FIRST
INVESTORS
GLOBAL
FUND, INC.
ANNUAL
REPORT
DECEMBER 31, 1996
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NEED SERVICE?
If you have questions about your account...or would like information regarding
other products or services...please contact your representative or call our
Shareholder Services Department at...
(800) 423-4026
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FIIS077
Portfolio Manager's Letter
FIRST INVESTORS GLOBAL FUND, INC.
Dear Investor:
Most equity markets posted good results during 1996. For the year,
equity markets outside of Japan performed very well, with the U.S.
S&P 500 rising 22.9% and Europe rising 21.6% (in U.S. dollars). Japan
was weak, down -15.4% (in U.S. dollars) for the year. The world's stock
markets returned 14.0% (in U.S. dollars) in 1996 as measured by the MSCI
World Index. The First Investors Global Fund Class A shares modestly
outperformed this benchmark providing investors with a 14.4% return for
the year on a net asset value basis. The Lipper Global Average for the
year returned 16.5%. Class B shares returned 13.3%. During 1996, the
Fund's relative performance was largely driven by its country weightings
and positive stock selection. The Fund outperformed the MSCI World Index
in large measure because of its underweight in Japan relative to the
Index's weighting. Compared to the competitive group, the reverse was
true; the Fund was overweight in Japan and also underweight in the U.S.,
leading to the Fund's relative underperformance versus the Lipper Global
Average. Good security selection helped returns, particularly in the
larger markets of the United Kingdom, Germany and Japan.
A strong U.S. stock market in 1996 was led by decent profits growth in a
context of very low inflation and strong cash flows into U.S. equity
funds. In contrast, the Japanese stock market's decline came as the yen
weakened and as local investors became increasingly pessimistic about
the future economic growth of the Japanese economy due to the impending
fiscal tightening and worries about deregulation of the financial system.
The European stock market returns were generally strong over the past
year. Spain led the pack with U.S. dollar returns of 41.3% followed by
the U.K. with 27.4% and most of the Nordic countries where 20-40% U.S.
dollar returns were seen. Countries such as Italy (13.4%) and Germany
(14.1%) also posted good returns. Swiss stocks were hurt by the
performance of their currency as 20.0% local returns were dragged down
by a significant currency decline, producing returns of only 2.8% in U.S.
dollar terms. In the Pacific Basin excluding Japan, the last quarter of
1996 saw a continuation of many of the trends in place for the full year.
Hong Kong followed Wall Street to record highs, up 33.1% for the year
(in U.S. dollars). Other markets such as Australia and New Zealand,
which often keep an eye on the U.S. market, also put in strong showings
with 17.8% and 18.7% returns in U.S. dollars, respectively.
We believe that global equity markets should have another good year in
1997. Outside of the U.S., valuations are supported by expectations of
good profits growth. Profits growth should be particularly good for many
Japanese companies as the lagged impact of lower interest rates and a
weaker yen are likely to strengthen Japanese profits in 1997. Japanese
companies experienced a 25% profit increase in 1996 and are forecasted
to see a 20% increase in 1997. The Japanese economy, while improving,
is not without its challenges. Nevertheless, the investment
opportunities are excellent in this environment. For example, strong
exporters such as Toyota, which possess a very strong product pipeline
and experience improved profit margins from a weaker yen, are the types
of investments the Fund is seeking. We believe the Japanese holdings in
the Fund are well positioned to benefit from a slow but improving
economic environment in Japan.
The U.S. economic picture appears relatively stable. Profits should
still grow in the high single digits and inflation likely will remain
relatively low. We are concerned that market valuations are on the high
side, particularly relative to many foreign markets whose economies are
at a much earlier stage in the economic cycle. The big challenge is
anticipating the extent to which fund flows will continue to push the
U.S. market higher.
In Europe we anticipate growth to rebound thanks to a weaker currency
and a stronger global demand for capital goods. An accommodative monetary
policy will offset the fiscal austerity needed to qualify for EMU entry.
Low rates of inflation should persist, given record-high joblessness and
modest wage growth. Stronger export revenues and pay restraints should
boost profit growth to 30% in 1997.
Based on this outlook, and our assessment of individual investment
opportunities within each market, the Fund had 43% of assets invested
in European stocks, 22% in the United States, 12% in Japan, 11% in other
Asian stocks excluding Japan, 5% in Australia and New Zealand and 5% in
Latin America at December 31, 1996. The emerging market exposure remains
at a relatively low level at 9% of the Fund. The Fund's top holdings
include: Unidanmark A, Metallgesellschaft, American Express Co.,
International Paper, and ING Groep NV.
While the recent bull market in U.S. stocks has lasted 77 months,
investors in non-U.S. stocks have not seen such a strong rise in the
last several years, with the MSCI EAFE index generally lagging the U.S.
market indices. Given this recent performance and the underlying economic
positions of major economies worldwide we are optimistic about investment
opportunities going forward in the world's developed markets. However,
it is important to remember that stock markets tend to be cyclical with
periods when stock prices generally rise and periods when stock prices
generally decline. While there is a fair degree of diversification
across markets within the portfolio, which is an aid during declining
markets, diversification can not totally protect from falling stock
prices. In particular, we have avoided many emerging markets as we
generally believe that the return potential does not outweigh the
inherent risks in these markets. Even in the developed foreign markets
in which the Fund predominately invests, there are currency risks as
well as country specific political and economic risks. Investors should
be aware of these risks and recognize that successful investing
generally requires a long-term commitment to the market.
As always, we appreciate the opportunity to serve your investment needs.
Sincerely,
/S/ Trond Skramstad
Trond Skramstad
Portfolio Manager
January 31, 1997
Cumulative Performance Information
FIRST INVESTORS GLOBAL FUND, INC.
