<PAGE> 1
SEMIANNUAL REPORT FEBRUARY 29, 2000
OPPENHEIMER
CAPITAL APPRECIATION FUND
[PHOTO]
[OPPENHEIMERFUNDS LOGO]
THE RIGHT WAY TO INVEST
<PAGE> 2
CONTENTS
1 President's Letter
3 An Interview with Your Fund's Manager
8 Financial Statements
31 Officers and Trustees
32 OppenheimerFunds Family
REPORT HIGHLIGHTS
- -------------------------------------------------------------------------------
THE ROBUST ECONOMY, COUPLED WITH STRONG CORPORATE EARNINGS continued to be a
key market driver during the period.
A CLOSE LOOK AT THE MARKET REVEALS THAT OTHER THAN THE HIGH FLYING TECHNOLOGY
SECTOR, most stocks were actually down over the period.
IN TERMS OF THE FUTURE, WE BELIEVE THE FUND IS VERY WELL POSITIONED. As growth
managers, our job is to pick good companies and keep a sensitive eye on price.
CUMULATIVE TOTAL RETURNS
For the 6-Month Period
Ended 2/29/00 *
<TABLE>
<CAPTION>
Class A
Without With
Sales Chg. Sales Chg.
- --------------------------
<S> <C>
36.90% 29.04%
</TABLE>
<TABLE>
<CAPTION>
Class B
Without With
Sales Chg. Sales Chg.
- --------------------------
<S> <C>
36.39% 31.39%
</TABLE>
<TABLE>
<CAPTION>
Class C
Without With
Sales Chg. Sales Chg.
- --------------------------
<S> <C>
36.39% 35.39%
</TABLE>
<TABLE>
<CAPTION>
Class Y
Without With
Sales Chg. Sales Chg.
- --------------------------
<S> <C>
37.18% 37.18%
</TABLE>
- --------------------
Not FDIC Insured.
No Bank Guarantee.
May Lose Value.
- --------------------
*See page 7 for further details.
<PAGE> 3
PRESIDENT'S LETTER
[PHOTO]
BRIDGET A. MACASKILL
President
Oppenheimer
Capital Appreciation
Fund
DEAR SHAREHOLDER,
For many years, we have encouraged investors to consider whether they could
tolerate more risk in their long-term investments by participating in the stock
market, which has historically provided higher long-term returns than any other
asset class. Today, however, we have a very different concern: some investors
may be assuming too much risk by concentrating their investments in just a
handful of stocks or sectors or by "chasing performance."
Alan Greenspan, the Chairman of the Federal Reserve Board, has stated his
view that the recent spectacular returns of some sectors of the market are
partly responsible for pushing our economy to growth rates that could lead to
higher inflation. The dramatic rise in the prices of a narrow segment of the
market has created enormous wealth for some investors. In turn, those investors
are spending at a rate that the Fed believes may threaten the healthy growth of
our economy.
That's why the Fed has been raising interest rates steadily and
decisively over the past year. By making borrowing more expensive, the Fed is
attempting to slow economic growth. It is a precarious balancing act: too much
tightening creates the risk of recession, while too little opens the door to
inflation.
The implications are clear: investors must be prepared for near-term
market volatility. In the bond market, higher interest rates usually lead to
lower bond prices. In the stock market, slower economic growth could reduce
corporate earnings and put downward pressure on stock prices. Highly valued
stocks may be particularly vulnerable to a correction. The Securities and
Exchange Commission Chairman, Arthur Levitt, has cautioned investors against
the expectation that the types of returns seen in the recent bull market will
last forever. We agree.
1 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 4
PRESIDENT'S LETTER
- -------------------------------------------------------------------------------
Because of the prospect of continued market volatility, we encourage you
to consider diversifying your investments. Indeed, diversification may help you
mitigate the effects of sharp declines in any one area. It may also help you
better position your portfolio to seek greater returns over the long run.
While "new economy" stocks have risen since our last report to you, many
"old economy" stocks are selling at unusually low prices. In the bond market,
higher interest rates over the short term may reduce inflation concerns, which
should be beneficial over the long term. By buying out-of-favor investments,
you may be able to profit when and if they return to favor in the future. Of
course, there is no assurance that value investing will return to favor in the
market, but it may be a diversification strategy to consider for part of your
portfolio.
What specific investments should you consider today so that you are
prepared for tomorrow? The answer depends on your individual investing goals,
risk tolerance and financial circumstances. We urge you to talk with your
financial advisor about ways to diversify your portfolio. This may include
considering global diversification as part of your strategy. While investing
abroad has special risks, such as the effects of foreign currency fluctuation,
it also offers opportunities to participate in global economic growth and to
hedge against the volatility in U.S. markets.
We thank you for your continued confidence in OppenheimerFunds, The Right
Way to Invest.
Sincerely,
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
March 21, 2000
2 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 5
[PHOTO]
PORTFOLIO MANAGEMENT
TEAM (L TO R)
Bruce Bartlett
Jane Putnam
(Portfolio Manager)
AN INTERVIEW WITH YOUR FUND'S MANAGER
- -------------------------------------------------------------------------------
Q HOW DID OPPENHEIMER CAPITAL APPRECIATION FUND PERFORM OVER THE REPORTING
PERIOD?
A. Over the six months that ended February 29, 2000, the Fund performed well--
particularly during a time when the markets experienced plenty of volatility.
HOW WOULD YOU DESCRIBE THE ECONOMIC ENVIRONMENT DURING THAT TIME?
We had a continuation of what we saw at the beginning of 1999. It was a period
of unexpected surprises, beginning with the prediction that 1999 would have a
weak economic environment--some even expected recession--with flat or down
earnings. Instead, the 1999 economy was robust and earnings so strong that they
became a key driver of the market. In past years, even the strongest earnings
growth took second place to events in the bond market; when interest rates
rose, earnings were affected by the cost of borrowing and contraction in P/E
multiples, and the stock market went down. Conversely, when interest rates
dropped, stock prices went up. 1999 was unusual in that in spite of rising
interest rates, the stock market rose another 15% and earnings continued to be
strong.
IT SOUNDS LIKE THE PAST FEW MONTHS CREATED A GOOD SETTING FOR STOCK INVESTING.
Well, a closer look at the markets shows that the gains were not broad based.
Other than the high flying technology sector, most stocks were actually down
over the period. What this means is that even though there were opportunities,
in terms of good companies at reasonable prices, there were very few
buyers--because investors focused on high growth. In such an environment,
balancing growth and risk requires an enlightened eye and active management.
3 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 6
"In the highly competitive area of eCommerce, the capability to actually
deliver a product is what may determine the long-term survivors."
AN INTERVIEW WITH YOUR FUND'S MANAGER
- -------------------------------------------------------------------------------
HOW DID YOU MANAGE THE PORTFOLIO UNDER THESE CONDITIONS?
Fortunately, the Fund has always had a healthy weighting in technology.(1)
During the period, the value of these holdings went up approximately 90%. Due to
our familiarity with the many industries encompassed by the term "technology,"
we were able to make knowledgeable investments in a number of the areas,
including eCommerce, semiconductors and wireless communications.
In eCommerce, the pioneer "dot-com's" are now facing the entrance of many
established old-line companies, from Merrill Lynch down to Sears. However, we
believe the next wave of investment opportunity is not at the front-end of the
transaction, where the customer clicks in the order, but at the back-end, where
the database links up with suppliers. In this highly competitive industry, the
capability to actually deliver is what may determine the long-term survivors.
With regard to semiconductors, the industry has been coming out of a
three-year downturn. In addition to the cyclical upturn, we detected a marked
long-term change regarding outsourcing of communications semiconductors.
Similar to what occurred throughout the computer industry, communications
equipment manufacturers are faced with ever decreasing product cycles and a
greater focus on being quick to market-- leading to greater willingness to buy
semiconductors from third parties rather than manufacture them themselves.
Therefore, we believe that cyclical as well as long- term forces have spurred
prices throughout the semiconductor industry and we are optimistic on its
prospects throughout 2000.
