<PAGE> 1
SEMIANNUAL REPORT APRIL 30, 1998
OPPENHEIMER
DISCIPLINED
ALLOCATION FUND
[PHOTO]
[OPPENHEIMERFUNDS LOGO]
THE RIGHT WAY TO INVEST
<PAGE> 2
CONTENTS
3 President's Letter
4 Fund Performance
6 An Interview
with the Fund's
Managers
10 Statement of
Investments
20 Statement of
Assets and
Liabilities
22 Statement of
Operations
23 Statements of
Changes in
Net Assets
24 Financial Highlights
27 Notes to Financial
Statements
34 Officers and
Directors
36 Information and
Services
REPORT HIGHLIGHTS
- --------------------------------------------------------------------------------
- - WE MADE A SIGNIFICANT MOVE away from companies that have a large exposure to
worldwide economic activity, and especially to Asia. We shifted toward companies
that are much more focused on the U.S. consumer.
- - NUMEROUS EXPERTS have predicted the market would decline, or at least level
off. Instead, it has continuously reached new highs.
CUMULATIVE TOTAL RETURNS
For the 6-Month Period Ended 4/30/98
CLASS A
Without With
Sales Chg.(1) Sales Chg.(2)
8.83% 2.57%
CLASS B
Without With
Sales Chg.(1) Sales Chg.(2)
8.42% 3.63%
CLASS C
Without With
Sales Chg.(1) Sales Chg.(2)
8.39% 7.44%
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
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.
Prior to March 1, 1996, the Fund had a different investment advisor. However,
the prior portfolio management team is now employed by OppenheimerFunds, Inc.,
the current advisor.
1. Includes changes in net asset value per share without deducting any sales
charges. This performance is not annualized.
2. Class A return includes the current maximum initial sales charge of 5.75%.
Class B return includes the applicable contingent deferred sales charge of 5%.
Class C return includes the contingent deferred sales charge of 1%. An
explanation of the different performance calculations is contained in the Fund's
prospectus. Class B and C shares are subject to an annual 0.75% asset-based
sales charge. This performance is not annualized.
2 Oppenheimer Disciplined Allocation Fund
<PAGE> 3
[PHOTO]
BRIDGET A. MACASKILL
President
Oppenheimer Disciplined
Allocation Fund
DEAR SHAREHOLDER,
- --------------------------------------------------------------------------------
As we move further into 1998, we remain impressed by the remarkable resilience
of the financial markets. Recent efforts by the United States to help support
the Japanese Yen have inspired hope that the fallout of the Asian economic
crisis can be contained. In general, the U.S. and world markets have continued
to build wealth for investors at a virtually unprecedented pace.
At OppenheimerFunds, we are pleased to help our fund shareholders
participate in the potential rewards of today's markets, but we also recognize
that this rate of growth cannot last forever. Because no one can predict exactly
when the next correction or bear market might occur, we think it is prudent to
continually identify, evaluate and manage the risks that may affect our fund
shareholders.
We believe that one of the leading risks facing investors today is that
stock valuations are at the high end of their historical range, while U.S.
corporate earnings growth is slowing. Given these facts, we believe it is
unlikely that stocks will sustain the growth rate of the past three years. Stock
prices could continue trading near current levels until earnings "catch up," or
there could be a market correction. However, we believe that either scenario
would be only a temporary pause on the way to potentially greater long-term
gains.
We are also examining the potential economic effects of the "millennium
problem" that may render many computer systems unable to recognize the year 2000
when it arrives. Solving this problem has required companies to divert
substantial human and financial resources from their core businesses, possibly
constraining global economic growth during 1999 and 2000.
For our part, we can report that OppenheimerFunds has made solid progress
toward ensuring that our shareholder accounting systems are fully "year 2000
compliant," and that all shareholder accounts will make a seamless transition
into the 21st century.
We encourage you to meet with your financial advisor to discuss how a
possible market correction or the millennium problem may affect your
investments. Together, you can prepare your investment portfolio for the
challenges and opportunities of the new century.
Sincerely,
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
May 21, 1998
3 Oppenheimer Disciplined Allocation Fund
<PAGE> 4
AVG ANNUAL TOTAL RETURNS
For the Periods Ended 3/31/98(1)
CLASS A
1 year 5 year 10 year
17.93% 11.32% 12.73%
CLASS B
Since
1 year 5 year Inception
19.20% N/A 13.73%
CLASS C
Since
1 year 5 year Inception
23.18% N/A 15.80%
CUMULATIVE TOTAL RETURN
For the Period Ended 3/31/98 (1)
CLASS A
5 year
70.96% $17,096(3)
PERFORMANCE UPDATE
- --------------------------------------------------------------------------------
The Fund performed well during this somewhat volatile period, its Class A shares
producing a cumulative total return of 8.83% for the six months ended April 30,
1998, without sales charges.(2) The stock markets, reacting to the broader
effects of the difficulties of many Asian countries, declined in the last months
of 1997. However, in early 1998, stock performance rebounded as investor
concerns eased. The bond market did the opposite. It rallied early in the period
and has consolidated during most of 1998.
<TABLE>
<CAPTION>
GROWTH OF $10,000
Over five years
(without sales charges)(3)
Oppenheimer Disciplined
Allocation Fund
S&P 500 Index Class A shares
<S> <C>
10,000 10,000
10,048.7 10,324.7
10,308.3 10,833.3
10,547.3 10,932
10,147.4 10,653.9
10,190.1 10,471.3
10,688.4 10,765.4
10,686.7 10,701.4
11,727.2 11,354.4
12,846.7 12,097.2
13,867.6 12,653.2
14,702.5 13,264.6
15,491.7 13,547
16,186.9 13,638.4
16,687.1 13,901.8
18,078.2 14,600.9
18,562.8 14,560.5
21,803.5 15,930.7
23,436.8 17,193.8
24,109.7 17,214.8
27,472.8 18,139
</TABLE>
1. Total returns include changes in share price and reinvestment of dividends
and capital gains distributions in a hypothetical investment for the periods
shown. Class A returns include the current maximum initial sales charge of
5.75%. Class A shares were first publicly offered on 9/16/85. The Fund's maximum
sales charge for Class A shares was lower prior to 3/18/96, so actual
performance may have been higher. Class B returns include the applicable
contingent deferred sales charge of 5% (1-year) and 3% (since inception on
10/2/95). Class C returns for the one-year period include the contingent
deferred sales charge of 1%. Class C shares have an inception date of 5/1/96. An
explanation of the different performance calculations is contained in the Fund's
prospectus. Class B and C shares are subject to an annual 0.75% asset-based
sales charge.
2. Includes changes in net asset value per share without deducting
any sales charges. Such performance is not annualized and would have been lower
if sales charges were taken into account.
4 Oppenheimer Disciplined Allocation Fund
<PAGE> 5
ASSET ALLOCATION(4)
<TABLE>
<S> <C>
Equities 52.6%
Bonds 38.9
Cash Equivalents 8.5
</TABLE>
PORTFOLIO REVIEW
- --------------------------------------------------------------------------------
Oppenheimer Disciplined Allocation Fund is for investors looking for high total
return by diversifying assets based on changing market condition.
WHAT WE LOOK FOR
- - Historical, concurrent and expectational ANALYSIS to determine allocation.
- - Common stocks with BELOW-MARKET PRICE/EARNINGS RATIOS and
better-than-anticipated earnings reports.
- - Bonds with an ACTIVE-DURATION PHILOSOPHY and at least 25% invested in senior
fixed-income securities.
- - QUALITY AND LIQUIDITY for the Fund's cash position.
<TABLE>
<CAPTION>
TOP 10 STOCK HOLDINGS(5)
................................................................................
<S> <C> <C> <C>
Storage Technology Corp. 3.2% BankBoston Corp. 2.4%
................................................................................
Xerox Corp. 3.2 U S West
Communications Group 2.3
................................................................................
Fort James Corp. 2.8 Conseco, Inc. 2.3
................................................................................
Textron, Inc. 2.5 Equitable Cos., Inc. 2.1
................................................................................
AT&T Corp. 2.5 Kroger Co. 1.9
................................................................................
</TABLE>
<TABLE>
<CAPTION>
TOP 5 INDUSTRIES(5)
................................................................................
<S> <C>
Manufacturing 11.9%
................................................................................
Insurance 11.9
................................................................................
Computer Hardware 9.0
................................................................................
Telephone Utilities 8.9
................................................................................
Retail: General 8.8
................................................................................
