- ----------- ----------- -----------
Total investment return (d).................. (5.80)% 28.3% (11.3)% 4.3% (14.7)%
------------ --------- ----------- ----------- -----------
------------ --------- ----------- ----------- -----------
Ratios and supplemental data:
Net assets, end of period (in 000's)......... $646,313 $854,701 $781,607 $1,211,709 $1,428,677
Ratio of net investment income (loss) to
average net assets.......................... 0.61% 0.6% 1.2%** 1.7% 1.1%
Ratio of expenses to average net assets...... 1.73% 1.9% 2.0%** 1.8% 1.9%
Ratio of expenses to average net assets
before expense reductions................... 1.81% --% --% --% --%
Portfolio turnover rate+++................... 91% 67% 65% 55% 34%
<CAPTION>
CLASS B++
--------------------------
APRIL 1,
1993 TO
DECEMBER 31,
1994(A) 1993(A)
----------- ------------
<S> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period......... $10.79 $ 9.02
----------- ------------
Net investment income........................ (0.00) 0.00
Net realized and unrealized gain (loss) on
investments................................. (0.69) 1.85
----------- ------------
Net increase (decrease) in net asset value
resulting from investment operations........ (0.69) 1.85
----------- ------------
Distributions:
Net investment income...................... (0.00) (0.06)
In excess of net investment income......... -- (0.02)
In excess of net realized gain on
investments............................... (0.13) --
----------- ------------
Total distributions.................... (0.13) (0.08)
----------- ------------
Net asset value, end of period............... $ 9.97 $10.79
----------- ------------
----------- ------------
Total investment return (d).................. (6.38)% 20.5%(b)
----------- ------------
----------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's)......... $81,602 $34,048
Ratio of net investment income (loss) to
average net assets.......................... (0.04)% (0.1)%(c)
Ratio of expenses to average net assets...... 2.38% 2.6%(c)
Ratio of expenses to average net assets
before expense reductions................... 2.46% --%
Portfolio turnover rate+++................... 91% 67%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A Shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
** Includes reimbursement by G.T. Capital Management, Inc. of Fund Class A
operating expenses of less than one cent per share. Without such
reimbursement, the ratio of expenses to average net assets would have been
2.1% and the ratio of net investment income to average net assets would
have been 1.2% (See Note 2).
(a) Calculated based upon weighted average shares outstanding during the
period.
(b) Not annualized.
(c) Annualized.
(d) Total investment return does not include sales charges.
</TABLE>
Statement of Additional Information Page 102
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Europe Growth Fund ("Fund"), formerly G.T. Europe Growth Fund, is a
separate series of G.T. Global Growth Series ("Company"). The Company is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended ("1940 Act"), as a diversified,
open-end management investment company. The Company has six series of shares of
beneficial interest outstanding, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sales price on the exchange on which
such securities are traded, or in the principal over-the-counter market in which
such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost, adjusted for foreign exchange
translation and market fluctuations, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially changed such value,
then the fair value of those securities will be determined by consideration of
other factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when earned or incurred.
As of January 1, 1994, the Fund adopted Statement of Position 93-4: "Foreign
Currency Accounting and Financial Statement Presentation for Investment
Companies." As permitted under the SOP, the Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of forward foreign currency contracts, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates on
securities transactions, the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and the
U.S. dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains or losses arise from changes in the value of assets and
liabilities other than investments in securities at fiscal year end, resulting
from changes in exchange rates.
Certain 1993 amounts have been reclassified for consistency in financial
statement presentation.
Statement of Additional Information Page 103
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
(C) REPURCHASE AGREEMENT
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be paid to the
Fund under each agreement at its maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of the contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or, in the case of an over-the-counter option, is valued at
the bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. The
Fund uses options in order to manage its exposure to currency levels or interest
rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The
Statement of Additional Information Page 104
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
cost of securities sold is determined on an identified cost basis. Dividends are
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Where a high level of uncertainty exists as to its collection, income is
recorded net of all withholding tax with any rebate recorded when received. The
Fund may trade securities on other than normal settlement terms. This may
increase the risk if the other party to the transaction fails to deliver and
causes the Fund to subsequently invest at less than advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At December 31, 1994, stocks with an aggregate value of approximately
$49,004,548 were on loan to brokers. The loans were secured by cash collateral
of $51,041,060, received by the Fund. For international securities, cash
collateral is received by the Fund against loaned securities in an amount at
least equal to 105% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 103%
of the market value of the loaned securities during the period of the loan. For
domestic securities, cash collateral is received by the Fund against loaned
securities in an amount at least equal to 102% of the market value of the loaned
securities at the inception of each loan. This collateral must be maintained at
not less than 100% of the market value of the loaned securities during the
period of the loan. For the year ended December 31, 1994, the Fund earned fees
of $590,131 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains. The Fund currently has a capital loss carryforward of
$195,539,627 of which $38,161,243 expires in 1999, $152,895,949 expires in 2000,
and $4,482,435 expires in 2001.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. These risks of investing in foreign markets may
include foreign currency exchange rate fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees to
G.T. Capital at the following annualized rates of 0.975% on the first $500
million of average daily net assets of the Fund; 0.95% on the next $500 million;
0.925% on the next $500 million and 0.90% on amounts thereafter. These fees are
computed daily and paid monthly, and are subject to reduction in any year to the
extent that the Fund's expenses (exclusive of brokerage commissions, taxes,
interest, distribution-related expenses and extraordinary expenses) exceed the
most stringent limits prescribed by the laws or regulations of any state in
which the Fund's shares are offered for sale, based on the average total net
asset value of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$137,252 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of
Statement of Additional Information Page 105
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
Class B shares made within six years of purchase are subject to contingent
deferred sales charges ("CDSCs"), in accordance with the Fund's current
prospectus. For the year ended December 31, 1994, G.T. Global collected CDSCs in
the amount of $237,076. In addition, G.T. Global makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class B
shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.35% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest and extraordinary
items) to the maximum annual rate of 2.25% and 2.90% of the average daily net
assets of the Fund's Class A shares and Class B shares, respectively. If
necessary, this limitation will be effected by waivers by G.T. Capital of
investment management and administration fees, waivers by G.T. Global of
payments under the Class A Plan and/or Class B Plan and/or reimbursements by
G.T. Capital or G.T. Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Fund placed a portion of its portfolio transactions with brokerage firms
which are affiliates of G.T. Capital. The commissions paid to these affiliated
companies were $84,945 for the year ended December 31, 1994.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $750,641,561 and $871,037,208, respectively. There were
no purchases or sales of U.S. government obligations by the Fund during the
year.