1. The Fund's portfolio is subject to change.
4 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 7
AVERAGE ANNUAL TOTAL RETURNS
For the Periods Ended 3/31/00(2)
<TABLE>
<CAPTION>
Class A
1-Year 5-Year 10-Year
- ------------------------------------------
<S> <C> <C>
43.40% 30.62% 20.74%
</TABLE>
<TABLE>
<CAPTION>
Class B Since
1-Year 5-Year Inception
- ------------------------------------------
<S> <C> <C>
45.93% N/A 29.96%
</TABLE>
<TABLE>
<CAPTION>
Class C Since
1-Year 5-Year Inception
- ------------------------------------------
<S> <C> <C>
49.92% 31.08% 25.59%
</TABLE>
<TABLE>
<CAPTION>
Class Y Since
1-Year 5-Year Inception
- ------------------------------------------
<S> <C> <C>
52.71% N/A 33.48%
</TABLE>
WHAT HOLDINGS ENHANCED THE FUND'S PERFORMANCE DURING THE PERIOD?
In wireless telecommunications, Nokia Corp. has been a top performer. And the
good news is that the wireless industry may still have plenty of room to grow.
Another strong area of the portfolio has been advertising. With margins
for corporate America at all-time highs, companies are now focused on revenue
growth. For many, the number one goal is "branding" to keep the company name
visible on every product and service. In addition, the dot.com companies that
have recently come to market, are spending as much as 50-60% of their IPO money
on marketing and advertising. As a result, our holdings in radio, advertising,
cable and networks have done very well.
DID ANY AREAS CONSTRAIN PERFORMANCE?
An area of weakness in the portfolio was energy. In spite of rising crude oil
prices, U.S. manufacturers have been very savvy, purchasing oil futures and
switching to alternative heating sources when necessary.
WHAT IS YOUR OUTLOOK FOR THE COMING MONTHS?
In terms of the future, we believe the Fund is very well positioned. As growth
managers, our job is to pick good companies and keep a sensitive eye on price.
We do it by studying the companies in which we invest. We see how they operate,
how they use their cashflow to benefit shareholders, and how they respond to
the people who buy their products--and then we triangulate that back to the
stock price.
2. See page 7 for further details.
5 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 8
SECTOR ALLOCATION(3)
[PIE CHART]
<TABLE>
<S> <C>
Technology 43.1%
Consumer Cyclicals 13.0
Consumer Staples 10.9
Financial 8.0
Energy 5.5
Healthcare 5.4
Capital Goods 5.3
Communication
Services 4.4
Basic Materials 1.7
Utilities 1.6
Transportation 1.1
</TABLE>
In our opinion, the advantage to our shareholders is better than average
performance, and because we're sensitive to valuation--better risk statistics.
Two very good reasons why Oppenheimer Capital Appreciation Fund is an important
part of The Right Way to Invest.
<TABLE>
<S> <C>
TOP FIVE COMMON STOCK INDUSTRIES(4)
- --------------------------------------------------------------
Electronics 15.2%
- --------------------------------------------------------------
Communications Equipment 12.5
- --------------------------------------------------------------
Computer Software 8.1
- --------------------------------------------------------------
Broadcasting 5.1
- --------------------------------------------------------------
Diversified Financial 4.2
TOP TEN COMMON STOCK HOLDINGS(4)
- --------------------------------------------------------------
Nokia Corp., A Shares, Sponsored ADR 4.1%
- --------------------------------------------------------------
Cisco Systems, Inc. 3.4
- --------------------------------------------------------------
Microsoft Corp. 2.7
- --------------------------------------------------------------
Time Warner, Inc. 2.1
- --------------------------------------------------------------
Vitesse Semiconductor Corp. 2.0
- --------------------------------------------------------------
RF Micro Devices, Inc. 1.8
- --------------------------------------------------------------
Amgen, Inc. 1.8
- --------------------------------------------------------------
Applied Micro Circuits Corp. 1.7
- --------------------------------------------------------------
Nortel Networks Corp. 1.7
- --------------------------------------------------------------
Oracle Corp. 1.7
</TABLE>
3. Portfolio is subject to change. percentages are as of February 29, 2000,
and are based on total market value of common stock.
4. Portfolio is subject to change. Percentages are as of February 29, 2000,
and are based on net assets.
6 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 9
NOTES
IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT PAST PERFORMANCE
DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST. BECAUSE OF ONGOING
MARKET VOLATILITY, THE FUND'S PERFORMANCE MAY BE SUBJECT TO SUBSTANTIAL SHORT-
TERM CHANGES. FOR UPDATES ON THE FUND'S PERFORMANCE, PLEASE CONTACT YOUR
FINANCIAL ADVISOR, CALL US AT 1.800.525.7048 OR VISIT OUR WEBSITE AT
WWW.OPPENHEIMERFUNDS.COM. WHEN LOOKING AT FUND PERFORMANCE RESULTS, PLEASE NOTE
THAT THE RECENT GROWTH RATE IN THE STOCK MARKET HAS HELPED PRODUCE SHORT-TERM
RETURNS THAT ARE NOT TYPICAL AND MAY NOT CONTINUE IN THE FUTURE.
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
Cumulative total returns are not annualized. The Fund's total returns shown do
not show the effects of income taxes on an individual's investment. Taxes may
reduce your actual investment returns on income or gains paid by the Fund or
any gains you may realize if you sell your shares.
CLASS A. The inception date of the Fund was 1/22/81. Class A returns include
the current maximum initial sales charge of 5.75%.
CLASS B shares of the Fund were first publicly offered on 11/1/95. Class B
returns include the applicable contingent deferred sales charge of 5% (1-year)
and 2% (since inception). Class B shares are subject to an annual 0.75%
asset-based sales charge.
CLASS C shares of the Fund were first publicly offered on 12/1/93. Class C
returns include the contingent deferred sales charge of 1% for the one-year
period. Class C shares are subject to an annual 0.75% asset-based sales charge.
CLASS Y shares of the Fund were first publicly offered on 11/3/97. Class Y
shares are offered only to certain institutional investors under special
agreement with the Distributor.
An explanation of the different performance calculations is in the Fund's
prospectus.