</TABLE>
3. Results of a hypothetical $10,000 investment in Class A shares on
March 31, 1993. The Standard & Poor's 500 Index is a broad-based unmanaged stock
index including daily reinvestment of dividends, and cannot be purchased
directly by investors.
4. Pie chart is based on total market value of investments as of April 30, 1998.
5. Portfolio is subject to change. Percentages are as of April 30, 1998 and are
based on total market value of stock holdings.
5 Oppenheimer Disciplined Allocation Fund
<PAGE> 6
"THE STOCK MARKETS TURNED SOMEWHAT MIXED IN DECEMBER..."
AN INTERVIEW WITH YOUR FUND'S MANAGERS
- --------------------------------------------------------------------------------
HOW HAS THE FUND PERFORMED IN THE PAST SIX MONTHS?
The Fund's Class A shares produced a cumulative total return of 8.83% for the
six-month period ended April 30, 1998, without sales charges.(1) The stock
markets turned somewhat mixed in December--primarily in response to the broader
effects of the difficulties of many Asian countries. In 1998, however, stock
performance rebounded as investor concerns eased. The bond market did the
opposite. It rallied early in the period and has consolidated during most of
1998.
DESCRIBE SOME OF THE SECTORS AND THE SECURITIES WHERE YOU'VE MADE SIGNIFICANT
MOVES IN THE PAST SIX MONTHS.
In the stock portion of the portfolio, we made a significant move away from
companies that have a large exposure to worldwide economic activity, and
especially to Asia. We shifted toward companies that are much more focused on
U.S. economic activity, and, even more specifically, toward the U.S. consumer.
More specifically, we reduced our holdings in basic materials, capital
goods and energy. Companies in these sectors have significant exposure to the
fortunes of Southeast Asian countries, because, as Asian companies reduce their
manufacturing and exporting, they also reduce their consumption of energy,
materials and capital goods. At the same time, we increased our holdings in
consumer cyclical stocks such as retail companies primarily exposed to the U.S.
consumer.
1. Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
6 Oppenheimer Disciplined Allocation Fund
<PAGE> 7
[PHOTO]
PORTFOLIO MANAGEMENT TEAM (L TO R)
Kenneth White
Peter Antos (Portfolio Manager)
Michael Strathearn
Stephen Libera
In the bond portion of the portfolio, we kept our duration about half a
year longer than one of our benchmarks, the Merrill Lynch U.S. Corporate and
Government Master Index.(2) Our bullish posture was based upon the belief that
the combination of a stable monetary policy, low inflation, a federal budget
surplus and emerging economic turmoil in Southeast Asia would drive bond yields.
It's most beneficial to invest in longer duration bonds when yields are
declining because they will appreciate faster.
WHAT IS THE CURRENT ASSET ALLOCATION OF THE FUND?
At the end of the period, the Fund's asset allocation was approximately 50% in
stocks, 40% in bonds and the rest in cash equivalents. That reflects a reduction
in our stock allocation from the previous six-month period, during which we
averaged about 56% in stocks.
IS THIS CHANGE IN ALLOCATION A RESPONSE TO EQUITY VALUATIONS?
In recent years, the equity markets have been driven by declining interest rates
and by large earnings gains, which, in turn, have apparently been driven by
productivity improvement. As a result, the average price/earnings ratio of all
the stocks in the market has gone from about 10-12 as little as four years ago
to about 23-24 today. A price/earnings ratio, or P/E, is the result of dividing
a stock's per-share price by its per-share earnings.
2. Duration measures interest-rates sensitivity; the longer the duration, the
greater the expected volatility as rates change.
7 Oppenheimer Disciplined Allocation Fund
<PAGE> 8
"...PRIMARILY IN RESPONSE TO THE BROADER EFFECTS OF THE DIFFICULTIES OF MANY
ASIAN COUNTRIES."
AN INTERVIEW WITH YOUR FUND'S MANAGERS
- --------------------------------------------------------------------------------
Will the stock market continue to advance despite high valuation
measures, and will investors continue to pour money into it? Obviously, no one
knows for sure. In the last several years, numerous experts have predicted the
market would decline, or at least level off. Instead, it has continuously
reached new highs suffering only brief, shallow corrections, with strong
momentum and continued large money inflows into U.S. stocks driving the market
higher. Most recently, some of the momentum indicators of our discipline have
weakened or turned negative. So, with valuation levels stretched and market
momentum apparently deteriorating, we are maintaining our conservative posture
for now.
WHAT DOES A ROBUST STOCK MARKET MEAN FOR YOUR ASSET ALLOCATION AND YOUR
PERFORMANCE?
Looking back over the last three or four years, the only asset call you should
have made was to be predominantly in stocks. The stock market's unprecedented
performance didn't leave an asset allocation manager much room to add value by
investing in bonds or cash.
We believe that our returns over this period have been satisfactory,
especially if you look at our risk profile in relation to our return. Yes, the
stock market has been going up, virtually without interruption. But there are
emotions associated with big market moves like that, and our asset allocation
investing style aims to take the emotion out of investing decisions. We believe
producing solid, risk-adjusted returns for our investors is The Right Way to
Invest.
8 Oppenheimer Disciplined Allocation Fund
<PAGE> 9
FINANCIALS
- --------------------------------------------------------------------------------
9 Oppenheimer Disciplined Allocation Fund
<PAGE> 10
STATEMENT OF INVESTMENTS April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS--51.8%
- ----------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--0.6%
- ----------------------------------------------------------------------------------------------------------------
PAPER--0.6%
Union Camp Corp. 26,500 $ 1,599,937
- ----------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--11.9%
- ----------------------------------------------------------------------------------------------------------------
AUTOS & HOUSING--2.6%
Dollar Thrifty Automotive Group, Inc.(1) 49,500 934,312
- ----------------------------------------------------------------------------------------------------------------
Federal-Mogul Corp. 26,700 1,727,156
- ----------------------------------------------------------------------------------------------------------------
Lear Corp.(1) 25,900 1,387,269
- ----------------------------------------------------------------------------------------------------------------
Republic Industries, Inc.(1) 35,000 973,437
- ----------------------------------------------------------------------------------------------------------------
Whirlpool Corp. 26,700 1,922,400
----------
6,944,574
- ----------------------------------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT--3.3%
Alaska Air Group, Inc.(1) 23,500 1,318,937
- ----------------------------------------------------------------------------------------------------------------
America West Holdings Corp., Cl. B(1) 48,200 1,458,050
- ----------------------------------------------------------------------------------------------------------------
AMR Corp.(1) 17,400 2,651,325
- ----------------------------------------------------------------------------------------------------------------
Delta Air Lines, Inc. 7,600 883,500
- ----------------------------------------------------------------------------------------------------------------
Hasbro, Inc. 44,900 1,652,881
- ----------------------------------------------------------------------------------------------------------------
Outback Steakhouse, Inc.(1) 23,700 903,562
----------
8,868,255
- ----------------------------------------------------------------------------------------------------------------
RETAIL: GENERAL--4.6%
Dayton Hudson Corp. 20,100 1,754,981
- ----------------------------------------------------------------------------------------------------------------
Federated Department Stores, Inc.(1) 42,900 2,110,144
- ----------------------------------------------------------------------------------------------------------------
Fruit of the Loom, Inc., Cl. A(1) 37,000 1,382,875
- ----------------------------------------------------------------------------------------------------------------
K Mart Corp.(1) 43,000 749,812
- ----------------------------------------------------------------------------------------------------------------
Liz Claiborne, Inc. 17,300 850,944
- ----------------------------------------------------------------------------------------------------------------
Nordstrom, Inc. 13,100 857,231
- ----------------------------------------------------------------------------------------------------------------
Penney (J.C.) Co., Inc. 38,000 2,700,375
- ----------------------------------------------------------------------------------------------------------------
Sears Roebuck & Co. 33,300 1,975,106
----------
12,381,468
- ----------------------------------------------------------------------------------------------------------------
RETAIL: SPECIALTY--1.4%
Brylane, Inc.(1) 13,300 781,375
- ----------------------------------------------------------------------------------------------------------------
Inacom Corp.(1) 29,600 1,060,050
- ----------------------------------------------------------------------------------------------------------------
Payless ShoeSource, Inc.(1) 25,100 1,794,650
----------
3,636,075
</TABLE>
10 Oppenheimer Disciplined Allocation Fund
<PAGE> 11
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER NON-CYCLICALS--5.4%
- ----------------------------------------------------------------------------------------------------------------
FOOD--1.5%
Kroger Co.(1) 64,800 $2,713,500
- ----------------------------------------------------------------------------------------------------------------
Safeway, Inc.(1) 35,600 1,361,700
----------
4,075,200
- ----------------------------------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES--1.1%
Tenet Healthcare Corp.(1) 58,595 2,193,650
- ----------------------------------------------------------------------------------------------------------------
WellPoint Health Networks, Inc.(1) 10,900 786,162
----------
2,979,812
