<PAGE>
TO SHAREHOLDERS
During the year ending December 31, 1994, EV Traditional Special Equities Fund
had a total return of -9.6 percent, excluding the sales charge. That return was
the result of a decline in net asset value to $6.88 per share from $8.43 on
December 31,1993 and the reinvestment of $0.73 in capital gain distributions. By
comparison, the S&P 500, an unmanaged index of common stocks, had a total return
of 1.4 percent for the same period.
The economy continued to grow solidly throughout the year, although investors
found the period to be extremely difficult. During the year, the stock market
watched nervously for signs of rising inflation as the Federal Reserve increased
short term rates a total of six times. Overall, the interest rate increase was
greater than many analysts anticipated. But inflation remained in the range of
2.7 percent for the year.
The increasing interest rates had a significant negative effect on
interest-sensitive stocks, such as those of financial service companies. Growth
stocks also were affected. The year also was characterized by great volatility
both in the prices of individual stocks and entire sectors of the market.
Cyclical stocks were among the better performers during the first half of the
year. During the second six months, growth stocks rallied for the first time in
more than a year.
EV TRADITIONAL SPECIAL EQUITIES FUND
10 LARGEST HOLDINGS*
Wabash National Corp..............................................Truck trailers
Boston Scientific Corp...........................................Medical devices
FIServ..................................................Data processing services
Federal National Mortgage Corp...................................Housing finance
Mylan Laboratories Inc...........................................Pharmaceuticals
Dallas Semiconductor Corp..............................High performance circuits
Consolidated Stores.........................................Closeout merchandise
Home Depot Inc.................................................Building supplies
Franklin Resources Inc........................................Investment manager
Loctite Corp...................................................Chemical sealants
*As of 12/31/94
During 1994, some sectors that had done well for the Fund in the past
experienced severe downturns, affecting the Funds performance in the process.
Gaming stocks, for example, did poorly because of a slowdown in the growth of
new jurisdictions that plan to allow gambling, as well as a more competitive
environment for all gaming companies. In response, the Portfolio's gaming
investments were sold during the year.
During 1994, there also was a pullback in some consumer sectors, most notably
restaurants and retail, both of which have traditionally been strongly
represented in the Portfolio.
Of course, past performance is no guarantee of future returns, but we believe
that growth stocks will provide a satisfactory long term total return.
Sincerely,
/s/James B. Hawkes
[Photograph of James B. Hawkes]
James B. Hawkes
President
February 21, 1995
<PAGE>
An interview with Clifford H. Krauss, Vice President and manager of EV
Traditional Special Equities Fund.
Q. CLIFF, HOW WOULD YOU DESCRIBE THE PAST YEAR FOR THE FUND?
A. Simply put, it was a bad year. The Fed increased interest rates six times,
which depressed stock prices in several sectors. During the first half of
the year, cyclicals did well, while during the second half, growth stocks
did better. In fact, during the third quarter of 1994, when growth stocks
rallied, the Fund's performance improved markedly, though not enough to
offset earlier losses. It also was a nervous market that could punish a
stock for even the slightest bit of bad news.
Q. IN TERMS OF THE HOLDINGS IN THE PORTFOLIO, WHAT SECTORS WERE HURT THE MOST?
A. The Portfolio has significant restaurant and retail holdings which did
poorly in 1994. For example, the stocks of Bertucci's Holding Corp. and
Buffets Inc., two restaurant companies, were down by large margins. Gaming
stocks did very poorly as a group, and we sold our gaming holdings during
the year even though these stocks performed very well for us in previous
years.
Q. HOW WILL YOU BE DEALING WITH THESE DEVELOPMENTS IN 1995?
A. Our strategy will change only slightly, because we still firmly believe in
the long-term value of investing in growth stocks. We still look for
companies with rapidly growing earnings and solid financial strength. In
1995, we expect that, when opportunities present themselves, we'll build our
holdings in smaller-capitalization companies. In addition, we've already
added to our technology holdings.
Q. CAN YOU CITE SOME EXAMPLES OF INTERESTING TECHNOLOGY STOCKS IN THE
PORTFOLIO?
A. Three come to mind immediately. EMC Corp. is a data storage company whose
stock has performed well for us thus far. Silicon Graphics is a manufacturer
of extremely sophisticated workstations that are used for multimedia
applications. And Cisco Systems is a networking company.
Q. YOU DESCRIBE THE MARKET AS NERVOUS. HOW DID THIS AFFECT INDIVIDUAL STOCKS?
A. In some cases, companies were punished for only meeting expectations. In
other cases, a piece of bad news about one company caused investors to flee
an entire segment of the market, depressing the prices of many stocks within
that segment.In addition to looking at the fundamentals of their prospective
investments, investors found themselves wondering how each stock would be
viewed by other investors as the year progressed. As I said, it was a very
difficult environment.
<PAGE>
Q. WHAT ARE SOME OF THE FUND'S SUCCESS STORIES THIS YEAR?
A. There were a number of stocks that performed well for us. Earlier I said
that retail was a tough sector this year, but here's an exception. We bought
stock in Consolidated Stores, a merchandiser of closeouts, at a very
advantageous price. It's done well for us. Wabash National, the Portfolio's
largest holding, also did very well. This is a company that is manufacturing
railroad cars and truck trailers in innovative ways. It's the kind of
company -- one thats bringing new technology to the marketplace -- that we'd
like to invest in during 1995. Linear Technology is a company that is
involved in the digital-to-analog conversion process. It's shown consistent
growth. Boston Scientific, a medical device company, also did well.
Q. ARE THERE OTHER STOCKS IN THE PORTFOLIO FOR WHICH YOU HAVE HIGH HOPES?
A. One is MFS Communications. This is what's called a competitive access
provider. It provides businesses with an alternative local telephone loop at
discount. We believe this company should perform well in 1995. We also hold
stock in three companies that should benefit from the aging of the American
population. Demographic trends show our population of older people
increasingly needs subacute care, and all three -- Genesis Health Ventures,
Horizon Health Care and Vitalink Pharmacy Services -- are in the business of
providing the elderly with lower-cost solutions to their medical needs.