Statement of Additional Information Page 106
<PAGE>
G.T. GLOBAL EUROPE GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
----------------------------- --------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
------------ --------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................ 109,168,643 $ 1,160,153,253 56,182,418 $ 540,986,298
Shares issued in connection with reinvestment of distributions......... 874,425 8,526,677 418,308 4,370,535
------------ --------------- ----------- -------------
110,043,068 1,168,679,930 56,600,726 545,356,833
Shares repurchased..................................................... (124,431,789) (1,325,037,548) (69,579,382) (662,837,625)
------------ --------------- ----------- -------------
Net decrease........................................................... (14,388,721) $ (156,357,618) (12,978,656) $(117,480,792)
------------ --------------- ----------- -------------
------------ --------------- ----------- -------------
<CAPTION>
APRIL 1, 1993
YEAR ENDED TO
DECEMBER 31, 1994 DECEMBER 31, 1993
----------------------------- --------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
------------ --------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................ 10,710,316 $ 118,315,558 3,789,830 $ 38,477,886
Shares issued in connection with reinvestment of distributions......... 91,703 889,430 17,347 179,910
------------ --------------- ----------- -------------
10,802,019 119,204,988 3,807,177 38,657,796
Shares repurchased..................................................... (5,769,922) (63,827,924) (651,439) (6,632,185)
------------ --------------- ----------- -------------
Net increase........................................................... 5,032,097 $ 55,377,064 3,155,738 $ 32,025,611
------------ --------------- ----------- -------------
------------ --------------- ----------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1994, the Fund's
expenses were reduced by $45,587 under these arrangements.
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
Pursuant to Section 853 of the Internal Revenue Code, the Fund designates
$3,225,473 of foreign taxes paid and $22,707,499 of gross income earned from
foreign sources in the taxable year ended December 31, 1994.
Statement of Additional Information Page 107
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global Japan Growth Fund, a series of shares of beneficial interest of G.T.
Global Growth Series, including the schedule of portfolio investments, as of
December 31, 1994, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the three years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits. The financial highlights for each of the two years in the period ended
December 31, 1991 were audited by other auditors whose report dated January 31,
1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of G.T.
Global Japan Growth Fund, as of December 31, 1994, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the three
years in the period then ended, in conformity with generally accepted accounting
principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
Statement of Additional Information Page 108
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Equity Market % of Net
Investments Shares Value Assets(a)
<S> <C> <C> <C>
- -------------------------------------------------------------------------
Retailers (20.9%)
- -----------------------------------------------------------
Seven-Eleven Japan Ltd. (c) 80,000 $6,436,966 5.1
RETAILERS-FOOD
Autobacs Seven 50,000 5,976,896 4.8
RETAILERS-OTHER
Southland Corp. (b)(c)(d) 1,145,000 5,152,500 4.1
RETAILERS-FOOD
Aoyama Trading 140,000 3,192,366 2.5
RETAILERS-APPAREL
Bunkyodo Co., Ltd. 72,000 2,965,344 2.4
RETAILERS-OTHER
Fast Retailing Co., Ltd. 23,000 2,518,332 2.0
RETAILERS-APPAREL
--------------
26,242,404
--------------
Technology (18.4%)
- -----------------------------------------------------------
Hosiden Electronics 230,000 4,944,249 3.9
COMPUTERS & PERIPHERALS
Matsushita-Kotobuki
Electronics Industries Ltd. 180,000 4,701,155 3.7
COMPUTERS & PERIPHERALS
Kyushu-Matsushita Electric
Industrial 190,000 4,656,956 3.7
COMPUTERS & PERIPHERALS
Nakamichi Corp. 330,000 2,933,702 2.3
COMPUTERS & PERIPHERALS
Innotech Corp. 40,500 1,765,645 1.4
SEMICONDUCTORS
NGK Spark Plug Co., Ltd. 115,000 1,513,310 1.2
SEMICONDUCTORS
Riso Kagaku 17,000 1,475,439 1.2
COMPUTERS & PERIPHERALS
Nippon Densan 32,900 1,193,059 1.0
COMPUTERS & PERIPHERALS
--------------
23,183,515
--------------
Services (11.5%)
- -----------------------------------------------------------
DDI Corp. 495 4,276,243 3.4
TELEPHONE NETWORKS
Nissha Printing Co. 150,000 3,179,307 2.5
BROADCASTING & PUBLISHING
Ten Allied Co. 100,000 2,812,657 2.2
RESTAURANTS
Yoshinoya D&C Co., Ltd. 190 2,385,736 1.9
RESTAURANTS
Kentucky Fried Chicken Japan 102,000 1,823,807 1.5
RESTAURANTS
--------------
14,477,750
--------------
<CAPTION>
Equity Market % of Net
Investments Shares Value Assets(a)
<S> <C> <C> <C>
- -------------------------------------------------------------------------
Health Care (10.2%)
- -----------------------------------------------------------
Takeda Chemical Industries 440,000 $5,348,066 4.3
PHARMACEUTICALS
Sankyo Co., Ltd. 150,000 3,736,816 3.0
PHARMACEUTICALS
Olympus Optical Co., Ltd. 330,000 3,613,260 2.9
MEDICAL TECHNOLOGY & SUPPLIES
--------------
12,698,142
--------------
Conglomerates (5.5%)
- -----------------------------------------------------------
Ito-Yokado Co., Ltd. 130,000 6,960,321 5.5
CONGLOMERATE
--------------
6,960,321
--------------
Capital Goods (2.9%)
- -----------------------------------------------------------
Enomoto Co., Ltd. 67,000 1,871,020 1.5
INDUSTRIAL COMPONENTS
Kato Spring Works 300,000 1,765,947 1.4
INDUSTRIAL COMPONENTS
Yurtec Corp. 1,000 22,803 --
CONSTRUCTION
Japan Foundation Engineering 900 18,714 --
CONSTRUCTION
NEC System Integration &
Construction 500 13,109 --
CONSTRUCTION
--------------
3,691,593
--------------
Materials/Basic Industries (2.2%)
- -----------------------------------------------------------
Toyo Exterior 100,000 2,722,250 2.2
BUILDING MATERIALS & COMPONENT
--------------
2,722,250
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Total Equity Investments
(cost $82,728,269)........................ 89,975,975 71.6
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
<CAPTION>
Fixed Income Principal
Investments Amount
<S> <C> <C> <C>
- -------------------------------------------------------------------------
Austrian Republic, 4.5% due
9/28/05 830,000,000 8,168,684 6.5
AUSTRIAN GOVERNMENT BOND
International Bank of
Reconstruction and
Development, 5.25% due
3/20/02 675,000,000 7,085,635 5.7
SUPRANATIONAL BOND
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 109
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
<TABLE>
<CAPTION>
Fixed Income Principal Market % of Net
Investments Amount Value Assets(a)
- -------------------------------------------------------------------------
<S> <C> <C> <C>
European Investment Bank,
5.875% due 11/26/99 450,000,000 $4,878,579 3.9
SUPRANATIONAL BOND
Credit National, 6.125% due
11/10/98 400,000,000 4,314,415 3.5
FRENCH CORPORATE BOND
Republic of Finland, 6% due
1/29/02 300,000,000 3,271,974 2.6
FINNISH GOVERNMENT BOND
Kingdom of Spain, 5.75% due
3/23/02 300,000,000 3,225,264 2.6
SPANISH GOVENMENT BOND
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Total Fixed Income Investments
(cost $28,507,605)........................ $30,944,551 24.8
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
<CAPTION>
Put Options on Indices Underlying Market % of Net
(0.0%) Amount Value Assets(a)
<S> <C> <C> <C>
- -------------------------------------------------------------------------
Simex Nikkei put option,
strike price 19000, expires
02/09/95(c) 50,000 $32,647 --
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Total Options (cost $51,743)............... 32,647 --
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Total Investments
(cost $111,287,617)*...................... 120,953,173 96.4
Other Assets and Liabilities............... 4,468,286 3.6
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
Net Assets................................. $125,421,459 100.0
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $125,421,459.
(b) U.S. currency denominated.
(c) Non-income producing security.