- ----------------------------------------------------------------------------------------------------------------
HOUSEHOLD GOODS--2.8%
Dial Corp. (The) 58,500 1,425,937
- ----------------------------------------------------------------------------------------------------------------
Fort James Corp. 77,675 3,854,622
- ----------------------------------------------------------------------------------------------------------------
Premark International, Inc. 68,000 2,269,500
----------
7,550,059
- ----------------------------------------------------------------------------------------------------------------
ENERGY--2.5%
- ----------------------------------------------------------------------------------------------------------------
ENERGY SERVICES & PRODUCERS--1.6%
Diamond Offshore Drilling, Inc. 47,200 2,389,500
- ----------------------------------------------------------------------------------------------------------------
Global Marine, Inc.(1) 30,700 723,369
- ----------------------------------------------------------------------------------------------------------------
Tidewater, Inc. 27,100 1,073,838
----------
4,186,707
- ----------------------------------------------------------------------------------------------------------------
OIL-INTEGRATED--0.9%
Exxon Corp. 19,400 1,414,988
- ----------------------------------------------------------------------------------------------------------------
Mobil Corp. 13,700 1,082,300
----------
2,497,288
- ----------------------------------------------------------------------------------------------------------------
FINANCIAL--10.9%
- ----------------------------------------------------------------------------------------------------------------
BANKS--2.9%
BankAmerica Corp. 15,000 1,275,000
- ----------------------------------------------------------------------------------------------------------------
BankBoston Corp. 30,500 3,292,094
- ----------------------------------------------------------------------------------------------------------------
First Union Corp. 9,500 573,563
- ----------------------------------------------------------------------------------------------------------------
NationsBank Corp. 14,700 1,113,525
- ----------------------------------------------------------------------------------------------------------------
Wells Fargo & Co. 4,400 1,621,400
----------
7,875,582
- ----------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--1.8%
Money Store, Inc. (The) 14,700 483,263
- ----------------------------------------------------------------------------------------------------------------
Morgan Stanley, Dean Witter & Co. 23,200 1,829,900
- ----------------------------------------------------------------------------------------------------------------
Travelers Group, Inc. 39,819 2,436,425
----------
4,749,588
</TABLE>
11 Oppenheimer Disciplined Allocation Fund
<PAGE> 12
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INSURANCE--6.2%
Allstate Corp. 26,300 $ 2,531,375
- ----------------------------------------------------------------------------------------------------------------
Chubb Corp. 26,800 2,115,525
- ----------------------------------------------------------------------------------------------------------------
Conseco, Inc. 64,000 3,176,000
- ----------------------------------------------------------------------------------------------------------------
Equitable Cos., Inc. 47,000 2,884,625
- ----------------------------------------------------------------------------------------------------------------
St. Paul Cos., Inc. 19,700 1,669,575
- ----------------------------------------------------------------------------------------------------------------
Torchmark Corp. 38,100 1,697,831
- ----------------------------------------------------------------------------------------------------------------
Travelers Property Casualty Corp., Cl. A 60,800 2,553,600
-----------
16,628,531
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL--7.4%
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL MATERIALS--0.6%
USG Corp.(1) 31,700 1,628,588
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL SERVICES--0.6%
Viad Corp. 60,800 1,569,400
- ----------------------------------------------------------------------------------------------------------------
MANUFACTURING--6.2%
AGCO Corp. 46,300 1,238,525
- ----------------------------------------------------------------------------------------------------------------
Case Corp. 27,000 1,716,188
- ----------------------------------------------------------------------------------------------------------------
Deere & Co. 33,900 1,981,031
- ----------------------------------------------------------------------------------------------------------------
Ingersoll-Rand Co. 40,850 1,881,653
- ----------------------------------------------------------------------------------------------------------------
PACCAR, Inc. 41,500 2,464,063
- ----------------------------------------------------------------------------------------------------------------
Parker-Hannifin Corp. 28,950 1,291,894
- ----------------------------------------------------------------------------------------------------------------
Textron, Inc. 44,800 3,505,600
- ----------------------------------------------------------------------------------------------------------------
U.S. Industries, Inc. 96,400 2,614,850
-----------
16,693,804
- ----------------------------------------------------------------------------------------------------------------
TECHNOLOGY--6.4%
- ----------------------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE--1.3%
General Dynamics Corp. 38,400 1,622,400
- ----------------------------------------------------------------------------------------------------------------
Lockheed Martin Corp. 17,571 1,956,970
-----------
3,579,370
- ----------------------------------------------------------------------------------------------------------------
COMPUTER HARDWARE--4.7%
Gateway 2000, Inc.(1) 17,600 1,032,900
- ----------------------------------------------------------------------------------------------------------------
International Business Machines Corp. 7,600 880,650
- ----------------------------------------------------------------------------------------------------------------
Lexmark International Group, Inc., Cl. A(1) 29,800 1,724,675
- ----------------------------------------------------------------------------------------------------------------
Storage Technology Corp. (New)(1) 53,600 4,525,850
- ----------------------------------------------------------------------------------------------------------------
Xerox Corp. 39,600 4,494,600
-----------
12,658,675
- ----------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE/SERVICES--0.1%
Symantec Corp.(1) 12,200 353,800
- ----------------------------------------------------------------------------------------------------------------
ELECTRONICS--0.3%
SCI Systems, Inc.(1) 18,900 778,444
</TABLE>
12 Oppenheimer Disciplined Allocation Fund
<PAGE> 13
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
UTILITIES--6.7%
- ----------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.3%
Edison International 52,900 $1,577,081
- ----------------------------------------------------------------------------------------------------------------
FPL Group, Inc. 33,100 2,054,269
-----------
3,631,350
- ----------------------------------------------------------------------------------------------------------------
GAS UTILITIES--0.8%
Columbia Energy Group 25,500 2,071,875
- ----------------------------------------------------------------------------------------------------------------
TELEPHONE UTILITIES--4.6%
Ameritech Corp. 40,700 1,732,294
- ----------------------------------------------------------------------------------------------------------------
AT&T Corp. 58,000 3,483,625
- ----------------------------------------------------------------------------------------------------------------
Bell Atlantic Corp. 27,500 2,572,969
- ----------------------------------------------------------------------------------------------------------------
Century Telephone Enterprises, Inc. 15,300 651,206
- ----------------------------------------------------------------------------------------------------------------
Frontier Corp. 28,200 844,238
- ----------------------------------------------------------------------------------------------------------------
U S West Communications Group 60,300 3,180,825
-----------
12,465,157
-----------
Total Common Stocks (Cost $112,618,892) 139,403,539
================================================================================================================
OTHER SECURITIES--0.3%
- ----------------------------------------------------------------------------------------------------------------
Ingersoll-Rand International Finance Corp. I, 6.22% Preferred
Redeemable Increased Dividend Equity Securities, 5/16/03(1)
(Cost $750,000) 30,000 761,250
FACE
AMOUNT
================================================================================================================
ASSET-BACKED SECURITIES--1.0%
- ----------------------------------------------------------------------------------------------------------------
Housing Securities, Inc., Series 1993-G, Cl. G4, 6.625%, 1/25/09 $ 750,000 751,260
- ----------------------------------------------------------------------------------------------------------------
IROQUOIS Trust, Asset-Backed Amortizing Nts., Series 1997-2, Cl. A,
6.752%, 6/25/07(2) 1,000,000 1,005,937
- ----------------------------------------------------------------------------------------------------------------
Olympic Automobile Receivables Trust, Automobile Receivables-
Backed Nts., Series 1997-A, Cl. A-5, 6.80%, 2/15/05 1,000,000 1,016,140
-----------
Total Asset-Backed Securities (Cost $2,753,767) 2,773,337
================================================================================================================
MORTGAGE-BACKED OBLIGATIONS--6.2%
- ----------------------------------------------------------------------------------------------------------------
Chase Commercial Mortgage Securities Corp., Commercial Mtg.
Obligations, Series 1996-1, Cl. A2, 7.60%, 3/18/06 1,500,000 1,597,852
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., Collateralized Mtg.
Obligations, Gtd. Multiclass Mtg. Participation Certificates, Series
1987, Cl. K, 7.50%, 9/15/27(2) 615,667 611,049
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., Gtd. Multiclass Mtg.