Comparison of change in value of $10,000 investment in the First
Investors Global Fund, Inc. (Class A shares) and the Morgan Stanley
World Index.
The following table is the source data for the line chart which
appears at this point in the printed document. This table is not part
of the original printed document and is shown for reference only.
The same is also true for this descriptive paragraph.
FIRST INVESTORS MORGAN
GLOBAL WORLD
JAN 1987 9,375 10,000
DEC 1987 12,058 11,677
DEC 1988 13,400 14,473
DEC 1989 19,271 16,963
DEC 1990 16,916 14,163
DEC 1991 19,765 16,849
DEC 1992 18,819 16,066
DEC 1993 23,143 19,783
DEC 1994 22,268 20,891
DEC 1995 26,237 25,341
DEC 1996 30,023 28,889
**BOXED INFORMATION INSIDE GRAPH
As of December 31, 1996
Average Annual Total Returns*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 14.43% 7.25%
Five Years 8.72% 7.33%
Ten Years 12.36% 11.62%
Class B Shares
One Year 13.33% 8.84%
Since Inception
(1/12/95) 16.31% 13.92%
Footnote reads:
The graph compares a $10,000 investment in the First Investors Global
Fund, Inc. (Class A shares) beginning 1/1/87 with a theoretical
investment in the Morgan Stanley World Index. The Morgan Stanley
World Index is designed to measure the performance of stock markets in
the United States, Europe, Canada, Australia, New Zealand and the Far
East. The Index consists of approximately 60% of the aggregate market
value of the covered stock exchanges. It is not possible to invest
directly in this Index. In addition, the Index does not take into
account fees and expenses. For purposes of the graph and the
accompanying table, unless otherwise indicated, it has been assumed that
the maximum sales charge was deducted from the initial $10,000 investment
in the Fund and all dividends and distributions were reinvested. Class B
shares performance may be greater than or less than that shown in the
line graph above based on differences in sales loads and fees paid by
shareholders investing in the different classes.
*Average Annual Total Return figures (for the period ended 12/31/96)
include the reinvestment of all dividends and distributions. "N.A.V.
Only" returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of
6.25% (prior to 7/1/93 and 12/29/89, the maximum sales charges were 6.9%
and 7.25%, respectively). The Class B "S.E.C. Standardized" returns are
adjusted for the applicable deferred sales charge (maximum of 4% in the
first year). Results represent past performance and do not indicate
future results. Investment return and principal value of an investment
will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than the original cost. Morgan Stanley World Index
figures from Morgan Stanley & Co. Incorporated and all other figures
from First Investors Management Company, Inc.
<TABLE>
<CAPTION>
Portfolio of Investments
FIRST INVESTORS GLOBAL FUND, INC.
December 31, 1996
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMON STOCKS--97.3%
United States--22.2%
63,000 American Express Company $3,559,500 $133
30,600 American International Group, Inc. 3,312,450 123
21,000 Boeing Company 2,233,875 83
18,372 Conrail, Inc. 1,830,310 68
40,000 Dow Chemical Company 3,135,000 117
23,000 Exxon Corporation 2,254,000 84
88,000 Federal National Mortgage Association 3,278,000 122
28,200 General Electric Company 2,788,275 104
25,000 Gillette Company 1,943,750 73
52,000 Hewlett-Packard Company 2,613,000 97
86,000 International Paper Company 3,472,250 129
58,000 Johnson & Johnson 2,885,500 108
35,000 Kimberly Clark Corporation 3,333,750 124
14,583 Lucent Technologies, Inc. 674,464 25
85,000 MCI Communications Corporation 2,778,437 104
66,000 PepsiCo, Inc. 1,930,500 72
73,000 PG & E Corporation 1,533,000 57
69,000 Pharmacia & Upjohn, Inc. 2,734,125 102
25,000 Phelps Dodge Corporation 1,687,500 63
41,600 United Technologies Corporation 2,745,600 102
6,080 *Viacom, Inc., Class "A" 209,760 8
46,067 *Viacom, Inc., Class "B" 1,606,587 60
108,000 Wal-Mart Stores, Inc. 2,470,500 92
32,000 Warner-Lambert Company 2,400,000 89
41,000 York International Corporation 2,290,875 85
- ----------------------------------------------------------------------------------------------------------------------
59,701,008 2,224
- ----------------------------------------------------------------------------------------------------------------------
Japan--11.6%
70,000 Asahi Organic Chemicals Industry Company, Ltd. 411,901 15
71,500 Canon Sales Company, Inc. 1,589,295 59
13,000 Chudenko Corporation 374,084 14
134,000 Chugai Pharmaceutical Company, Ltd. 1,119,838 42
99,000 Dai Nippon Printing Company, Ltd. 1,731,451 65
50,000 Fuji Machine Manufacturing Company 1,322,475 49
106,000 JGC Corporation 793,601 30
34,000 Kyudenko Company, Ltd. 351,509 13
15,000 Mabuchi Motor Company, Ltd. 753,425 28
83,000 Maruichi Steel Tube, Ltd. 1,430,165 53
101,000 Matsushita Electric Industrial Company, Ltd. 1,644,603 61
150,000 Mitsubishi Heavy Industries, Ltd. 1,188,930 44
42,000 Murata Manufacturing Company, Ltd. 1,393,123 52
104,000 NGK Spark Plugs Company 1,137,926 42
95,000 Nippon Express Company, Ltd. 649,857 24
9,240 Nippon Television Network Corporation 2,786,249 104
75,000 Nomura Securities Company, Ltd. 1,124,318 42
128,000 Onward Kashiyama Company, Ltd. 1,797,530 67
97,000 Sakura Bank, Ltd. 691,959 26
40,000 Sanwa Bank, Ltd. 544,496 20
114,000 Seventy-Seven Bank 933,056 35
11,000 Sony Corporation 719,307 27
206,000 Sumitomo Realty & Development 1,295,596 48
38,000 Sumitomo Trust and Banking Company, Ltd. 379,768 14
62,000 Toda Construction Company, Ltd. 470,059 18
180,000 Toyo Ink Manufacturing Company, Ltd. 736,614 27
49,000 Toyota Motor Corporation 1,405,785 52
13,400 World Company, Ltd. 554,148 21
198,000 Yamato Kogyo Company, Ltd. 1,825,263 68
1,000 Yamazaki Baking Company, Ltd. 15,939 1
- ----------------------------------------------------------------------------------------------------------------------