We're enthusiastic about two companies in the transportation sector. One is
Greenbrier Companies, a major provider of double-stack railroad cars. The
other is Union Switch & Signal, which provides switching equipment and other
engineering services to railroads, which now are spending more money on
upgrading such systems.
[Photograph of Clifford H. Krauss]
Q. DO YOU HAVE GOALS FOR THE FUND IN 1995?
A. Yes. We want to be increasingly nimble in looking for investment
opportunities. As I mentioned earlier, the area of mid and
smaller-capitalization companies may be fertile ground for us if we find the
investments at the appropriate time.
Q. THERE ARE THOSE ANALYSTS WHO BELIEVE THAT WE'RE ABOUT TO ENTER A PERIOD WHEN
GROWTH STOCKS ARE STRONGER. ARE YOU AMONG THEM?
A. This certainly could happen, given the right conditions. Traditionally,
growth stocks do not do well at times of interest rate increases, so if
interest rates level off, there could be a rally in growth stocks during
1995. That's because under those circumstances, investors are going to be
looking at the basic value that these stocks represent. In addition, some of
the political proposals now on the table would be very interesting for
growth stocks. I'm thinking particularly of a cut in the capital gains tax,
which would be very positive. And certainly any possibility of getting the
budget deficit further under control would be positive as well.
<PAGE>
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN EV TRADITIONAL SPECIAL
EQUITIES FUND AND THE S&P 500 STOCK INDEX
From January 1, 1985, through December 31, 1994
Average Annual 1 5 10
Returns Year Year Year
------------- ---- ----- -----
Including Maximum
Sales Charge -13.9% 7.6% 9.0%
Excluding Maximum
Sales Charge -9.6% 8.7% 9.5%
Past performance is not indicative of future results. Investment returns and
principal will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost. Source: Towers Data Systems,
Bethesda, MD.
*Investment operations commenced on 4/22/68.
Traditional
Special
Equities
Fund S&P 500
12/84 9526 10000
1/85 10620 10741
2/85 10683 10834
3/85 10211 10918
4/85 10003 10868
5/85 10395 11455
6/85 10741 11715
7/85 10885 11658
8/85 10632 11518
9/85 9790 11238
10/85 10136 11716
11/85 10954 12478
12/85 11289 13164
1/86 11638 13195
2/86 12466 14139
3/86 12683 15013
4/86 13115 14801
5/86 13635 15544
6/86 13437 15894
7/86 12225 14961
8/86 12435 16026
9/86 11019 14790
10/86 11502 15599
11/86 11236 15934
12/86 11100 15615
1/87 12599 17673
2/87 13368 18325
3/87 13224 18945
4/87 12674 18728
5/87 13045 18841
6/87 13080 19890
7/87 13521 20850
8/87 14122 21578
9/87 13942 21203
10/87 10650 16589
11/87 9981 15173
12/87 11327 16424
1/88 11423 17088
2/88 12251 17802
3/88 12141 17358
4/88 12196 17522
5/88 11975 17578
6/88 12735 18508
7/88 12376 18408
8/88 11927 17698
9/88 12493 18567
<PAGE>
Traditional
Special
Equities
Fund S&P 500
10/88 12334 19049
11/88 12100 18689
12/88 12597 19133
1/89 13073 20494
2/89 12907 19901
3/89 13163 20487
4/89 13867 21513
5/89 14646 22269
6/89 14191 22291
7/89 15054 24261
8/89 15426 24638
9/89 15696 24675
10/89 15392 24054
11/89 15544 24452
12/89 15565 25177
1/90 14357 23445
2/90 14998 23645
3/90 15675 24416
4/90 15285 23759
5/90 17393 25945
6/90 17835 25945
7/90 17216 25809
8/90 15344 23375
9/90 14629 22396
10/90 13759 22246
11/90 15020 23579
12/90 15954 24393
1/91 17572 25406
2/91 19111 27115
3/91 20244 27923
4/91 19799 27933
5/91 21142 29011
6/91 19767 27862
7/91 21338 29112
8/91 21900 29684
9/91 21611 29351
10/91 22525 29699
11/91 21822 28394
12/91 25100 31793
1/92 24889 31160
2/92 25179 31458
3/92 23729 30993
4/92 22701 31858
5/92 22596 31889
6/92 21699 31584
7/92 22886 32827
8/92 22464 32040
9/92 22912 32579
10/92 23518 32648
11/92 25364 33635
12/92 25781 34212
1/93 26326 34453
2/93 24433 34814
3/93 24921 35701
4/93 22913 34794
5/93 24491 35584
6/93 24404 35870
7/93 24003 35679
8/93 25236 36908
9/93 25982 36794
10/93 26240 37508
11/93 25666 37023
12/93 26075 37645
<PAGE>
Traditional
Special
Equities
Fund S&P 500
1/94 26415 38868
2/94 26261 37700
3/94 23972 36229
4/94 23972 36647
5/94 23322 37101
6/94 22085 36384
7/94 22394 37530
8/94 24436 38941
9/94 23693 38162
10/94 24157 38959
11/94 23168 37420
12/94 23572 38156
THE FUND'S PERFORMANCE
In accordance with guidelines issued by the Securities and Exchange Commission,
the above performance chart compares the Fund's total return with that of a
broad-based securities market index. The lines on the chart represent the total
returns of $10,000 hypothetical investments in the Fund and the S&P 500 Stock
Index.
THE TOTAL RETURN FIGURES
The solid line on the chart represents the Fund's performance, and includes the
Fund's maximum current sales charge of 4.75%. The Fund's total return figure
reflects Fund expenses and Portfolio transaction costs, and assumes the
reinvestment of income dividends and capital gain distributions.