(d) This security is a U.S. stock of which approximately 62.5% of its
outstanding stock is owned by Ito-Yokado Co., Ltd.
* For Federal income tax purposes, cost is $111,484,017 and appreciation
(depreciation) of securities is as follows:
Unrealized appreciation: $15,069,557
Unrealized depreciation: (5,600,401)
-----------
Net unrealized appreciation: $ 9,469,156
-----------
-----------
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
DECEMBER 31, 1994
<TABLE>
<CAPTION>
Market Value
(U.S. Contract Delivery Unrealized
Contracts to Sell: Dollars) Price Date Appreciation
- ------------------------------------------------------------------------------- ------------- ---------- --------- ------------
<S> <C> <C> <C> <C>
Japanese Yen................................................................... 38,771,266 96.84500 2/15/95 $ 880,756
Japanese Yen................................................................... 29,223,282 96.60000 2/15/95 739,658
------------- ------------
Total Contracts to Sell (Receivable amount $69,614,962)........................ 67,994,548 1,620,414
------------- ------------
The value of Contracts to Sell as a Percentage of Net Assets is 54.2%.
Contracts to Buy:
- -------------------------------------------------------------------------------
Japanese Yen................................................................... 6,029,986 99.54000 2/15/95 29,986
------------- ------------
Total Contracts to Buy (Payable amount $6,000,000)............................. 6,029,986 29,986
------------- ------------
The value of Contracts to Buy as a Percentage of Net Assets is 4.8%.
Total Open Forward Foreign Currency Contracts, Net......................... $1,650,400
------------
------------
<FN>
- ----------------
See Note 1 of the financial statements.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 110
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C>
Investments in securities, at value (cost $111,287,617) (Note 1).....................................
$ 120,953,173
Foreign currency (cost $614,318).....................................................................
619,559
Receivable for securities sold.......................................................................
4,269,973
Receivable for Fund shares sold......................................................................
1,668,304
Receivable for open forward foreign currency contracts, net (Note 1).................................
1,650,400
Interest receivable..................................................................................
559,169
Dividends and dividend withholding tax reclaims receivable...........................................
15,139
Prepaid insurance....................................................................................
8,916
Cash held as collateral for securities loaned (Note 1)...............................................
20,725,300
-------------
Total assets.........................................................................................
150,469,933
-------------
Liabilities:
Payable for Fund shares repurchased..................................................................
3,008,740
Payable for securities purchased.....................................................................
542,881
Due to custodian.....................................................................................
411,897
Payable for investment management and administration fees (Note 2)...................................
101,426
Payable for printing and postage expenses............................................................
95,379
Payable for service and distribution expenses (Note 2)...............................................
50,860
Payable for transfer agent fees (Note 2).............................................................
42,569
Payable for professional fees........................................................................
24,374
Payable for registration and filing fees.............................................................
22,947
Payable for custodian fees (Note 1)..................................................................
10,563
Payable for Trustees' fees and expenses (Note 2).....................................................
6,011
Accrued expenses.....................................................................................
5,527
Collateral for securities loaned (Note 1)............................................................
20,725,300
-------------
Total liabilities....................................................................................
25,048,474
-------------
Net assets.............................................................................................
$ 125,421,459
-------------
-------------
Class A:
Net asset value and redemption price per share
($98,066,119 DIVIDED BY 8,072,717 shares outstanding)................................................
$ 12.15
-------------
-------------
Maximum offering price per share
(100/95.25 of $12.15)*................................................................................
$ 12.76
-------------
-------------
Class B:+
Net asset value and offering price per share
($27,355,340 DIVIDED BY 2,275,306 shares outstanding)................................................
$ 12.02
-------------
-------------
Net assets consist of:
Paid in capital (Note 4).............................................................................
$ 113,938,420
Accumulated net realized gain on investments, options, and foreign currency transactions.............
157,871
Net unrealized appreciation on translation of dividends and dividend withholding tax reclaims
receivable, interest receivable, securities purchased and sold, foreign currency, and forward
foreign currency contracts..........................................................................
1,659,612
Net unrealized appreciation of investments and options...............................................
9,665,556
-------------
Total -- representing net assets applicable to capital shares outstanding............................
$ 125,421,459
-------------
-------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 111
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income: (Note 1)
Interest.............................................................................................. $ 1,906,713
Dividends (net of foreign withholding tax of $63,944)................................................. 362,349
-----------
Total investment income............................................................................... 2,269,062
-----------
Expenses:
Investment management and administration fees (Note 2)................................................ 1,345,064
Service and distribution expenses: (Note 2)
Class A............................................................................... $ 405,800
Class B............................................................................... 220,123 625,923
------------
Transfer agent fees (Note 2).......................................................................... 470,668
Custodian fees (Note 1)............................................................................... 223,755
Printing and postage expenses......................................................................... 102,402
Professional fees..................................................................................... 79,902
Registration fees..................................................................................... 71,645
Interest expense...................................................................................... 70,706
Trustees' fees and expenses (Note 2).................................................................. 19,180
-----------
Total expenses before expense reductions.............................................................. 3,009,245
Expense reductions (Notes 1 and 5).................................................................. (162,795)
-----------
Total net expenses.................................................................................... 2,846,450
-----------
Net investment loss..................................................................................... (577,388)
-----------
Net realized and unrealized gain (loss) on investments, options and foreign currencies:
(Note 1)
Net realized gain on investments and options.............................................. 9,110,972
Net realized loss on foreign currency transactions........................................ (381,322)
------------
Net realized gain during the period..................................................................... 8,729,650
Net change in unrealized appreciation on translation of dividends and dividend withholding
tax reclaims receivable, interest receivable, securities purchased and sold, foreign
currency, and forward foreign currency contracts........................................ (528,496)
Net change in unrealized appreciation of investments and options.......................... (3,251,782)
------------
Net unrealized depreciation............................................................................. (3,780,278)
-----------
Net realized and unrealized gain on investments, options and foreign currencies......................... 4,949,372
-----------
Net increase in net assets resulting from operations.................................................... $ 4,371,984
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 112
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment loss......................................................................
$ (577,388) $ (281,615)
Net realized gain on investments, options, and foreign currency transactions.............
8,729,650 10,635,932
Net change in unrealized appreciation (depreciation) on translation of dividends and
dividend withholding tax reclaims receivable, interest receivable, securities purchased
and sold, foreign currency, and forward foreign currency contracts......................
(528,496) 2,185,617
Net change in unrealized appreciation (depreciation) of investments and options..........
(3,251,782) 17,921,247
------------------ ------------------
Net increase in net assets resulting from operations.....................................
4,371,984 30,461,181
------------------ ------------------
Class A:+
Distribution to shareholders from: (Note 1)
Net realized gain on investments.......................................................
(1,687,150) --
Class B:++
Distribution to shareholders from: (Note 1)
Net realized gain on investments.......................................................
(462,102) --
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.........................................
422,096,027 149,874,803
Decrease from capital shares repurchased.................................................
(391,082,829) (182,015,793)
------------------ ------------------
Net increase (decrease) from capital share transactions....................................
31,013,198 (32,140,990)
------------------ ------------------
Total increase (decrease) in net assets....................................................
33,235,930 (1,679,809)
Net assets:
Beginning of year........................................................................
92,185,529 93,865,338
------------------ ------------------
End of year..............................................................................