31,172,270 1,161
- ----------------------------------------------------------------------------------------------------------------------
United Kingdom--11.1%
280,000 Associated British Foods PLC 2,321,536 87
190,000 Bank of Scotland 1,003,067 37
166,000 BOC Group PLC 2,481,401 93
150,000 Boots Company PLC 1,546,575 58
580,000 British Gas PLC 2,228,244 83
163,000 British Telecommunications PLC 1,100,413 41
370,000 BTR PLC 1,804,564 67
820,000 Cookson Group PLC 3,311,652 123
210,000 De La Rue PLC 2,057,391 77
420,000 National Grid Holdings PLC 1,405,110 52
225,000 Northern Foods PLC 787,410 29
161,798 PowerGen PLC 1,585,151 59
130,000 Rank Group PLC 968,851 36
52,250 Reckitt & Colman PLC 646,468 24
184,218 Royal & Sun Alliance Insurance Group PLC 1,401,291 52
171,219 Royal Bank of Scotland PLC 1,646,699 62
335,031 Sainsbury PLC 2,224,538 83
190,000 *Sun Life & Provincial Holdings PLC 850,250 32
100,000 United Biscuits (Holdings) PLC 359,370 13
- ----------------------------------------------------------------------------------------------------------------------
29,729,981 1,108
- ----------------------------------------------------------------------------------------------------------------------
France--6.6%
11,434 Accor SA 1,444,992 54
82,400 Assurances Generales De France 2,654,870 99
54,000 Banque Nationale De Paris 2,085,734 78
6,986 Compagnie De Saint Gobain 986,340 37
24,000 Credit Commercial De France 1,107,960 41
29,314 Groupe Havas SA 2,052,475 76
4,600 Peugeot SA 516,741 19
24,075 Remy Cointreau 680,745 25
58,706 Rhone-Poulenc SA Series "A" 1,997,612 74
14,976 Societe Generale Paris 1,616,072 60
15,000 Societe Nationale Elf Aquitaine SA 1,362,733 51
16,367 Total SA Class "B" 1,328,567 50
- ----------------------------------------------------------------------------------------------------------------------
17,834,841 664
- ----------------------------------------------------------------------------------------------------------------------
Germany--4.3%
36,000 *Daimler-Benz AG 2,476,138 92
4,200 Degussa AG 1,907,717 71
61,200 *Deutsche Telekom AG 1,274,741 48
3,750 Karstadt AG 1,245,856 46
1,975 Mannesmann AG 854,790 32
185,000 *Metallgesellschaft AG 3,771,761 141
- ----------------------------------------------------------------------------------------------------------------------
11,531,003 430
- ----------------------------------------------------------------------------------------------------------------------
Australia--3.8%
283,050 Amcor, Ltd. 1,818,738 68
757,177 Boral, Ltd. 2,152,957 80
196,782 Broken Hill Proprietary, Ltd. 2,800,798 104
535,566 Goodman Fielder, Ltd. 663,566 25
530,000 Pioneer International, Ltd. 1,578,552 59
65,700 Qantas Airways (ADR) (Note 4) 1,095,830 41
- ----------------------------------------------------------------------------------------------------------------------
10,110,441 377
- ----------------------------------------------------------------------------------------------------------------------
Netherlands--3.6%
12,700 Akzo-Nobel NV 1,732,747 65
93,875 ING Groep NV 3,375,670 126
49,392 KLM Royal Dutch Airlines 1,387,752 52
60,000 PolyGram NV 3,052,482 114
- ----------------------------------------------------------------------------------------------------------------------
9,548,651 357
- ----------------------------------------------------------------------------------------------------------------------
Hong Kong--3.2%
150,000 Citic Pacific, Ltd. 870,705 32
285,000 Hutchison Whampoa, Ltd. 2,238,361 83
168,000 Sun Hung Kai Properties, Ltd. 2,057,916 77
265,000 Swire Pacific, Ltd. Class "A" 2,526,642 94
3,630,000 *Tingyi Holding Company 949,971 35
- ----------------------------------------------------------------------------------------------------------------------
8,643,595 321
- ----------------------------------------------------------------------------------------------------------------------
Italy--2.7%
153,500 Arnoldo Mondadori Editore SPA 1,246,773 47
763,400 Banca Commerciale Italiana 1,385,647 52
270,000 Fiat SPA 815,049 30
510,000 *Finanziaria Autogrill SPA 493,017 18
220,000 Stet-Societa Finanziaria Telefonica SPA 998,338 37
850,000 Telecom Italia SPA 2,202,520 82
- ----------------------------------------------------------------------------------------------------------------------
7,141,344 266
- ----------------------------------------------------------------------------------------------------------------------
Switzerland--2.7%
1,070 Compagnie Financiere Richemont AG 1,498,151 56
2,350 Nestle AG Regd 2,515,003 94
3,700 Sulzer AG PC 1,973,007 73
1,400 *SwissAir AG Regd 1,129,199 42
- ----------------------------------------------------------------------------------------------------------------------
7,115,360 265
- ----------------------------------------------------------------------------------------------------------------------
Singapore--2.6%
188,500 Development Bank of Singapore 2,546,880 95
270,000 Far East-Levingston Shipbuilding, Ltd. 1,409,022 52
283,000 Keppel Corporation, Ltd. 2,205,193 82
270,000 Straits Steamship Land, Ltd. 864,729 32
- ----------------------------------------------------------------------------------------------------------------------
7,025,824 261
- ----------------------------------------------------------------------------------------------------------------------
Spain--2.4%
7,600 Acerinox SA Regd 1,096,105 41
47,900 Empresa Nacional De Electricidad SA (ADR) 3,353,000 125
81,000 Telefonica De Espana SA 1,877,491 70
- ----------------------------------------------------------------------------------------------------------------------
6,326,596 236
- ----------------------------------------------------------------------------------------------------------------------
Denmark--2.4%
71,800 Tele Danmark A/S Class "B" (ADR) 1,956,550 73