The dotted line represents the performance of the S&P 500 Stock Index, a
broad-based, widely recognized unmanaged index of 500 common stocks. The Index's
total return does not reflect any commissions or expenses that would be incurred
if an investor individually purchased or sold the securities represented in the
Index.
<PAGE>
EV TRADITIONAL SPECIAL EQUITIES FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
December 31, 1994
- --------------------------------------------------------------------------------
ASSETS:
Investment in Special Investment Portfolio (Portfolio),
at value (Note 1A) $63,763,414
Receivable for Fund shares sold and dividend reinvestments 185,637
Deferred organization expenses (Note 1E) 10,542
-----------
Total assets 63,959,593
LIABILITIES:
Payable for Fund shares redeemed $81,391
Accrued directors fees 1,520
Accrued distribution fees 12,870
Accrued transfer agent fees 4,025
Accrued organization expenses 2,942
Accrued expenses 4,543
-------
Total liabilities 107,291
-----------
NET ASSETS for 9,277,415 shares of beneficial interest
outstanding $63,852,302
===========
SOURCES OF NET ASSETS:
Proceeds from sales of shares (including shares
issued to shareholders electing to receive
payment of distributions in shares), less cost
of shares redeemed $53,674,709
Unrealized appreciation of investments 10,177,593
-----------
Total net assets $63,852,302
===========
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
($63,852,302 / 9,277,415 shares of beneficial interest) $ 6.88
======
COMPUTATION OF OFFERING PRICE:
Offering price per share (100/95.25 of $6.88) $ 7.22
======
On sales of $100,000 or more, the offering price is reduced.
The accompanying notes are an integral part of the financial statements
<PAGE>
FINANCIAL STATEMENTS (continued)
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the Year Ended December 31, 1994
- --------------------------------------------------------------------------------
INVESTMENT INCOME (NOTE 1B):
Dividend income $ 199,753
Interest income 138,477
Dividend income allocated from Portfolio 129,925
Interest income allocated from Portfolio 133,258
Expenses allocated from Portfolio (207,783)
-----------
Total investment income 393,630
Expenses --
Investment adviser fee (Note 5) $ 270,926
Service fees (Note 6) 50,704
Compensation of Trustees not members of the
Investment Adviser's organization 6,292
Custodian fees (Note 5) 38,880
Legal and accounting services 20,265
Transfer and dividend disbursing agent fees 56,755
Printing and postage 28,421
Registration fees 29,018
Amortization of organization expenses
(Note 1E) 958
Miscellaneous 11,734
-----------
Total expenses 513,953
-----------
Net investment loss (120,323)
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (identified cost basis) --
Investment transactions 7,209,586
Net realized loss from Portfolio (identified
cost basis) --
Investment transactions (985,337)
-----------
Net realized gain on investments
($6,183,757 net gain as computed for
federal income tax purposes) 6,224,249
Change in unrealized appreciation of investments (13,248,458)
-----------
Net realized and unrealized loss on
investments (7,024,209)
-----------
Net decrease in net assets resulting from
operations $(7,144,532)
===========
The accompanying notes are an integral part of the financial statements
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
- ---------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------
1994 1993
------------- -----------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment loss $ (120,323) $ (239,079)
Net realized gain on investments 6,224,249 6,026,583
Decrease in unrealized appreciation of investments (13,248,458) (4,246,587)
------------ -----------
Net increase (decrease) in net assets resulting
from operations $ (7,144,532) $ 1,540,917
Undistributed net investment income included in
price of shares sold and shares reacquired -- 350,353
Distributions to shareholders --
From net realized gains on investment
transactions (6,183,757) (6,183,828)
Tax return of capital (30,146) --
Net increase (decrease) from Fund share
transactions (Note 3) (921,158) 5,880,577
------------ -----------
Total increase (decrease) in net assets $(14,279,593) $ 1,588,019
------------ -----------
NET ASSETS:
Beginning of year 78,131,895 76,543,876
------------ -----------
End of year $ 63,852,302 $78,131,895
============ ===========
</TABLE>
The accompanying notes are an integral part of the financial statements
<PAGE>
FINANCIAL STATEMENTS (continued)
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
- ---------------------------------------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------------
1994 1993 1992 1991<F4> 1990<F4>
<S> <C> <C> <C> <C> <C>
------- ------- ------- ------- -------
NET ASSET VALUE -- Beginning of year $ 8.430 $ 8.990 $ 9.520 $ 6.810 $ 7.050
------- ------- ------- ------- -------
Income from investment
operations:
Net investment income (loss) $(0.013) $(0.018) $ 0.006 $ 0.004 $ 0.033
Net realized and unrealized
gain (loss) on investments (0.807) 0.108 0.239 3.776 0.130
------- -------- ------- ------- -------
Total income (loss) from
investment operations $(0.820) $ 0.090 $ 0.245 $ 3.780 $ 0.163
------- -------- ------- ------- -------
Less distributions:
From net realized gain on
investments (0.727) (0.650) (0.775) (1.070) (0.403)
Tax return of capital (0.003) -- -- -- --
------- -------- ------- ------- -------
NET ASSET VALUE -- End of year $ 6.880 $ 8.430 $ 8.990 $ 9.520 $ 6.810
======= ======== ======= ======= =======
TOTAL RETURN (9.60)% 1.14% 2.71% 57.33% 2.50%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year (000's
omitted) $63,852 $78,132 $76,544 $77,324 $50,094
Ratio of expenses to average net
assets<F1> 1.02% 1.01% 0.96% 0.94% 1.06%
Ratio of net investment income
to average net assets (0.17)% (0.30)% 0.07% 0.05% 0.48%
PORTFOLIO TURNOVER<F3> 37% 73% 48% 41% 47%
<FN>
<F1>Includes the Fund's share of Special Investment Portfolio's allocated expenses for the period from August
1, 1994, to December 31, 1994.
<F2>Computed on an average share basis.
<F3>Portfolio Turnover represents the rate of portfolio activity for the period
while the Fund was making investments directly in securities. The portfolio
turnover for the period since the Fund transferred substantially all of its
investable assets to the Portfolio is shown in the Portfolio's financial
statements which are included elsewhere in this report.