Participation Certificates:
6%, 3/1/09 733,266 729,754
Series 1337, Cl. D, 6%, 8/15/07 1,000,000 977,810
Series 1820, Cl. PL, 5.75%, 7/15/06 1,000,000 990,620
Series 1849, Cl. VA, 6%, 12/15/10 746,812 744,012
Series 1994-43, Cl. PE, 6%, 12/25/19 800,000 797,744
</TABLE>
13 Oppenheimer Disciplined Allocation Fund
<PAGE> 14
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MORTGAGE-BACKED OBLIGATIONS (CONTINUED)
Federal Home Loan Mortgage Corp., Interest-Only Stripped
Mtg.-Backed Security, Series 1583, C1. IC, 6.924%, 1/15/20(3) $2,000,000 $ 259,375
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn.:
6%, 12/1/03 661,245 657,516
6.50%, 3/1/26 682,995 677,559
7.50%, 1/1/08--6/1/08 775,929 798,224
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., Collateralized Mtg. Obligations, Gtd.
Multiclass Mtg. Participation Certificates, Series 1992-15,
Cl. KZ, 7%, 2/25/22 768,945 754,043
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., Collateralized Mtg. Obligations, Gtd.
Real Estate Mtg. Investment Conduit Pass-Through Certificates:
Trust 1993-181, Cl. C, 5.40%, 10/25/02 158,332 157,590
Trust 1993-190, Cl. Z, 5.85%, 7/25/08 325,080 323,391
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed
Security, Trust 1993-223, C1. PM, 7.504%, 10/25/23(3) 1,828,547 272,563
- ----------------------------------------------------------------------------------------------------------------
GE Capital Mortgage Services, Inc., Gtd. Real Estate Mtg. Investment
Conduit Pass-Through Certificates, Series 1994-7, Cl. A18, 6%, 2/25/09 994,428 938,492
- ----------------------------------------------------------------------------------------------------------------
Government National Mortgage Assn.:
7%, 4/15/09--2/15/24 1,380,248 1,403,605
7.50%, 3/15/09 607,585 628,207
8%, 5/15/17 422,739 444,600
- ----------------------------------------------------------------------------------------------------------------
Green Tree Financial Corp., Series 1994-7, Cl. A3, 8%, 3/15/20 157,808 158,474
- ----------------------------------------------------------------------------------------------------------------
Norwest Asset Securities Corp., Mtg. Pass-Through Certificates,
Series 1997-14, Cl. A3, 6.75%, 10/25/27 1,000,000 1,001,367
- ----------------------------------------------------------------------------------------------------------------
PNC Mortgage Securities Corp., Commercial Mtg. Pass-Through
Certificates, Series 1995-2, Cl. A3, 6.50%, 2/25/12 1,000,000 1,001,602
- ----------------------------------------------------------------------------------------------------------------
Residential Accredit Loans, Inc., Mtg. Asset-Backed Pass-Through
Certificates, Series 1997-QS9, Cl. A2, 6.75%, 9/25/27 700,000 698,387
-----------
Total Mortgage-Backed Obligations (Cost $16,291,112) 16,623,836
================================================================================================================
U.S. GOVERNMENT OBLIGATIONS--11.8%
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, 6%, 2/15/26 2,250,000 2,245,079
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, 7.50%, 11/15/16 4,950,000 5,759,018
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, 8.75%, 5/15/17 8,250,000 10,776,571
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 5.625%, 2/15/06 6,000,000 5,953,128
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 5.75%, 8/15/03 2,250,000 2,257,034
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 6.50%, 8/15/05 1,750,000 1,827,658
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., 7.50%, 11/15/01 2,750,000 2,909,846
-----------
Total U.S. Government Obligations (Cost $29,654,981) 31,728,334
================================================================================================================
FOREIGN GOVERNMENT OBLIGATIONS--0.2%
- ----------------------------------------------------------------------------------------------------------------
Colombia (Republic of) Unsub. Nts., 7.125%, 5/11/98 300,000 300,002
</TABLE>
14 Oppenheimer Disciplined Allocation Fund
<PAGE> 15
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
United Mexican States Bonds, 6.97%, 8/12/00 $ 250,000 $ 247,500
----------
Total Foreign Government Obligations (Cost $545,108) 547,502
================================================================================================================
MUNICIPAL BONDS AND NOTES--0.4%
- ----------------------------------------------------------------------------------------------------------------
CA Infrastructure & Economic Development Bank Special Purpose
Trust Certificates, Series 1997-1, 6.28%, 9/25/05 (Cost $1,001,487) 1,000,000 1,011,450
================================================================================================================
NON-CONVERTIBLE CORPORATE BONDS AND NOTES--19.0%
- ----------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--1.2%
- ----------------------------------------------------------------------------------------------------------------
CHEMICALS--0.4%
Du Pont (E.I.) De Nemours & Co., 8.50% Debs., 2/15/03 228,000 241,852
- ----------------------------------------------------------------------------------------------------------------
Morton International, Inc., 9.25% Credit Sensitive Nts., 6/1/20 500,000 651,210
- ----------------------------------------------------------------------------------------------------------------
PPG Industries, Inc., 9% Debs., 5/1/21 250,000 312,224
----------
1,205,286
- ----------------------------------------------------------------------------------------------------------------
METALS--0.3%
Alcan Aluminum Ltd., 9.625% Debs., 7/15/19 850,000 920,745
- ----------------------------------------------------------------------------------------------------------------
PAPER--0.5%
Aracruz Celulose SA, 10.375% Debs., 1/31/02 750,000 770,625
- ----------------------------------------------------------------------------------------------------------------
Celulosa Arauco y Constitucion SA, 7.25% Debs., 6/11/98(2) 500,000 498,750
----------
1,269,375
- ----------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--2.1%
- ----------------------------------------------------------------------------------------------------------------
AUTOS & HOUSING--0.4%
Black & Decker Corp., 6.625% Nts., 11/15/00 700,000 706,946
- ----------------------------------------------------------------------------------------------------------------
First Industrial LP, 7.15% Bonds, 5/15/27 500,000 514,185
----------
1,221,131
- ----------------------------------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT--0.6%
Paramount Communications, Inc., 7.50% Sr. Nts., 1/15/02 750,000 766,772
- ----------------------------------------------------------------------------------------------------------------
Tricon Global Restaurants, Inc., 7.45% Sr. Nts., 5/15/05(4) 750,000 748,680
----------
1,515,452
- ----------------------------------------------------------------------------------------------------------------
MEDIA--0.8%
Reed Elsevier, Inc., 6.625% Nts., 10/15/23(5) 400,000 391,300
- ----------------------------------------------------------------------------------------------------------------
TCI Communications, Inc., 6.375% Sr. Unsub. Nts., 5/1/03(4) 500,000 499,570
- ----------------------------------------------------------------------------------------------------------------
TKR Cable I, Inc., 10.50% Sr. Debs., 10/30/07 750,000 825,154
- ----------------------------------------------------------------------------------------------------------------
Viacom, Inc., 6.75% Unsec. Sr. Nts., 1/15/03 500,000 501,439
----------
2,217,463
- ----------------------------------------------------------------------------------------------------------------
RETAIL: GENERAL--0.3%
Federated Department Stores, Inc., 10% Sr. Nts., 2/15/01 350,000 383,484
- ----------------------------------------------------------------------------------------------------------------
Price/Costco Cos., Inc., 7.125% Sr. Nts., 6/15/05 400,000 416,773
----------
800,257
</TABLE>
15 Oppenheimer Disciplined Allocation Fund
<PAGE> 16
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER NON-CYCLICALS--2.5%
- ----------------------------------------------------------------------------------------------------------------
FOOD--1.2%
CPC International, Inc., 6.15% Unsec. Nts., Series C, 1/15/06 $ 500,000 $ 499,728
- ----------------------------------------------------------------------------------------------------------------
Dole Food Distributing, Inc., 6.75% Nts., 7/15/00 530,000 536,840
- ----------------------------------------------------------------------------------------------------------------
Grand Metro Inventory Corp., Gtd. Nts., 7.125%, 9/15/04 1,250,000 1,303,522
- ----------------------------------------------------------------------------------------------------------------
Kellogg Co., 5.75% Nts., 2/2/01(5) 1,000,000 992,914
-----------
3,333,004
HEALTHCARE/SUPPLIES & SERVICES--0.3%
Tenet Healthcare Corp., 8% Sr. Nts., 1/15/05 250,000 257,500
- ----------------------------------------------------------------------------------------------------------------
Tenet Healthcare Corp., 8.625% Sr. Unsec. Nts., 12/1/03 500,000 531,850
-----------
789,350
HOUSEHOLD GOODS--1.0%
Dial Corp. (The), 5.89% Nts., Series MTNA, 10/22/01 750,000 744,157
- ----------------------------------------------------------------------------------------------------------------