$ 125,421,459 $ 92,185,529
------------------
------------------ ------------------
------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 113
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and supplemental data. This information has been
derived from information provided in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
-------------------------------------------
YEAR ENDED DECEMBER 31,
-------------------------------------------
1994 1993 1992(A) 1991 1990
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period...................... $ 11.61 $ 8.70 $ 11.16 $ 11.48 $ 16.39
------- ------- ------- ------- -------
Net investment loss....................................... (0.04) (0.14) (0.00)* (0.09) (0.05)++
Net realized and unrealized gain (loss) on investments.... 0.79 3.05 (2.40) (0.23) (4.60)
------- ------- ------- ------- -------
Net increase (decrease) from investment operations........ 0.75 2.91 (2.40) (0.32) (4.65)
------- ------- ------- ------- -------
Distributions:
Net realized gain on investments........................ (0.21) (0.00) (0.06) (0.00) (0.26)
------- ------- ------- ------- -------
Total distributions................................... (0.21) (0.00) (0.06) (0.00) (0.26)
------- ------- ------- ------- -------
Net asset value, end of period............................ $ 12.15 $ 11.61 $ 8.70 $ 11.16 $ 11.48
------- ------- ------- ------- -------
------- ------- ------- ------- -------
Total investment return (d)............................... 6.56% 33.5% (21.5)% (2.8)% (28.7)%
------- ------- ------- ------- -------
------- ------- ------- ------- -------
Ratios and supplemental data:
Net assets, end of period (in 000's)...................... $98,066 $88,487 $93,865 $61,519 $51,693
Ratio of net investment loss to average net assets........ (0.32)% (0.3)% (0.0)%* (1.5)% (1.2)%++
Ratio of expenses to average net assets................... 1.91% 2.1% 2.2%* 2.2% 2.2%++
Ratio of expenses to average net assets before expense
reductions.............................................. 2.03% --% --% --% --%
Portfolio turnover rate+++................................ 49% 104% 115% 251% 138%
<CAPTION>
CLASS B++
---------------------
APRIL 1,
1993
TO
DECEMBER 31,
1994 1993
------- ------------
<S> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period...................... $ 11.57 $ 9.85
------- ------------
Net investment loss....................................... (0.13) (0.18)
Net realized and unrealized gain (loss) on investments.... 0.79 1.90
------- ------------
Net increase (decrease) from investment operations........ 0.66 1.72
------- ------------
Distributions:
Net realized gain on investments........................ (0.21) (0.00)
------- ------------
Total distributions................................... (0.21) (0.00)
------- ------------
Net asset value, end of period............................ $ 12.02 $11.57
------- ------------
------- ------------
Total investment return (d)............................... 5.81% 17.5%(b)
------- ------------
------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's)...................... $27,355 $3,699
Ratio of net investment loss to average net assets........ (0.97)% (0.9)%(c)
Ratio of expenses to average net assets................... 2.56% 2.7%(c)
Ratio of expenses to average net assets before expense
reductions.............................................. 2.68% --%
Portfolio turnover rate+++................................ 49% 104%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993 were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
* Includes reimbursement by G.T. Capital Management, Inc. of the Fund Class A
operating expenses of $0.01. Without such reimbursement, the ratio of
expenses to average net assets would have been 2.3% and the ratio of net
investment loss to average net assets would have been (0.1)% (See Note 2).
++ Includes reimbursement by G.T. Capital Management, Inc. of the Fund Class A
operating expenses of $0.01. Without such reimbursement, the ratio of
expenses to average net assets would have been 2.4% and the ratio of net
investment loss to average net assets would have been (1.35)% (See Note 2).
(a) These selected per share data were calculated based upon weighted average
shares outstanding during the year.
(b) Not annualized.
(c) Annualized.
(d) Total investment return does not include sales charges.
</TABLE>
Statement of Additional Information Page 114
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global Japan Growth Fund ("Fund"), formerly G.T. Japan Growth Fund, is a
separate series of G.T. Global Growth Series ("Company"). The Company is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended ("1940 Act"), as a diversified,
open-end management investment company. The Company has six series of shares of
beneficial interest outstanding, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or, in the principal over-the-counter market in
which such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management Inc.
("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type. However, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost, adjusted for foreign exchange
translation and market fluctuations, if any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Trustees.
Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially changed such value,
then the fair value of those securities will be determined by consideration of
other factors by or under the direction of the Company's Board of Trustees.
(B) FOREIGN CURRENCY TRANSLATION
The accounting records of the Fund are maintained in U.S. dollars. The market
values of foreign securities, currency holdings, other assets and liabilities
are recorded in the books and records of the Fund after translation to U.S.
dollars based on the exchange rates on that day. The cost of each security is
determined using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when earned or incurred.
As of January 1, 1994, the Fund adopted Statement of Position 93-4: "Foreign
Currency Accounting and Financial Statement Presentation for Investment
Companies." As permitted under the SOP, the Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains and losses arise from sales and
maturities of forward foreign currency contracts, 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 Fund's books and the
U.S. dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains and losses arise from changes in the value of assets and
liabilities other than investments in securities at fiscal year end, resulting
from changes in exchange rates.
Certain 1993 amounts have been reclassified for consistency in financial
statement presentation.
Statement of Additional Information Page 115
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be paid to the
Fund under each agreement at its maturity.
(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward fluctuates with changes in currency exchange rates. The
Forward is marked-to-market daily and the change in market value is recorded by
the Fund as an unrealized gain or loss. When the Forward is closed, the Fund
records a realized gain or loss equal to the difference between the value at the
time it was opened and the value at the time it was closed. The Fund could be
exposed to risk if a counterparty is unable to meet the terms of a contract or
if the value of the currency changes unfavorably. The Fund may enter into
Forwards in connection with planned purchases or sales of securities or to hedge
the value of portfolio securities denominated in a foreign currency.
(E) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or, in the case of an over-the-counter option, is valued at
the bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding. The
Fund uses options in order to manage its exposure to currency levels and
interest rates.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the closing sale transaction
are greater or less than the cost of the option. If the Fund exercises a call
option, the cost of the securities acquired by exercising the call is increased
by the premium paid to buy the call. If the Fund exercises a put option, it
realizes a gain or loss from the sale of the underlying security, and the
proceeds from such sale are decreased by the premium originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying securitiy or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The
Statement of Additional Information Page 116
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
cost of securities sold is determined on an identified cost basis. Dividends are
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Where a high level of uncertainty exists as to its collection, income is
recorded net of all withholding tax with any rebate recorded when received. The
Fund may trade securities on other than normal settlement terms. This may
increase the risk if the other party to the transaction fails to deliver and
causes the Fund to subsequently invest at less advantageous prices.
(H) PORTFOLIO SECURITIES LOANED
At December 31, 1994, stocks with an aggregate value of approximately
$19,708,469 were on loan to brokers. The loans were secured by cash collateral
of $20,725,300, received by the Fund. Cash collateral is received by the Fund
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For the year ended December 31, 1994,
the Fund received fees of $125,858 which were used to reduce custodian fees.
(I) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, and unrealized appreciation of securities held, or for excise tax on
income and capital gains.
(J) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. These risks of investing in foreign markets may
include foreign currency exchange rate fluctuations, perceived credit risk,
adverse political and economic developments and possible adverse foreign
government intervention.