7 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 10
STATEMENT OF INVESTMENTS February 29, 2000 / Unaudited
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
=======================================================================================
<S> <C> <C>
COMMON STOCKS--92.8%
- ---------------------------------------------------------------------------------------
BASIC MATERIALS--1.6%
- ---------------------------------------------------------------------------------------
CHEMICALS--1.3%
Lafarge Corp. 400,300 $ 7,880,906
- ---------------------------------------------------------------------------------------
Monsanto Co. 750,000 29,109,375
- ---------------------------------------------------------------------------------------
PPG Industries, Inc. 380,000 18,762,500
- ---------------------------------------------------------------------------------------
Union Carbide Corp. 230,000 12,348,125
--------------
68,100,906
- ---------------------------------------------------------------------------------------
METALS--0.2%
Alcoa, Inc. 140,000 9,590,000
- ---------------------------------------------------------------------------------------
PAPER--0.1%
Boise Cascade Corp. 160,000 4,770,000
- ---------------------------------------------------------------------------------------
CAPITAL GOODS--4.9%
- ---------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--2.7%
Etec Systems, Inc.(1) 184,000 21,671,750
- ---------------------------------------------------------------------------------------
Sanmina Corp.(1) 710,000 83,114,375
- ---------------------------------------------------------------------------------------
Vishay Intertechnology, Inc.(1) 850,000 36,550,000
--------------
141,336,125
- ---------------------------------------------------------------------------------------
INDUSTRIAL SERVICES--0.5%
Coflexip SA, Sponsored ADR(1) 145,200 6,506,775
- ---------------------------------------------------------------------------------------
Republic Services, Inc.(1) 600,000 6,525,000
- ---------------------------------------------------------------------------------------
Waste Management, Inc. 1,000,000 15,000,000
--------------
28,031,775
- ---------------------------------------------------------------------------------------
MANUFACTURING--1.7%
Corning, Inc. 145,600 27,372,800
- ---------------------------------------------------------------------------------------
Honeywell International, Inc. 500,000 24,062,500
- ---------------------------------------------------------------------------------------
Pentair, Inc. 300,000 10,312,500
- ---------------------------------------------------------------------------------------
Tyco International Ltd. 711,150 26,979,253
--------------
88,727,053
- ---------------------------------------------------------------------------------------
COMMUNICATION SERVICES--4.1%
- ---------------------------------------------------------------------------------------
TELECOMMUNICATIONS: LONG DISTANCE--3.2%
AT&T Corp. 400,000 19,775,000
- ---------------------------------------------------------------------------------------
Intermedia Communications, Inc.(1) 400,000 25,325,000
- ---------------------------------------------------------------------------------------
MCI WorldCom, Inc.(1) 805,300 35,936,512
- ---------------------------------------------------------------------------------------
Nortel Networks Corp. 800,000 89,200,000
--------------
170,236,512
</TABLE>
8 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 11
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
TELEPHONE UTILITIES--0.4%
CenturyTel, Inc. 330,000 $ 11,096,250
- ---------------------------------------------------------------------------------------
SBC Communications, Inc. 220,520 8,379,760
--------------
19,476,010
- ---------------------------------------------------------------------------------------
TELECOMMUNICATIONS: WIRELESS--0.5%
Amdocs Ltd.(1) 384,600 28,532,512
- ---------------------------------------------------------------------------------------
CONSUMER CYCLICALS--12.0%
- ---------------------------------------------------------------------------------------
AUTOS & HOUSING--2.4%
Centex Corp. 615,000 12,107,812
- ---------------------------------------------------------------------------------------
Ethan Allen Interiors, Inc. 485,550 11,319,384
- ---------------------------------------------------------------------------------------
Ford Motor Co. 1,000,000 41,625,000
- ---------------------------------------------------------------------------------------
Gentex Corp.(1) 680,000 19,868,750
- ---------------------------------------------------------------------------------------
Southdown, Inc. 400,000 19,850,000
- ---------------------------------------------------------------------------------------
Toll Brothers, Inc. 300,000 4,987,500
- ---------------------------------------------------------------------------------------
USG Corp. 510,000 16,575,000
--------------
126,333,446
- ---------------------------------------------------------------------------------------
CONSUMER SERVICES--1.7%
Budget Group, Inc., Cl. A(1) 760,000 4,465,000
- ---------------------------------------------------------------------------------------
Hertz Corp., Cl. A 130,000 4,655,625
- ---------------------------------------------------------------------------------------
Omnicom Group, Inc. 600,000 56,512,500
- ---------------------------------------------------------------------------------------
Young & Rubicam, Inc. 500,000 25,250,000
--------------
90,883,125
- ---------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT--1.7%
Callaway Golf Co. 565,000 6,780,000
- ---------------------------------------------------------------------------------------
Carnival Corp. 1,600,000 46,100,000
- ---------------------------------------------------------------------------------------
Harley-Davidson, Inc. 300,000 20,437,500
- ---------------------------------------------------------------------------------------
Hasbro, Inc. 172,000 2,709,000
- ---------------------------------------------------------------------------------------
Mandalay Resort Group(1) 950,000 13,359,375
--------------
89,385,875
- ---------------------------------------------------------------------------------------
MEDIA--3.6%
News Corp. Ltd. (The), Sponsored ADR 1,400,000 81,637,500
- ---------------------------------------------------------------------------------------
Time Warner, Inc. 1,300,000 111,150,000
--------------
192,787,500
</TABLE>
9 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 12
STATEMENT OF INVESTMENTS Unaudited / Continued
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
RETAIL: SPECIALTY--2.0%
Abercrombie & Fitch Co., Cl. A(1) 990,000 $ 14,540,625
- ---------------------------------------------------------------------------------------
CSK Auto Corp.(1) 139,400 1,603,100
- ---------------------------------------------------------------------------------------
Gap, Inc. 1,100,000 53,143,750
- ---------------------------------------------------------------------------------------
Target Corp. 190,000 11,210,000
- ---------------------------------------------------------------------------------------
TJX Cos., Inc. 280,000 4,462,500
- ---------------------------------------------------------------------------------------
Zale Corp.(1) 600,000 22,575,000
---------------
107,534,975
- ---------------------------------------------------------------------------------------
TEXTILE/APPAREL & HOME FURNISHINGS--0.6%
Jones Apparel Group, Inc.(1) 460,000 10,407,500
- ---------------------------------------------------------------------------------------
Tommy Hilfiger Corp.(1) 890,000 10,346,250
- ---------------------------------------------------------------------------------------
Too, Inc.(1) 495,000 11,880,000
---------------
32,633,750
- ---------------------------------------------------------------------------------------
CONSUMER STAPLES--10.1%
- ---------------------------------------------------------------------------------------
BEVERAGES--1.5%
Adolph Coors Co., Cl. B 450,000 19,743,750
- ---------------------------------------------------------------------------------------
Seagram Co. Ltd. (The) 985,000 57,868,750
---------------
77,612,500
- ---------------------------------------------------------------------------------------
BROADCASTING--5.1%
AMFM, Inc.(1) 650,000 39,893,750
- ---------------------------------------------------------------------------------------
CBS Corp.(1) 980,000 58,371,250
- ---------------------------------------------------------------------------------------
Comcast Corp., Cl. A Special(1) 1,600,000 68,000,000
- ---------------------------------------------------------------------------------------
Fox Entertainment Group, Inc., A Shares(1) 432,500 11,380,156
- ---------------------------------------------------------------------------------------
Hispanic Broadcasting Corp.(1) 300,000 28,031,250
- ---------------------------------------------------------------------------------------
Infinity Broadcasting Corp., Cl. A(1) 1,000,000 31,937,500
- ---------------------------------------------------------------------------------------
Rogers Communications, Inc., Cl. B(1) 1,005,200 34,153,246
---------------
271,767,152
- ---------------------------------------------------------------------------------------
ENTERTAINMENT--1.1%
Outback Steakhouse, Inc.(1) 350,000 9,143,750
- ---------------------------------------------------------------------------------------
Royal Caribbean Cruises Ltd. 1,180,000 41,742,500
- ---------------------------------------------------------------------------------------
SFX Entertainment, Inc., Cl. A(1) 199,100 7,665,350
---------------
58,551,600
- ---------------------------------------------------------------------------------------
FOOD--0.6%
IBP, Inc. 550,000 6,875,000
- ---------------------------------------------------------------------------------------
Keebler Foods Co.(1) 500,000 12,687,500
- ---------------------------------------------------------------------------------------
Nabisco Holdings Corp., Cl. A 330,000 9,652,500
---------------
29,215,000
</TABLE>
10 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 13
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
FOOD & DRUG RETAILERS--1.3%
CVS Corp. 1,000,000 $ 35,000,000
- ---------------------------------------------------------------------------------------
Safeway, Inc.(1) 900,000 34,706,250
--------------
69,706,250
- ---------------------------------------------------------------------------------------
HOUSEHOLD GOODS--0.5%
Avon Products, Inc. 1,000,000 27,062,500
- ---------------------------------------------------------------------------------------
ENERGY--5.1%
- ---------------------------------------------------------------------------------------
ENERGY SERVICES--2.3%
Coastal Corp. 741,600 31,193,550
- ---------------------------------------------------------------------------------------
ENSCO International, Inc. 220,000 6,655,000
- ---------------------------------------------------------------------------------------
Halliburton Co. 560,000 21,385,000
- ---------------------------------------------------------------------------------------
Nabors Industries, Inc.(1) 600,000 21,525,000
- ---------------------------------------------------------------------------------------
Schlumberger Ltd. 280,000 20,685,000
- ---------------------------------------------------------------------------------------
Transocean Sedco Forex, Inc. 300,000 11,831,250
- ---------------------------------------------------------------------------------------
Varco International, Inc.(1) 679,800 7,520,288
--------------
120,795,088
- ---------------------------------------------------------------------------------------
OIL: DOMESTIC--2.1%
Amerada Hess Corp. 600,000 30,337,500
- ---------------------------------------------------------------------------------------
Exxon Mobil Corp. 840,000 63,262,500
- ---------------------------------------------------------------------------------------
Forest Oil Corp.(1) 680,000 5,567,500
- ---------------------------------------------------------------------------------------
