<PAGE>
PAGE 1
1996 ANNUAL REPORT
IDS New Dimensions Fund
(prospectus enclosed)
(Icon of) A dimension
The goal of IDS New Dimensions Fund, Inc. is long-term growth of
capital.
(This annual report includes a prospectus that describes in detail
the Fund's objective, investment policies, risks, sales charges,
fees and other matters of interest. Please read the prospectus
carefully before you invest or send money.)
AMERICAN
EXPRESS
Financial
Advisors
Distributed by American Express Financial Advisors Inc.
<PAGE>
PAGE 2
(Icon of) A dimension
Fast-track stocks
What type of stock has been the driving force behind the dramatic
increases posted by U.S. and foreign stock markets in recent years?
The answer is growth stocks -- that is, stocks of companies that
have a track record of increasing their business and profits at a
rapid pace. These companies, some large and well-known, others
smaller and newly discovered, form the foundation of IDS New
Dimensions Fund. The Fund looks for companies from around the
world that not only have a history of continuous growth, but are
believed to be poised to continue growing over the long term due to
their management, marketing innovation and/or technological
advances.
<PAGE>
PAGE 3
Contents
(Icon of) One open book inside of another.
The purpose of this annual report is to tell investors how the Fund
performed.
The prospectus, which is bound into the middle of this annual
report, describes the Fund in detail.
1996 annual report
From the president 4
From the portfolio manager 4
Ten largest holdings 6
Making the most of the Fund 7
Long-term performance 8
Independent auditors' report (Fund) 9
Financial statements (Fund) 10
Notes to financial statements (Fund) 13
Independent auditors' report (Portfolio) 18
Financial statements (Portfolio) 19
Notes to financial statements (Portfolio) 22
Investments in securities 30
IDS mutual funds 35
Federal income tax information 38
1996 prospectus
The Fund in brief 3p
Goal 3p
Investment policies and risks 3p
Structure of the Fund 4p
Manager and distributor 4p
Portfolio manager 5p
Alternative purchase arrangements 5p
Sales charge and Fund expenses 6p
Performance 8p
Financial highlights 8p
Total returns 10p
Investment policies and risks 13p
Facts about investments and their risks 13p
Valuing Fund shares 16p
How to purchase, exchange or redeem shares 17p
Alternative purchase arrangements 17p
How to purchase shares 20p
How to exchange shares 23p
How to redeem shares 23p
Reductions and waivers of the sales charge 28p
Special shareholder services 33p
Services 33p
Quick telephone reference 33p
<PAGE>
PAGE 4
Distributions and taxes 34p
Dividend and capital gain distributions 34p
Reinvestments 35p
Taxes 35p
How to determine the correct TIN 37p
How the Fund is organized 38p
Shares 38p
Voting rights 38p
Shareholder meetings 38p
Special considerations regarding
master/feeder structure 39p
Board members and officers 41p
Investment manager 43p
Administrator and transfer agent 43p
Distributor 44p
About American Express Financial Corporation 45p
General information 45p
Appendix 46p
Descriptions of derivative instruments 46p
<PAGE>
PAGE 5
To our shareholders
(Photo of) William R. Pearce, President of the Fund
(Photo of) Gordon M. Fines, Portfolio manager
From the president
The volatility in the stock market in recent months has put some
investors, even experienced ones, on edge. Although no one can
know exactly what will happen next, history tells us that ups and
downs are intrinsic to stock investing.
But history also shows that changing strategies with every twist
and turn of the market is an impractical and, worse yet, typically
unproductive way to invest. What matters more, therefore, is how
we react to market volatility.
If we take a long-term view and accept the downs with the ups, we
improve our chances of success. For in the investment world, the
race most often goes not to the swift, but to the persistent.
Along the way, of course, you'll still want to review your
investment program to make sure it's on track to achieving your
financial goals. Your American Express financial advisor will help
you do just that, and I suggest you take advantage of his or her
services on a regular basis.
On May 13, 1996, the Fund began investing its assets in Growth
Portfolio instead of directly in securities of individual
companies. Following the portfolio manager's letter are the
financial statements of both the Fund and Portfolio. The notes to
the financials and the prospectus go into more detail of how the
new structure works.
William R. Pearce
From the portfolio manager
IDS New Dimensions Fund recorded a double-digit gain during the
past 10 months (October 1995 through July 1996), as the stock
market advanced for most of the period. For Class A shareholders
of the Fund, the result was a 12.2% total return. (A substantial
portion of the return came in the form of a capital gain, which was
paid to shareholders last December and reduced the Fund's net asset
value by a like amount at that time.) This report also marks a
change in the Fund's fiscal year, which now ends on July 31.
Thanks to a low inflation rate, low interest rates and moderate
economic growth, stocks found the environment largely to their
liking for the first several months of the period. The relatively
few setbacks proved to be both modest and fleeting, as the market
quickly righted itself in the wake of occasional negative news.
Growth is good
Although a variety of stocks performed positively, those of growth
companies were most often at the forefront, as their generally
strong earnings attracted an increasing amount of investors'
<PAGE>
PAGE 6
capital. To the particular benefit of this Fund, growth stocks in
the amount of investors' capital. To the particular benefit of
this Fund, growth stocks in the technology/telecommunications,
health care and financial services sectors -- which have formed the
foundation of the portfolio for some time -- recorded many of the
most impressive gains. Although I continue to be optimistic about
the long-term prospects of technology-related companies, I did
reduce the exposure to personal computer manufacturers, whose near-
term potential appears questionable.
The portfolio also enjoyed good results from stocks of agri-
business companies, including seed, fertilizer and chemical
producers. This is a relatively new investment theme in the
portfolio that I began to develop late last year. Monsanto, an
agri-chemical supplier that we added to the portfolio, is a good
example of the type of company that appears likely to benefit from
less-developed countries' desire to improve their diets.
Summer slump
The news wasn't all good, though, during the past fiscal period.
By summer, stocks had begun to stall out under the weight of
higher long-term interest rates, and by July, they were in rapid
retreat. Growth stocks, especially those of technology-related
companies, found themselves under particular pressure. Although
the cash reserves in the portfolio (about 11% of assets) provided
some cushion against the downturn, the portfolio was forced to give
back a substantial portion of its gain for the period.
At this point (mid-August), questions about the direction of long-
term interest rates and corporate earnings have yet to be answered.
I expect this uncertainty will continue for a time yet, which could
well present a hurdle for the stock market. Looking longer-term, I
think the fundamentals remain favorable, but I suspect investors
will have to be content with less robust returns than they've
enjoyed in recent years.
Gordon Fines
Class A
10-month performance
(All figures per share)
Net asset value (NAV)
____________________________
July 31, 1996 $18.54
____________________________
Sept. 30, 1995 $17.24
____________________________
Increase $ 1.30
____________________________
<PAGE>
PAGE 7
Distributions
Oct. 1, 1995 - July 31, 1996
____________________________
From income $ 0.15
____________________________
From capital gains $ 0.60
____________________________
Total distributions $ 0.75
____________________________
Total return* +12.2%**
____________________________
Class B
10-month performance
(All figures per share)
Net asset value (NAV)
____________________________
July 31, 1996 $18.38
____________________________
Sept. 30, 1995 $17.18
____________________________
Increase $ 1.20
____________________________
Distributions
Oct. 1, 1995 - July 31, 1996
____________________________
From income $ 0.11
____________________________
From capital gains $ 0.60
____________________________
Total distributions $ 0.71
____________________________
Total return* +11.5%**
____________________________
Class Y
10-month performance
(All figures per share)
Net asset value (NAV)
____________________________
July 31, 1996 $18.56
____________________________
Sept. 30, 1995 $17.26
____________________________
Increase $ 1.30
____________________________
<PAGE>
PAGE 8
Distributions
Oct. 1, 1995 - July 31, 1996
____________________________
From income $ 0.17
____________________________
From capital gains $ 0.60
____________________________
Total distributions $ 0.77
____________________________
Total return* +12.3%**
____________________________
*The prospectus discusses the effect of
sales charges, if any, on the various classes.