<F4>Audited by previous auditors.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements
<PAGE>
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
EV Traditional Special Equities Fund (the Fund), a Massachusetts business trust,
is registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end, management investment company. The Fund is a series in
the Eaton Vance Special Investment Trust. On August 2, 1994, the Fund
transferred substantially all of its investable assets to the Special Investment
Portfolio (the Portfolio). Prior to this date the Fund's name was Eaton Vance
Special Equities Fund. The Fund invests all of its investable assets in
interests in the Portfolio, a New York Trust, having the same investment
objective as the Fund. The value of the Fund's investment in the Portfolio
reflects the Fund's proportionate interest in the net assets of the Portfolio
(98.9% at December 31, 1994). The performance of the Fund is directly affected
by the performance of the Portfolio. The financial statements of the Portfolio,
including the portfolio of investments, are included elsewhere in this report
and should be read in conjunction with the Fund's financial statements. The
following is a summary of significant accounting policies consistently followed
by the Fund in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles.
A. INVESTMENT VALUATIONS -- Valuations of securities by the Portfolio is
discussed in Note 1 of the Portfolio's Notes to Financial Statements which are
included elsewhere in this report.
B. INCOME -- The Fund's net investment income consists of the Fund's pro rata
share of the net investment income of the Portfolio, less all actual and accrued
expenses of the Fund. Prior to the Fund's investment in the Portfolio, the Fund
held its investments directly.
C. EQUALIZATION -- Prior to January 1, 1994, the Fund followed the accounting
practice known as equalization by which a portion of the proceeds from the sales
and costs of reacquisitions of Fund shares was allocated to undistributed net
investment income. As a result, undistributed net investment income per share
was unaffected by sales or reacquisitions of Fund shares. As of January 1, 1994,
the Fund discontinued the use of equalization. This change had no effect on the
Fund's net assets, net asset value per share, or its net increase or (decrease)
in net assets from operations. Discontinuing the use of equalization will result
in a simpler and more meaningful financial statement presentation.
D. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments, options and financial futures transactions.
Accordingly, no provision for federal income or excise tax is necessary.
E. DEFERRED ORGANIZATION EXPENSES -- Costs incurred by the Fund in connection
with its organization, are being amortized on the straight-line basis over five
years.
F. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Dividend income and dividends to shareholders
are recorded on the ex-dividend date. Dividend income may include dividends that
represent returns of capital for federal tax purposes. Gains or loss on the sale
of investments is determined on the identified cost basis.
G. DISTRIBUTIONS -- Generally accepted accounting principles require that
differences in the recognition or classification of income between the financial
statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes, are classified as
distributions in excess of net investment income or accumulated net realized
gains.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
(2) LINE OF CREDIT
Through August 1, 1994, the Fund participated with other funds managed by EVM in
a $120 million unsecured line of credit with a bank. The line of credit consists
of a $20 million committed facility and a $100 million discretionary facility.
Borrowings will be made by the Fund solely to facilitate the handling of unusual
and/or unanticipated short-term cash requirements. Interest is charged to each
fund based on its borrowings at an amount above either the bank's adjusted
certificate of deposit rate, a variable adjusted certificate of deposit rate, or
a federal funds effective rate. In addition, a fee computed at an annual rate of
1/4 of 1% on the $20 million committed facility and/or the daily unused portion
of the $100 million discretionary facility is allocated among the participating
funds at the end of each quarter. The Fund did not have any significant
borrowings or allocated fees during the period. At December 31, 1994, the Fund
had no outstanding balance. This line of credit was assumed by the Portfolio as
of August 2, 1994 (see Note 4 of the Portfolios financial statements).
- ------------------------------------------------------------------------------
(3) FUND SHARES
The Fund under its indenture of trust is authorized to issue unlimited shares of
$0.50 par value. Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
--------------------------------------------------------
1994 1993
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
<S> <C> <C> <C> <C>
--------- ----------- --------- -----------
Sales 23,121,866 $181,853,726 20,019,093 $167,330,920
Shares issued in reinvestment of
distributions 785,094 5,336,802 629,883 5,050,505
Shares issued for the net assets of
another investment company -- -- 812,931 6,744,651
Shares redeemed (23,895,612) (188,111,686) (20,706,918) (173,245,499)
----------- ------------ ----------- ------------
Net increase (decrease) 11,348 $ (921,158) 754,989 $ 5,880,577
=========== ============ =========== =============
</TABLE>
<PAGE>
- -------------------------------------------------------------------------------
(4) INVESTMENT TRANSACTIONS
On August 2, 1994, the Fund transferred substantially all of its assets to the
Portfolio in exchange for an interest in the Portfolio. Increases and decreases
in the Fund's investments for the period from January 1, 1994 to August 1, 1994
aggregated $24,746,464 and $32,758,520, respectively. Increases and decreases in
the Fund's investments in the Portfolio for the period from August 2, 1994 to
December 31, 1994 aggregated $34,816,259 and $43,392,065, respectively.
- -------------------------------------------------------------------------------
(5) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Prior to August 2, 1994 (when the Fund transferred substantially all of its
assets to the Portfolio in exchange for an interest in the Portfolio), the Fund
retained Eaton Vance Management (EVM) as its investment adviser. The investment
adviser fee was earned by EVM as compensation for management and investment
advisory services rendered to the Fund. The fee was computed at the annual rate
of 5/8 of 1% of the Fund's average daily net assets. For the period from January
1 to August 1, 1994, the fee for such period amounted to $270,926. Since August
2, 1994, Eaton Vance has served only as the administrator of the Fund, but
receives no compensation. The Portfolio has engaged Boston Management and
Research (BMR), a subsidiary of EVM, to render investment advisory services. See
Note 3 of the Portfolio's Notes to Financial Statements which are included
elsewhere in this report. Except as to Trustees of the Fund and the Portfolio
who are not members of EVM's or BMR's organization, officers and Trustees
receive remuneration for their services to the Fund out of such investment
adviser fee. Investors Bank & Trust Company (IBT), an affiliate of EVM, serves
as custodian of the Fund and the Portfolio. Pursuant to the respective custodian
agreements, IBT receives a fee reduced by credits which are determined based on
the average cash balances the Fund or the Portfolio maintains with IBT. Certain
of the officers and Trustees of the Fund, Portfolio are officers and
directors/trustees of the above organizations.
