[COVER PAGE]
December 31, 1997
PHOENIX
FUNDS
ANNUAL REPORT
o PHOENIX STRATEGIC
ALLOCATION FUND, INC.
[LOGO] PHOENIX
DUFF & PHELPS
<PAGE>
Mutual funds are not insured by the FDIC; are not deposits or other obligations
of a bank and are not guaranteed by a bank; and are subject to investment risks,
including possible loss of the principal invested.
<PAGE>
Chairman's Message
Dear Fellow Shareholder,
We're pleased to provide this annual report for Phoenix Strategic Allocation
Fund for the fiscal year ended December 31, 1997. This has been a remarkable
time for the financial markets, particularly equities. For the latest 12
months, the S&P 500 Stock Index returned over 33%, substantially above the
historical average of 10.7%, but market volatility has been high.
During market extremes, your most important asset may be your financial
adviser. Managing your investments in changing markets can be challenging, and
your financial adviser knows some time-tested strategies that can help.
Rebalancing your portfolio is one strategy to reduce risk. As the stock
market has moved higher, your equity investments may have increased in value so
that now they represent a higher percentage of your total portfolio than you
originally intended. Your financial adviser may recommend a shift in asset
allocation to bring your portfolio back in line with your investment goals and
risk tolerance.
Diversifying your portfolio can smooth the effects of volatility. Spreading
your investments across a broad mix of securities reduces risk. You can also
diversify by investment style. For example, you may choose to balance an
investment in growth stocks with a fund that focuses on value-oriented stocks.
Dollar-cost averaging takes advantage of market fluctuations.
In a systematic savings plan, you'll buy fewer shares when prices are high and
more when prices fall. Periodic investments don't ensure a profit, however, and
you should consider your ability to continually make purchases.
On behalf of Phoenix Funds, I want to thank you for investing with us and
assure you that we will continue to work hard to help you meet your investment
needs.
Sincerely,
/s/ Philip R. McLoughlin
Philip R. McLoughlin
President and Chairman
Phoenix Funds
<PAGE>
PHOENIX STRATEGIC ALLOCATION FUND, INC.
INVESTOR PROFILE
Phoenix Strategic Allocation Fund is designed for investors seeking
capital appreciation with less volatility than an all-equity fund.
INVESTMENT ADVISER'S REVIEW
Phoenix Strategic Allocation Fund posted strong gains over this latest
reporting cycle. For the 12 months ended December 31, 1997, Class A and B
shares returned 20.68% and 19.74%, respectively. Over the same period, the
average return of a peer group of 196 funds was 18.69% according to Lipper
Analytical Services, Inc. The S&P 500 Index return was 33.38%. All performance
figures assume reinvestment of dividends and exclude the effect of sales
charges.
Despite increased volatility in the fourth quarter, 1997 was another good
year for U.S. investors. In fact, the Dow Jones Industrial Average ended the
year at more than 10 times its 1982 low. Overseas, however, the picture was not
as bright: high jobless rates continued in Europe, turmoil continues in the
Middle East and Latin America is recovering slowly. The surprise was the
collapse of many markets in the Asia-Pacific region. While it will be some time
before we see the real impact of the Asian problems on the earnings of domestic
and global companies, the U.S. market reacted to the uncertainty with a violent
rotation to defensive issues. The strongest sectors in the fourth quarter were
communication services, utilities and consumer staples--slow but steady
growers.
During this latest reporting period, the Fund benefited from an
overweighted position in the health-care sector, strong stock selection in the
financial services group and excellent relative performance from the
fixed-income segment of the portfolio. Negative contributors to performance
included the relative underperformance of some of our consumer staples and
technology holdings as well as our underweighted position in the communication
services area.
OUTLOOK
While our long-term outlook remains constructive, there are more reasons
than ever to maintain a cautious investment posture. On the positive side, the
economy continues to grow at a healthy, sustainable pace, inflation remains
benign and the overall outlook for corporate earnings is still upbeat. On the
other hand, analysts' estimates for 1998 earnings are probably too high, and we
believe that the frequency of earnings disappointments will increase.
Our stock selection continues to focus on firms that possess above-average
earnings growth potential, superior management and global opportunities outside
Asia. We expect interest rates to continue to trend down and would not be
surprised if the Fed actually cut rates during the year, which would partially
offset the negative impact of slightly slower earnings growth on equity prices.
While the Asian "meltdown" introduces a new element of uncertainty in the
outlook for the financial markets, we do not believe the real impact will be
great. Health-care, financial services and technology continue to be the
sectors in which we have the greatest confidence for exceptional long-term
growth.