Texaco, Inc. 160,000 7,590,000
- ---------------------------------------------------------------------------------------
Tosco Corp. 160,000 4,280,000
--------------
111,037,500
- ---------------------------------------------------------------------------------------
OIL: INTERNATIONAL--0.7%
Total Fina SA, Sponsored ADR(1) 580,000 38,932,500
- ---------------------------------------------------------------------------------------
FINANCIAL--7.4%
- ---------------------------------------------------------------------------------------
BANKS--1.9%
Bank of America Corp. 500,000 23,031,250
- ---------------------------------------------------------------------------------------
Chase Manhattan Corp. 650,000 51,756,250
- ---------------------------------------------------------------------------------------
FleetBoston Financial Corp. 867,164 23,630,219
--------------
98,417,719
</TABLE>
11 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 14
STATEMENT OF INVESTMENTS Unaudited / Continued
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
DIVERSIFIED FINANCIAL--4.2%
Associates First Capital Corp., Cl. A 900,000 $ 17,887,500
- ---------------------------------------------------------------------------------------
C.I.T. Group, Inc., Cl. A 360,000 5,040,000
- ---------------------------------------------------------------------------------------
Citigroup, Inc. 1,228,750 63,511,016
- ---------------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The) 200,000 18,500,000
- ---------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc. 380,000 38,950,000
- ---------------------------------------------------------------------------------------
Morgan Stanley Dean Witter & Co. 660,000 46,488,750
- ---------------------------------------------------------------------------------------
Price (T. Rowe) Associates, Inc. 256,800 8,458,350
- ---------------------------------------------------------------------------------------
Schwab (Charles) Corp. 575,000 24,042,188
---------------
222,877,804
- ---------------------------------------------------------------------------------------
INSURANCE--0.8%
American International Group, Inc. 130,000 11,496,875
- ---------------------------------------------------------------------------------------
AXA Financial, Inc. 1,000,000 29,937,500
---------------
41,434,375
- ---------------------------------------------------------------------------------------
REAL ESTATE INVESTMENT TRUSTS--0.5%
Boston Properties, Inc. 900,000 27,281,250
- ---------------------------------------------------------------------------------------
HEALTHCARE--5.0%
- ---------------------------------------------------------------------------------------
HEALTHCARE/DRUGS--3.8%
Amgen, Inc.(1) 1,380,000 94,098,750
- ---------------------------------------------------------------------------------------
Elan Corp. plc, ADR(1) 1,140,000 46,882,500
- ---------------------------------------------------------------------------------------
Forest Laboratories, Inc.(1) 151,000 10,315,188
- ---------------------------------------------------------------------------------------
Pfizer, Inc. 300,000 9,637,500
- ---------------------------------------------------------------------------------------
Schering-Plough Corp. 200,000 6,975,000
- ---------------------------------------------------------------------------------------
Warner Lambert Co. 400,000 34,225,000
---------------
202,133,938
- ---------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES--1.2%
Baxter International, Inc. 335,000 18,257,500
- ---------------------------------------------------------------------------------------
Becton, Dickinson & Co. 637,700 19,808,556
- ---------------------------------------------------------------------------------------
Medtronic, Inc. 500,000 24,218,750
---------------
62,284,806
- ---------------------------------------------------------------------------------------
TECHNOLOGY--40.0%
- ---------------------------------------------------------------------------------------
COMPUTER HARDWARE--2.3%
Compaq Computer Corp. 600,000 14,925,000
- ---------------------------------------------------------------------------------------
Hewlett-Packard Co. 300,000 40,350,000
- ---------------------------------------------------------------------------------------
MMC Networks, Inc.(1) 310,000 12,303,125
- ---------------------------------------------------------------------------------------
Seagate Technology, Inc.(1) 1,060,000 52,867,500
---------------
120,445,625
</TABLE>
12 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 15
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
COMPUTER SERVICES--1.9%
Applied Micro Circuits Corp.(1) 331,000 $ 91,045,688
- ---------------------------------------------------------------------------------------
CGI Group, Inc.(1) 565,200 9,679,683
---------------
100,725,371
- ---------------------------------------------------------------------------------------
COMPUTER SOFTWARE--8.1%
BMC Software, Inc.(1) 920,000 42,320,000
- ---------------------------------------------------------------------------------------
Microsoft Corp.(1) 1,620,000 144,787,500
- ---------------------------------------------------------------------------------------
Novell, Inc.(1) 2,500,000 82,656,250
- ---------------------------------------------------------------------------------------
Oracle Corp.(1) 1,200,000 89,100,000
- ---------------------------------------------------------------------------------------
Sybase, Inc.(1) 800,000 20,050,000
- ---------------------------------------------------------------------------------------
Veritas Software Corp.(1) 260,000 51,447,500
---------------
430,361,250
- ---------------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--12.5%
CIENA Corp.(1) 360,000 57,532,500
- ---------------------------------------------------------------------------------------
Cisco Systems, Inc.(1) 1,350,000 178,453,125
- ---------------------------------------------------------------------------------------
Lucent Technologies, Inc. 1,000,000 59,500,000
- ---------------------------------------------------------------------------------------
Nokia Corp., A Shares, Sponsored ADR(1) 1,100,000 218,143,750
- ---------------------------------------------------------------------------------------
QUALCOMM, Inc.(1) 110,000 15,668,125
- ---------------------------------------------------------------------------------------
Tellabs, Inc.(1) 555,000 26,640,000
- ---------------------------------------------------------------------------------------
Vodafone Group plc, Sponsored ADR 1,350,000 77,878,125
- ---------------------------------------------------------------------------------------
Williams Communications Group, Inc.(1) 600,000 26,700,000
---------------
660,515,625
- ---------------------------------------------------------------------------------------
ELECTRONICS--15.2%
Analog Devices, Inc.(1) 300,000 47,100,000
- ---------------------------------------------------------------------------------------
Atmel Corp.(1) 1,550,000 76,725,000
- ---------------------------------------------------------------------------------------
Cypress Semiconductor Corp.(1) 800,000 36,500,000
- ---------------------------------------------------------------------------------------
Flextronics International Ltd.(1) 1,130,000 68,788,750
- ---------------------------------------------------------------------------------------
LSI Logic Corp.(1) 740,000 47,406,250
- ---------------------------------------------------------------------------------------
Micron Technology, Inc.(1) 660,000 64,721,250
- ---------------------------------------------------------------------------------------
National Semiconductor Corp.(1) 865,000 64,983,125
- ---------------------------------------------------------------------------------------
Novellus Systems, Inc.(1) 830,000 49,229,375
- ---------------------------------------------------------------------------------------
PMC-Sierra, Inc.(1) 120,000 23,167,500
- ---------------------------------------------------------------------------------------
RF Micro Devices, Inc.(1) 692,300 95,753,744
- ---------------------------------------------------------------------------------------
Texas Instruments, Inc. 400,000 66,600,000
- ---------------------------------------------------------------------------------------
Veeco Instruments, Inc.(1) 300,000 24,637,500
- ---------------------------------------------------------------------------------------
Vitesse Semiconductor Corp.(1) 1,000,000 103,812,500
- ---------------------------------------------------------------------------------------
Waters Corp.(1) 360,000 35,302,500
---------------
804,727,494
</TABLE>
13 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 16
STATEMENT OF INVESTMENTS Unaudited / Continued
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------
<S> <C> <C>
TRANSPORTATION--1.1%
- ---------------------------------------------------------------------------------------
RAILROADS & TRUCKERS--1.1%
Canadian Pacific Ltd. 1,100,000 $ 21,450,000
- ---------------------------------------------------------------------------------------
Kansas City Southern Industries, Inc. 440,000 34,650,000
-----------------
56,100,000
- ---------------------------------------------------------------------------------------
UTILITIES--1.5%
- ---------------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.0%
Calpine Corp.(1) 411,800 37,679,700
- ---------------------------------------------------------------------------------------
Potomac Electric Power Co. 700,000 14,218,750
-----------------
51,898,450
- ---------------------------------------------------------------------------------------
GAS UTILITIES--0.5%
Williams Cos., Inc. (The) 620,000 25,923,750
-----------------
Total Common Stocks (Cost $3,294,904,800) 4,908,167,111
PRINCIPAL
AMOUNT
=======================================================================================
SHORT-TERM NOTES--7.9%
Alcoa, Inc., 5.83%, 4/18/00 $54,000,000 53,580,240
- ---------------------------------------------------------------------------------------
American Express Credit Corp., 5.77%, 3/27/00 50,000,000 49,791,639
- ---------------------------------------------------------------------------------------
Caterpillar Financial Services Corp., 5.67%, 3/7/00 39,500,000 39,462,672
- ---------------------------------------------------------------------------------------
Coca Cola Enterprises, Inc.:
5.76%, 3/24/00 30,000,000 29,889,600
5.78%, 3/9/00 25,000,000 24,967,889
- ---------------------------------------------------------------------------------------
Colgate-Palmolive Co., 5.75%, 3/20/00 32,200,000 32,102,282
- ---------------------------------------------------------------------------------------
FINOVA Capital Corp.:
5.87%, 3/21/00 25,000,000 24,918,472
5.87%, 4/7/00 25,000,000 24,849,174
5.87%, 4/18/00 25,000,000 24,804,333
- ---------------------------------------------------------------------------------------
IBM Credit Corp., 5.64%, 3/13/00 50,000,000 49,906,000
- ---------------------------------------------------------------------------------------
Wal-Mart Stores, Inc.:
5.75%, 3/14/00 34,000,000 33,929,403
5.80%, 3/1/00 32,087,000 32,087,000
-----------------
Total Short-Term Notes (Cost $420,288,704) 420,288,704
</TABLE>
14 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 17
<TABLE>
<CAPTION>
PRINCIPAL MARKET VALUE
AMOUNT SEE NOTE 1
==================================================================================================================
<S> <C> <C>
REPURCHASE AGREEMENTS--1.9%
Repurchase agreement with Zion First National Bank, 5.75%,
dated 2/29/00, to be repurchased at $99,315,860 on 3/1/00,
collateralized by U.S. Treasury Nts., 5.75%-6.125%, 7/31/00-11/15/04,
with a value of $51,531,131, U.S. Treasury Bonds, 5.25%-8.875%,
8/15/17-8/15/29, with a value of $18,589,375 and U.S. Treasury
Bills, 4/27/00-12/7/00, with a value of $31,517,822 (Cost $99,300,000) $99,300,000 $ 99,300,000
- ------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $3,814,493,504) 102.6% 5,427,755,815
- ------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (2.6) (139,911,433)