**The total return is a hypothetical investment
in the Fund with all distributions reinvested.
<PAGE>
PAGE 9
<TABLE>
<CAPTION>
Growth Trends Portfolio
The Portfolio's ten largest holdings
(Pie chart)
The ten holdings listed here make up 25.91% of the Portfolio's net assets.
________________________________________________________________________________________________________
Percent Value
(of Portfolio's net assets) (as of July 31, 1996)
________________________________________________________________________________________________________
<S> <C> <C>
Cisco Systems 3.62% $310,500,000
A leading designer and builder of devices that link personal computers
for application in the fast-growing business network market.
General Electric 3.07 263,600,000
A diversified company with interests in manufacturing, broadcasting
(NBC), financial services and technology.
Citicorp 3.05 262,000,000
The parent of Citibank, the largest bank in the U.S., it has a
substantial worldwide corporate and retail banking presence.
Pfizer 2.77 237,575,000
A leading producer of pharmaceuticals, hospital products,
animal health items, non-prescription medications and
specialty chemicals.
Intel 2.63 225,375,000
The world's number one semiconductor manufacturer, Intel produces
microcomputer components, modules and systems.
Monsanto 2.55 218,750,000
This company and its subsidiaries manufacture and sell a diverse
line of agricultural products; chemical products, including plastics
and manufactured fibers; pharmaceuticals; and food products, including
low-calorie sweeteners.
Boeing 2.16 185,850,000
The largest producer of commercial aircraft in the free world with over
50% of the market.
First Data 2.08 178,537,500
Operates in one business segment providing high-quality, high-volume
information processing and related services to specific client groups:
the transaction card, payment instruments, teleservices, mutual funds,
health care, receivables and information management industries.
Johnson & Johnson 2.00 171,900,000
A major producer of health-care products, including consumer
products, medical and dental devices and products and a wide variety
of ethical and over-the-counter drugs.
ConAgra 1.98 170,000,000
Engaged in a variety of basic food businesses, including
feed and fertilizer, grain processing and merchandising,
agricultural chemicals, worldwide trading, fresh and processed
red meats, poultry products, and frozen prepared foods and seafood.
</TABLE>
<PAGE>
PAGE 10
Making the most of the Fund
Average annual total return
(as of July 31, 1996)
1 year Since inception* 5 years 10 years
Class A +10.67% --% +14.02% +15.07%
Class B +10.65% +21.70% --% --%
Class Y +16.68% +25.54% --% --%
*Inception date was March 20, 1995.
The performance of Class B and Class Y will vary from the
performance of Class A based on differences in sales charges and
fees.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
Figures for Class A and Class B reflect the effect of the maximum
5% sales charge. This was a period of widely fluctuating security
prices. Past performance is no guarantee of future results.
Build your assets systematically
One of the best ways to invest in the Fund is by dollar-cost
averaging -- a time-tested strategy that can make market
fluctuations work for you. To dollar-cost average, simply invest a
fixed amount of money regularly. You'll automatically buy more
shares when the Fund's share price is low, fewer shares when it is
high.
This does not ensure a profit or avoid a loss if the market
declines. But, if you can continue to invest regularly through
changing market conditions, it can be an effective way to
accumulate shares to meet your long-term goals.
How dollar-cost averaging works
Month Amount Per-share Number of shares purchased
invested market price
Jan $100 $20 5.00 XXXXX
Feb 100 18 5.56 XXXXXx
March 100 17 5.88 XXXXXx
April 100 15 6.67 XXXXXXx
May 100 16 6.25 XXXXXXx
June 100 18 5.56 XXXXXx
July 100 17 5.88 XXXXXx
Aug 100 19 5.26 XXXXXx
Sept 100 21 4.76 XXXXx
Oct 100 20 5.00 XXXXX
(footnotes to table) By investing an equal number of dollars each
month...
<PAGE>
PAGE 11
(arrow in table pointing to April) you automatically buy more
shares when the per share market price is low...
(arrow in table pointing to September) and fewer shares when the
per share market price is high.
You have paid an average price of only $17.91 per share over the 10
months, while the average market price actually was $18.10.
<PAGE>
PAGE 12
The Fund's long-term performance
Three ways to benefit from a mutual fund:
o your shares increase in value when the Fund's investments do
well
o you receive capital gains when the gains on investments sold
by the Fund exceed losses
o you receive income when the Fund's stock dividends, interest
and short-term gains exceed its expenses.
All three make up your total return. And you potentially can
increase your investment if, like most investors, you reinvest your
dividends and capital gain distributions to buy additional shares
of the Fund or another fund.
How your $10,000 has grown in IDS New Dimensions Fund
$40,767
$40,000 New Dimensions Fund
Class A
$30,000 S&P 500
Stock Index
Lipper Growth
Fund Index
$20,000
$9,500
'86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96
Average annual total return
(as of July 31, 1996)
1 year Since inception* 5 years 10 years
Class A +10.67% --% +14.02% +15.07%
Class B +10.65% +21.70% --% --%
Class Y +16.68% +25.54% --% --%
*Inception date was March 20, 1995.
Assumes: Holding period from 8/1/86 to 7/31/96. Returns do not
reflect taxes payable on distributions. Reinvestment of all income
and capital gain distributions for the Fund, with a value of
$25,185. Also see "Performance" in the Fund's current prospectus.
Standard & Poor's 500 Stock Index (S&P 500), an unmanaged list of
common stocks, is frequently used as a general measure of market
performance. However, the S&P companies are generally larger than
those in which the Fund invests.
<PAGE>
PAGE 13
Lipper Growth Fund Index, published by Lipper Analytical Services,
Inc., includes 30 funds that are generally similar to this Fund,
although some funds in the index may have somewhat different
investment policies or objectives.
On the graph above you can see how the Fund's total return compared
to two widely cited performance indexes, the S&P 500 and the Lipper
Growth Fund Index. In comparing New Dimensions Fund to the two
indexes, you should take into account the fact that the Fund's
performance reflects the maximum sales charge of 5%, while such
charges are not reflected in the performance of the indexes. If
you were actually to buy individual stocks or growth mutual funds,
any sales charges that you pay would reduce your total return as
well.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
This was a period of widely fluctuating security prices. Past
performance is no guarantee of future results.
<PAGE>
PAGE 14
Independent auditors' report
The board and shareholders
IDS New Dimensions Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities of IDS New Dimensions Fund, Inc. as of July 31, 1996,
and the related statement of operations for the ten-month period
then ended and the statements of changes in net assets for the ten-
month period ended July 31, 1996 and the year ended September 30,
1995, and the financial highlights for the ten-month period ended
July 31, 1996 and for each of the years in the ten-year period
ended September 30, 1995. These financial statements and the
financial highlights are the responsibility of fund management.
Our responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of IDS New
Dimensions Fund, Inc. at July 31, 1996, and the results of its
operations, changes in its net assets and the financial highlights
for the periods stated in the first paragraph above, in conformity
with generally accepted accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
September 6, 1996
<PAGE>
PAGE 15
<TABLE>
<CAPTION>
Statement of assets and liabilities
IDS New Dimensions Fund, Inc.