(L) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees to
G.T. Capital at the following annualized rates: 0.975% on the first $500 million
of average daily net assets of the Fund; 0.95% on the next $500 million; 0.925%
of the next $500 million and 0.90% on amounts thereafter. These fees are
computed daily and paid monthly, and are subject to reduction in any year to the
extent that the Fund's expenses (exclusive of brokerage commissions, taxes,
interest, distribution-related expenses and extraordinary expenses) exceed the
most stringent limits prescribed by the laws or regulations of any state in
which the Fund's shares are offered for sale, based on the average net asset
value of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$23,730 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. During the year ended December
31, 1994, G.T. Global collected CDSCs in the amount of $88,454. In addition,
G.T. Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate
Statement of Additional Information Page 117
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
distribution plans with respect to the Fund's Class A shares ("Class A Plan")
and Class B shares ("Class B Plan"), pursuant to which the Fund reimburses G.T.
Global for a portion of its shareholder servicing and distribution expenses.
Under the Class A Plan, the Fund may pay G.T. Global a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class A shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.35% of the average daily net assets of the Fund's
Class A shares, less any amounts paid by the Fund as the aforementioned service
fee, for its expenditures incurred in providing services as distributor. All
expenses for which G.T. Global is reimbursed under the Class A Plan will have
been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for its expenditures incurred in servicing and maintaining
shareholder accounts, and may pay G.T. Global a distribution fee at the
annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global have voluntarily undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
items) to the maximum annual level of 2.25% and 2.90% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of investment
management and administration fees, waivers by G.T. Global of payments under the
Class A Plan and/or Class B Plan and/or reimbursements by G.T. Capital or G.T.
Global of portions of the Fund's other operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $88,000,946 and $61,412,768, respectively. There were no
purchases or sales of U.S. government obligations by the Fund during the year.
Statement of Additional Information Page 118
<PAGE>
G.T. GLOBAL JAPAN GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold............................................................... 26,403,403 $ 337,405,704 13,412,344 $ 144,749,056
Shares issued in connection with reinvestment of distributions............ 119,477 1,396,969 -- --
----------- ------------- ----------- -------------
26,522,880 338,802,673 13,412,344 144,749,056
Shares repurchased........................................................ (26,071,333) (332,875,892) (16,577,099) (180,533,651)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... 451,547 $ 5,926,781 (3,164,755) $ (35,784,595)
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
<CAPTION>
APRIL 1, 1993
YEAR ENDED TO
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS B
Shares sold............................................................... 6,416,496 $ 82,933,091 448,340 $ 5,125,747
Shares issued in connection with reinvestment of distributions............ 31,084 360,263 -- --
----------- ------------- ----------- -------------
6,447,580 83,293,354 448,340 5,125,747
Shares repurchased........................................................ (4,491,860) (58,206,937) (128,754) (1,482,142)
----------- ------------- ----------- -------------
Net increase.............................................................. 1,955,720 $ 25,086,417 319,586 $ 3,643,605
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1994, the Fund's
expenses were reduced by $36,937 under these arrangements.
Statement of Additional Information Page 119
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
REPORT OF
INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
ANNUAL REPORT
To the Shareholders and Board of Trustees of
G.T. Global Growth Series:
We have audited the accompanying statement of assets and liabilities of G.T.
Global America Growth Fund, one of the funds organized as a series of G.T.
Global Growth Series, including the schedule of portfolio investments, as of
December 31, 1994 and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended and the financial highlights for each of the three years in
the period then ended. These financial statements and the financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and the financial highlights
based on our audits. The financial highlights for each of the two years in the
period ended December 31, 1991 were audited by other auditors whose report dated
January 31, 1992 expressed an unqualified opinion on such financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1994 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global America Growth Fund as of December 31, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the three years in the period then ended, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
BOSTON, MASSACHUSETTS
FEBRUARY 10, 1995
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 120
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
PORTFOLIO OF INVESTMENTS
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Shares Value Assets(a)
<S> <C> <C> <C>
- ------------------------------------------------------------------------
Semiconductors (15.3%)
- ----------------------------------------------------------
Lattice Semiconductor Corp. (b) 428,600 $7,179,050 2.6
Applied Materials Inc. (b) 167,700 7,085,325 2.6
Integrated Device Technology
Inc. (b) 216,600 6,389,700 2.3
Cirrus Logic Inc. (b) 277,300 6,239,250 2.2
Dallas Semiconductor Corp. (b) 328,100 5,454,663 2.0
Microchip Technology Inc. (b) 152,806 4,202,165 1.5
S3 Incorporated (b) 247,300 3,894,975 1.4
Lam Research Corp. (b) 48,700 1,814,075 0.7
--------------
42,259,203
--------------
Services (10.1%)
- ----------------------------------------------------------
Proffitt's Inc. (b) 247,800 5,513,550 2.0
RETAILERS - OTHER
United Video Satellite Group
Inc. Class A (b) 199,200 4,780,800 1.7
CABLE TELEVISION
Equity Inns Inc. 428,300 4,711,300 1.7
LEISURE & TOURISM
Savoy Pictures Entertainment
Inc. (b) 600,000 3,900,000 1.4
LEISURE & TOURISM
Friedman's Inc. Class A (b) 219,600 3,788,100 1.4
RETAILERS - OTHER
Rio Hotel & Casino Inc. (b) 303,800 3,683,575 1.3
LEISURE & TOURISM
The Buckle Inc. (b) 157,900 1,697,425 0.6
RETAILERS - APPAREL
--------------
28,074,750
--------------
Finance (9.9%)
- ----------------------------------------------------------
Leader Financial Corp. (b) 314,800 6,492,750 2.4
SAVINGS & LOAN
Advanta Corp. Class B 249,100 6,289,775 2.3
CONSUMER FINANCE
Mid-America Apartment
Communities Inc. 169,700 4,539,475 1.6
REAL ESTATE
Signet Banking Corp. 133,900 3,832,888 1.4
BANKS - REGIONAL
Trans Financial Bancorp Inc. 178,433 2,319,629 0.8
SAVINGS & LOAN
RFS Hotel Investors Inc. 152,100 2,224,463 0.8
REAL ESTATE
<CAPTION>
Market % of Net
Equity Investments Shares Value Assets(a)
<S> <C> <C> <C>
- ------------------------------------------------------------------------
Capitol American Financial
Corp. 72,600 $1,669,800 0.6
INSURANCE/MULTI-LINE
--------------
27,368,780
--------------
Technology (9.3%)
- ----------------------------------------------------------
Seagate Technology (b) 336,400 8,073,600 2.9
COMPUTERS & PERIPHERALS
BMC Software Inc. (b) 126,700 7,206,063 2.6
SOFTWARE
Cisco Systems Inc. (b) 176,900 6,213,613 2.3
NETWORKING
Excalibur Technology Corp.