----------------------------------
NET ASSETS 100.0% $5,287,844,382
==================================
</TABLE>
FOOTNOTES TO STATEMENT OF INVESTMENTS
1. Non-income producing security.
See accompanying Notes to Financial Statements.
15 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 18
STATEMENT OF ASSETS AND LIABILITIES Unaudited
FEBRUARY 29, 2000
<TABLE>
<S> <C>
===================================================================================================================
ASSETS
Investments, at value (cost $3,814,493,504)--see accompanying statement $ 5,427,755,815
- -------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold 23,819,353
Investments sold 4,020,634
Interest and dividends 3,013,288
Other 325,920
-----------------
Total assets 5,458,935,010
===================================================================================================================
LIABILITIES
Bank overdraft 524,492
- -------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 160,996,384
Shares of beneficial interest redeemed 6,635,863
Distribution and service plan fees 1,537,352
Transfer and shareholder servicing agent fees 446,415
Trustees' compensation 243,470
Other 706,652
----------------
Total liabilities 171,090,628
===================================================================================================================
NET ASSETS $5,287,844,382
=================
===================================================================================================================
COMPOSITION OF NET ASSETS
Paid-in capital $3,337,458,671
- -------------------------------------------------------------------------------------------------------------------
Accumulated net investment loss (4,017,063)
- -------------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and
foreign currency transactions 341,140,463
- -------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and
translation of assets and liabilities in foreign currencies 1,613,262,311
-----------------
Net assets $5,287,844,382
=================
</TABLE>
16 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 19
<TABLE>
<S> <C>
=================================================================================================
NET ASSET VALUE PER SHARE
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$3,098,777,088 and 53,931,252 shares of beneficial interest outstanding) $57.46
Maximum offering price per share (net asset value plus sales charge of
5.75% of offering price) $60.97
- -------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $982,628,194
and 17,696,563 shares of beneficial interest outstanding) $55.53
- -------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $292,170,949
and 5,316,516 shares of beneficial interest outstanding) $54.96
- -------------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $914,268,151 and 15,847,805 shares of beneficial interest outstanding) $57.69
</TABLE>
See accompanying Notes to Financial Statements.
17 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 20
STATEMENT OF OPERATIONS Unaudited
<TABLE>
<S> <C>
For the Six Months Ended February 29, 2000
===================================================================================================================
INVESTMENT INCOME
Dividends (net of foreign withholding taxes of $41,276) $ 10,214,952
- -------------------------------------------------------------------------------------------------------------------
Interest 9,282,806
----------------
Total income 19,497,758
===================================================================================================================
EXPENSES
Management fees 11,856,142
- -------------------------------------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 2,785,462
Class B 3,472,298
Class C 1,061,724
- -------------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 2,212,303
Class B 644,907
Class C 196,169
Class Y 1,151
- -------------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 97,855
- -------------------------------------------------------------------------------------------------------------------
Trustees' compensation 65,368
- -------------------------------------------------------------------------------------------------------------------
Other 954,184
----------------
Total expenses 23,347,563
Less expenses paid indirectly (46,219)
----------------
Net expenses 23,301,344
===================================================================================================================
NET INVESTMENT LOSS (3,803,586)
===================================================================================================================
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investments 382,352,516
Foreign currency transactions (70,752)
----------------
Net realized gain 382,281,764
- -------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments 916,323,946
Translation of assets and liabilities denominated in foreign currencies 725,031
----------------
Net change 917,048,977
----------------
Net realized and unrealized gain 1,299,330,741
===================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $1,295,527,155
================
</TABLE>
See accompanying Notes to Financial Statements.
18 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 21
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
6 MOS. ENDED
FEBRUARY 29, 2000 YEAR ENDED
(UNAUDITED) AUGUST 31, 1999
============================================================================================================================
<S> <C> <C>
OPERATIONS
Net investment loss $ (3,803,586) $ (4,314,868)
- ----------------------------------------------------------------------------------------------------------------------------
Net realized gain 382,281,764 213,387,917
- ----------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 917,048,977 635,648,269
-------------------------------------------
Net increase in net assets resulting from operations 1,295,527,155 844,721,318
============================================================================================================================
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income:
Class A -- (3,435,127)
Class Y -- (1,089,768)
- ----------------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (156,140,905) (101,506,314)
Class B (44,535,579) (17,982,633)
Class C (13,725,279) (6,603,979)
Class Y (34,586,462) (14,490,090)
============================================================================================================================
BENEFICIAL INTEREST TRANSACTIONS
Net increase in net assets resulting from
beneficial interest transactions:
Class A 379,192,014 332,180,412
Class B 267,865,719 250,141,075
Class C 71,313,669 57,426,203
Class Y 334,306,681 165,100,529
=============================================================================================================================
NET ASSETS
Total increase 2,099,217,013 1,504,461,626
- ----------------------------------------------------------------------------------------------------------------------------
Beginning of period 3,188,627,369 1,684,165,743
-------------------------------------------
End of period (including accumulated net investment
loss of $4,017,063 and $213,477, respectively) $5,287,844,382 $3,188,627,369
===========================================
</TABLE>
See accompanying Notes to Financial Statements.
19 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 22
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
6 MOS. ENDED YEAR YEAR
FEB. 29, ENDED ENDED
2000 AUG. 31, DEC. 31,
CLASS A (UNAUDITED) 1999 1998 1997 1996(1) 1995
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $44.73 $32.53 $38.63 $30.81 $27.44 $22.63
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.03) (.04) .17 .18 .11 .24
Net realized and unrealized gain (loss) 15.98 14.87 (1.55) 11.36 3.26 7.61
-----------------------------------------------------------------------------
Total income (loss) from
investment operations 15.95 14.83 (1.38) 11.54 3.37 7.85
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.09) (.15) (.17) -- (.24)
Distributions from net realized gain (3.22) (2.54) (4.57) (3.55) -- (2.80)
-----------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (3.22) (2.63) (4.72) (3.72) -- (3.04)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $57.46 $44.73 $32.53 $38.63 $30.81 $27.44
=============================================================================
====================================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(2) 36.90% 47.36% (4.06)% 40.52% 12.28% 34.85%
====================================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $3,099 $2,071 $1,234 $1,179 $789 $758
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in millions) $2,476 $1,789 $1,353 $ 986 $790 $538
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment income (loss) (0.08)% (0.05)% 0.48% 0.53% 0.55% 1.08%
Expenses 1.06% 1.04% 1.00%(4) 1.01%(4) 1.09%(4) 1.03%(4)
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 26% 59% 60% 66% 45% 72%
</TABLE>
1. For the eight months ended August 31, 1996. The Fund changed its fiscal year
end from December 31 to August 31.