July 31, 1996
Assets
<S> <C>
Investment in Growth Trends Portfolio (Note 1) $8,560,236,452
Total assets 8,560,236,452
Liabilities
Disbursements in excess of cash on demand deposit 4,432
Accrued distribution fee 11,906
Accrued service fee 29,193
Accrued transfer agency fee 28,509
Accrued administrative services fee 8,539
Other accrued expenses 977,669
Total liabilities 1,060,248
Net assets applicable to outstanding capital stock $8,559,176,204
Represented by
Capital stock -- authorized 10,000,000,000 shares of $.01 par value $ 4,618,125
Additional paid-in-capital 6,073,895,611
Undistributed net investment income 36,187,086
Accumulated net realized gain (Note 1) 266,762,530
Unrealized appreciation of investments 2,177,712,852
Total - representing net assets applicable to outstanding capital stock 8,559,176,204
Net assets applicable to outstanding shares: Class A $5,625,868,997
Class B $ 593,497,390
Class Y $2,339,809,817
Net asset value per share of outstanding capital stock:Class A shares 303,463,317 $ 18.54
Class B shares 32,283,002 $ 18.38
Class Y shares 126,066,164 $ 18.56
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 16
<TABLE>
<CAPTION>
Statement of operations
IDS New Dimensions Fund, Inc.
Ten months ended July 31, 1996
Oct. 1, 1995 to May 13, 1996 to
May 12, 1996 July 31, 1996 Total
(Notes 1 and 5)
Investment income
<S> <C> <C> <C>
Income:
Interest $ 30,498,568 $ 12,065,824 $ 42,564,392
Dividends 48,412,633 20,390,020 68,802,653*
Total income 78,911,201 32,455,844 111,367,045
Expenses (Note 2):
Investment management services fee 25,565,271 -- 25,565,271
Distribution fee -- Class B 1,287,734 898,655 2,186,389
Transfer agency fee 5,546,585 2,262,070 7,808,655
Incremental transfer agency fee -- Class B 29,093 17,407 46,500
Service fee
Class A 5,253,546 2,206,914 7,460,460
Class B 299,676 209,485 509,161
Administrative services fee 1,721,130 717,228 2,438,358
Compensation of board members 84,873 25,346 110,219
Compensation of officers 48,007 3,524 51,531
Custodian fees 263,008 -- 263,008
Postage 217,165 72,389 289,554
Registration fees 695,687 171,917 867,604
Reports to shareholders 232,470 64,955 297,425
Audit fees 28,798 1,528 30,326
Administrative 26,962 8,988 35,950
Other 41,431 6,162 47,593
Total expenses 41,341,436 6,666,568 48,008,004
Earnings credits on cash balances (Note 5) (16,175) -- (16,175)
41,325,261 6,666,568 47,991,829
Expenses, including investment management services fee
allocated from Growth Trends Portfolio -- 11,791,327 11,791,327
Total net expenses 41,325,261 18,457,895 59,783,156
Investment income -- net 37,585,940 13,997,949 51,583,889
Realized and unrealized gain (loss) -- net
Net realized gain on security transactions 280,525,097 45,442,725 325,967,822
Net change in unrealized appreciation or depreciation 611,005,528 (147,891,553) 463,113,975
Net gain (loss) on investments 891,530,625 (102,448,828) 789,081,797
Net increase (decrease) in net assets resulting from operations $929,116,565 $ (88,450,879) $840,665,686
*Includes net of foreign taxes withheld of $476,797.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 17
<TABLE>
<CAPTION>
Statement of changes in net assets
IDS New Dimensions Fund, Inc.
Operations and distributions July 31, 1996 Sept. 30, 1995
Ten-month Year ended
period ended
<S> <C> <C>
Investment income - net $ 51,583,889 $ 56,020,175
Net realized gain on investments 325,967,822 188,034,728
Net change in unrealized appreciation or depreciation 463,113,975 1,122,806,020
Net increase in net assets resulting from operations 840,665,686 1,366,860,923
Distributions to shareholders from:
Net investment income
Class A (39,448,269) (37,824,704)
Class B (1,492,148) --
Class Y (19,131,175) --
Net realized gain
Class A (162,150,758) (161,781,539)
Class B (8,111,389) --
Class Y (68,560,165) --
Excess distributions of realized gain
Class A -- (10,005)
Total distributions (298,893,904) (199,616,248)
Capital share transactions (Note 3)
Proceeds from sales
Class A shares (Note 2) 1,078,880,570 1,277,766,445
Class B shares 442,410,073 139,503,525
Class Y shares 862,302,096 1,678,216,434
Reinvestment of distributions at net asset value
Class A shares 198,597,094 197,521,609
Class B shares 9,572,264 --
Class Y shares 87,691,340 --
Payments for redemptions
Class A shares (593,204,599) (2,058,310,273)
Class B shares (Note 2) (24,532,266) (2,112,953)
Class Y shares (560,414,845) (180,172,610)
Increase in net assets from capital share transactions 1,501,301,727 1,052,412,177
Total increase in net assets 2,043,073,509 2,219,656,852
Net assets at beginning of period 6,516,102,695 4,296,445,843
Net assets at end of period
(including undistributed net investment income of
$36,187,086 and $44,674,789) $8,559,176,204 $6,516,102,695
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 18
Notes to financial statements
IDS New Dimensions Fund, Inc.
___________________________________________________________________
1. Summary of significant accounting policies
The Fund is registered under the Investment Company Act of 1940 (as
amended) as a diversified, open-end management investment company.
The Fund offers Class A, Class B and Class Y shares. Class A shares
are sold with a front-end sales charge. Class B shares may be
subject to a contingent deferred sales charge and such shares
automatically convert to Class A after eight years. Class Y shares
have no sales charge and are offered only to qualifying
institutional investors.
All classes of shares have identical voting, dividend, liquidation
and other rights, and the same terms and conditions, except that
the level of distribution fee, transfer agency fee and service fee
(class specific expenses) differs among classes. Income, expenses
(other than class specific expenses) and realized and unrealized
gains or losses on investments are allocated to each class of
shares based upon its relative net assets.
Investment in Growth Trends Portfolio
Effective May 13, 1996, the Fund began investing all of its assets
in the Growth Trends Portfolio (Portfolio), a series of Growth
Trust, an open-end investment company that has the same objectives
as the Fund. This was accomplished by transferring the Fund's
assets to the Portfolio in return for a proportionate ownership
interest in the Portfolio. Growth Trends Portfolio invests
primarily in common stocks of companies showing potential for
significant growth and operating in areas where economic or
technological changes are occuring.
The Fund records daily its share of the Portfolio's income,
expenses and realized and unrealized gains and losses. The
financial statements of the Portfolio are included elsewhere in
this report and should be read in conjunction with the Fund's
financial statements.
The Fund records its investment in the Portfolio at value which is
equal to the Fund's proportionate owership interest in the net
assets of the Portfolio. The percentage of the Portfolio owned by
the Fund at July 31, 1996 was 99.71%. Valuation of securities held
by the Portfolio is discussed in Note 1 of the Portfolio's Notes to
Financial Statements, which are included elsewhere in this report.
Use of estimates
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 increase and decrease in net assets from
operations during the period. Actual results could differ from
those estimates.
<PAGE>
PAGE 19
Federal taxes
Since the Fund's policy is to comply with all sections of the
Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to the shareholders, no
provision for income or excise taxes is required.
Net investment income (loss) and net realized gains (losses)
allocated from the Portfolio may differ for financial statement and
tax purposes primarily because of the deferral of losses on certain
futures contracts, the recognition of certain foreign currency
gains (losses) as ordinary income (loss) for tax purposes, and
losses deferred due to "wash sale" transactions. The character of
distributions made during the year from net investment income or
net realized gains may differ from their ultimate characterization
for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized
gains (losses) were recorded by the Fund.
Dividends to shareholders
An annual dividend declared and paid at the end of the calendar
year from net investment income is reinvested in additional shares
of the Fund at net asset value or payable in cash. Capital gains,
when available, are distributed along with the income dividend.