84,500 Unidanmark A/S Class "A" Regd 4,369,021 163
- ----------------------------------------------------------------------------------------------------------------------
6,325,571 236
- ----------------------------------------------------------------------------------------------------------------------
Finland--2.1%
300 Kesko 4,224 --
335,000 Merita Bank, Ltd. Class "A" 1,039,371 39
160,000 Metsa-Serla OY Class "B" 1,197,648 45
29,900 Nokia Corporation Class "A" (ADR) 1,722,988 64
80,400 Rauma OY 1,692,074 63
- ----------------------------------------------------------------------------------------------------------------------
5,656,305 211
- ----------------------------------------------------------------------------------------------------------------------
Mexico--1.9%
325,000 Cemex SA CPO 1,164,248 43
240,000 Fomento Economico Mexicano SA Class "B" 823,166 31
260,000 Grupo Carso SA Class "A" 1,370,676 51
3,360,000 *Grupo Financiero Bancomer Class "B" 1,344,504 50
99,400 Transportacion Maritima Mexicana SA Class "A" (ADR) 459,725 17
- ----------------------------------------------------------------------------------------------------------------------
5,162,319 192
- ----------------------------------------------------------------------------------------------------------------------
Norway--1.5%
109,700 Fokus Bank AS Class "A" 754,188 28
97,117 *Nycomed AS Class "A" 1,482,899 55
109,000 Saga Petroleum AS Series "A" Free 1,817,978 68
- ----------------------------------------------------------------------------------------------------------------------
4,055,065 151
- ----------------------------------------------------------------------------------------------------------------------
Malaysia--1.4%
570,000 Land & General Holdings BHD 1,365,435 51
90,000 MBF Capital BHD 146,106 5
120,000 Resorts World BHD 546,420 20
466,000 Sime Darby Berhad 1,835,947 68
- ----------------------------------------------------------------------------------------------------------------------
3,893,908 144
- ----------------------------------------------------------------------------------------------------------------------
Canada--1.4%
104,000 Canadian Pacific, Ltd. 2,756,000 103
97,000 *Canwest Global Communications Corporation 994,250 37
- ----------------------------------------------------------------------------------------------------------------------
3,750,250 140
- ----------------------------------------------------------------------------------------------------------------------
Sweden--1.4%
25,500 BT Industries AB 474,295 18
77,000 Pharmacia & Upjohn, Inc. 3,151,933 117
- ----------------------------------------------------------------------------------------------------------------------
3,626,228 135
- ----------------------------------------------------------------------------------------------------------------------
Korea--1.1%
15,610 *Chosun Brewery Company, Ltd. 436,637 16
20,360 Daewoo Securities 262,475 10
48,000 Hanil Bank 329,270 12
32,000 Hanwha Chemical Corporation 247,898 9
13,000 Korea Electric Power 378,238 14
15,570 Korean Air Lines 258,548 10
38,000 Pohang Iron & Steel Company, Ltd. (ADR) 769,500 29
130 Samsung Fire & Marine Insurance 53,384 2
6,000 Shinsegae Department Store 249,083 9
- ----------------------------------------------------------------------------------------------------------------------
2,985,033 111
- ----------------------------------------------------------------------------------------------------------------------
Thailand--1.1%
1,322,009 Bangkok Metropolitan Bank Public Company, Ltd. Foreign Regd 515,584 19
119,400 Land & House Public Company, Ltd. Foreign Regd 870,808 32
85,000 Siam City Cement Public Company, Ltd. Foreign Regd 450,857 17
150,000 Siam Commercial Bank Public Company, Ltd. Foreign Regd 1,088,130 41
- ----------------------------------------------------------------------------------------------------------------------
2,925,379 109
- ----------------------------------------------------------------------------------------------------------------------
Argentina--1.1%
80,000 Perez Companc SA Class "B" 562,496 21
84,600 Quilmes Industrial SA (ADR) 771,975 29
61,000 YPF SA Class "D" (ADR) 1,540,250 57
- ----------------------------------------------------------------------------------------------------------------------
2,874,721 107
- ----------------------------------------------------------------------------------------------------------------------
Chile--.7%
71,000 Enersis SA (ADR) 1,970,250 73
- ----------------------------------------------------------------------------------------------------------------------
New Zealand--.7%
283,141 Air New Zealand, Ltd. Class "B" 768,162 29
523,000 Carter Holt Harvey, Ltd. 1,186,112 44
- ----------------------------------------------------------------------------------------------------------------------
1,954,274 73
- ----------------------------------------------------------------------------------------------------------------------
Brazil--.7%
60,000 Centrais Electricas Brasileiras (ADR) 1,074,012 40
11,930,000 Telecomunicacoes Brasileiras SA 854,188 32
- ----------------------------------------------------------------------------------------------------------------------
1,928,200 72
- ----------------------------------------------------------------------------------------------------------------------
Ireland--.6%
82,344 Allied Irish Banks PLC 549,564 20
40,000 Bank of Ireland 365,188 14
270,000 *Jefferson Smurfit Group PLC 801,657 30
- ----------------------------------------------------------------------------------------------------------------------
1,716,409 64
- ----------------------------------------------------------------------------------------------------------------------
Indonesia--.6%
24,000 Indonesian Satellite Corporation (ADR) 657,000 25