(b)(c) 365,000 2,098,750 0.8
SOFTWARE
Cabletron System Inc. (b) 43,900 2,041,350 0.7
NETWORKING
--------------
25,633,376
--------------
Consumer Non-Durables (8.4%)
- ----------------------------------------------------------
Haggar Corp. 351,000 8,862,750 3.2
TEXTILES & APPAREL
Premark International Inc. 143,900 6,439,985 2.3
HOUSEHOLD PRODUCTS
Varsity Spirit Corp. (b) 228,100 4,162,825 1.5
TEXTILES & APPAREL
Drypers Corp. (b) 312,800 3,910,000 1.4
PERSONAL CARE/COSMETICS
--------------
23,375,560
--------------
Consumer Durables (5.5%)
- ----------------------------------------------------------
Eaton Corp. 158,900 7,864,404 2.8
AUTO PARTS
Lifetime Hoan Corp. (b) 320,008 3,760,089 1.4
APPLIANCES & HOUSEHOLD DURABLES
Syratech Corp. (b) 195,800 3,597,825 1.3
APPLIANCES & HOUSEHOLD DURABLES
--------------
15,222,318
--------------
Health Care (4.9%)
- ----------------------------------------------------------
Health Systems International
Inc. Class A (b) 232,900 7,074,338 2.5
HEALTH CARE SERVICES
Grancare Inc. (b) 137,200 2,401,000 0.9
HEALTH CARE SERVICES
Abaxis Inc. (b) 672,600 2,101,875 0.8
MEDICAL TECHNOLOGY & SUPPLIES
Nellcor Inc. (b) 58,600 1,933,800 0.7
MEDICAL TECHNOLOGY & SUPPLIES
--------------
13,511,013
--------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 121
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
<TABLE>
<CAPTION>
Market % of Net
Equity Investments Shares Value Assets(a)
- ------------------------------------------------------------------------
<S> <C> <C> <C>
Capital Goods (0.7%)
- ----------------------------------------------------------
OfficeMax Inc. (b) 77,700 $2,059,050 0.7
OFFICE EQUIPMENT
--------------
2,059,050
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
Total Equity Investments
(cost $160,685,039)...................... 177,504,050 64.1
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
<CAPTION>
Principal
Short-Term Investments Amount
<S> <C> <C> <C>
- ------------------------------------------------------------------------
Treasury Bills (21.7%)
- ----------------------------------------------------------
United States Treasury Bill,
yield 1.014%, due 1/5/95
(cost $59,993,333) ........... 60,000,000 59,993,333 21.7
<CAPTION>
Market % of Net
Short-Term Investments Value Assets(a)
<S> <C> <C> <C>
- ------------------------------------------------------------------------
Repurchase Agreement (18.0%)
- ----------------------------------------------------------
Dated December 30, 1994 with State Street
Bank and Trust Company, due January 3,
1995, for an effective yield of 5.25%
collateralized by $50,010,000 United
States Treasury Notes, 6.25% due 8/31/96.
(Market value $50,024,937 including
accrued interest) (cost $50,019,585).....
$50,019,585 18.0
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
Total Investments (cost $270,697,957)*....
287,516,968 103.8
Other Assets and Liabilities.............. (10,519,525) (3.8 )
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
Net Assets................................ $276,997,443 100.0
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
<FN>
- --------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $276,997,443.
(b) Non-income producing security.
(c) The following is a restricted security bought from a private placement and
is subject to restriction from public resale:
ValueAcquisition Per ShareDate
12/31/94 -----------
Shares
Costat
--
--------------- --------------
Excalibur Technology
Corp............... 4/19/94 365,000 $2,920,000 $ 5.75
* For Federal Income tax purposes, cost is $271,106,009 and appreciation
(depreciation) of securities is as follows:
Unrealized appreciation: $26,383,842
Unrealized depreciation: (9,972,883)
-----------
Net unrealized appreciation: $16,410,959
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 122
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
STATEMENT OF ASSETS
AND LIABILITIES
December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Assets:
<S> <C>
Investments in securities, at value (cost $220,678,372) (Note 1).....................................
$ 237,497,383
Repurchase Agreement, at value (cost $50,019,585) (Note 1)...........................................
50,019,585
Cash.................................................................................................
566
Receivable for Fund shares sold......................................................................
5,536,661
Receivable for securities sold.......................................................................
1,341,558
Dividends receivable.................................................................................
94,226
Other assets.........................................................................................
393
-------------
Total assets.........................................................................................
294,490,372
-------------
Liabilities:
Payable for securities purchased.....................................................................
12,900,984
Payable for Fund shares repurchased..................................................................
4,138,787
Payable for investment management and administration fees (Note 2)...................................
154,109
Payable for service and distribution expenses (Note 2)...............................................
111,755
Payable for printing and postage expenses............................................................
67,003
Payable for registration fees........................................................................
57,398
Payable for professional fees........................................................................
26,751
Payable for custodian fees...........................................................................
20,398
Payable for Trustees' fees and expenses (Note 2).....................................................
2,047
Accrued expenses.....................................................................................
13,697
-------------
Total liabilities....................................................................................
17,492,929
-------------
Net assets.............................................................................................
$ 276,997,443
-------------
-------------
Class A:
Net asset value and redemption price per share
($196,937,385 DIVIDED BY 11,130,828 shares outstanding)..............................................
$ 17.69
-------------
-------------
Maximum offering price per share
(100/95.25 of $17.69)*................................................................................
$ 18.57
-------------
-------------
Class B:+
Net asset value and offering price per share
($80,060,058 DIVIDED BY 4,575,521 shares outstanding)................................................
$ 17.50
-------------
-------------
Net assets consist of:
Paid in capital (Note 4).............................................................................
$ 257,081,753
Undistributed net investment income..................................................................
39,441
Accumulated net realized gain on investments.........................................................
3,057,238
Net unrealized appreciation of investments...........................................................
16,819,011
-------------
Total -- representing net assets applicable to capital shares outstanding............................
$ 276,997,443
-------------
-------------
<FN>
- ----------------
* On sales of $50,000 or more, the offering price is reduced.
+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 123
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
STATEMENT OF OPERATIONS
For the year ended December 31, 1994
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
Investment income: (Note 1)
Interest.............................................................................................. $ 2,273,157
Dividends............................................................................................. 902,998
-----------
Total investment income............................................................................... 3,176,155
-----------
Expenses:
Investment management and administration fees (Note 2)................................................ 1,283,893
Service and distribution expenses: (Note 2)
Class A.................................................................................. $ 526,699
Class B.................................................................................. 266,032 792,731
---------
Transfer agent fees (Note 2).......................................................................... 516,252
Registration fees..................................................................................... 123,748
Custodian fees........................................................................................ 88,580
Printing and postage expenses......................................................................... 72,429
Professional fees..................................................................................... 69,311
Trustees' fees and expenses (Note 2).................................................................. 15,220
-----------
Total expenses before reductions...................................................................... 2,962,164
Expense reductions (Note 5).............................................................. (2,813)
-----------
Total net expenses......................................................................... 2,959,351
-----------
Net investment income................................................................................... 216,804
-----------
Net realized and unrealized gain on investments:
Net realized gain on investments........................................................................ 24,664,201
Net change in unrealized appreciation of investments.................................................... 1,064,481
-----------
Net realized and unrealized gain on investments......................................................... 25,728,682
-----------
Net increase in net assets resulting from operations.................................................... $25,945,486
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 124
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
------------------ ------------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income (loss).............................................................
$ 216,804 $ (1,042,830)
Net realized gain on investments.........................................................
24,664,201 12,855,768
Net change in unrealized appreciation (depreciation) of investments......................
1,064,481 (5,894,468)
------------------ ------------------
Net increase in net assets resulting from operations.....................................
25,945,486 5,918,470
------------------ ------------------
Class A:+
Distributions to shareholders from: (Note 1)
Net investment income....................................................................
(177,363) --
Net realized gain on investments.........................................................
(18,246,884) (9,010,079)
Class B:++
Distributions to shareholders from: (Note 1)
Net investment income....................................................................