Fort James Corp., 6.234% Nts., 3/15/01 250,000 248,754
- ----------------------------------------------------------------------------------------------------------------
Fort James Corp., 6.875% Sr. Nts., 9/15/07 1,000,000 1,018,913
- ----------------------------------------------------------------------------------------------------------------
Kimberly-Clark Corp., 7.875% Debs., 2/1/23 290,000 315,137
- ----------------------------------------------------------------------------------------------------------------
Procter & Gamble Co., 9.36% Debs., Series A, 1/1/21 250,000 322,014
-----------
2,648,975
- ----------------------------------------------------------------------------------------------------------------
ENERGY--2.9%
- ----------------------------------------------------------------------------------------------------------------
ENERGY SERVICES & PRODUCERS--1.9%
Chesapeake Energy Corp., 7.875% Sr. Nts., Series B, 3/15/04 750,000 701,250
- ----------------------------------------------------------------------------------------------------------------
Coastal Corp., 8.125% Sr. Nts., 9/15/02 500,000 534,000
- ----------------------------------------------------------------------------------------------------------------
Columbia Gas System, Inc., 6.80% Nts., Series C, 11/28/05 500,000 508,849
- ----------------------------------------------------------------------------------------------------------------
Ferrellgas LP/Ferrellgas Finance Corp., 10% Sr. Nts., Series A, 8/1/01 500,000 527,500
- ----------------------------------------------------------------------------------------------------------------
Louisiana Land & Exploration Co., 7.65% Debs., 12/1/23 915,000 1,001,417
- ----------------------------------------------------------------------------------------------------------------
Petroliam Nasional Berhad, 6.875% Nts., 7/1/03(5) 500,000 471,322
- ----------------------------------------------------------------------------------------------------------------
TransCanada PipeLines Ltd., 9.875% Debs., 1/1/21 500,000 667,535
- ----------------------------------------------------------------------------------------------------------------
Williams Holdings of Delaware, Inc., 6.25% Sr. Unsec. Debs., 2/1/06 650,000 642,696
-----------
5,054,569
- ----------------------------------------------------------------------------------------------------------------
OIL-INTEGRATED--1.0%
Gulf Canada Resources Ltd., 8.25% Sr. Nts., 3/15/17 500,000 537,425
- ----------------------------------------------------------------------------------------------------------------
Gulf Canada Resources Ltd., 9% Debs., 8/15/99 250,000 257,409
- ----------------------------------------------------------------------------------------------------------------
Norcen Energy Resources Ltd., 6.80% Debs., 7/2/02 1,000,000 1,019,756
- ----------------------------------------------------------------------------------------------------------------
Petroleum Geo-Services ASA, 7.50% Nts., 3/31/07 750,000 804,216
- ----------------------------------------------------------------------------------------------------------------
Phillips Petroleum Co., 7.53% Pass-Through Certificates,
Series 1994-A1, 9/27/98 159,825 160,562
-----------
2,779,368
</TABLE>
16 Oppenheimer Disciplined Allocation Fund
<PAGE> 17
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCIAL--5.4%
- ----------------------------------------------------------------------------------------------------------------
BANKS--1.2%
Chase Manhattan Corp. (New), 10.125% Sub. Nts., 11/1/00 $ 250,000 $ 272,954
- ----------------------------------------------------------------------------------------------------------------
Citicorp, 5.625% Sr. Nts., 2/15/01 550,000 542,315
- ----------------------------------------------------------------------------------------------------------------
Fleet Mtg./Norstar Group, Inc., 9.90% Sub. Nts., 6/15/01 250,000 276,271
- ----------------------------------------------------------------------------------------------------------------
Greenpoint Bank (Brooklyn New York), 6.70% Medium-Term Sr.
Bank Nts., 7/15/02 1,000,000 1,008,927
- ----------------------------------------------------------------------------------------------------------------
People's Bank of Bridgeport (Connecticut), 7.20% Sub. Nts., 12/1/06 1,000,000 1,022,986
---------
3,123,453
- ----------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--3.2%
American General Finance Corp., 8.50% Sr. Nts., 8/15/98 500,000 503,441
- ----------------------------------------------------------------------------------------------------------------
American General Institutional Capital B, 8.125% Bonds,
Series B, 3/15/46(5) 500,000 563,487
- ----------------------------------------------------------------------------------------------------------------
Capital One Financial Corp., 6.83% Sr. Nts., 5/17/99 500,000 504,266
- ----------------------------------------------------------------------------------------------------------------
Capital One Financial Corp., 7.25% Nts., 12/1/03 440,000 446,917
- ----------------------------------------------------------------------------------------------------------------
Chelsea GCA Realty Partner, Inc., 7.75% Gtd. Unsec. Unsub. Nts.,
1/26/01 1,000,000 1,027,602
- ----------------------------------------------------------------------------------------------------------------
Commercial Credit Co., 5.55% Unsec. Nts., 2/15/01 1,000,000 986,390
- ----------------------------------------------------------------------------------------------------------------
Countrywide Home Loans, Inc., 6.05% Gtd. Medium-Term Nts.,
Series D, 3/1/01 400,000 398,580
- ----------------------------------------------------------------------------------------------------------------
Fleet Mtg. Group, Inc., 6.50% Nts., 9/15/99 250,000 251,793
- ----------------------------------------------------------------------------------------------------------------
Ford Motor Credit Co., 6% Unsec. Sr. Nts., 1/14/03 1,000,000 992,489
- ----------------------------------------------------------------------------------------------------------------
Household Finance Corp. Ltd., 6% Gtd. Sr. Nts., 6/30/98 250,000 250,185
- ----------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 6% Nts., 3/1/01 500,000 499,968
- ----------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 6.50% Nts., 4/1/01 500,000 506,613
- ----------------------------------------------------------------------------------------------------------------
Norsk Hydro AS, 8.75% Bonds, 10/23/01 500,000 535,625
- ----------------------------------------------------------------------------------------------------------------
PHH Corp., 6.50% Nts., 2/1/00 350,000 353,404
- ----------------------------------------------------------------------------------------------------------------
Sears Roebuck Acceptance Corp., 6% Unsec. Bonds, 3/20/03 750,000 741,611
---------
8,562,371
- ----------------------------------------------------------------------------------------------------------------
INSURANCE--1.0%
Conseco Financing Trust III, 8.796% Bonds, 4/1/27 750,000 839,890
- ----------------------------------------------------------------------------------------------------------------
Equitable Life Assurance Society (U.S.A.), 6.95% Surplus Nts.,
12/1/05(5) 500,000 512,824
- ----------------------------------------------------------------------------------------------------------------
GenAmerica Capital I, 8.525% Gtd. Bonds, 6/30/27(5) 750,000 795,856
- ----------------------------------------------------------------------------------------------------------------
Life Re Capital Trust I, 8.72% Gtd. Bonds, 6/15/27(5) 500,000 537,952
---------
2,686,522
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL--2.3%
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL MATERIALS--0.3%
American Standard Cos., Inc., 10.875% Sr. Nts., 5/15/99(2) 740,000 775,150
</TABLE>
17 Oppenheimer Disciplined Allocation Fund
<PAGE> 18
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INDUSTRIAL SERVICES--1.6%
Fred Meyer, Inc., 7.375% Sr. Nts., 3/1/05 $1,250,000 $ 1,255,660
- ----------------------------------------------------------------------------------------------------------------
Raytheon Co., 6.45% Nts., 8/15/02 500,000 503,740
- ----------------------------------------------------------------------------------------------------------------
Sony Corp., 6.125% Bonds, 3/4/03 750,000 749,773
- ----------------------------------------------------------------------------------------------------------------
Sun Co., Inc., 7.95% Debs., 12/15/01 1,000,000 1,055,132
- ----------------------------------------------------------------------------------------------------------------
USI American Holdings, Inc., 7.25% Gtd. Sr. Nts., Series B, 12/1/06 750,000 771,844
----------
4,336,149
- ----------------------------------------------------------------------------------------------------------------
TRANSPORTATION--0.4%
Union Pacific Corp., 7% Nts., 6/15/00 500,000 507,964
- ----------------------------------------------------------------------------------------------------------------
Union Pacific Corp., 7.60% Nts., 5/1/05 500,000 528,599
----------
1,036,563
- ----------------------------------------------------------------------------------------------------------------
TECHNOLOGY--1.0%