- ------------------------------------------------------------------------------
(6) SERVICE PLAN
The Trustees of the Fund adopted a Service Plan on July 7, 1993 designed to meet
the requirements of Rule 12b-1 under the Investment Company Act of 1940 and the
service fee requirements of the revised sales charge rule of The National
Association of Securities Dealers Inc. The Service Plan replaced the Fund's
distribution plan which became effective on June 12, 1989. The Service Plan
provides that the Fund may make service fee payments to the Principal
Underwriter, Eaton Vance Distributors, Inc., a subsidiary of Eaton Vance
Management, Authorized Firms or other persons in amounts not exceeding .25% of
the Fund's average daily net assets for any fiscal year. The Trustees have
implemented the Service Plan by authorizing the Fund to make quarterly service
fee payments to the Principal Underwriter and Authorized Firms in amounts not
expected to exceed .25% of that portion of the Fund's average daily net assets
for any fiscal year which is attributable to shares of the Fund sold on or after
June 12, 1989 by such persons and remaining outstanding for at least twelve
months. Such payments are made for personal services and/or the maintenance of
shareholder accounts. During the fiscal year ended December 31, 1994 the Fund
made payments of $50,704 under the Plan to the Principal Underwriter and
Authorized Firms.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees of
EV Traditional Special Equities Fund, a series of Eaton Vance
Special Investment Trust:
We have audited the accompanying statement of assets and liabilities of EV
Traditional Special Equities Fund (formerly Eaton Vance Special Equities Fund),
a series of Eaton Vance Special Investment Trust, as of December 31, 1994, and
the related statement of operations for the year then ended, the statement 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,
presented herein, were audited by other auditors whose report dated January 21,
1992, expressed an unqualifed 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. 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 EV
Traditional Special Equities Fund, a series of Eaton Vance Special Investment
Trust, 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 3, 1995
<PAGE>
- --------------------------------------------------------------------------------
SPECIAL INVESTMENT PORTFOLIO
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1994
- --------------------------------------------------------------------------------
COMMON STOCKS - 93.3%
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
BUSINESS SERVICES - 6.8%
Accustaff Inc.* 20,000 $ 277,500
Provider of specialized temporary staffing
services to major corporations.
BISYS Corp.* 40,000 885,000
Services financial institutions with
computer, administrative and marketing
support data processing services.
Danka Business Systems PLC, ADR 20,000 432,500
An independent provider of maintenance and
service for office copying machines.
FIserv Incorporated* 103,500 2,225,250
Provider of data processing services to
banks and savings institutions, benefiting
from outsourcing trend.
G&K Services, Inc. 35,000 581,875
Rents and launders uniforms and other
textile products.
-----------
$ 4,402,125
-----------
COMMUNICATIONS - 6.2%
Comcast Corp. 55,000 $ 862,812
Cable TV and cellular telephone operator.
Comcast UK Cable Partners 40,000 640,000
Operator of integrated cable television,
residential telephone and business
telecommunications services in the
United Kingdom. Intelcom Group, Inc.* 17,300 229,030
Provider of alternative access
telecommunication services and
international satellite uplink teleports.
MFS Communications Co., Inc* 45,000 1,473,750
Provider of fiber-optic based
telecommunications services primarily to
businesses.
Paging Network, Inc.* 10,000 340,000
Provider of paging services in U.S.
Telephone & Data Systems, Inc. 10,000 461,250
A provider of local telephone service in
smaller communities, as well as
cellular and paging services.
-----------
$ 4,006,842
-----------
<PAGE>
PORTFOLIO OF INVESTMENTS (Continued)
COMMON STOCKS - (Continued)
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
COMPUTER EQUIPMENT - 2.7%
EMC Corp. Mass. 55,000 $ 1,189,375
Manufacturer of data storage products for
midrange and mainframe computer systems.
Motorola Inc. 10,000 578,750
Leading worldwide producer of wireless
communication systems and equipment,major
manufacturer of semiconductors.
-----------
$ 1,768,125
-----------
CONSUMER SOFTWARE - 6.4%
Banyan Inc.* 70,000 $ 1,251,250
Provider of networking software products for
large, complex computer networks.
Lotus Development Corp.* 10,000 411,250
Provider of business application software
including (1-2-3), graphics (Freelance)
and communications (Notes) products.
Novell, Inc.* 70,000 1,198,750
Leading provider of network software
systems.
Silicon Graphics, Inc.* 40,000 1,235,000
Produces computer systems used for the
design analysis and simulation of three
dimensional objects.
-----------
$ 4,096,250
-----------
CONSUMER PRODUCTS - 2.2%
Sunbeam Oster, Inc. 55,000 $ 1,416,250
Manufacturer of outdoor, household, and -----------
specialty consumer products under Sunbeam
and Oster brand names.
ELECTRONICS & INSTRUMENTATION - 7.3%
Cisco Systems, Inc.* 35,000 $ 1,229,375
Manufacturer of routers that connect
computer networks.
Dallas Semiconductor Corp.* 110,000 1,828,750
Specialty semiconductor supplier focusing on
CMOS integrated circuits.
Linear Technology Corp. 15,000 742,500
Manufacturer of high performance linear
integrated circuits.
Xilinx Inc.* 15,000 888,750
Leading world-wide supplier of CMOS
programmable logic semiconductors.