2
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
[PLOT POINTS FOR STRATEGIC ALLOCATION LINE CHART]
Lipper Analytical S&P 500 Stock Index* Phoenix Strategic
Services Flexible Allocation Fund-
Portfolio Index** Class A
12/31/87 10,000 10,000 9,525
12/31/88 10,869 11,650 9,842
12/31/89 12,744 15,312 11,654
12/31/90 12,863 14,823 12,173
12/31/91 16,334 19,351 15,657
12/31/92 17,260 20,839 17,273
12/31/93 19,460 22,923 19,085
12/31/94 18,941 23,226 18,655
12/31/95 23,409 31,937 22,056
12/31/96 26,698 39,362 23,994
12/31/97 31,713 52,500 28,956
Average Annual Total Returns for Periods Ending 12/31/97
<TABLE>
<CAPTION>
From Inception
10/24/94 to
1 Year 5 Years 10 Years 12/31/97
----------- --------- ---------- ---------------
<S> <C> <C> <C> <C>
Class A with 4.75% sales charge 14.98% 9.82% 11.22% --
- ---------------------------------------------------------------------------------------------------------------------
Class A at net asset value 20.68% 10.89% 11.76% --
- ---------------------------------------------------------------------------------------------------------------------
Class B with CDSC 15.78% -- -- 13.43%
- ---------------------------------------------------------------------------------------------------------------------
Class B at net asset value 19.74% -- -- 13.90%
- ---------------------------------------------------------------------------------------------------------------------
Lipper Analytical Services Flexible Portfolio Index** 18.77% 12.93% 12.22% 16.98%***
- ---------------------------------------------------------------------------------------------------------------------
S&P 500 Stock Index* 33.38% 20.30% 18.04% 29.24%
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
This chart assumes an initial gross investment of $10,000 made on 12/31/87 for
Class A shares. The total return for Class A shares reflects the maximum sales
charge of 4.75% on the initial investment and assumes reinvestment of dividends
and capital gains. Class B share performance will be greater or less than that
shown based on differences in inception date, fees and sales charges. The total
return for Class B shares reflects the 5% contingent deferred sales charge
(CDSC), which is applicable on all shares redeemed during the 1st year after
purchase and 4% for all shares redeemed during the 2nd year after purchase
(scaled down to 3%--3rd year; 2%--4th and 5th year and 0% thereafter). Returns
indicate past performance, which is not predictive of future performance.
Investment return and net asset value will fluctuate, so that your shares, when
redeemed, may be worth more or less than the original cost.
*The S&P 500 Stock Index is an unmanaged but commonly used measure of common
stock total return performance. The S&P 500's performance does not reflect
sales charges.
**The Lipper Analytical Services Flexible Portfolio Index is an average of the
largest mutual funds within the flexible portfolio category; the 5 and 10 year
returns are derived from compounding the yearly returns. Performance is based
on the reinvestment of all distributions and does not reflect the effects of
sales charges.
***Index information from 10/31/94 to 12/31/97.
3
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
INVESTMENTS AT DECEMBER 31, 1997
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
--------------- ------------------ ----------------
<S> <C> <C> <C>
U.S. GOVERNMENT AND AGENCY SECURITIES--3.1%
U.S. Treasury Notes--2.6%
U.S. Treasury Notes
6.625%, 5/15/07 ........... AAA $ 7,865 $ 8,327,069
-----------
Agency Mortgage-Backed Securities--0.5%
FNMA 6.85%, 5/17/20 ......... AAA 1,500 1,538,906
-----------
TOTAL U.S. GOVERNMENT AND
AGENCY SECURITIES
(Identified cost $9,313,833) ................................. 9,865,975
-----------
MUNICIPAL BONDS--4.1%
California--2.0%
California State Department
Water System Series S
5%, 12/1/29 ............... AA 325 315,988
Kern County Pension