- ----------------------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE--0.8%
Lockheed Martin Corp., 6.85% Gtd. Unsec. Nts., 5/15/01 1,250,000 1,275,373
- ----------------------------------------------------------------------------------------------------------------
Northwest Airlines Corp., 8.375% Gtd. Nts., 3/15/04 750,000 775,940
----------
2,051,313
- ----------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-TECHNOLOGY--0.2%
U S West Capital Funding, Inc., 6.85% Gtd. Nts., 1/15/02 500,000 508,076
- ----------------------------------------------------------------------------------------------------------------
UTILITIES--1.6%
- ----------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES--0.6%
El Paso Electric Co., 8.25% First Mtg. Bonds, Series C, 2/1/03 500,000 532,500
- ----------------------------------------------------------------------------------------------------------------
Hawaiian Electric Industries, Inc., 6.31% Nts., Series MTNB, 2/19/02 1,000,000 999,085
----------
1,531,585
- ----------------------------------------------------------------------------------------------------------------
GAS UTILITIES--0.7%
Northern Illinois Gas Co., 6.45% First Mtg. Bonds, 8/1/01 500,000 506,281
- ----------------------------------------------------------------------------------------------------------------
Southern California Gas Co., 6.38% Medium-Term Nts., 10/29/01 500,000 505,040
- ----------------------------------------------------------------------------------------------------------------
Tennessee Gas Pipeline Co., 7.50% Bonds, 4/1/17 750,000 801,655
----------
1,812,976
- ----------------------------------------------------------------------------------------------------------------
TELEPHONE UTILITIES--0.3%
Ameritech Capital Funding Corp., 5.65% Gtd. Nts., 1/15/01 750,000 743,301
----------
Total Non-Convertible Corporate Bonds and Notes (Cost $50,083,969) 50,922,434
================================================================================================================
SHORT-TERM NOTES--4.3%(6)
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 5.42%, 5/13/98 5,575,000 5,564,909
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., 5.42%, 5/4/98 5,000,000 4,997,742
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Bills, 5.03%, 8/20/98 1,000,000 980,579
-----------
Total Short-Term Notes (Cost $11,543,230) 11,543,230
</TABLE>
18 Oppenheimer Disciplined Allocation Fund
<PAGE> 19
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
================================================================================================================
<S> <C> <C>
REPURCHASE AGREEMENTS--4.1%
- ----------------------------------------------------------------------------------------------------------------
Repurchase agreement with Zion First National Bank, 5.52%, dated 4/30/98,
to be repurchased at $11,101,702 on 5/1/98, collateralized by U.S. Treasury
Nts., 7.25%, 8/15/07, with a value of $10,849,806, and U.S. Treasury Bills
maturing 10/8/98, with a value of $487,527
(Cost $11,100,000) $11,100,000 $ 11,100,000
- ----------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $236,342,546) 99.1% 266,414,912
- ----------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 0.9 2,548,561
--------------- --------------
NET ASSETS 100.0% $268,963,473
=============== ==============
</TABLE>
1. Non-income producing security.
2. Identifies issues considered to be illiquid or restricted--See Note 5 of
Notes to Financial Statements.
3. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows.
4. When-issued security to be delivered and settled after April 30, 1998.
5. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Directors. These securities amount to $4,265,655 or 1.59% of the Fund's net
assets as of April 30, 1998.
6. Short-term notes are generally traded on a discount basis; the interest rate
is the discount rate received by the Fund at the time of purchase.
See accompanying Notes to Financial Statements.
19 Oppenheimer Disciplined Allocation Fund
<PAGE> 20
STATEMENT OF ASSETS AND LIABILITIES April 30, 1998 (Unaudited)
<TABLE>
<S> <C>
================================================================================================================
ASSETS
Investments, at value (cost $236,342,546)---see accompanying statement $266,414,912
- ----------------------------------------------------------------------------------------------------------------
Cash 110,038
- ----------------------------------------------------------------------------------------------------------------
Receivables:
Investments sold 3,610,446
Interest, dividends and principal paydowns 2,024,555
Shares of capital stock sold 47,110
- ----------------------------------------------------------------------------------------------------------------
Other 9,158
------------
Total assets 272,216,219
================================================================================================================
LIABILITIES
Payables and other liabilities:
Investments purchased 2,740,234
Shares of capital stock redeemed 221,418
Directors' fees--Note 1 97,812
Shareholder reports 63,655
Distribution and service plan fees 56,769
Transfer and shareholder servicing agent fees 44,075
Legal and auditing fees 19,057
Other 9,726
------------
Total liabilities 3,252,746
================================================================================================================
NET ASSETS $268,963,473
============
================================================================================================================
COMPOSITION OF NET ASSETS
Par value of shares of capital stock $ 16,709
- ----------------------------------------------------------------------------------------------------------------
Additional paid-in capital 229,079,093
- ----------------------------------------------------------------------------------------------------------------
Undistributed net investment income 728,591
- ----------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 9,066,714
- ----------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 30,072,366
------------
Net assets $268,963,473
============
</TABLE>
20 Oppenheimer Disciplined Allocation Fund
<PAGE> 21
<TABLE>
<S> <C>
================================================================================================================
NET ASSET VALUE PER SHARE
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$254,177,246 and 15,797,196 shares of capital stock outstanding) $16.09
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $17.07
- ----------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share (based on net assets of $12,337,935
and 757,963 shares of capital stock outstanding) $16.28
- ----------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share (based on net assets of $2,448,292
and 153,403 shares of capital stock outstanding) $15.96
</TABLE>
See accompanying Notes to Financial Statements.
21 Oppenheimer Disciplined Allocation Fund
<PAGE> 22
STATEMENT OF OPERATIONS For the Six Months Ended April 30, 1998 (Unaudited)
<TABLE>
<S> <C>
================================================================================================================
INVESTMENT INCOME
Interest (net of foreign withholding taxes of $724) $ 4,246,081
- ----------------------------------------------------------------------------------------------------------------
Dividends 970,646
-----------
Total income 5,216,727
================================================================================================================
EXPENSES
Management fees--Note 4 809,186
- ----------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 308,731
Class B 51,020
Class C 8,751
- ----------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 133,999
- ----------------------------------------------------------------------------------------------------------------
Shareholder reports 41,861
- ----------------------------------------------------------------------------------------------------------------
Directors' fees and expenses--Note 1 18,678
- ----------------------------------------------------------------------------------------------------------------
Legal and auditing fees 17,878
- ----------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 13,022
- ----------------------------------------------------------------------------------------------------------------
Accounting service fees--Note 4 7,500
- ----------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 5,876
Class B 1,150
Class C 301
- ----------------------------------------------------------------------------------------------------------------
Insurance expenses 4,465
- ----------------------------------------------------------------------------------------------------------------
Other 4,048
-----------
Total expenses 1,426,466
================================================================================================================
NET INVESTMENT INCOME 3,790,261
================================================================================================================
REALIZED AND UNREALIZED GAIN
Net realized gain on investments 9,170,415
- ----------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 9,105,975
-----------
Net realized and unrealized gain 18,276,390
================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $22,066,651
===========
</TABLE>
See accompanying Notes to Financial Statements.