-----------
$ 4,689,375
-----------
<PAGE>
PORTFOLIO OF INVESTMENTS (Continued)
COMMON STOCKS - (Continued)
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
ENTERTAINMENT - 2.5%
Carnival Corp. 60,000 $ 1,275,000
World's largest cruise ship company
operating primarily as Carnival and
Holland America cruise lines.
Gaylord Entertainment 16,000 364,000
Diversified cable entertainment/broadcasting
company focused in the country music
industry.
-----------
$ 1,639,000
-----------
ENVIRONMENTAL SERVICES - 0.4%
United Waste Systems, Inc.* 10,000 $ 250,000
Integrated provider of solid waste -----------
management services to residential,
commercial and industrial customers.
FINANCE - 7.5%
Federal National Mortgage Association 30,000 $ 2,186,250
Leading factor in the secondary mortgage
market.
Franklin Resources, Inc. 45,000 1,603,125
One of the largest mutual fund organizations
in the U.S.
T. Rowe Price Associates, Inc. 35,000 1,050,000
Investment adviser to mutual funds,
institutions and individuals.
-----------
$ 4,839,375
-----------
HEALTHCARE - 11.9%
Boston Scientific Corp.* 134,000 $ 2,328,250
Medical device manufacturer focusing
primarily on disposable products in less
invasive surgery procedures.
Genesis Health Ventures, Inc.* 35,000 1,106,875
Provider of geriatric health services.
Horizon Healthcare Corp.* 25,000 700,000
Manager of long-term care and specialty
healthcare facilities focusing on
geriatric care.
Mylan Laboratories, Inc. 75,000 2,025,000
Leading manufacturer of generic drugs.
U.S. Healthcare, Inc. 15,000 618,750
Operates health management organization
serving over 1.5 million members.
Ventritex Inc.* 25,500 688,500
Developer of new generation implantable
heart defibrillator.
Vitalink Pharmacy Services, Inc.* 12,500 178,125
Provider of pharmacy services to nursing
homes and sub-acute care medical
facilities.
-----------
$ 7,645,500
-----------
<PAGE>
PORTFOLIO OF INVESTMENTS (Continued)
COMMON STOCKS - (Continued)
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
INDUSTRIAL PRODUCTS - 9.8%
J & L Specialty Steel, Inc. 40,000 $ 785,000
Manufacturer of stainless steel.
Loctite Corp. 34,400 1,599,600
International manufacturer of adhesives,
sealants and related products.
Union Switch & Signal, Inc.* 45,000 613,125
Manufacturer of advanced signaling, control
and automatic systems for railroads and
transit authorities.
Wabash National Corp. 85,000 3,315,000
Manufacturer of specialy truck trailers
benefiting from innovative new products.
-----------
$ 6,312,725
-----------
INSURANCE - 7.1%
American International Group 10,000 $ 980,000
One of the world's leading insurance
companies, operating in 130 countries.
HCC Insurance Holdings, Inc.* 47,700 1,001,700
Specialty insurer focusing on complex
international markets.
Mutual Risk Management Ltd. 55,000 1,443,750
Specialty insurer focusing on workmen's
compensation.
UNUM Corp. 30,000 1,132,500
Leading provider of long-term disability
insurance.
-----------
$ 4,557,950
-----------
PUBLISHING -1.2%
Scholastic Corp.* 15,000 $ 765,000
Publisher/distributor of children's books, -----------
magazines and related educational
materials.
RESTAURANTS - 5.5%
Bertucci's Holding Corp.* 95,000 $ 1,045,000
Rapidly growing operator of Italian style
restaurants featuring wood burning brick
ovens.
Brinker International, Inc.* 70,000 1,268,750
Operator of Chili's, Grady's and other
dinnerhouse restaurants growing through
new unit expansion.
Buffets Inc.* 100,000 987,500
Chain of value-oriented Old Country Buffet
restaurants growing through new unit
expansion.
Quality Dining, Inc.* 16,900 209,138
Midwestern U.S. franchise operator of Burger
King and Chili's restaurants.
-----------
$ 3,510,388
-----------
<PAGE>
COMMON STOCKS - (Continued)
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
RETAILING - 9.3%
Ann Taylor Stores Corp.* 20,000 $ 687,500
Specialty retailer of better quality women's
apparel, shoes and accessories.
Consolidated Stores Corp.* 95,000 1,769,375
Chain of close-out merchandise stores
operating primarily under the Odd/Big Lots
name.
Gap (The) Inc. 25,000 762,500
Specialty apparel retailer offering high-
quality, modestly priced private-label
sportswear under six brand names.
Home Depot Inc. 35,000 1,610,000
Operator of a chain of retail warehouse-type
stores selling building supply and home
improvement products.
Michaels Stores Inc.* 30,000 1,042,500
Leading arts and crafts retailer in the U.S.
Sports Authority (The)* 6,600 138,600
Largest operator of large-format sporting
goods stores in the United States.
-----------
$ 6,010,475
-----------
SPECIALTY CHEMICALS - 2.9%
Great Lakes Chemical Corp. 20,000 $ 1,140,000
Leading producer of flame retardant and
specialty intermediate chemicals.
Millipore Corp. 15,000 725,625
Manufacturer of membrane technology products
used for chemical analysis and
purification.
-----------
$ 1,865,625
-----------
TRANSPORTATION - 3.6%
Greenbrier Companies,Inc. 45,500 $ 750,750
Leading manufacturer of intermodal railcars
used to transport container freight.
M.S. Carriers, Inc.* 40,000 870,000
Irregular route truckload carrier.
Werner Enterprises, Inc. 30,000 708,750
Nationwide truckload transportation carrier.
-----------
$ 2,329,500
-----------
TOTAL COMMON STOCKS
IDENTIFIED COST, $49,823,351) $60,104,505
-----------
<PAGE>
- --------------------------------------------------------------------------------
PREFERRED STOCK - 0.1%
- --------------------------------------------------------------------------------
NAME OF COMPANY SHARES VALUE
- --------------------------------------------------------------------------------
Concentric Data Systems, Inc.