756,000 Jaya Real Property Foreign Regd 1,055,981 39
- ----------------------------------------------------------------------------------------------------------------------
1,712,981 64
- ----------------------------------------------------------------------------------------------------------------------
Austria--.6%
13,300 OMV AG 1,498,153 56
- ----------------------------------------------------------------------------------------------------------------------
Philippines--.4%
8,000 Philippine Long Distance Telephone Company (ADR) 408,000 15
880,000 Pilipino Telephone Corporation 744,480 28
- ----------------------------------------------------------------------------------------------------------------------
1,152,480 43
- ----------------------------------------------------------------------------------------------------------------------
India--.4%
106,800 *Indo Gulf Fertilizers and Chemicals Corp., Ltd. (GDR) 86,444 3
59,700 *State Bank of India (GDR) (Note 4) 1,052,213 39
- ----------------------------------------------------------------------------------------------------------------------
1,138,657 42
- ----------------------------------------------------------------------------------------------------------------------
Venezuela--.3%
26,300 Compania Anonima Nacional Telefonos De Venezuela (ADR) 739,688 28
- ----------------------------------------------------------------------------------------------------------------------
Portugal--.1%
3,800 *Telecel-Comunicacoes Pessoais SA 242,318 9
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $220,913,595) 261,189,103 9,730
- ----------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS--1.0%
Brazil--.5%
717,600 Companhia Cervejaria Brahma Regd 392,240 14
5,680,000 Petroleo Brasileiro SA Regd 904,256 34
- ----------------------------------------------------------------------------------------------------------------------
1,296,496 48
- ----------------------------------------------------------------------------------------------------------------------
Germany--.5%
17,300 Hornbach Holdings AG 1,234,824 46
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Preferred Stocks (cost $2,283,504) 2,531,320 94
- ----------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--2.1%
$ 5,710M Aubrey G. Lanston & Co., Inc. 6.75%, 1/2/97 (collateralized by
U.S Treasury Bonds, 111/8%, 8/15/2003, valued at $5,815M)
(cost $5,710,000) 5,710,000 213
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $228,907,099) 100.4% 269,430,423 10,037
Excess of Liabilities Over Other Assets (.4) (998,234) (37)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $268,432,189 $10,000
- ----------------------------------------------------------------------------------------------------------------------
* Non-income producing
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
At December 31, 1996, sector diversification of the portfolio was as follows:
- ------------------------------------------------------------------------
Percentage
Sector Diversification of Net Assets Value
- ------------------------------------------------------------------------
<S> <C> <C>
Banks 10.90% $29,132,622
Telephone 5.9 15,834,164
Drugs 5.9 15,771,907
Food/Beverage/Tobacco 5.8 15,516,885
Metals & Minerals 5.4 14,512,120
Media 5.1 13,680,027
Real Estate Companies 4.6 12,275,468
Chemicals 4.4 11,757,986
Machinery & Manufacturing 4.3 11,520,790
Electric Utilities 4.2 11,298,761
Energy Sources. 4.2 11,268,433
Paper/Forest Products 3.9 10,533,796
Retail Trade 3.5 9,529,748
Insurance 3.1 8,272,245
Transportation. 3.0 8,159,633
Financial Services 3.0 7,961,818
Travel & Leisure 2.9 7,834,223
Electrical Equipment 2.6 6,970,501
Automotive 2.3 6,084,418
Computers & Office Equipment 2.2 5,924,652
Household Products 2.2 5,923,968
Business Services 2.0 5,414,495
Aerospace/Defense 1.9 4,979,475
Electronics 1.1 3,037,726
Communication Equipment .9 2,397,452
Pipeline .8 2,228,244
Medical Products .7 1,973,007
Apparel/Textiles .7 1,797,530
Energy Services .5 1,409,022
Entertainment Products .3 719,307
Repurchase Agreements 2.1 5,710,000
- -------------------------------------------------------------------------
Total Value of Investments 100.4 269,430,423
Excess of Liabilities Over Other Assets (.4) (998,234)
- -------------------------------------------------------------------------
Net Assets 100.0% $268,432,189
=========================================================================
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Assets and Liabilities
FIRST INVESTORS GLOBAL FUND, INC.
December 31, 1996
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Assets
Investments in securities, at value (identified
cost $228,907,099) (Note 1A) $269,430,423
Cash 839
Receivables:
Investment securities sold $ 953,501
Dividends and interest 516,857
Capital shares sold 267,947 1,738,305
------------
Other assets 20,335
------------
Total Assets 271,189,902
Liabilities
Payables:
Investment securities purchased 1,349,196
Cash portion of dividend payable January 15, 1997 605,203
Capital shares redeemed 314,457
Accrued expenses 268,585
Accrued advisory fee 220,272
------------
Total Liabilities 2,757,713
------------
Net Assets (Note 5):
Class A (39,915,162 shares outstanding) 263,087,773
Class B (820,683 shares outstanding) 5,344,416 $268,432,189
------------ ============
Net Assets Consist of:
Capital paid in $227,924,308
Undistributed net investment deficit (15,418)
Net unrealized appreciation of investments and
translation of assets in foreign currencies 40,523,299
------------
Total $268,432,189
============
Net asset value and redemption price per share--Class A $6.59
======
Maximum offering price per share--Class A ($6.59/.9375)* $7.03
======
Net asset value and offering price per share--Class B $6.51
======
* On purchases of $25,000 or more, the sales charge is reduced.