___________________________________________________________________
2. Expenses and sales charges
In addition to the expenses allocated from the Portfolio, the Fund
accrues its own expenses as follows:
Effective March 20, 1995, the Fund entered into agreements with
American Express Financial Corporation (AEFC) for providing
administrative services and serving as transfer agent. Under its
Administrative Services Agreement, the Fund pays AEFC for
administration and accounting services at a percentage of the
Fund's average daily net assets in reducing percentages from 0.05%
to 0.03% annually. Under this agreement, the Fund also pays taxes;
audit and certain legal fees; registration fees for shares; office
expenses; consultant's fees; compensation of board members,
officers and employees; corporate filing fees; organizational
expenses; and any other expenses properly payable by the Fund
approved by the board.
Under a separate Transfer Agency Agreement, AEFC maintains
shareholder accounts and records. The Fund pays AEFC an annual fee
per shareholder account for this service as follows:
o Class A $15
o Class B $16
o Class Y $15
<PAGE>
PAGE 20
Also effective March 20, 1995, the Fund entered into agreements
with American Express Financial Advisors Inc. for distribution and
shareholder servicing-related services. Under a Plan and Agreement
of Distribution, the Fund pays a distribution fee at an annual rate
of 0.75% of the Fund's average daily net assets attributable to
Class B shares for distribution-related services.
Under a Shareholder Service Agreement, the Fund pays a fee for
service provided to shareholders by financial advisors and other
servicing agents. The fee is calculated at a rate of 0.175% of the
Fund's average daily net assets attributable to Class A and Class B
shares.
AEFC will assume and pay any expenses (except taxes and brokerage
commissions) that exceed the most restrictive applicable state
expense limitation.
Sales charges received by American Express Financial Advisors for
distributing Fund shares were $19,094,029 for Class A and $210,811
for Class B for the period ended July 31, 1996.
Prior to April 30, 1996, the Fund had a retirement plan for its
independent board members. The plan was terminated April 30, 1996.
The retirement plan expense amounted to $61,688 for the period.
The total liability for the plan is $179,512 which will be paid out
at some future date.
___________________________________________________________________
3. Capital share transactions
Transactions in shares of capital stock for the periods indicated
are as follows:
<TABLE>
<CAPTION>
Period ended July 31, 1996
Class A Class B Class Y
_______________________________________________________________________
<S> <C> <C> <C>
Sold 59,377,568 24,364,763 47,643,756
Issued for reinvested 11,500,909 556,495 5,077,375
distributions
Redeemed (32,745,436) (1,354,343) (30,480,217)
_______________________________________________________________________
Net increase 38,133,041 23,566,915 22,240,914
_______________________________________________________________________
Year ended Sept. 30, 1995
Class A Class B* Class Y*
_______________________________________________________________________
Sold 87,791,383 8,845,958 115,253,413
Issued for reinvested 14,863,540 ___ ___
distributions
Redeemed (142,988,018) (129,871) (11,428,163)
_______________________________________________________________________
Net increase (decrease) (40,333,095) 8,716,087 103,825,250
_______________________________________________________________________
*Inception date was March 20, 1995.
</TABLE>
___________________________________________________________________
4. Change of Fund's fiscal year
The By-Laws of the Fund were amended on Jan. 11, 1996, changing
it's fiscal year end from Sept. 30 to July 31, effective 1996.
<PAGE>
PAGE 21
___________________________________________________________________
5. Pre-conversion to Master
Prior to transferring its securities to Growth Trends Portfolio on
May 13, 1996, various transactions took place as stated below.
Expenses and sales charges
Prior to the conversion on May 13, 1996, the Fund paid an
investment management fee to AEFC. Subsequent to the conversion,
the investment management fee is assessed at the Portfolio level.
(See the footnotes to the Portfolio financial statements for the
terms of the investment management agreement which remain
unchanged.) Prior to conversion, the investment management fee
was adjusted by a performance incentive adjustment based on the
Funds's average daily net assets over a rolling 12-month period as
measured against the change in the Lipper Growth Fund Index. The
adjustment increased the fee by $1,168,789 for the period from Oct.
1, 1995 to May 12, 1996.
During the period from Oct. 1, 1995 to May 12, 1996, the Fund's
custodian fees were reduced by $16,175 as a result of earnings
credits from overnight cash balances.
Securities transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $2,918,666,737 and
$2,267,032,914, respectively, for the period from Oct. 1, 1995 to
May 12, 1996.
Brokerage commissions paid to brokers affiliated with AEFC were
$272,605 during this period.
Lending of portfolio securities
Income from securities lending amounted to $38,570 for the period
from Oct. 1, 1995 to May 12, 1996.
___________________________________________________________________
6. Financial highlights
"Financial highlights" showing per share data and selected
information is presented on pages 8 and 9 of the prospectus.
<PAGE>
PAGE 22
Independent auditors' report
The board of trustees and unitholders
Growth Trust:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments in securities,
of Growth Trends Portfolio (a series of Growth Trust) as of July
31, 1996, and the related statements of operations and changes in
net assets for the period from May 13, 1996 (commencement of
operations) to July 31, 1996. These financial statements are the
responsibility of fund management. Our responsibility is to
express an opinion on these financial statements based on our
audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. Investment
securities held in custody are confirmed to us by the custodian.
As to securities purchased and sold but not received or delivered,
and securities on loan, we request confirmations from brokers, and
where replies are not received, we carry out other appropriate
auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Growth
Trends Portfolio at July 31, 1996, and the results of its
operations and the changes in its net assets for the period from
May 13, 1996 (commencement of operations) to July 31, 1996, in
conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
September 6, 1996
<PAGE>
PAGE 23
<TABLE>
<CAPTION>
Statement of assets and liabilities
Growth Trends Portfolio
July 31, 1996
Assets
<S> <C>
Investments in securities, at value (Note 1)
Investments in securities of unaffiliated issuers
(identified cost $6,336,887,547) $8,454,639,876
Investments in securities of affiliated issuers
(identified cost $72,334,647) 133,031,250
Cash in bank on demand deposit 3,393,915
Dividends and accrued interest receivable 7,099,993
Receivable for investment securities sold 37,289,090
U.S. government securities held as collateral (Note 4) 640,540
Total assets 8,636,094,664
Liabilities
Payable for investment securities purchased 45,520,458
Payable upon return of securities loaned (Note 4) 5,018,140
Accrued investment management services fee 561,398
Other accrued expenses 155,470
Total liabilities 51,255,466
Net assets $8,584,839,198
See accompany notes to financial statements.
<PAGE>
PAGE 24
Statement of Operations
Growth Trends Portfolio
For the period from May 13, 1996
(commencement of operations) to July 31, 1996
Investment income
Income:
Interest $ 12,099,456
Dividends (net of foreign taxes withheld of $73,091) 20,448,561
Total income 32,548,017
Expenses (Note 2):
Investment management services fee 11,544,754
Compensation of board members 10,250
Custodian fees 256,677
Audit fees 4,582
Administrative 2,892
Other 11,403
Total expenses 11,830,558
Earnings credits on cash balances (Note 2) (6,141)
Total net expenses 11,824,417
Investment income -- net 20,723,600
Realized and unrealized gain (loss) -- net
Net realized gain on security transactions (Note 3) 44,047,563
Net change in unrealized appreciation or depreciation (147,155,473)
Net loss on investments (103,107,910)
Net decrease in net assets resulting from operations $ (82,384,310)
See accompanying notes to financial statements.