-- --
Net realized gain on investments.........................................................
(7,094,970) (134,310)
Capital share transactions: (Note 4)
Increase from capital shares sold and reinvested.........................................
842,423,864 434,055,605
Decrease from capital shares repurchased.................................................
(684,302,549) (479,091,372)
------------------ ------------------
Net increase (decrease) from capital share transactions....................................
158,121,315 (45,035,767)
------------------ ------------------
Total increase (decrease) in net assets....................................................
158,547,584 (48,261,686)
Net assets:
Beginning of year........................................................................
118,449,859 166,711,545
------------------ ------------------
End of year..............................................................................
$ 276,997,443 $ 118,449,859
------------------
------------------ ------------------
------------------
<FN>
- ----------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
</TABLE>
The accompanying notes are an integral part of the financial statements.
Statement of Additional Information Page 125
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Contained below is per share operating performance data for a share outstanding,
total investment return, ratios and
supplemental data. This information has been derived from information provided
in the financial statements.
<TABLE>
<CAPTION>
CLASS A+
-------------------------------------------------------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1994(C) 1993 1992 1991 1990
--------- --------- --------- -------- --------
Per Share Operating Performance:
Net asset value, beginning of period..................... $ 17.17 $ 17.12 $ 14.13 $ 11.89 $ 12.84
--------- --------- --------- -------- --------
Net investment income (loss)............................. 0.04 (0.21) (0.11) 0.01 (0.01)
Net realized and unrealized gain (loss)
on investments.......................................... 2.55 1.56 4.54 2.28 (0.94)
--------- --------- --------- -------- --------
Net increase (decrease) in net asset value resulting from
investment operations................................... 2.59 1.35 4.43 2.29 (0.95)
--------- --------- --------- -------- --------
Distributions:
Net investment income.................................. (0.02) (0.00) (0.00) (0.01) (0.00)
Net realized gain on investments....................... (2.05) (1.30) (1.44) (0.04) (0.00)
--------- --------- --------- -------- --------
Total distributions.................................. (2.07) (1.30) (1.44) (0.05) (0.00)
--------- --------- --------- -------- --------
Net asset value, end of period........................... $ 17.69 $ 17.17 $ 17.12 $ 14.13 $ 11.89
--------- --------- --------- -------- --------
--------- --------- --------- -------- --------
Total investment return (d).............................. 15.69% 8.3% 31.7% 19.3% (7.4)%
--------- --------- --------- -------- --------
--------- --------- --------- -------- --------
Ratios and supplemental data:
Net assets, end of period (in 000's)..................... $196,937 $116,468 $166,712 $88,041 $65,413
Ratio of net investment income (loss) to average
net assets.............................................. 0.17% (0.7)% (1.1)% 0.0% (0.1)%
Ratio of expenses to average net assets.................. 1.58% 1.6% 1.8% 1.7% 2.0%
Ratio of expenses to average net assets before expense
reductions.............................................. 1.58% --% --% --% --%
Portfolio turnover rate+++............................... 102% 92% 114% 156% 145%
<CAPTION>
CLASS B++
-----------------------
<S> <C> <C>
APRIL 1,
1993
TO
DECEMBER 31,
1994(C) 1993
-------- ------------
Per Share Operating Performance:
Net asset value, beginning of period..................... $ 17.09 $ 15.90
-------- ------------
Net investment income (loss)............................. (0.09) (0.29)
Net realized and unrealized gain (loss)
on investments.......................................... 2.55 2.78
-------- ------------
Net increase (decrease) in net asset value resulting from
investment operations................................... 2.46 2.49
-------- ------------
Distributions:
Net investment income.................................. (0.00) (0.00)
Net realized gain on investments....................... (2.05) (1.30)
-------- ------------
Total distributions.................................. (2.05) (1.30)
-------- ------------
Net asset value, end of period........................... $ 17.50 $ 17.09
-------- ------------
-------- ------------
Total investment return (d).............................. 15.06% 16.1%(a)
-------- ------------
-------- ------------
Ratios and supplemental data:
Net assets, end of period (in 000's)..................... $80,060 $1,982
Ratio of net investment income (loss) to average
net assets.............................................. (0.48)% (1.3)%(b)
Ratio of expenses to average net assets.................. 2.23% 2.2%(b)
Ratio of expenses to average net assets before expense
reductions.............................................. 2.23% --%
Portfolio turnover rate+++............................... 102% 92%
<FN>
- ------------------
+ All capital shares issued and outstanding as of March 31, 1993, were
reclassified as Class A shares.
++ Commencing April 1, 1993, the Fund began offering Class B shares.
+++ Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(a) Not annualized.
(b) Annualized.
(c) These selected per share data were calculated based upon weighted shares
outstanding during the year.
(d) Total investment return does not include sales charges.
</TABLE>
Statement of Additional Information Page 126
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
NOTES TO
FINANCIAL STATEMENTS
December 31, 1994
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global America Growth Fund ("Fund"), formerly G.T. America Growth Fund, is
a separate series of G.T. Global Growth Series ("Company"). The Company is
organized as a Massachusetts business trust and is registered under the
Investment Company Act of 1940, as amended ("1940 Act"), as a diversified,
open-end management investment company. The Company has six series of shares of
beneficial interest outstanding, each series corresponding to a distinct
portfolio of investments. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of the financial
statements. The policies are in conformity with generally accepted accounting
principles.
(A) PORTFOLIO VALUATION
The Fund calculates the net asset value of and completes orders to purchase,
exchange or repurchase Fund shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or, in the principal over-the-counter market in
which such securities are traded, as of the close of business on the day the
securities are being valued or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.
Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost, adjusted for market fluctuation, if
any.
Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Company's Board of Trustees.
(B) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Fund, it is the Fund's
policy to always receive, as collateral, United States government securities or
other high quality debt securities of which the value,
including accrued interest, is at least equal to the amount to be paid to the
Fund under each agreement at its maturity.
(C) OPTION ACCOUNTING PRINCIPLES
When the Fund writes a call or put option, an amount equal to the premium
received is included in the Fund's "Statement of Assets and Liabilities" as an
asset and an equivalent liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. The current
market value of an option listed on a traded exchange is valued at its last
settlement price, or, in the case of an over-the-counter option, is valued at
the bid price obtained from a broker. If an option expires on its stipulated
expiration date or if the Fund enters into a closing purchase transaction, a
gain or loss is realized without regard to any unrealized gain or loss on the
underlying security, and the liability related to such option is extinguished.
If a written call option is exercised, a gain or loss is realized from the sale
of the underlying security and the proceeds of the sale are increased by the
premium originally received. If a written put option is exercised, the cost of
the underlying security purchased would be decreased by the premium originally
received. The Fund can write options only on a covered basis, which for a call
requires that the Fund hold the underlying security, and for a put requires the
Fund to set aside cash, U.S. government securities or other liquid, high grade
debt securities in an amount not less than the exercise price or otherwise
provide adequate cover at all times while the put option is outstanding.
The premium paid by the Fund for the purchase of a call or put option is
included in the Fund's "Statement of Assets and Liabilities" as an investment
and subsequently "marked-to-market" to reflect the current market value of the
option. If an option which the Fund has purchased expires on the stipulated
expiration date, the Fund realizes a loss in the amount of the cost of the
option. If the Fund enters into a closing sale transaction, the Fund realizes a
gain or loss, depending on whether proceeds from the
Statement of Additional Information Page 127
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
closing sale transaction are greater or less than the cost of the option. If the
Fund exercises a call option, the cost of the securities acquired by exercising
the call is increased by the premium paid to buy the call. If the Fund exercises
a put option, it realizes a gain or loss from the sale of the underlying
security, and the proceeds from such sale are decreased by the premium
originally paid.