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
FIRST INVESTORS GLOBAL FUND, INC.
Year Ended December 31, 1996
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Investment Income
Income:
Dividends (net of $376,658 foreign withholding taxes) $5,020,836
Interest 779,303
------------
Total income 5,800,139
Expenses (Note 3):
Advisory fee $ 2,491,112
Shareholder servicing costs 819,904
Distribution plan expenses--Class A 737,348
Distribution plan expenses--Class B 34,173
Custodian fees and expenses 313,030
Reports and notices to shareholders 81,091
Professional fees 47,257
Other expenses 57,920
------------
Total expenses 4,581,835
------------
Net investment income 1,218,304
------------
Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions (Note 2):
Net realized gain (loss) from:
Investments 35,375,352
Translation of assets in foreign currencies (18,381) 35,356,971
------------
Net unrealized depreciation of:
Investments (2,633,342)
Translation of assets in foreign currencies (6,508) (2,639,850)
------------ ------------
Net gain from investments and foreign currency 32,717,121
------------
Net Increase in Net Assets Resulting from Operations $33,935,425
============
See notes to financial statements
</TABLE>
<TABLE>
<CAPTION>
Statement of Changes in Net Assets
FIRST INVESTORS GLOBAL FUND, INC.
- ----------------------------------------------------------------------------------------------------
Year Ended December 31 1996 1995
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase (Decrease) in Net Assets from Operations
Net investment income $ 1,218,304 $ 1,189,013
Net realized gain on investments and foreign currency transactions 35,356,971 13,092,919
Net unrealized appreciation (depreciation) of investments and
translation of assets in foreign currencies (2,639,850) 21,510,849
------------ ------------
Net increase in net assets resulting from operations 33,935,425 35,792,781
------------ ------------
Distributions to Shareholders
Net investment income--Class A (1,513,003) (1,201,748)
Net investment income--Class B (12,327) (5,314)
Net realized gains--Class A (31,032,925) (9,215,464)
Net realized gains--Class B (636,439) (52,445)
------------ ------------
Total distributions (33,194,694) (10,474,971)
------------ ------------
Capital Share Transactions (a)
Class A:
Proceeds from shares sold 36,352,940 20,655,423
Value of distributions reinvested 31,943,902 8,448,358
Cost of shares redeemed (34,487,088) (39,890,811)
------------ ------------
33,809,754 (10,787,030)
------------ ------------
Class B:
Proceeds from shares sold 4,040,306 1,286,260
Value of distributions reinvested 645,589 57,759
Cost of shares redeemed (449,042) (83,283)
------------ ------------
4,236,853 1,260,736
------------ ------------
Net increase (decrease) from capital share transactions 38,046,607 (9,526,294)
------------ ------------
Net increase in net assets 38,787,338 15,791,516
Net Assets
Beginning of year 229,644,851 213,853,335
------------ ------------
End of year (including undistributed net investment deficit of
$15,418 and none, respectively) $268,432,189 $229,644,851
============ ============
(a)Capital Shares Issued and Redeemed
Class A:
Sold 5,281,102 3,322,118
Issued for distributions reinvested 4,847,330 1,229,747
Redeemed (4,942,141) (6,436,387)
------------ ------------
Net increase (decrease) in Class A shares outstanding 5,186,291 (1,884,522)
============ ============
Class B:
Sold 585,922 204,422
Issued for distributions reinvested 99,169 8,457
Redeemed (64,422) (12,865)
------------ ------------
Net increase in Class B shares outstanding 620,669 200,014
============ ============
See notes to financial statements
</TABLE>
Notes to Financial Statements
FIRST INVESTORS GLOBAL FUND, INC.
1. Significant Accounting Policies--The Fund is registered under the
Investment Company Act of 1940 (the "1940 Act") as a diversified,
open-end management investment company. The objective of the Fund is
primarily to seek long-term capital growth and secondarily to earn a
reasonable level of current income.
A. Security Valuation--A security listed or traded on any stock exchange
or the NASDAQ National Market System is valued at its last sale price on
that exchange or system prior to the time when assets are valued. If no
sale is reported at that time, the mean between the current bid and asked
prices is used. Securities for which over-the-counter market quotations
are readily available are valued at the mean between the last current
bid and asked prices. Securities may also be priced by a pricing service.
The pricing service uses quotations obtained from investment dealers or
brokers, information with respect to market transactions in comparable
securities and other available information in determining value.
Securities for which market quotations are not readily available and
other assets are valued on a consistent basis at fair value as determined
in good faith by or under the supervision of the Fund's officers in a
manner specifically authorized by the Board of Directors. For valuation
purposes, quotations of foreign securities in foreign currency are
translated to U.S. dollar equivalents using the foreign exchange
quotation in effect.
B. Federal Income Taxes--No provision has been made for federal income
taxes on net income or capital gains, since it is the policy of the Fund
to continue to comply with the special provisions of the Internal Revenue
Code applicable to investment companies and to make sufficient
distributions of income and capital gains to relieve it from all, or
substantially all, such taxes.
C. Foreign Currency Translations--The books and records are maintained
in U.S. dollars. For valuation purposes, quotations of foreign
securities in foreign currency are translated to U.S. dollar equivalents
using the daily rate of exchange. Purchases and sales of investment
securities, dividend income and certain expenses are translated to U.S.
dollars at the rates of exchange prevailing on the respective dates of
such transactions.