<PAGE>
PAGE 25
Statement of changes in net assets
Growth Trends Portfolio
For the period from May 13, 1996
(commencement of operations) to July 31, 1996
Operations and distributions
Investment income -- net $ 20,723,600
Net realized gain on investments 44,047,563
Net change in unrealized appreciation or depreciation (147,155,473)
Net decrease in net assets resulting from operations (82,384,310)
Net contributions 8,667,223,508
Total increase in net assets 8,584,839,198
Net assets at beginning of period (Note 1) --
Net assets at end of period $8,584,839,198
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 26
Notes to financial statements
Growth Trends Portfolio
___________________________________________________________________
1. Summary of significant accounting policies
The Growth Trends Portfolio (Portfolio) is a series of Growth Trust
(Trust) and is registered under the Investment Company Act of 1940
as a diversified, open-end management investment company. Growth
Trends Portfolio invests primarily in common stocks of companies
showing potential for significant growth and operating in areas
where economic or technological changes are occurring. The
Declaration of Trust permits the Trustees to issue non-transferable
interests in the Portfolio. The Portfolio commenced operations on
May 13, 1996. At this time, an existing fund transferred its assets
to the Portfolio in return for an ownership percentage of the
Portfolio.
Significant accounting polices followed by the Portfolio are
summarized below:
Use of estimates
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 increase and decrease in net assets from
operations during the period. Actual results could differ from
those estimates.
Valuation of securities
All securities are valued at the close of each business day.
Securities traded on national securities exchanges or included in
national market systems are valued at the last quoted sales price;
securities for which market quotations are not readily available
are valued at fair value according to methods selected in good
faith by the board. Determination of fair value involves, among
other things, reference to market indexes, matrixes and data from
independent brokers. Short-term securities maturing in more than 60
days from the valuation date are valued at the market price or
approximate market value based on current interest rates; those
maturing in 60 days or less are valued at amortized cost.
Option transactions
In order to produce incremental earnings, protect gains and
facilitate buying and selling of securities for investment
purposes, the Portfolio may buy or write options traded on any U.S.
or foreign exchange or in the over-the-counter market where the
completion of the obligation is dependent upon the credit standing
of the other party. The Portfolio also may buy and sell put and
call options and write covered call options on portfolio securities
and may write cash-secured put options. The risk in writing a call
option is that the Portfolio gives up the opportunity of profit if
the market price of the security increases. The risk in writing a
put option is that the Portfolio may incur a loss if the market <PAGE>
PAGE 27
price of the security decreases and the option is exercised. The
risk in buying an option is that the Portfolio pays a premium
whether or not the option is exercised. The Portfolio also has the
additional risk of not being able to enter into a closing
transaction if a liquid secondary market does not exist.
Option contracts are valued daily at the closing prices on their
primary exchanges and unrealized appreciation or depreciation is
recorded. The Portfolio will realize a gain or loss upon expiration
or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost
for a written put option or the cost of a security for a purchased
put or call option is adjusted by the amount of premium received or
paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the
market, the Portfolio may buy and sell stock index futures
contracts traded on any U.S. or foreign exchange. The Portfolio
also may buy or write put and call options on these futures
contracts. Risks of entering into futures contracts and related
options include the possibility that there may be an illiquid
market and that a change in the value of the contract or option may
not correlate with changes in the value of the underlying
securities.
Upon entering into a futures contract, the Portfolio is required to
deposit either cash or securities in an amount (initial margin)
equal to a certain percentage of the contract value. Subsequent
payments (variation margin) are made or received by the Portfolio
each day. The variation margin payments are equal to the daily
changes in the contract value and are recorded as unrealized gains
and losses. The Portfolio recognizes a realized gain or loss when
the contract is closed or expires.
Foreign currency translations and foreign currency contracts
Securities and other assets and liabilities denominated in foreign
currencies are translated daily into U.S. dollars at the closing
rate of exchange. Foreign currency amounts related to the purchase
or sale of securities and income and expenses are translated at the
exchange rate on the transaction date. The effect of changes in
foreign exchange rates on realized and unrealized security gains or
losses is reflected as a component of such gains or losses. In
the statement of operations, net realized gains or losses from
foreign currency transactions may arise from sales of foreign
currency, closed forward contracts, exchange gains or losses
realized between the trade date and settlement dates on securities
transactions, and other translation gains or losses on dividends,
interest income and foreign withholding taxes.
The Portfolio may enter into forward foreign currency exchange
contracts for operational purposes and to protect against adverse
exchange rate fluctuation. The net U.S. dollar value of foreign
currency underlying all contractual commitments held by the
Portfolio and the resulting unrealized appreciation or depreciation
<PAGE>
PAGE 28
are determined using foreign currency exchange rates from an
independent pricing service. The Portfolio is subject to the
credit risk that the other party will not complete the obligations
of the contract.
Federal taxes
For federal income tax purposes the Portfolio qualifies as a
partnership and each investor in the Portfolio is treated as the
owner of its proportionate share of the net assets, income,
expenses and realized and unrealized gains and losses of the
Portfolio. Accordingly, as a "pass-through" entity, the Portfolio
does not pay any income dividends or capital gain distributions.
Other
Security transactions are accounted for on the date securities are
purchased or sold. Dividend income is recognized on the ex-dividend
date and interest income, including level-yield amortization of
premium and discount, is accrued daily.
___________________________________________________________________
2. Fees and expenses
The Trust, on behalf of the Portfolio, has entered into an
Investment Management Services Agreement with American Express
Financial Corporation (AEFC) for managing its portfolio. Under this
agreement, AEFC determines which securities will be purchased, held
or sold. The management fee is a percentage of the Portfolio's
average daily net assets in reducing percentages from 0.6% to 0.5%
annually. The fees may be increased or decreased by a performance
adjustment based on a comparison of the performance of Class A
shares of IDS New Dimensions Fund to the Lipper Growth Fund Index.
The maximum adjustment is 0.12% of the Portfolio's average daily
net assets on an annual basis. The adjustment increased the fee by
$1,130,056 for the period from May 13, 1996 to July 31, 1996.
Under the agreement, the Trust also pays taxes, brokerage
commissions and nonadvisory expenses, which include custodian fees
to be paid to an affiliate of AEFC; audit and certain legal fees;
fidelity bond premiums; registration fees for units; Portfolio
office expenses; consultants' fees; compensation of trustees;
corporate filing fees; expenses incurred in connection with lending
securities of the Portfolio; and any other expenses properly
payable by the Trust or Portfolio, approved by the board.
For the period from May 13, 1996 to July 31, 1996, the Portfolio's
custodian fees were reduced by $6,141 as a result of earnings
credits from overnight cash balances.
Pursuant to a Placement Agency Agreement, American Express
Financial Advisors Inc. acts as placement agent of the units of the
Trust.
<PAGE>
PAGE 29
___________________________________________________________________
3. Securities transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $883,856,643 and $586,814,919,
respectively, for the period from May 13, 1996 to July 31, 1996.
For the same period, the portfolio turnover rate was 7%. Realized
gains and losses are determined on an identified cost basis.
Brokerage commissions paid to brokers affiliated with AEFC were
$66,667 for this period.
___________________________________________________________________
4. Lending of portfolio securities
At July 31, 1996, securities valued at $4,997,200 were on loan to
brokers. For collateral, the Portfolio received $4,377,600 in cash
and U.S. government securities valued at $640,540. Income from
securities lending amounted to $86,952 for the period ended July
31, 1996. The risks to the Portfolio of securities lending are that
the borrower may not provide additional collateral when required or
return the securities when due.