2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Sales charges are not reflected in the total returns.
Total returns are not annualized for periods of less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has not been grossed up to reflect the effect of expenses paid
indirectly.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the period ended February 29, 2000 were $1,555,120,514 and $951,182,130,
respectively.
See accompanying Notes to Financial Statements.
20 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 23
<TABLE>
<CAPTION>
6 MOS. ENDED YEAR YEAR
FEB. 29, ENDED ENDED
2000 AUG. 31, DEC. 31,
CLASS B (UNAUDITED) 1999 1998 1997 1996(1) 1995(6)
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $43.48 $31.85 $38.07 $30.56 $27.37 $29.77
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.09) (.21) (.02) .07 -- (.14)
Net realized and unrealized gain (loss) 15.36 14.38 (1.62) 11.05 3.19 .78
---------------------------------------------------------------------------
Total income (loss) from
investment operations 15.27 14.17 (1.64) 11.12 3.19 .64
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- (.01) (.06) -- (.24)
Distributions from net realized gain (3.22) (2.54) (4.57) (3.55) -- (2.80)
---------------------------------------------------------------------------
Total dividends and distributions
to shareholders (3.22) (2.54) (4.58) (3.61) -- (3.04)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $55.53 $43.48 $31.85 $38.07 $30.56 $27.37
===========================================================================
===================================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(2) 36.39% 46.20% (4.86)% 39.30% 11.65% 1.67%
===================================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $983 $532 $194 $52 $5 $3
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in millions) $700 $372 $133 $24 $4 $1
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment income (loss) (0.85)% (0.86)% (0.37)% (0.33)% (0.25)% (0.54)%
Expenses 1.84% 1.84% 1.81%(4) 1.86%(4) 1.94%(4) 2.62%(4)
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 26% 59% 60% 66% 45% 72%
</TABLE>
1. For the eight months ended August 31, 1996. The Fund changed its fiscal year
end from December 31 to August 31.
2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Sales charges are not reflected in the total returns.
Total returns are not annualized for periods of less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has not been grossed up to reflect the effect of expenses paid
indirectly.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the period ended February 29, 2000 were $1,555,120,514 and $951,182,130,
respectively.
6. For the period from November 1, 1995 (inception of offering) to December 31,
1995.
See accompanying Notes to Financial Statements.
21 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 24
FINANCIAL HIGHLIGHTS Continued
<TABLE>
<CAPTION>
6 MOS. ENDED YEAR YEAR
FEB. 29, ENDED ENDED
2000 AUG. 31, DEC. 31,
CLASS C (UNAUDITED) 1999 1998 1997 1996(1) 1995
==================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $43.06 $31.57 $37.76 $30.27 $27.11 $22.50
- ----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.08) (.23) (.03) .01 (.03) .09
Net realized and unrealized gain (loss) 15.20 14.26 (1.59) 11.03 3.19 7.43
-------------------------------------------------------------------------
Total income (loss) from
investment operations 15.12 14.03 (1.62) 11.04 3.16 7.52
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- -- -- -- (.11)
Distributions from net realized gain (3.22) (2.54) (4.57) (3.55) -- (2.80)
-------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (3.22) (2.54) (4.57) (3.55) -- (2.91)
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $54.96 $43.06 $31.57 $37.76 $30.27 $27.11
=========================================================================
==================================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(2) 36.39% 46.16% (4.84)% 39.35% 11.66% 33.56%
==================================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $292 $165 $76 $36 $10 $7
- ----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in millions) $214 $126 $62 $20 $ 9 $4
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment income (loss) (0.85)% (0.86)% (0.36)% (0.32)% (0.30)% 0.19%
Expenses 1.84% 1.85% 1.82%(4) 1.85%(4) 1.93%(4) 1.90%(4)
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 26% 59% 60% 66% 45% 72%
</TABLE>
1. For the eight months ended August 31, 1996. The Fund changed its fiscal year
end from December 31 to August 31.
2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Sales charges are not reflected in the total returns.
Total returns are not annualized for periods of less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has not been grossed up to reflect the effect of expenses paid
indirectly.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the period ended February 29, 2000 were $1,555,120,514 and $951,182,130,
respectively.
6. For the period from November 1, 1995 (inception of offering) to December 31,
1995.
See accompanying Notes to Financial Statements.
22 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 25
<TABLE>
<CAPTION>
6 MOS. ENDED YEAR
FEB. 29, ENDED
2000 AUG. 31,
CLASS Y (UNAUDITED) 1999 1998(7)
================================================================================================
<S> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $44.81 $32.56 $40.15
- ------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .02 .13 .30
Net realized and unrealized gain (loss) 16.08 14.85 (3.11)
-------------------------------------
Total income (loss) from investment operations 16.10 14.98 (2.81)
- ------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.19) (.21)
Distributions from net realized gain (3.22) (2.54) (4.57)
-------------------------------------
Total dividends and distributions to shareholders (3.22) (2.73) (4.78)
- ------------------------------------------------------------------------------------------------
Net asset value, end of period $57.69 $44.81 $32.56
=====================================
================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(2) 37.18% 47.90% (7.45)%
================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $914 $420 $181
- ------------------------------------------------------------------------------------------------
Average net assets (in millions) $583 $307 $139
- ------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment income (loss) 0.35% 0.30% 0.75%
Expenses 0.66% 0.68% 0.69%(4)
- ------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 26% 59% 60%
</TABLE>
1. For the eight months ended August 31, 1996. The Fund changed its fiscal year
end from December 31 to August 31.
2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Sales charges are not reflected in the total returns.
Total returns are not annualized for periods of less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has not been grossed up to reflect the effect of expenses paid
indirectly.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the period ended February 29, 2000 were $1,555,120,514 and $951,182,130,
respectively
6. For the period from November 1, 1995 (inception of offering) to December 31,
1995.
7. For the period from November 3, 1997 (inception of offering) to August 31,
1998.
See accompanying Notes to Financial Statements.
23 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 26
NOTES TO FINANCIAL STATEMENTS Unaudited
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Capital Appreciation Fund (the Fund) is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company. The Fund's investment objective is to seek capital
appreciation. The Fund's investment advisor is OppenheimerFunds, Inc. (the
Manager).
The Fund offers Class A, Class B, Class C and Class Y shares. Class A
shares are sold at their offering price, which is normally net asset value plus
an initial sales charge. Class B and Class C shares are sold without an initial
sales charge but may be subject to a contingent deferred sales charge (CDSC).
Class Y shares are sold to certain institutional investors without either a
front-end sales charge or a CDSC. All classes of shares have identical rights
to earnings, assets and voting privileges, except that each class has its own
expenses directly attributable to that class and exclusive voting rights with
respect to matters affecting that class. Classes A, B and C shares have
separate distribution and/or service plans. No such plan has been adopted for
Class Y shares. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The following is a summary of significant
accounting policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
SECURITIES VALUATION. Securities for which quotations are readily available are
valued at the last sale price, or if in the absence of a sale, at the last sale
price on the prior trading day if it is within the spread of the closing bid
and asked prices, and if not, at the closing bid price. Securities (including
restricted securities) for which quotations are not readily available are
valued primarily using dealer-supplied valuations, a portfolio pricing service
authorized by the Board of Trustees, or at their fair value. Fair value is
determined in good faith under consistently applied procedures under the
supervision of the Board of Trustees. Foreign currency contracts are valued
based on the closing prices of the forward currency contract rates in the
London foreign exchange markets on a daily basis as provided by a reliable
bank, dealer or pricing service. Short-term "money market type" debt securities
with remaining maturities of sixty days or less are valued at cost (or last
determined market value) and adjusted for amortization or accretion to maturity
of any premium or discount.