The Fund does not isolate that portion of gains and losses on investments
which is due to changes in foreign exchange rates from that which is due
to changes in market prices of the investments. Such fluctuations are
included with the net realized and unrealized gains and losses from
investments.
Net realized and unrealized gain (loss) from foreign currency
transactions includes gains and losses from the sales of foreign currency
and gains and losses on accrued foreign dividends and related withholding
taxes.
D. Distributions to Shareholders--Distributions to shareholders from net
investment income and net realized gains are declared and paid annually.
The timing and characterization of income and capital gain distributions
are determined in accordance with income tax regulations which may
differ from generally accepted accounting principles. These differences
are primarily due to differing treatments for foreign currency
transactions and capital loss carryforwards.
E. Repurchase Agreements--Securities pledged as collateral for repurchase
agreements are held by the Fund's custodian until maturity of the
repurchase agreement. The agreements provide that the Fund will receive,
as collateral, securities with a market value which will at all times be
at least equal to 100% of the amount invested by the Fund.
F. Use of Estimates--The preparation of the 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 at the date of the financial statements
and the reported amounts of revenue and expense during the reporting
period. Actual results could differ from those estimates.
G. Other--Security transactions are accounted for on the date the
securities are purchased or sold. Cost is determined, and gains and
losses are based, on the identified cost basis for both financial
statement and federal income tax purposes. Dividend income is recorded
on the ex-dividend date. Interest income and estimated expenses are
accrued daily.
2. Securities Transactions--For the year ended December 31, 1996,
purchases and sales of investment securities, excluding foreign
currencies and repurchase agreements, aggregated $180,662,576 and
$172,580,055, respectively.
At December 31, 1996, the cost of investments for federal income tax
purposes was $228,907,099. Accumulated net unrealized appreciation on
investments was $40,523,324 consisting of $50,229,295 gross unrealized
appreciation and $9,705,971 gross unrealized depreciation.
3. Advisory Fee and Other Transactions With Affiliates--Certain officers
and directors of the Fund are officers and directors of its investment
adviser, First Investors Management Company, Inc. ("FIMCO"), its
underwriter, First Investors Corporation ("FIC"), its transfer agent,
Administrative Data Management Corp. ("ADM") and/or First Financial
Savings Bank, S.L.A. ("FFS"), custodian of the Fund's Individual
Retirement Accounts. Officers and directors of the Fund received no
remuneration from the Fund for serving in such capacities. Their
remuneration (together with certain other expenses of the Fund) is
paid by FIMCO or FIC.
The Investment Advisory Agreement provides as compensation to FIMCO an
annual fee, payable monthly, at the rate of 1% on the first $250 million
of the Fund's average daily net assets, declining by .03% on each $250
million thereafter, down to .91% on average daily net assets over $750
million.
During the year ended December 31, 1996, FIC, as underwriter, received
$1,455,711 in commissions after allowing $5,196 to other dealers.
Shareholder servicing costs included $505,820 in transfer agent fees
paid to ADM and $220,482 in custodian fees paid to FFS.
Wellington Management Company serves as the investment subadviser to the
Fund. The subadviser is paid by FIMCO and not by the Fund.
Pursuant to a Distribution Plan adopted under Rule 12b-1 of the 1940 Act,
the Fund is authorized to pay FIC a fee equal to .30% of the average net
assets of the Class A shares and 1% of the average net assets of the
Class B shares on an annualized basis each year, payable monthly. The
fee consists of a distribution fee and a service fee. The service fee is
paid for the ongoing servicing of clients who are shareholders of the
Fund.
4. Rule 144A Securities--Under Rule 144A, certain restricted securities
are exempt from the registration requirements of the Securities Act of
1933 and may only be resold to qualified institutional investors. At
December 31, 1996, the Fund held two 144A securities with an aggregate
value of $2,148,043 representing less than 1% of the Fund's net assets.
These securities are valued as set forth in Note 1A.
5. Capital--The Fund sells two classes of shares, Class A and Class B,
each with a public offering price that reflects different sales charges
and expense levels. Class A shares are sold with an initial sales charge
of up to 6.25% of the amount invested and together with the Class B
shares are subject to 12b-1 fees as described in Note 3. Class B shares
are sold without an initial sales charge, but are generally subject to
a contingent deferred sales charge which declines in steps from 4% to
0% during a six-year period. Class B shares automatically convert into
Class A shares after eight years. Realized and unrealized gains or
losses, investment income and expenses (other than 12b-1 fees and
certain other class expenses) are allocated daily to each class of
shares based upon the relative proportion of net assets of each class.
Of the 100,000,000 shares originally designated, the Fund has classified
65,000,000 shares as Class A and 35,000,000 shares as Class B.
<TABLE>
<CAPTION>
Financial Highlights
FIRST INVESTORS GLOBAL FUND, INC.