1983 Class B Pfd.+
Software company providing data management
programs for microcomputers. 43,750 $ 87,500
------------
TOTAL PREFERRED STOCK
(IDENTIFIED COST, $175,000) $ 87,500
------------
- --------------------------------------------------------------------------------
SHORT-TERM OBLIGATIONS - 6.9%
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000 OMITTED)
- --------------------------------------------------------------------------------
CXC Inc., 5.95s, 1/3/95 $2,958 $ 2,956,842
General Electric Capital Corp., 5.82s, 1/9/95 1,485 1,483,080
-----------
TOTAL SHORT-TERM OBLIGATIONS, AT
AMORTIZED COST $ 4,439,922
-----------
TOTAL INVESTMENTS (IDENTIFIED COST,
$54,438,273) $64,631,927
OTHER ASSETS, LESS LIABILITIES - (0.3%) $ (189,555)
-----------
TOTAL NET ASSETS - 100% $64,442,372
===========
*Non-income producing security.
+Not readily marketable security.
The accompanying notes are an integral part of the financial statements
<PAGE>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
December 31, 1994
- --------------------------------------------------------------------------------
ASSETS:
Investments, at value (Note 1A) (identified cost,
$54,438,273) $64,631,927
Cash 1,875
Dividends receivable 28,262
Deferred organization expenses (Note 1D) 14,476
-----------
Total assets $64,676,540
LIABILITIES:
Payable for investments purchased $229,889
Custodian fee payable 1,929
Accrued expenses 2,350
--------
Total liabilities 234,168
-----------
NET ASSETS applicable to investors' interest
in Portfolio $64,442,372
===========
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and withdrawals $ 54,248,718
Unrealized appreciation of investments (identified
cost) 10,193,654
-----------
Total net assets $64,442,372
===========
The accompanying notes are an integral part of the financial statements
<PAGE>
FINANCIAL STATEMENTS (Continued)
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
For the period from the start of business,
August 1, 1994, to December 31, 1994
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Dividend income $ 130,332
Interest income 133,617
----------
Total income 263,949
Expenses --
Investment adviser fee (Note 3) $ 175,012
Custodian fee (Note 3) 20,710
Legal and accounting 8,231
Registration fees 2,642
Amortization of organization expenses (Note 1D) 1,196
Printing 173
Miscellaneous 348
----------
Total expenses 208,312
----------
Net investment income 55,637
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investments (identified cost
basis) $ (986,284)
Change in unrealized appreciation on investments 4,288,639
----------
Net realized and unrealized gain on
investments 3,302,355
----------
Net increase in net assets resulting from operations $3,357,992
==========
The accompanying notes are an integral part of the financial statements
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
For the period from the start of business,
August 1, 1994, to December 31, 1994
- --------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 55,637
Net realized loss on investment transactions (986,284)
Increase in unrealized appreciation of investments 4,288,639
------------
Net increase in net assets from operations $ 3,357,992
------------
Capital transactions--
Contributions $104,495,403
Withdrawals (43,411,023)
------------
Increase in net assets resulting from capital transactions $ 61,084,380
------------
Total increase in net assets $ 64,442,372
NET ASSETS:
At beginning of period --
------------
At end of period $ 64,442,372
============
- --------------------------------------------------------------------------------
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
RATIOS (As a percentage of average net assets):
Expenses 0.74%+
Net investment income 0.20%+
PORTFOLIO TURNOVER 19%
+Computed on an annualized basis.
The accompanying notes are an integral part of the financial statements
<PAGE>
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
Special Investment Portfolio (the Portfolio) is registered under the Investment
Company Act of 1940 as a diversified open-end investment company which was
organized as a trust under the laws of the State of New York on May 1, 1992. The
Declaration of Trust permits the Trustees to issue beneficial interests in the
Portfolio. Investment operations began on August 1, 1994, with the acquisition
of net assets of $69,001,817 in exchange for an interest in the Portfolio by one
of the Portfolio's investors. The following is a summary of significant
accounting policies of the Portfolio. The policies are in conformity with
generally accepted accounting principles.
A. SECURITY VALUATIONS -- Investments in securities traded on a national
securities exchange or in the NASDAQ National Market are valued on the basis of
the last reported sales prices on the last business day of the period. If no
sale is reported on that date, a security is valued, if quoted on such a day, at
not lower than the old bid price nor higher than the asked prices. Prices on
such exchanges will not be used for valuing debt securities if in the Trustees
judgment, some other valuation method more accurately reflects the fair market
value of such a security. Securities for which over-the-counter market
quotations are readily available are valued on the basis of the mean between the
last bid and asked prices. Short-term securities are valued at cost, which
approximates market value. All other securities and assets are appraised to
reflect their fair value as determined in good faith by the Trustees.
B. INCOME TAXES -- The Portfolio is treated as a partnership for federal tax
purposes. No provision is made by the Portfolio for federal or state taxes on
any taxable income of the Portfolio because each investor in the Portfolio is
ultimately responsible for the payment of any taxes. Since some of the
Portfolio's investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolio, the Portfolio normally must
satisfy the applicable source of income and diversification requirements (under
the Code) in order for its investors to satisfy them. The Portfolio will
allocate at least annually among its investors each investors' distributive
share of the Portfolio's net investment income, net realized capital gains, and
any other items of income, gain, loss, deduction or credit.
C. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Dividend income is recorded on the ex-
dividend date. Realized gains and losses on the sale of investments are
determined on the identified cost basis.
D. DEFERRED ORGANIZATION EXPENSES -- Costs incurred by the Portfolio in
connection with its organization are being amortized on the straight-line basis
over five years.
- --------------------------------------------------------------------------------
(2) INVESTMENT TRANSACTIONS
Purchases and sales of investments, other than short-term obligations,
aggregrated $11,947,002 and $14,500,376, respectively.