<PAGE>
PAGE 30
<TABLE>
<CAPTION>
Investments in securities
Growth Trends Portfolio (Percentages represent value of
July 31, 1996 investments compared to net assets)
Investments in securities of unaffiliated issuers
Common stocks (86.7%)
Issuer Shares Value (a)
<S> <C> <C>
Aerospace & defense (5.3%)
Boeing 2,100,000 $ 185,850,000
Lockheed Martin 1,100,000 91,162,500
Raytheon 1,700,000 82,450,000
United Technologies 860,000 96,857,500
Total 456,320,000
Airlines (0.9%)
AMR 1,000,000 (b) 78,875,000
Automotive & related (1.3%)
Chrylser 4,000,000 113,500,000
Banks and savings & loans (5.4%)
Citicorp 3,200,000 262,000,000
MBNA 1,700,000 47,387,500
Norwest 3,700,000 131,350,000
State Street Boston 500,000 25,125,000
Total 465,862,500
Beverages & tobacco (3.9%)
Anheuser-Busch 1,150,000 85,962,500
Coca-Cola 3,200,000 150,000,000
PepsiCo 3,000,000 94,875,000
Total 330,837,500
Building materials & construction (0.6%)
Tyco Intl 1,300,000 53,300,000
Chemicals (3.3%)
IMC Global 1,100,000 43,450,000
Monsanto 7,000,000 218,750,000
Praxair 620,000 23,792,500
Total 285,992,500
Communications equipment & services (1.7%)
ADC Telecommunications 1,100,000 (b) 46,475,000
Andrew 1,000,000 (b) 40,875,000
Tellabs 1,000,000 (b) 59,750,000
Total 147,100,000
<PAGE>
PAGE 31
Computers & office equipment (16.2%)
Ceridian 2,100,000 (b) 91,350,000
Cisco Systems 6,000,000 (b) 310,500,000
Computer Associates Intl 2,100,000 106,837,500
Computer Sciences 1,260,000 (b) 85,680,000
First Data 2,300,000 178,537,500
Hewlett-Packard 3,330,000 146,520,000
Microsoft 1,200,000 (b) 141,450,000
Oracle 4,000,000 (b) 156,500,000
Parametric Technology 2,500,000 (b) 104,062,500
3Com 1,850,000 (b) 72,843,750
Total 1,394,281,250
Electronics (2.6%)
Intel 3,000,000 225,375,000
Energy (2.5%)
Amoco 300,000 20,062,500
Exxon 1,000,000 82,250,000
Mobil 1,000,000 110,375,000
Total 212,687,500
Energy equipment & services (1.6%)
Fluor 1,600,000 96,400,000
Sonat Offshore Drilling 800,000 39,200,000
Total 135,600,000
Financial services (1.6%)
Dean Witter 800,000 40,700,000
Household Intl 600,000 44,700,000
Morgan Stanley 1,050,000 51,187,500
Total 136,587,500
Food (2.2%)
ConAgra 4,000,000 170,000,000
Pioneer Hi-Bred Intl 400,000 21,500,000
Total 191,500,000
Health care (9.5%)
Amgen 2,400,000 (b) 131,100,000
Boston Scientific 1,000,000 (b) 47,750,000
Guidant 800,000 40,600,000
Johnson & Johnson 3,600,000 171,900,000
Medtronic 1,700,000 80,537,500
Merck 1,600,000 102,800,000
Pfizer 3,400,000 237,575,000
Total 812,262,500
Health care services (1.3%)
Cardinal Health 472,400 32,831,800
HBO & Co 1,200,000 73,500,000
Total 106,331,800
Household products (3.0%)
Gillette 2,100,000 133,612,500
Procter & Gamble 1,400,000 125,125,000
Total 258,737,500
Industrial equipment & services (1.7%)
Case 600,000 26,550,000
Deere 2,500,000 89,375,000
Illinois Tool Works 400,000 25,750,000
Total 141,675,000
Insurance (2.2%)
ACE Limited 1,000,000 44,000,000
American Intl Group 1,000,000 94,125,000
UNUM 840,000 51,240,000
Total 189,365,000
<PAGE>
PAGE 32
Leisure time & entertainment (1.8%)
Marriott Intl 1,800,000 92,475,000
Mattel 800,000 19,800,000
Mirage Resorts 2,000,000 (b) 45,000,000
Total 157,275,000
Media (1.0%)
A.H. Belo Series A 650,000 26,162,500
Infinity Broadcasting Cl A 900,000 (b) 24,750,000
Time Warner 1,000,000 34,875,000
Total 85,787,500
Metals (1.0%)
Aluminum Co of America 1,400,000 81,200,000
Multi-industry conglomerates (5.4%)
Alco Standard 1,650,000 72,187,500
Emerson Electric 1,477,200 124,638,750
General Electric 3,200,000 263,600,000
Total 460,426,250
Restaurants & lodging (2.6%)
Hospitality Franchise System 1,700,000 (b) 102,000,000
McDonald's 2,000,000 92,750,000
Promus Hotel 1,000,000 (b) 27,250,000
Total 222,000,000
Retail (2.9%)
Albertson's 1,300,000 53,300,000
Circuit City 700,000 22,050,000
Federated Department Stores 1,400,000 (b) 42,350,000
Home Depot 1,000,000 50,500,000
Kroger 500,000 (b) 18,875,000
Safeway 1,700,000 (b) 61,200,000
Total 248,275,000
Textiles & apparel (0.6%)
NIKE Cl B 500,000 51,437,500
Utilities -- telephone (1.7%)
AirTouch Communications 2,000,000 (b) 55,000,000
GTE 1,700,000 70,125,000
MFS Communications 700,000 (b) 22,050,000
Total 147,175,000
Foreign (2.9%) (c)
British Airways ADR 400,000 (d) 32,600,000
Reuters Holdings ADR 700,000 43,837,500
Royal Dutch Petroleum 300,000 (d) 45,262,500
Schlumberger 700,000 56,000,000
SmithKline Beecham ADR 1,350,000 72,562,500
Total 250,262,500
Total common stocks
(Cost: $5,322,021,805) $7,440,029,300
</TABLE>
<PAGE>
PAGE 33
<TABLE>
<CAPTION>
Short-term securities (11.8%)
Issuer Annualized Amount Value (a)
yield on payable at
date of maturity
purchase
<S> <C> <C> <C>
U.S. government agencies (0.1%)
Federal Home Loan Bank Disc Nt
08-05-96 5.32% $ 600,000 $ 599,647
Federal Home Loan Mtge Corp Disc Nt
08-16-96 5.25 7,900,000 7,882,784
Total 8,482,431
Commercial paper (11.5%)
ABN Amro
08-27-96 5.06 15,000,000 14,937,992
10-11-96 5.52 9,000,000 8,900,100
A.I. Credit
08-20-96 5.41 10,000,000 9,970,327
09-18-96 5.37 10,235,000 10,162,263
Alabama Power
08-23-96 5.31 6,700,000 6,678,340
American General Finance
08-01-96 5.38 1,500,000 1,500,000
08-01-96 5.35 10,100,000 10,100,000
Ameritech Capital Funding
08-13-96 5.40 13,600,000 13,572,004
08-27-96 5.41 10,400,000 (f) 10,355,472
08-29-96 5.42 1,200,000 (f) 1,194,564
Associates North America
09-25-96 5.42 10,000,000 9,913,640
AVCO Financial Services
08-01-96 5.40 3,500,000 3,500,000
08-19-96 5.34 9,000,000 8,974,609
08-29-96 5.34 8,300,000 8,263,616
10-22-96 5.49 8,700,000 8,588,676
10-30-96 5.49 5,400,000 5,321,952
10-31-96 5.50 18,000,000 17,741,480
BBV Finance (Delaware)
08-01-96 5.32 9,000,000 9,000,000
08-07-96 5.33 4,400,000 4,395,729
08-07-96 5.29 10,000,000 9,990,292
Becton Dickinson
08-28-96 5.44 7,000,000 6,971,650
BellSouth
08-28-96 5.42 6,958,000 6,928,555
09-17-96 5.38 9,800,000 9,731,678
Beneficial
09-12-96 5.39 10,000,000 9,937,583
CAFCO
09-11-96 5.44 15,000,000 14,901,870
Cargill
08-14-96 5.37 7,100,000 7,086,283
10-08-96 5.53 8,000,000 7,914,900
10-23-96 5.50 17,000,000 (f) 16,779,850
Chevron
08-21-96 5.43 13,000,000 12,966,995
Ciesco LP
08-21-96 5.40 6,100,000 (f) 6,079,364
08-23-96 5.34 7,000,000 6,974,122
09-13-96 5.45 10,000,000 9,928,793
10-01-96 5.43 10,000,000 9,904,417
CIT Group
08-16-96 5.41 15,000,000 14,966,375
Commercial Credit
08-08-96 5.39 5,400,000 5,394,361
Commerzbank U.S. Finance
08-13-96 5.35 8,000,000 7,982,181
08-14-96 5.39 16,700,000 16,661,560
<PAGE>
PAGE 34
CPC Intl
09-04-96 5.44 8,300,000 (f) 8,254,972
09-16-96 5.47 11,000,000 (f) 10,919,977
09-24-96 5.37 12,000,000 (f) 11,899,533
09-26-96 5.45 20,000,000 (f) 19,824,338
10-22-96 5.49 10,300,000 (f) 10,168,203
Dean Witter
08-05-96 5.37 3,800,000 3,796,830
Ford Motor Credit
09-05-96 5.39 15,000,000 14,921,979
Gannett
10-11-96 5.54 12,400,000 (f) 12,262,360
10-15-96 5.52 5,400,000 (f) 5,376,337
10-16-96 5.54 10,700,000 (f) 10,572,982
General Electric Capital
08-14-96 5.37 12,000,000 11,971,840
08-22-96 5.43 15,000,000 14,946,404
08-28-96 5.44 10,000,000 9,954,418
08-29-96 5.32 6,500,000 6,473,206
Goldman Sachs
08-05-96 5.36 6,000,000 5,995,299
08-23-96 5.39 5,000,000 4,981,030
09-09-96 5.50 1,400,000 1,390,947
09-10-96 5.47 7,000,000 6,954,606
10-21-96 5.53 2,200,000 2,172,188
Harris Trust
08-09-96 5.37 10,400,000 10,399,592
Hewlett-Packard
08-29-96 5.42 4,500,000 4,479,153
09-17-96 5.42 2,430,000 2,411,536
Household Finance
08-26-96 5.42 10,000,000 9,958,074
09-19-96 5.44 20,000,000 19,841,873
Kredietbank North America Finance
09-03-96 5.16 10,000,000 9,945,270
Lilly (Eli) & Co.