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The accounting records of the Fund are maintained
in U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of foreign securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
The effect of changes in foreign currency exchange rates on investments
is separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains
and losses in the Fund's Statement of Operations.
24 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 27
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENTS. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is
required to be at least 102% of the resale price at the time of purchase. If
the seller of the agreement defaults and the value of the collateral declines,
or if the seller enters an insolvency proceeding, realization of the value of
the collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated daily
to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Fund has adopted an unfunded retirement plan for
the Fund's independent Board of Trustees. Benefits are based on years of
service and fees paid to each trustee during the years of service. During the
six months ended February 29, 2000, a provision of $34,536 was made for the
Fund's projected benefit obligations and payments of $11,052 were made to
retired trustees, resulting in an accumulated liability of $237,023 as of
February 29, 2000.
The Board of Trustees has adopted a deferred compensation plan for
independent trustees that enables trustees to elect to defer receipt of all or
a portion of annual compensation they are entitled to receive from the Fund.
Under the plan, the compensation deferred is periodically adjusted as though an
equivalent amount had been invested for the Board of Trustees in shares of one
or more Oppenheimer funds selected by the trustee. The amount paid to the Board
of Trustees under the plan will be determined based upon the performance of the
selected funds. Deferral of trustees' fees under the plan will not affect the
net assets of the Fund, and will not materially affect the Fund's assets,
liabilities or net investment income per share.
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date.
25 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 28
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES Continued
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax
purposes. The character of distributions made during the year from net
investment income or net realized gains may differ from its ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the fiscal year in which the income or realized gain was recorded
by the Fund.
- --------------------------------------------------------------------------------
EXPENSE OFFSET ARRANGEMENTS. Expenses paid indirectly represent a reduction of
custodian fees for earnings on cash balances maintained by the Fund.
- --------------------------------------------------------------------------------
OTHER. Investment transactions are accounted for as of trade date and dividend
income is recorded on the ex-dividend date. Certain dividends from foreign
securities will be recorded as soon as the Fund is informed of the dividend if
such information is obtained subsequent to the ex-dividend date. Realized gains
and losses on investments and unrealized appreciation and depreciation are
determined on an identified cost basis, which is the same basis used for
federal income tax purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
26 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 29
================================================================================
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED FEB. 29, 2000 YEAR ENDED AUGUST 31, 1999
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS A
Sold 10,360,010 $ 519,332,998 16,486,612 $ 682,694,426
Dividends and/or distributions
reinvested 2,997,583 146,971,508 2,761,935 101,086,519
Redeemed (5,736,799) (287,112,492) (10,867,095) (451,600,533)
----------------------------------------------------------------------------
Net increase 7,620,794 $379,192,014 8,381,452 $332,180,412
============================================================================
- ---------------------------------------------------------------------------------------------------------------------
CLASS B
Sold 6,259,295 $ 307,348,422 8,303,860 $ 339,552,020
Dividends and/or distributions
reinvested 907,048 43,059,027 488,475 17,477,638
Redeemed (1,696,806) (82,541,730) (2,644,213) (106,888,583)
----------------------------------------------------------------------------
Net increase 5,469,537 $267,865,719 6,148,122 $250,141,075
============================================================================
- ---------------------------------------------------------------------------------------------------------------------
CLASS C
Sold 2,570,467 $ 122,918,923 3,159,608 $ 128,803,033
Dividends and/or distributions
reinvested 281,042 13,203,399 180,148 6,384,452
Redeemed (1,372,315) (64,808,653) (1,911,652) (77,761,282)
----------------------------------------------------------------------------
Net increase 1,479,194 $ 71,313,669 1,428,104 $ 57,426,203
============================================================================
- ---------------------------------------------------------------------------------------------------------------------
CLASS Y
Sold 6,261,891 $ 324,955,622 4,483,054 $ 191,633,897
Dividends and/or distributions
reinvested 703,262 34,586,461 426,028 15,579,858
Redeemed (500,519) (25,235,402) (1,069,125) (42,113,226)
----------------------------------------------------------------------------
Net increase 6,464,634 $334,306,681 3,839,957 $165,100,529
============================================================================
</TABLE>
================================================================================
3. UNREALIZED GAINS AND LOSSES ON SECURITIES
As of February 29, 2000, net unrealized appreciation on securities of
$1,613,262,311 was composed of gross appreciation of $1,872,875,621, and gross
depreciation of $259,613,310.
27 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 30
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
================================================================================
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES. Management fees paid to the Manager were in accordance with
the investment advisory agreement with the Fund which provides for a fee of
0.75% of the first $200 million of average annual net assets, 0.72% of the next
$200 million, 0.69% of the next $200 million, 0.66% of the next $200 million,
0.60% of the next $700 million, 0.58% of the next $1.0 billion and 0.56% of
average annual net assets over $2.5 billion. Starting January 1, 2000, the rate
was revised to be 0.56% of average annual net assets over $2.5 billion to $4.5
billion and 0.54% of average annual net assets over $4.5 billion. The Fund's
management fee for the six months ended February 29, 2000 was 0.60% of average
net assets for each class of shares, annualized for periods of less than one
full year.
- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the
Manager, is the transfer and shareholder servicing agent for the Fund and for
other Oppenheimer funds. OFS's total costs of providing such services are
allocated ratably to these funds.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN FEES. Under its General Distributor's Agreement
with the Manager, the Distributor acts as the Fund's principal underwriter in
the continuous public offering of the different classes of shares of the Fund.
The compensation paid to (or retained by) the Distributor from the sale of
shares or on the redemption of shares is shown in the table below for the
period indicated.
<TABLE>
<CAPTION>
AGGREGATE CLASS A COMMISSIONS COMMISSIONS COMMISSIONS
FRONT-END FRONT-END ON CLASS A ON CLASS B ON CLASS C
SALES CHARGES SALES CHARGES SHARES SHARES SHARES
ON CLASS A RETAINED BY ADVANCED BY ADVANCED BY ADVANCED BY
SIX MONTHS ENDED SHARES DISTRIBUTOR DISTRIBUTOR(1) DISTRIBUTOR(1) DISTRIBUTOR(1)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
February 29, 2000 $3,814,377 $1,103,111 $805,899 $5,109,982 $451,892
</TABLE>
1. The Distributor advances commission payments to dealers for certain sales of
Class A shares and for sales of Class B and Class C shares from its own
resources at the time of sale.
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
CONTINGENT DEFERRED CONTINGENT DEFERRED CONTINGENT DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES
SIX MONTHS ENDED RETAINED BY DISTRIBUTOR RETAINED BY DISTRIBUTOR RETAINED BY DISTRIBUTOR
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
February 29, 2000 $21,303 $546,541 $17,133
</TABLE>
The Fund has adopted a Service Plan for Class A shares and Distribution and
Service Plans for Class B and Class C shares under Rule 12b-1 of the Investment
Company Act. Under those plans the Fund pays the Distributor for all or a
portion of its costs incurred in connection with the distribution and/or
servicing of the shares of the particular class.
28 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 31
- --------------------------------------------------------------------------------
CLASS A SERVICE PLAN FEES. Under the Class A service plan, the Distributor
currently uses the fees it receives from the Fund to pay brokers, dealers and
other financial institutions. The Class A service plan permits reimbursements
to the Distributor at a rate of up to 0.25% of average annual net assets of
Class A shares purchased. The Distributor makes payments to plan recipients
quarterly at an annual rate not to exceed 0.25% of the average annual net
assets consisting of Class A shares of the Fund. For the six months ended
February 29, 2000, payments under the Class A plan totaled $2,785,462, all of
which was paid by the Distributor to recipients. That included $152,097 paid
to an affiliate of the Manager. Any unreimbursed expenses the Distributor
incurs with respect to Class A shares in any fiscal year cannot be recovered in
subsequent years.
- --------------------------------------------------------------------------------
CLASS B AND CLASS C DISTRIBUTION AND SERVICE PLAN FEES. Under each plan,
service fees and distribution fees are computed on the average of the net asset
value of shares in the respective class, determined as of the close of each
regular business day during the period. The Class B and Class C plans provide
for the Distributor to be compensated at a flat rate, whether the Distributor's
distribution expenses are more or less than the amounts paid by the Fund under
the plan during the period for which the fee is paid.