The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Fund may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Fund may not be able to enter into a closing transaction because of an illiquid
secondary market.
(D) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Fund is required to pledge to the broker an amount of cash or securities equal
to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Fund agrees to receive from or
pay to the broker an amount of cash equal to the daily fluctuation in value of
the contract. Such receipts or payments are known as "variation margin" and are
recorded by the Fund as unrealized gains or losses. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the Fund is that the change in value of the
underlying securities may not correlate to the change in value of the contracts.
(E) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on an identified
cost basis. Dividends are recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Where a high level of uncertainty exists as to
its collection, income is recorded net of all withholding tax with any rebate
recorded when received. The Fund may trade securities on other than normal
settlement terms. This may increase the risk if the other party to the
transaction fails to deliver and causes the Fund to subsequently invest at less
advantageous prices.
(F) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains.
For corporate shareholders, 3.8% of the net investment income and short-term
gain dividends paid during the Fund's year ended December 31, 1994 qualified for
the dividends received deduction.
(G) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund and timing differences.
(H) RESTRICTED SECURITIES
The Fund is permitted to invest in privately placed restricted securities. These
securities may be resold in transactions exempt from registration or to the
public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult. At the end of the period, restricted
securities (excluding 144A issues) are shown at the end of the Portfolio of
Investments.
2. RELATED PARTIES
G.T. Capital is the Fund's investment manager and
administrator. The Fund pays investment management and administration fees to
G.T. Capital at the following annualized rates of 0.725% on the first $500
million of average daily net assets on the Fund; 0.70% on the next $500 million;
0.675% on the next $500 million and 0.65% on amounts thereafter. These fees are
computed daily and paid monthly, and are subject to reduction in any year to the
extent that the Fund's expenses (exclusive of brokerage commissions, taxes,
interest, distribution-related expenses and extraordinary expenses) exceed the
most stringent limits prescribed by the laws or regulations of any state in
which the Fund's shares are offered for sale, based on the average total net
asset value of the Fund.
G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's
Statement of Additional Information Page 128
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
distributor. The Fund offers Class A shares and Class B shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the year ended December 31, 1994, G.T. Global retained
$80,807 of such sales charges. G.T. Global also makes ongoing shareholder
servicing and trail commission payments to dealers whose clients hold Class A
shares.
Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to contingent deferred sales charges ("CDSCs"), in
accordance with the Fund's current prospectus. For the year ended December 31,
1994, G.T. Global collected CDSCs in the amount of $130,809. In addition, G.T.
Global makes ongoing shareholder servicing and trail commission payments to
dealers whose clients hold Class B shares.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Trustees has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.35% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.
Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G..T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.
G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
items) to the maximum annual level of 2.00% and 2.65% of the average daily net
assets of the Fund's Class A shares and Class B shares, respectively. If
necessary, this limitation will be effected by waivers by G.T. Capital of
investment management and administration fees, waivers by G.T.
Global of payments under the Class A Plan and/or Class B Plan and/or
reimbursements by G.T. Capital or G.T. Global of portions of the Fund's other
operating expenses.
G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.
The Company pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Trustee.
3. PURCHASES AND SALES OF SECURITIES
For the year ended December 31, 1994, purchases and sales of investment
securities by the Fund, other than U.S. government obligations and short-term
investments, aggregated $179,755,298 and $130,213,517, respectively. There were
no purchases or sales of U.S. government obligations by the Fund during the
year.
Statement of Additional Information Page 129
<PAGE>
G.T. GLOBAL AMERICA GROWTH FUND
4. CAPITAL SHARES
At December 31, 1994, there were an unlimited number of shares of beneficial
interest authorized, at no par value. Transactions in capital shares of the Fund
were as follows:
CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS A
Shares sold............................................................... 37,768,865 $ 699,605,033 25,915,034 $ 424,803,912
Shares issued in connection with reinvestment of distributions............ 902,149 15,125,347 440,378 7,187,250
----------- ------------- ----------- -------------
38,671,014 714,730,380 26,355,412 431,991,162
Shares repurchased........................................................ (34,322,058) (638,933,258) (29,313,091) (478,905,129)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... 4,348,956 $ 75,797,122 (2,957,679) $ (46,913,967)
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
<CAPTION>
APRIL 1, 1993
YEAR ENDED TO
DECEMBER 31, 1994 DECEMBER 31, 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
CLASS B
Shares sold............................................................... 6,565,639 $ 121,728,093 119,722 $ 1,949,748
Shares issued in connection with reinvestment of distributions............ 359,927 5,965,391 7,054 114,695
----------- ------------- ----------- -------------
6,925,566 127,693,484 126,776 2,064,443
Shares repurchased........................................................ (2,466,010) (45,369,291) (10,811) (186,243)
----------- ------------- ----------- -------------
Net increase.............................................................. 4,459,556 $ 82,324,193 115,965 $ 1,878,200
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
</TABLE>
5. EXPENSE REDUCTIONS
G.T. Capital has directed certain portfolio trades to brokers who paid a portion
of the Fund's expenses. For the year ended December 31, 1994, the Fund's
expenses were reduced by $2,813 under these arrangements.
- --------------
FEDERAL TAX INFORMATION (UNAUDITED):
Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$5,754,456 as capital gain dividends for the taxable year ended December 31,
1994.
Statement of Additional Information Page 130
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Statement of Additional Information Page 131
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Statement of Additional Information Page 132
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Statement of Additional Information Page 133
<PAGE>
G.T. GLOBAL GROWTH FUNDS
NOTES
- --------------------------------------------------------------------------------
Statement of Additional Information Page 134
<PAGE>
G.T. GLOBAL GROWTH FUNDS
[LOGO]
G.T. GLOBAL GROUP OF FUNDS
G.T. GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY
INVESTORS' PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE
G.T. GLOBAL FUNDS, PLEASE CONTACT YOUR INVESTMENT COUNSELOR OR CALL G.T.
GLOBAL DIRECTLY AT 1-800-824-1580.
GROWTH FUNDS
/ / GLOBALLY DIVERSIFIED FUNDS
G.T. GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.
G.T. GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside
the U.S.
G.T. GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies
/ / GLOBAL THEME FUNDS
G.T. GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide
G.T. GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture or sell
telecommunications services or equipment
G.T. GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve or maintain a country's infrastructure
G.T. GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products
G.T. GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore or develop natural resources
G.T. GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services
/ / REGIONALLY DIVERSIFIED FUNDS
G.T. GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim,
excluding Japan
G.T. GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe
G.T. LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America
/ / SINGLE COUNTRY FUNDS
G.T. GLOBAL AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.
G.T. GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market
GROWTH AND INCOME FUND
G.T. GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world
INCOME FUNDS
G.T. GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities
G.T. GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets
G.T. GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets
MONEY MARKET FUND
G.T. GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY G.T. GLOBAL GROWTH SERIES, G.T. CAPITAL
MANAGEMENT, INC. OR G.T. GLOBAL FINANCIAL SERVICES, INC. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF ANY OFFER TO BUY ANY
OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
EQUSX506MC