08-09-96 5.40 11,200,000 11,186,610
Merrill Lynch
08-23-96 5.43 3,700,000 3,686,576
Metlife Funding
09-09-96 5.39 9,700,000 9,643,675
Mobil Australia Finance (Delaware)
08-15-96 5.40 8,000,000 (f) 7,980,371
08-30-96 5.41 10,000,000 (f) 9,951,305
09-18-96 5.48 8,000,000 (f) 7,937,946
09-18-96 5.45 9,908,000 (f) 9,831,146
10-02-96 5.49 7,000,000 (f) 6,932,012
Morgan Stanley Group
08-08-96 5.40 6,000,000 5,993,735
09-06-96 5.37 7,100,000 7,062,086
Motorola
08-28-96 5.35 13,523,000 13,469,043
Natl Australia Funding (Delaware)
08-13-96 5.39 6,700,000 6,686,316
NationsBank
08-06-96 5.37 15,000,000 14,999,931
09-04-96 5.40 8,000,000 7,999,173
Norfolk Southern
08-29-96 5.37 5,000,000 (f) 4,977,144
PACCAR
08-26-96 5.34 9,000,000 8,962,856
Penney (JC) Funding
09-17-96 5.43 9,000,000 8,932,984
Pfizer
08-02-96 5.40 20,000,000 (f) 19,997,017
Pitney Bowes Credit
08-29-96 5.42 9,000,000 8,958,859
10-09-96 5.49 3,500,000 3,452,048
10-16-96 5.51 8,800,000 8,695,537
Reed Elsevier
09-20-96 5.47 20,000,000 (f) 19,839,148
SAFECO Credit
08-05-96 5.35 8,100,000 8,093,845
08-23-96 5.41 7,500,000 7,475,387
09-23-96 5.40 1,000,000 991,768
<PAGE>
PAGE 35
Sandoz
08-01-96 5.38 12,000,000 (f) 12,000,000
08-06-96 5.40 8,800,000 8,793,449
08-20-96 5.35 8,000,000 7,973,647
09-10-96 5.47 7,900,000 (f) 7,847,816
Siemens
08-20-96 5.41 9,100,000 9,070,024
09-18-96 5.44 1,300,000 1,289,701
SmithKline Beecham
08-13-96 5.40 15,600,000 15,572,024
Societe Generale North America
08-12-96 5.39 21,700,000 21,664,526
Southern California Gas
09-03-96 5.03 10,269,000 (f) 10,212,059
10-29-96 5.53 5,623,000 (f) 5,546,246
Southwestern Bell Telephone
09-10-96 5.37 8,500,000 8,449,567
Transamerica Financial
08-19-96 5.37 6,000,000 5,981,152
09-23-96 5.40 3,000,000 2,975,303
USAA Capital
08-07-96 5.40 9,100,000 9,091,856
08-12-96 5.37 14,000,000 13,972,579
08-19-96 5.34 10,000,000 9,968,587
08-23-96 5.41 6,700,000 6,678,013
09-06-96 5.33 5,100,000 5,072,970
U S WEST Communications
09-17-96 5.44 9,600,000 9,525,755
09-24-96 5.40 8,600,000 8,530,856
10-24-96 5.49 10,000,000 9,868,958
Total 987,866,146
Letters of credit (0.2%)
First Chicago - Commed Fuel
08-15-96 5.42 9,134,000 9,112,039
09-09-96 5.35 9,203,000 9,149,960
Total 18,261,999
Total short-term securities
(Cost: $1,014,865,742) $1,014,610,576
Total investments in securities of unaffiliated issuers
(Cost: $6,336,887,547) $8,454,639,876
Investments in securities of affiliated issuer (e)
Common Stock (1.5%)
Issuer Shares Value (a)
Reynolds & Reynolds Cl A 2,750,000 $ 133,031,250
Total investments in securities of affiliated issuer
(Cost: $72,334,647) 133,031,250
Total investments in securities
(Cost: $6,409,222,194) (g) $8,587,671,126
<PAGE>
PAGE 36
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial statements.
(b) Presently non-income producing.
(c) Foreign security values are stated in U.S. dollars.
(d) Security is partially or fully on loan. See Note 4 to the financial statements.
(e) Investments representing 5% or more of the outstanding voting securities of the issuer.
(f) Commercial paper sold within terms of a private placement memorandum, exempt from registration under Section 4(2) of the
Securities Act of 1933, as amended, and may be sold only to dealers in that program or other "accredited investors." This security
has been determined to be liquid under guidelines established by the board.
(g) At July 31, 1996, the cost of securities for federal income tax purposes was $6,409,235,783 and the aggregate gross unrealized
appreciation and depreciation based on that cost was:
Unrealized appreciation 2,247,642,210
Unrealized depreciation (69,206,867)
Net unrealized appreciation 2,178,435,343
</TABLE>
<PAGE>
PAGE 37
IDS mutual funds
Cash equivalent investments
These money market funds have three main goals: conservation of
capital, constant liquidity and the highest possible current income
consistent with these objectives. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial
paper, bankers' acceptances, certificates of deposits (CDs) and
other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and
local governments to seek high current income exempt from federal
income taxes.
(icon of) shield with piggy bank enclosed
Income investments
The funds in this group invest their assets primarily in corporate
bonds or government securities to seek interest income. Secondary
objective is capital growth. Risk varies by bond quality.
IDS Global Bond Fund
Invests primarily in debt securities of U.S. and foreign issuers to
seek high total return through income and growth of capital.