The Distributor retains the asset-based sales charge on Class B shares.
The Distributor retains the asset-based sales charge on Class C shares during
the first year the shares are outstanding. The asset-based sales charges on
Class B and Class C shares allow investors to buy shares without a front-end
sales charge while allowing the Distributor to compensate dealers that sell
those shares.
The Distributor's actual expenses in selling Class B and Class C shares
may be more than the payments it receives from the contingent deferred sales
charges collected on redeemed shares and asset-based sales charges from the
Fund under the plans. If any plan is terminated by the Fund, the Board of
Trustees may allow the Fund to continue payments of the asset-based sales
charge to the Distributor for distributing shares before the plan was
terminated. The plans allow for the carry-forward of distribution expenses, to
be recovered from asset-based sales charges in subsequent fiscal periods.
Distribution fees paid to the Distributor for the six months ended February 29,
2000, were as follows:
<TABLE>
<CAPTION>
DISTRIBUTOR'S DISTRIBUTOR'S
AGGREGATE UNREIMBURSED
UNREIMBURSED EXPENSES AS %
TOTAL PAYMENTS AMOUNT RETAINED EXPENSES OF NET ASSETS
UNDER PLAN BY DISTRIBUTOR UNDER PLAN OF CLASS
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Plan $3,472,298 $2,888,772 $13,600,006 1.38%
Class C Plan 1,061,724 403,314 1,351,712 0.46
</TABLE>
29 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 32
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
================================================================================
5. FOREIGN CURRENCY CONTRACTS
A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into
foreign currency contracts for operational purposes and to seek to protect
against adverse exchange rate fluctuations. Risks to the Fund include the
potential inability of the counterparty to meet the terms of the contract.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using foreign currency exchange rates as provided
by a reliable bank, dealer or pricing service. Unrealized appreciation and
depreciation on foreign currency contracts are reported in the Statement of
Assets and Liabilities.
The Fund may realize a gain or loss upon the closing or settlement of the
foreign currency transactions. Realized gains and losses are reported with all
other foreign currency gains and losses in the Statement of Operations.
Securities denominated in foreign currency to cover net exposure on
outstanding foreign currency contracts are noted in the Statement of
Investments where applicable.
================================================================================
6. BANK BORROWINGS
The Fund may borrow from a bank for temporary or emergency purposes including,
without limitation, funding of shareholder redemptions provided asset coverage
for borrowings exceeds 300%. The Fund has entered into an agreement which
enables it to participate with other Oppenheimer funds in an unsecured line of
credit with a bank, which permits borrowings up to $400 million, collectively.
Interest is charged to each fund, based on its borrowings, at a rate equal to
the Federal Funds Rate plus 0.45%. Borrowings are payable 30 days after such
loan is executed. The Fund also pays a commitment fee equal to its pro rata
share of the average unutilized amount of the credit facility at a rate of
0.08% per annum.
The Fund had no borrowings outstanding during the six months ended
February 29, 2000.
30 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 33
OPPENHEIMER CAPITAL APPRECIATION FUND
<TABLE>
<S> <C>
====================================================================================================
OFFICERS AND TRUSTEES Leon Levy, Chairman of the Board of Trustees
Donald W. Spiro, Vice Chairman of the Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Phillip A. Griffiths, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Clayton K. Yeutter, Trustee
Jane Putnam, Vice President
Andrew J. Donohue, Secretary
Brian W. Wixted, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
====================================================================================================
INVESTMENT ADVISOR OppenheimerFunds, Inc.
====================================================================================================
DISTRIBUTOR OppenheimerFunds Distributor, Inc.
====================================================================================================
TRANSFER AND SHAREHOLDER OppenheimerFunds Services
SERVICING AGENT
====================================================================================================
CUSTODIAN OF The Bank of New York
PORTFOLIO SECURITIES
====================================================================================================
INDEPENDENT AUDITORS KPMG LLP
====================================================================================================
LEGAL COUNSEL Mayer, Brown & Platt
The financial statements included herein have been taken from the
records of the Fund without examination of those records by the
independent auditors.
This is a copy of a report to shareholders of Oppenheimer Capital
Appreciation Fund. This report must be preceded or accompanied by a
Prospectus of Oppenheimer Capital Appreciation Fund. For material
information concerning the Fund, see the Prospectus.
SHARES OF OPPENHEIMER FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF ANY
BANK, ARE NOT GUARANTEED BY ANY BANK, ARE NOT INSURED BY THE FDIC
OR ANY OTHER AGENCY, AND INVOLVE INVESTMENT RISKS, INCLUDING THE
POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED.
</TABLE>
31 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 34
OPPENHEIMERFUNDS FAMILY
<TABLE>
<S> <C> <C>
====================================================================================================
GLOBAL EQUITY
Developing Markets Fund Global Fund
International Small Company Fund Quest Global Value Fund
Europe Fund Global Growth & Income Fund
International Growth Fund
====================================================================================================
EQUITY
Stock Stock & Bond
Enterprise Fund(1) Main Street(R) Growth & Income Fund
Discovery Fund Quest Opportunity Value Fund
Main Street(R) Small Cap Fund Total Return Fund
Quest Small Cap Value Fund Quest Balanced Value Fund
MidCap Fund Capital Income Fund(2)
Capital Appreciation Fund Multiple Strategies Fund
Growth Fund Disciplined Allocation Fund
Disciplined Value Fund Convertible Securities Fund
Quest Value Fund
Trinity Growth Fund Specialty
Trinity Core Fund Real Asset Fund
Trinity Value Fund Gold & Special Minerals Fund
====================================================================================================
FIXED INCOME
Taxable Municipal
International Bond Fund California Municipal Fund(3)
World Bond Fund Main Street(R) California Municipal Fund(3)
High Yield Fund Florida Municipal Fund(3)
Champion Income Fund New Jersey Municipal Fund(3)
Strategic Income Fund New York Municipal Fund(3)
Bond Fund Pennsylvania Municipal Fund(3)
Senior Floating Rate Fund Municipal Bond Fund
U.S. Government Trust Insured Municipal Fund
Limited-Term Government Fund Intermediate Municipal Fund
Rochester Division
Rochester Fund Municipals
Limited Term New York Municipal Fund
====================================================================================================
MONEY MARKET(4)
Money Market Fund Cash Reserves
</TABLE>
1. Effective July 1, 1999, this fund is closed to new investors. See prospectus
for details.
2. On 4/1/99, the Fund's name was changed from "Oppenheimer Equity Income
Fund."
3. Available to investors only in certain states.
4. An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency. Although
these funds may seek to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in these funds.
Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203.
(C) Copyright 2000 OppenheimerFunds, Inc. All rights reserved.
32 OPPENHEIMER CAPITAL APPRECIATION FUND
<PAGE> 35
INFORMATION AND SERVICES
As an Oppenheimer fund shareholder, you can benefit from special services
designed to make investing simple. Whether it's automatic investment plans,
timely market updates, or immediate account access, you can count on us
whenever you need assistance. So call us today, or visit our website--we're
here to help.
INTERNET
24-hr access to account information and transactions
WWW.OPPENHEIMERFUNDS.COM
- --------------------------------------------------------------------------------
GENERAL INFORMATION
Mon-Fri 8:30am-9pm ET, Sat 10am-4pm ET
1.800.525.7048
- --------------------------------------------------------------------------------
TELEPHONE TRANSACTIONS
Mon-Fri 8:30am-9pm ET, Sat 10am-4pm ET
1.800.852.8457
- --------------------------------------------------------------------------------
PHONELINK
24-hr automated information and automated transactions
1.800.533.3310
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS DEVICE FOR THE DEAF (TDD)
Mon-Fri 8:30am-7pm ET
1.800.843.4461
- --------------------------------------------------------------------------------
OPPENHEIMERFUNDS INFORMATION HOTLINE
24 hours a day, timely and insightful messages on the
economy and issues that may affect your investments
1.800.835.3104
- --------------------------------------------------------------------------------
TRANSFER AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270, Denver, CO 80217-5270
[OPPENHEIMERFUNDS LOGO]
RS0320.001.0200 April 28, 2000