<PAGE>
- --------------------------------------------------------------------------------
(3) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee is earned by Boston Management and Research (BMR), a
wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to the Portfolio. The fee
is at the annual rate of 5/8 of 1% of average daily net assets. For the period
from the start of business, August 1, 1994 to December 31, 1994, the fee
amounted to $175,012. Except as to Trustees of the Portfolio who are not members
of EVM's or BMR's organization, officers and Trustees receive remuneration for
their services to the Portfolio out of such investment adviser fee. Investors
Bank & Trust Company (IBT), an affiliate of EVM and BMR, serves as custodian of
the Portfolio. Pursuant to the custodian agreement, IBT receives a fee reduced
by credits which are determined based on the average daily cash balances the
Portfolio maintains with IBT. Certain of the officers and Trustees of the
Portfolio are officers and directors/trustees of the above organizations.
- ------------------------------------------------------------------------------
(4) LINE OF CREDIT
The Portfolio participates with other portfolios and funds managed by BMR and
EVM and its affiliates in a $120 million unsecured line of credit agreement with
a bank. The line of credit consists of $20 million committed facility and a $100
million discretionary facility. Borrowings will be made by the Portfolio solely
to facilitate the handling of unusual and/or unanticipated short-term cash
requirements. Interest is charged to each portfolio based on its borrowings at
an amount above either the bank's adjusted certificate of deposit rate, a
variable adjusted certificate of deposit rate, or a federal funds effective
rate. In addition, a fee computed at an annual rate of 1/4 of 1% on the $20
million committed facility and on the daily unused portion of the $100 million
discretionary facility is allocated among the participating funds and portfolios
at the end of each quarter. The Portfolio did not have any significant
borrowings or allocated fees during the period. At December 31, 1994, the Fund
did not have an outstanding balance pursuant to the line of credit.
- ------------------------------------------------------------------------------
(5) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investments
owned at December 31, 1994, as computed on a federal income tax basis, are as
follows:
Aggregate cost $54,436,173
===========
Gross unrealized appreciation $12,351,693
Gross unrealized depreciation 2,158,039
-----------
Net unrealized appreciation $10,193,654
===========
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
- -------------------------------------------------------------------------------
To the Trustees and Investors of
Special Investment Portfolio:
We have audited the accompanying statement of assets and liabilities of Special
Investment Portfolio, including the portfolio of investments, as of December 31,
1994, the related statement of operations, changes in net assets and
supplementary data for the period from August 1, 1994 (start of business) to
December 31, 1994. These financial statements and supplementary data are the
responsibility of the Portfolio's management. Our responsibility is to express
an opinion on these financial statements and supplementary data based on our
audit.
We conducted our audit 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 supplementary data 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statements and supplementary data referred to
above present fairly, in all material respects, the financial position of
Special Investment Portfolio as of December 31, 1994, the results of its
operations, changes in its net assets and supplementary data for the period from
August 1, 1994 (start of business) to December 31, 1994, in conformity with
generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
February 3, 1995
<PAGE>
- --------------------------------------------------------------------------------
INVESTMENT MANAGEMENT
EV TRADITIONAL OFFICERS TRUSTEES
SPECIAL EQUITIES JAMES B. HAWKES LANDON T. CLAY
FUND President, Trustee Chairman, Eaton Vance
24 Federal Street PETER F. KIELY Management
Boston, MA 02110 Vice President DONALD R. DWIGHT
CLIFFORD H. KRAUSS President,
Vice President and Dwight Partners, Inc.
Portfolio Manager Chairman, Newspapers of
JAMES L. O'CONNOR New England, Inc.
Treasurer SAMUEL L. HAYES, III
THOMAS OTIS Jacob H. Schiff Professor of
Secretary Investment Banking,
WILLIAM J. AUSTIN, JR. Harvard University
Assistant Treasurer Graduate School of
DOUGLAS C. MILLER Business Administration
Assistant Treasurer NORTON H. REAMER
JANET E. SANDERS President and Director, United
Assistant Treasurer and Asset Management Corporation
Assistant Secretary JOHN L. THORNDIKE
Director,
Fiduciary Trust Company
JACK L. TREYNOR
Investment Adviser and
Consultant
------------------------------------------------------------
SPECIAL OFFICERS TRUSTEES
INVESTMENT JAMES B. HAWKES LANDON T. CLAY
PORTFOLIO President, Trustee Chairman, Eaton Vance
24 Federal Street PETER F. KIELY Management
Boston, MA 02110 Vice President DONALD R. DWIGHT
CLIFFORD H. KRAUSS President,
Vice President and Dwight Partners, Inc.
Portfolio Manager Chairman, Newspapers of
JAMES L. O'CONNOR New England, Inc.
Treasurer SAMUEL L. HAYES, III
THOMAS OTIS Jacob H. Schiff Professor of
Secretary Investment Banking,
WILLIAM J. AUSTIN, JR. Harvard University
Assistant Treasurer Graduate School of
JANET E. SANDERS Business Administration
Assistant Treasurer and NORTON H. REAMER
Assistant Secretary President and Director, United
Asset Management Corporation
JOHN L. THORNDIKE
Director,
Fiduciary Trust Company
JACK L. TREYNOR
Investment Adviser and
Consultant
<PAGE>
INVESTMENT ADVISER
Eaton Vance Management
24 Federal Street
Boston, MA 02110
PRINCIPAL UNDERWRITER
Eaton Vance Distributors, Inc.
24 Federal Street
Boston, MA 02110
(617) 482-8260
CUSTODIAN
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110
TRANSFER AGENT AND DIVIDEND
DISBURSING AGENT
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand LLP
One Post Office Square
Boston, MA 02109
This report must be preceded or accompanied by a current prospectus which
contains more complete information on the Fund, including its distribution plan,
sales charges and expenses. Please read the prospectus carefully before you
invest or send money.
EV TRADITIONAL SPECIAL EQUITIES FUND
24 FEDERAL STREET
BOSTON, MA 02110
T-SESRC
EV TRADITIONAL
SPECIAL EQUITIES
FUND
ANNUAL
SHAREHOLDER REPORT
DECEMBER 31, 1994