22 Oppenheimer Disciplined Allocation Fund
<PAGE> 23
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31,
(UNAUDITED) 1997
================================================================================================================
<S> <C> <C>
OPERATIONS
Net investment income $ 3,790,261 $ 7,729,813
- ----------------------------------------------------------------------------------------------------------------
Net realized gain 9,170,415 27,308,175
- ----------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 9,105,975 7,070,415
------------ ------------
Net increase in net assets resulting from operations 22,066,651 42,108,403
================================================================================================================
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment
income:
Class A (3,744,800) (8,280,055)
Class B (123,673) (168,085)
Class C (21,778) (21,190)
- ----------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (26,053,045) (19,860,930)
Class B (1,001,059) (389,052)
Class C (171,534) (21,246)
================================================================================================================
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) in net assets resulting from
capital stock transactions--Note 2:
Class A 19,621,558 (2,888,598)
Class B 3,907,246 4,390,846
Class C 1,022,766 1,194,708
================================================================================================================
NET ASSETS
Total increase 15,502,332 16,064,801
- ----------------------------------------------------------------------------------------------------------------
Beginning of period 253,461,141 237,396,340
------------ ------------
End of period (including undistributed net investment
income of $728,591 and $828,581, respectively) $268,963,473 $253,461,141
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
23 Oppenheimer Disciplined Allocation Fund
<PAGE> 24
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
-----------------------------------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
1998 YEAR ENDED OCTOBER 31, DEC. 31,
(UNAUDITED) 1997 1996(3) 1995
===========================================================================================================
<S> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $16.81 $16.00 $15.46 $13.44
- ----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .22 .51(4) .46 .60
Net realized and unrealized gain (loss) 1.11 2.25(4) .49 2.59
------ ------ ------ ------
Total income (loss) from
investment operations 1.33 2.76 .95 3.19
- ----------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.24) (.56) (.36) (.60)
Distributions from net realized gain (1.81) (1.39) (.05) (.57)
------ ------ ------ ------
Total dividends and distributions
to shareholders (2.05) (1.95) (.41) (1.17)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $16.09 $16.81 $16.00 $15.46
====== ====== ====== ======
==========================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(5) 8.83% 18.82% 6.27% 23.95%
==========================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $254,177 $243,267 $233,289 $218,099
- ----------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $249,094 $238,821 $228,203 $200,172
- ----------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 2.96%(6) 3.17% 3.52%(6) 4.00%
Expenses 1.07%(6) 1.11% 1.11%(6) 1.17%
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 50.0% 98.0% 85.4% 55.2%
Average brokerage commission rate(8) $0.0700 $0.0699 $0.0636 --
</TABLE>
1. For the period from May 1, 1996 (inception of offering) to October 31, 1996.
2. For the period from October 2, 1995 (inception of offering) to December 31,
1995.
3. For the ten months ended October, 31, 1996. The Fund changed its fiscal year
end from December 31 to October 31. On March 18, 1996, OppenheimerFunds, Inc.
became the investment advisor to the Fund.
4. Per share amounts calculated based on the average shares outstanding during
the period.
24 Oppenheimer Disciplined Allocation Fund
<PAGE> 25
<TABLE>
<CAPTION>
CLASS B
----------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
1998 YEAR ENDED OCTOBER 31, DEC. 31,
1994 1993 (UNAUDITED) 1997 1996(3) 1995(2)
===================================================================================
<S> <C> <C> <C> <C> <C>
$14.54 $13.81 $16.99 $16.16 $15.66 $15.48
- -----------------------------------------------------------------------------------
.55 .48 .18 .40(4) .31 .07
(.86) 1.70 1.11 2.27(4) .54 .70
------ ------ ------ ------ ------ ------
(.31) 2.18 1.29 2.67 .85 .77
- -----------------------------------------------------------------------------------
(.55) (.48) (.19) (.45) (.30) (.07)
(.24) (.97) (1.81) (1.39) (.05) (.52)
------ ------ ------ ------ ------ ------
(.79) (1.45) (2.00) (1.84) (.35) (.59)
- -----------------------------------------------------------------------------------
$13.44 $14.54 $16.28 $16.99 $16.16 $15.66
====== ====== ====== ====== ====== ======
===================================================================================
(2.11)% 15.89% 8.42% 17.96% 5.51% 4.93%
===================================================================================
$177,904 $171,205 $12,338 $8,720 $3,919 $650
- -----------------------------------------------------------------------------------
$187,655 $138,629 $10,309 $6,183 $2,324 $375
- -----------------------------------------------------------------------------------
3.80% 3.40%) 2.18%(6) 2.32% 2.86%(6) 0.73%(6)
0.96% 1.02%) 1.83%(6) 1.89% 1.85%(6) 1.92%(6)
- -----------------------------------------------------------------------------------
115.0% 155.2% 50.0% 98.0% 85.4% 55.2%
-- -- $0.0700 $0.0699 $0.0636 --
</TABLE>
5. Assumes a 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.
6. Annualized.
25 Oppenheimer Disciplined Allocation Fund
<PAGE> 26
FINANCIAL HIGHLIGHTS (Continued)
<TABLE>
<CAPTION>
CLASS C
---------------------------------------------------
SIX MONTHS
ENDED
APRIL 30,
1998 YEAR ENDED OCTOBER 31,
(UNAUDITED) 1997 1996(1)
===============================================================================================================
<S> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $16.70 $15.93 $15.71
- ---------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .19 .44(4) .30
Net realized and unrealized gain (loss) 1.07 2.19(4) .32
------ ------ -----
Total income (loss) from
investment operations 1.26 2.63 .62
- ---------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.19) (.47) (.35)
Distributions from net realized gain (1.81) (1.39) (.05)
------ ----- -----
Total dividends and distributions
to shareholders (2.00) (1.86) (.40)
- ---------------------------------------------------------------------------------------------------------------
Net asset value, end of period $15.96 $16.70 $15.93
====== ====== ======
===============================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(5) 8.39% 17.93% 4.08%
===============================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $2,448 $1,473 $188
- ---------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $1,770 $ 805 $ 57
- ---------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 2.17%(6) 2.18% 2.90%(6)
Expenses 1.84%(6) 1.92% 1.87%(6)
- ---------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 50.0% 98.0% 85.4%
Average brokerage commission rate(8) $0.0700 $0.0699 $0.0636
</TABLE>
7. 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 April 30, 1998 were $119,084,495 and $128,988,791, respectively.
8. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
26 Oppenheimer Disciplined Allocation Fund
<PAGE> 27
NOTES TO FINANCIAL STATEMENTS (Unaudited)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Disciplined Allocation Fund (the Fund), a series of Oppenheimer
Series Fund, Inc. (the Company), is registered under the Investment Company Act
of 1940, as amended, as a diversified, open-end management investment company.
The Fund's investment objective is to seek to maximize total investment return
(including both capital appreciation and income) principally by allocating its
assets among stocks, corporate bonds, U.S. Government Securities and money
market instruments according to changing market conditions. The Fund's
investment advisor is OppenheimerFunds, Inc. (the Manager). The Fund offers
Class A, Class B and Class C shares. Class A shares are sold with a front-end
sales charge. Class B and Class C shares may be subject to a contingent deferred
sales charge. All classes of shares have identical rights to earnings, assets
and voting privileges, except that each class has its own distribution and/or
service plan, expenses directly attributable to that class and exclusive voting
rights with respect to matters affecting that class. 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.
- --------------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
the last sale price on the prior trading day. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Directors. Such securities which cannot be valued by an
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Directors to
determine fair value in good faith. Short-term "money market type" debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount.
27 Oppenheimer Disciplined Allocation Fund
<PAGE> 28
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 AND GAINS AND LOSSES. Income, expenses (other
than those attributable to a specific class) and 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.
- --------------------------------------------------------------------------------
DIRECTORS' FEES AND EXPENSES. The Fund has adopted a nonfunded retirement plan
for the Fund's independent directors. Benefits are based on years of service and
fees paid to each director during the years of service. During the six months
ended April 30, 1998, a provision of $6,035 was made for the Fund's projected
benefit obligations and payments of $4,526 were made to retired directors,
resulting in an accumulated liability of $95,625 at April 30, 1998.
The Board of Directors has adopted a Deferred Compensation plan for
independent Directors that enables Directors to elect to defer receipt of all
or a portion of annual fees 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 Director in shares of one or more
Oppenheimer funds selected by the Director. The amount paid to the Director
under the plan will be determined based upon the performance of the selected
funds. Deferral of Directors' 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 income per share.
28 Oppenheimer Disciplined Allocation Fund
<PAGE> 29
================================================================================
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.
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of paydown gains and losses and the recognition of certain
foreign currency gains (losses) as ordinary income (loss) for 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.
- --------------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
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.
29 Oppenheimer Disciplined Allocation Fund
<PAGE> 30
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
2. SHARES OF CAPITAL STOCK
The Fund has authorized 450 million of $0.001 par value shares of capital stock.
Transactions in shares of capital stock were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED APRIL 30, 1998 YEAR ENDED OCTOBER 31, 1997
--------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 688,128 $ 11,050,191 1,295,002 $ 20,645,750
Dividends and distributions
reinvested 1,934,597 29,289,892 1,821,876 27,715,425
Redeemed (1,295,011) (20,718,525) (3,224,574) (51,249,773)
--------- ------------ --------- ------------
Net increase (decrease) 1,327,714 $ 19,621,558 (107,696) $ (2,888,598)
========= ============ ========= ============
- ----------------------------------------------------------------------------------------------------------------
Class B:
Sold 213,036 $ 3,460,800 279,134 $ 4,555,544
Dividends and distributions
reinvested 71,972 1,102,678 35,724 551,096
Redeemed (40,449) (656,232) (43,911) (715,794)
--------- ------------ --------- ------------
Net increase 244,559 $ 3,907,246 270,947 $ 4,390,846
========= ============ ========= ============
- ----------------------------------------------------------------------------------------------------------------
Class C:
Sold 70,277 $ 1,114,282 80,502 $ 1,266,698
Dividends and distributions
reinvested 12,213 183,563 2,629 40,489
Redeemed (17,324) (275,079) (6,697) (112,479)
--------- ------------ -------- ------------
Net increase 65,166 $ 1,022,766 76,434 $ 1,194,708
========= ============ ======== ============
================================================================================================================
</TABLE>
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At April 30, 1998, net unrealized appreciation on investments of $30,072,366 was
composed of gross appreciation of $31,853,903, and gross depreciation of
$1,781,537.