The following table sets forth the per share operating performance for a share of capital
stock outstanding, total return, ratios to average net assets and other supplemental data
for each year indicated.*
- ---------------------------------------------------------------------------------------------------------------
CLASS A
------------------------------------------------------------
Year Ended December 31 1996 1995 1994 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data
Net Asset Value, Beginning of Year $6.57 $5.84 $6.27 $5.11 $5.41 $4.63
------- ------- ------- ------- ------- -------
Income from Investment Operations
Net investment income (loss) .036 .035 .028 .014 .039 .005
Net realized and unrealized gain (loss) from
investments and foreign currency transactions. .912 1.006 (.265) 1.160 (.298) .775
------- ------- ------- ------- ------- -------
Total from Investment Operations .948 1.041 (.237) 1.174 (.259) .780
------- ------- ------- ------- ------- -------
Less Distributions from:
Net investment income .043 .036 .028 .014 -- --
Net realized gain from investments .885 .275 .165 -- -- --
Capital surplus -- -- -- -- .041 --
------- ------- ------- ------- ------- -------
Total Distributions .928 .311 .193 .014 .041 --
------- ------- ------- ------- ------- -------
Net Asset Value, End of Year $6.59 $6.57 $5.84 $6.27 $5.11 $5.41
======= ======= ======= ======= ======= =======
Total Return (%)+ 14.43 17.83 (3.78) 22.97 (2.89) 14.56
Ratios/Supplemental Data
Net Assets, End of Year (in millions) $263.1 $228.3 $213.9 $209.8 $181.0 $226.3
Ratio to Average Net Assets: (%)
Expenses 1.83 1.83 1.84 1.87 1.83 1.95
Net investment income (loss) .50 .55 .45 .27 .73 .09
Portfolio Turnover Rate (%) 73 47 56 41 45 64
Average Commission Rate (per share of security)++ $.0094 N/A N/A N/A N/A N/A
<CAPTION>
Financial Highlights (continued)
- ---------------------------------------------------------------------------------------------------------------
CLASS A CLASS B
-------------------------------------- -------------------
Year Ended December 31 1990 1989 1988 1987 1996 1995**
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Data
Net Asset Value, Beginning of Year $5.38 $4.47 $3.85 $3.31 $6.54 $5.76
------- ------- ------- ------- ------- -------
Income from Investment Operations
Net investment income (loss) (.023) (.019) .003 (.021) (.007) .027
Net realized and unrealized gain (loss) from
investments and foreign currency transactions. (.634) 1.689 .617 .969 .879 1.056
------- ------- ------- ------- ------- -------
Total from Investment Operations (.657) 1.670 .620 .948 .872 1.083
------- ------- ------- ------- ------- -------
Less Distributions from:
Net investment income -- -- -- .008 .017 .028
Net realized gain from investments -- .390 -- .400 .885 .275
Capital surplus 0.093 .370 -- -- -- --
------- ------- ------- ------- ------- -------
Total Distributions .093 .760 -- .408 .902 .303
------- ------- ------- ------- ------- -------
Net Asset Value, End of Year $4.63 $5.38 $4.47 $3.85 $6.51 $6.54
======= ======= ======= ======= ======= =======
Total Return (%)+ (12.22) 37.65 16.10 28.60 13.33 18.80
Ratios/Supplemental Data
Net Assets, End of Year (in millions) $219.0 $182.4 $88.9 $92.9 $5.3 $1.3
Ratio to Average Net Assets: (%)
Expenses 1.88 1.75 1.74 1.73 2.54 2.56(a)
Net investment income (loss) (.43) (.38) .07 (.45) (.21) (.19)(a)
Portfolio Turnover Rate (%) 116 155 115 137 73 47
Average Commission Rate (per share of security)++ N/A N/A N/A N/A $0.0094 N/A
* Adjusted to reflect five-for-one stock split on March 4, 1987
** From January 12, 1995 (date Class B shares first offered) to December 31, 1995
+ Calculated without sales charge
(a) Annualized
++ Average commission rate as required by amended disclosure requirements effective for fiscal years
beginning on or after September 1, 1995
See notes to financial statements
</TABLE>
Independent Auditor's Report
To the Shareholders and Board of Directors of
First Investors Global Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
First Investors Global Fund, Inc., including the portfolio of
investments, as of December 31, 1996, and the related statement of
operations for the year then ended, the statement of changes in net
assets for each of the two years in the period then ended and financial
highlights for each of the years presented. These financial statements
and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.
Our procedures included confirmation of securities owned as of December
31, 1996, by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of First Investors Global Fund, Inc. as of December 31, 1996,
and the results of its operations, changes in its net assets and
financial highlights for the years presented, in conformity with
generally accepted accounting principles.
Tait, Weller & Baker
Philadelphia, Pennsylvania
January 31, 1997
FIRST INVESTORS GLOBAL FUND, INC.
Directors
James J. Coy
Roger L. Grayson
Glenn O. Head
Kathryn S. Head
Rex R. Reed
Herbert Rubinstein
James M. Srygley
John T. Sullivan
Robert F. Wentworth
Officers
Glenn O. Head
President
Concetta Durso
Vice President and Secretary
Joseph I. Benedek
Treasurer
Carol Lerner Brown
Assistant Secretary
Gregory R. Kingston
Assistant Treasurer
Mark S. Spencer
Assistant Treasurer
Shareholder Information
Investment Adviser
First Investors
Management Company, Inc.
95 Wall Street
New York, NY 10005
Subadviser
Wellington Management Company
75 State Street
Boston, MA 02109
Underwriter
First Investors Corporation
95 Wall Street
New York, NY 10005
Custodian
Brown Brothers Harriman & Co.
40 Water Street
New York, NY 10286
Transfer Agent
Administrative Data
Management Corp.
581 Main Street
Woodbridge, NJ 07095-1198
Legal Counsel
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
Auditors
Tait, Weller & Baker
Two Penn Center Plaza
Philadelphia, PA 19102
It is the Fund's practice to mail only one copy of its
annual and semi-annual reports to any address at which more than one
shareholder with the same last name has indicated that mail is to be
delivered. Additional copies of the reports will be mailed if requested
by any shareholder in writing or by calling 800-423-4026. The Fund will
ensure that separate reports are sent to any shareholder who
subsequently changes his or her mailing address.
This report is authorized for distribution only to existing shareholders,
and, if given to prospective shareholders, must be accompanied or
preceded by the Fund's prospectus.