(icon of) globe
IDS Extra Income Fund
Invests mainly in long-term, high-yielding corporate fixed-income
securities in the lower rated, higher risk bond categories to seek
high current income. Secondary objective is capital growth.
(icon of) coins
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher
rated, lower risk bond categories, or the equivalent, and in
government bonds.
(icon of) greek column
<PAGE>
PAGE 38
IDS Selective Fund
Invests in high-quality corporate bonds and other highly rated debt
instruments including government securities and short-term
investments. Seeks current income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests primarily in securities issued or guaranteed as to the
timely payment of principal and interest by the U.S. government,
its agencies and instrumentalities. Seeks a high level of current
income and safety of principal consistent with its type of
investments.
(icon of) shield with eagle head enclosed
Tax-exempt income investments
These funds provide tax-free income by investing in municipal
bonds. The income is generally free from federal income tax. Risk
varies by bond quality.
IDS High Yield Tax-Exempt Fund
Invests primarily in medium- and lower-quality municipal bonds and
notes. Lower-quality securities generally involve greater risk of
principal and income.
(icon of) shield with basket of apples enclosed
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities to
provide income to residents of each respective state that is exempt
from federal, state and local income taxes. (New York is the only
state that is exempt at the local level.)
(icon of) shield with U.S. enclosed
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government
units, with at least 75% in the four highest rated, lowest risk
bond categories.
(icon of) shield with Greek column enclosed
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to
the timely payment of principal and interest. The insurance
feature minimizes credit risk of the fund but does not guarantee
the market value of the fund's shares.
(icon of) shield with star enclosed
<PAGE>
PAGE 39
Growth and income investments
These funds focus on securities of medium to large, well-
established companies that offer long-term growth of capital and
reasonable income from dividends and interest. Moderate risk.
IDS International Fund
Invests primarily in common stocks of foreign companies that offer
potential for superior growth. The fund may invest up to 20% of
its assets in the U.S. market.
(icon of) three flags
IDS Managed Allocation Fund
Invests in U.S. equity securities, U.S. and foreign debt
securities, foreign equity securities and money market instruments.
The fund provides diversification among these major investment
categories and has a target mix that represents the way the fund's
investments will be allocated over the long term. Seeks maximum
total return.
(icon of) bird in a nest
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks,
higher-yielding equities and bonds. Seeks growth of capital and
income.
(icon of) three pine trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities
purchased are those recommended by our research analysts as the
best from each industry represented on the index. Offers potential
for long-term growth as well as dividend income.
(icon of) ribbon
IDS Stock Fund
Invests in common stock of companies representing many sectors of
the economy. Seeks current income and growth of capital.
(icon of) building with columns
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential
for growth of capital and income.
(icon of) three growing flowers
<PAGE>
PAGE 40
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek
high current income and growth of income and capital with reduced
volatility.
(icon of) light bulb
IDS Diversified Equity Income Fund
Invests primarily in high-yielding common stocks to seek high
current income and, secondarily, to benefit from the growth
potential offered by stock investments.
(icon of) two puzzle pieces
IDS Mutual
Invests in a balance between common stocks and senior securities
(preferred stocks and bonds). Seeks a balance of growth of capital
and current income.
(icon of) scale of justice
Growth investments
Funds in this group seek capital growth, primarily from common
stocks. They are high risk mutual funds with a potential for high
reward.
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies
emphasizing technological innovation and productivity enhancement.
Buys and holds larger growth-oriented stocks.
(icon of) ship
IDS Small Company Index Fund
Invests in all or a representative group of the equity securities
comprising the S&P SmallCap 600 Index, as it strives to provide
long-term capital appreciation.
(icon of) office building
IDS Progressive Fund
Invests primarily in undervalued common stocks. The fund holds
stocks for the long term with the goal of capital growth.
(icon of) shooting star
<PAGE>
PAGE 41
IDS Global Growth Fund
Invests in stocks of companies throughout the world that are
positioned to meet market needs in a changing world economy. These
companies offer above-average potential for long-term growth.
(icon of) world
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected
for their potential for above-average growth. Above-average means
that their growth potential is better, in the opinion of the
portfolio's investment manager, than the Standard & Poor's
Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Research Opportunities Fund
Invests primarily in equity securities of companies included in the
S&P 500 Index that are believed to have strong growth potential.
The Portfolio is managed using a research methodology by the
Research Department of AEFC. Goal is long-term appreciation.
(icon of) magnifying glass
IDS Growth Fund
Invests primarily in companies that have above-average potential
for long-term growth as a result of new management, marketing
opportunities or technological superiority.
(icon of) trees
IDS New Dimensions Fund
Invests primarily in companies with significant growth potential
due to superiority in technology, marketing or management. The
fund frequently changes its industry mix.
(icon of) dimension
Specialty growth investment
This fund aggressively seeks capital growth as a hedge against
inflation.
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic
companies that explore for, mine and process or distribute gold and
other precious metals. This is the most aggressive and most
speculative IDS mutual fund.
(icon of) cart of precious gems
<PAGE>
PAGE 42
For more complete information about any of these funds, including
charges and expenses, you can obtain a prospectus by contacting
your financial advisor or writing to American Express Shareholder
Service, P.O. Box 534, Minneapolis, MN 55440-0534. Read it
carefully before you invest or send money.
<PAGE>
PAGE 43
Federal income tax information
IDS New Dimensions Fund, Inc.
___________________________________________________________________
The Fund is required by the Internal Revenue Code of 1986 to tell
its shareholders about the tax treatment of the dividends it pays
during its fiscal year. The dividends listed below were reported
to you on a Form 1099-DIV, Dividends and Distributions, last
January. Shareholders should consult a tax advisor on how to
report distributions for state and local purposes.
IDS New Dimensions Fund, Inc.
Fiscal year ended July 31, 1996
Class A
Income distribution taxable as dividend income, 100% qualifying for
deduction by corporations.
Payable date Per share
Dec. 29, 1995 $0.14600
Capital gain distribution taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.60100
Total distributions $0.74700
Class B
Income distribution taxable as dividend income, 100% qualifying for
deduction by corporations.
Payable date Per share
Dec. 29, 1995 $0.10942
Capital gain distribution taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.60100
Total distributions $0.71042
Class Y
Income distribution taxable as dividend income, 100% qualifying for
deduction by corporations.
Payable date Per share
Dec. 29, 1995 $0.16774
<PAGE>
PAGE 44
Capital gain distribution taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $0.60100
Total distributions $0.76874
<PAGE>
PAGE 45
Quick telephone reference
American Express Telephone Transaction Service
Redemptions and exchanges, dividend payments or reinvestments and
automatic payment arrangements
National/Minnesota: 800-437-3133
Mpls./St. Paul area: 671-3800
American Express Shareholder Service
Fund performance, objectives and account inquiries
612-671-3733
TTY Service
For the hearing impaired
800-846-4852
American Express Infoline
Automated account information (TouchToneR phones only), including
current fund prices and performance, account values and recent
account transactions
National/Minnesota: 800-272-4445
Mpls./St. Paul area: 671-1630
AMERICAN
EXPRESS
Financial
Advisors
IDS New Dimensions Fund
IDS Tower 10
Minneapolis, MN 55440-0010
<PAGE>
PAGE 46
STATEMENT OF DIFFERENCES
Difference Description
1) The layout is different 1) Some of the layout in the
throughout the annual report. annual report to
shareholders is in two
columns.
2) Headings. 2) The headings in the
annual report are
placed in a blue strip
at the top of the page.
3) There are pictures, icons 3) Each picture, icon and
and graphs throughout the graph is described in
annual report. parentheses.
4) Footnotes for charts and 4) The footnotes for each
graphs are described at chart or graph are typed
the left margin. below the description of
the chart or graph.