30 Oppenheimer Disciplined Allocation Fund
<PAGE> 31
================================================================================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager are in accordance with the investment
advisory agreement with the Fund which provides for a fee of 0.625% of the first
$300 million of average annual net assets, 0.50% of the next $100 million and
0.45% of average annual net assets in excess of $400 million. The manager acts
as the accounting agent for the Fund at an annual fee of $15,000, plus
out-of-pocket costs and expenses reasonably incurred.
For the six months ended April 30, 1998, commissions (sales charges
paid by investors) on sales of Class A shares totaled $251,340, of which
$224,602 was retained by OppenheimerFunds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B and Class C shares totaled $129,026 and $8,515, respectively, of
which $53,521 and $1,681, respectively, was paid to an affiliated broker/dealer
for Class B and Class C. During the six months ended April 30, 1998, OFDI
received contingent deferred sales charges of $11,936 and $1,749, respectively,
upon redemption of Class B and Class C shares as reimbursement for sales
commissions advanced by OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund and for other registered
investment companies. OFS's total costs of providing such services are
allocated ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to reimburse
OFDI for a portion of its costs incurred in connection with the personal
service and maintenance of shareholder accounts that hold Class A shares.
Reimbursement is made quarterly at an annual rate that may not exceed 0.25% of
the average annual net assets of Class A shares of the Fund. OFDI uses the
service fee to reimburse brokers, dealers, banks and other financial
institutions quarterly for providing personal service and maintenance of
accounts of their customers that hold Class A shares. During the six months
ended April 30, 1998, OFDI paid $256,441 to an affiliated broker/dealer as
reimbursement for Class A personal service and maintenance expenses.
31 Oppenheimer Disciplined Allocation Fund
<PAGE> 32
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
The Fund has adopted Distribution and Service Plans for Class B and Class C
shares to compensate OFDI for its costs in distributing Class B and Class C
shares and servicing accounts. Under the Plans, the Fund pays OFDI an annual
asset-based sales charge of 0.75% per year on Class B and Class C shares, for
its services rendered in distributing Class B and Class C shares. OFDI also
receives a service fee of 0.25% per year to compensate dealers for providing
personal services for accounts that hold Class B and Class C shares. Each fee is
computed on the average annual net assets of Class B or Class C shares,
determined as of the close of each regular business day. During the six months
ended April 30, 1998, OFDI paid $3,879 to an affiliated broker/dealer as
compensation for Class B personal service and maintenance expenses and retained
$44,189 and $6,723, respectively, as compensation for Class B and Class C sales
commissions and service fee advances, as well as financing costs. If either Plan
is terminated by the Fund, the Board of Directors may allow the Fund to continue
payments of the asset-based sales charge to OFDI for distributing shares before
the Plan was terminated. At April 30, 1998, OFDI had incurred excess
distribution and servicing costs of $322,258 for Class B and $19,185 for
Class C.
================================================================================
5. ILLIQUID AND RESTRICTED SECURITIES
At April 30, 1998, investments in securities included issues that are illiquid
or restricted. Restricted securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Directors as reflecting fair value. A security may be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund intends to invest no more than
10% of its net assets (determined at the time of purchase and reviewed
periodically) in illiquid or restricted securities. Certain restricted
securities, eligible for resale to qualified institutional investors, are not
subject to that limit. The aggregate value of illiquid or restricted securities
subject to this limitation at April 30, 1998 was $2,890,886, which represents
1.07% of the Fund's net assets.
32 Oppenheimer Disciplined Allocation Fund
<PAGE> 33
================================================================================
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 0.35%. 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
0.0575% per annum.
The Fund had no borrowings outstanding during the six months ended
April 30, 1998.
33 Oppenheimer Disciplined Allocation Fund
<PAGE> 34
OPPENHEIMER DISCIPLINED ALLOCATION FUND
A series of Oppenheimer Series Fund, Inc.
================================================================================
OFFICERS AND DIRECTORS Leon Levy, Chairman of the Board of Directors
Donald W. Spiro, Vice Chairman of the Board
of Directors
Bridget A. Macaskill, Director and President
Robert G. Galli, Director
Benjamin Lipstein, Director
Elizabeth B. Moynihan, Director
Kenneth A. Randall, Director
Edward V. Regan, Director
Russell S. Reynolds, Jr., Director
Pauline Trigere, Director
Clayton K. Yeutter, Director
Peter M. Antos, Vice President
Robert C. Doll, Jr., Vice President
Stephen F. Libera, Vice President
Michael C. Strathearn, Vice President
Kenneth B. White, Vice President
Arthur J. Zimmer, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
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 Peat Marwick LLP
================================================================================
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have
been taken from the records of the Fund
without examination of the independent
auditors.
This is a copy of a report to shareholders of
Oppenheimer Disciplined Allocation Fund. This
report must be preceded or accompanied by a
Prospectus of Oppenheimer Disciplined
Allocation 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, and are not insured
by the FDIC or any other agency, and involve
investment risks, including possible loss of
the principal amount invested.
34 Oppenheimer Disciplined Allocation Fund
<PAGE> 35
OPPENHEIMERFUNDS FAMILY
<TABLE>
========================================================================================================
<S> <C> <C>
REAL ASSET FUNDS
- --------------------------------------------------------------------------------------------------------
Real Asset Fund Gold & Special Minerals Fund
========================================================================================================
GLOBAL STOCK FUNDS
- --------------------------------------------------------------------------------------------------------
Developing Markets Fund International Growth Fund Quest Global Value Fund
International Small Global Fund Global Growth &Income Fund
Company Fund
========================================================================================================
STOCK FUNDS
- --------------------------------------------------------------------------------------------------------
Enterprise Fund MidCap Fund Growth Fund
Discovery Fund Capital Appreciation Fund Disciplined Value Fund
Quest Small Cap Value Fund Quest Capital Value Fund Quest Value Fund
========================================================================================================
STOCK & BOND FUNDS
- --------------------------------------------------------------------------------------------------------
Main Street Income & Total Return Fund Disciplined Allocation Fund
Growth Fund Quest Balanced Multiple Strategies Fund
Quest Opportunity Value Fund(1) Convertible Securities Fund(2)
Value Fund Equity Income Fund
========================================================================================================
TAXABLE BOND FUNDS
- --------------------------------------------------------------------------------------------------------
International Bond Fund Champion Income Fund U.S. Government Trust
World Bond Fund Strategic Income Fund Limited-Term Government Fund
High Yield Fund Bond Fund
========================================================================================================
MUNICIPAL BOND FUNDS
- --------------------------------------------------------------------------------------------------------
California Municipal Fund(3) Pennsylvania Municipal Fund(3) Rochester Division:
Florida Municipal Fund(3) Municipal Bond Fund Rochester Fund Municipals
New Jersey Municipal Fund(3) Insured Municipal Fund Limited Term New York
New York Municipal Fund(3) Intermediate Municipal Fund Municipal Fund
========================================================================================================
MONEY MARKET FUNDS(4)
- --------------------------------------------------------------------------------------------------------
Money Market Fund Cash Reserves
</TABLE>
1. On May 18, 1998, the Fund's name was changed from "Quest Growth & Income
Value Fund."
2. On 4/28/98, the Fund's name was changed from "Bond Fund for Growth."
3. Available only to investors 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 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 1998 OppenheimerFunds, Inc. All rights reserved.
35 Oppenheimer Disciplined Allocation Fund
<PAGE> 36
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- --------------------------------------------------------------------------------
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And when you need help, our Customer Service Representatives are only a
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When you want to make a transaction, you can do it easily by calling our
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For added convenience, you can get automated information with
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PhoneLink gives you access to a variety of fund, account, and market
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You can count on us whenever you need assistance. That's why the
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So call us today, or visit us at our website at
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[OPPENHEIMERFUNDS LOGO]
RS0205.001.0498 June 29, 1998