Obligation Taxable
7.26%, 8/15/14 (f) ........ AAA 1,700 1,805,978
Long Beach Pension
Obligation Taxable
6.87%, 9/1/06 ............. AAA 950 988,351
Los Angeles County Public
Works 5.125%, 12/1/29 ..... AAA 495 486,328
San Bernardino County
Pension Obligation
Revenue Taxable 6.87%,
8/1/08 .................... AAA 455 472,913
San Bernardino County
Pension Obligation
Revenue Taxable 6.94%,
8/1/09 .................... AAA 1,240 1,297,164
Ventura County Pension
Obligation Taxable
6.54%, 11/1/05 ............ AAA 1,100 1,121,384
-----------
6,488,106
-----------
Florida--1.6%
Florida State Department of
Transportation Series A
5%, 7/1/27 ................ AA+ 400 389,260
Miami Beach Special
Obligation Taxable
8.60%, 9/1/21 ............. AAA 3,600 4,066,092
University of Miami
Exchangeable Revenue
Series A Taxable 7.65%,
4/1/20 .................... AAA 595 628,028
-----------
5,083,380
-----------
Massachusetts--0.1%
Massachusetts State Water
Authority 5%, 8/1/24 ...... AAA 400 388,592
-----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
--------------- ------------------ ----------------
<S> <C> <C> <C>
Texas--0.2%
Houston Water & Sewer
Refunding, Jr. Lien,
Series D 5%, 12/1/25 ...... AAA $ 495 $ 484,145
-----------
Washington--0.2%
Washington State Series E
Taxable 5%, 7/1/22 ........ AA+ 495 486,818
-----------
TOTAL MUNICIPAL BONDS
(Identified cost $12,507,289) ................................... 12,931,041
-----------
NON-CONVERTIBLE BONDS--5.5%
Asset-Backed Securities--1.8%
AESOP Funding II LLC
97-1, A2 144A 6.40%,
10/20/03 (d) .............. AAA 1,600 1,613,000
Capita Equipment
Receivables Trust 97-1,
B 6.45%, 8/15/02 .......... A+ 600 600,938
Chase Credit Card Master
Trust 97-2, A 6.30%,
4/15/03 ................... AAA 1,500 1,511,074
Fleetwood Credit Corp.
96-B, A 6.90%, 3/15/12 AAA 728 734,143
Green Tree Financial Corp.
96-2, M1 7.60%,
4/15/27 ................... AA- 1,150 1,199,594
-----------
5,658,749
-----------
Non-Agency Mortgage-Backed Securities--3.6%
CS First Boston Mortgage
Securities Corp. 95-AE,
B 7.182%, 11/25/27 ........ AA- 1,775 1,787,203
First Union Lehman Bros.
97-C1, B 7.43%,
4/18/29 ................... Aa(c) 600 628,312
G.E. Capital Mortgage
Services, Inc. 96-8, M
7.25%, 5/25/26 ............ AA 246 248,333
Lehman Large Loan
97-LL1, B 6.95%,
3/12/07 (f) ............... AA 725 742,559
Nationslink Funding Corp.
96-1, B 7.69%,
12/20/05 .................. AA 325 345,617
Residential Asset
Securitization Trust
96-A8, A1 8%, 12/25/26 .... AAA 660 669,558
Residential Funding
Mortgage Securities I
96-S1, A11 7.10%,
1/25/26 ................... AAA 1,500 1,518,281
</TABLE>
See Notes to Financial Statements
4
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
------------- --------- -------------
<S> <C> <C> <C>
Non-Agency Mortgage-Backed Securities--continued
Residential Funding
Mortgage Securities I
96-S4, M1 7.25%,
2/25/26 ..................... AA $ 492 $ 497,622
Resolution Trust Corp.
93-C1, B 8.75%,
5/25/24 ..................... Aa(c) 805 804,985
Resolution Trust Corp.
95-2, M1 7.15%,
5/25/29 ..................... Aa(c) 1,310 1,332,677
Structured Asset Securities
Corp. 93-C1, B 6.60%,
10/25/24 (f) ................ A+ 1,275 1,249,603
Structured Asset Securities
Corp. 95-C4, B 7%,
6/25/26 (f) ................. AA 1,850 1,866,766
----------
11,691,516
----------
Paper & Forest Products--0.1%
Buckeye Cellulose Corp.
9.25%, 9/15/08 .............. BB- 350 370,125
----------
TOTAL NON-CONVERTIBLE BONDS
(Identified cost $17,485,676) ...................... 17,720,390
----------
FOREIGN GOVERNMENT SECURITIES--3.0%
Argentina--0.2%
Republic of Argentina
Bearer FRB 6.688%,
3/31/05 (e) ................. BB 797 712,140
----------
Brazil--0.3%
Republic of Brazil NMB-L
6.75%, 4/15/09 (e) .......... BB- 945 763,678
----------
Bulgaria--0.1%
Republic of Bulgaria
FLIRB Series A Bearer
Euro 2.25%, 7/28/12 (e) ..... B(c) 615 374,381
----------
Colombia--0.2%
Republic of Colombia
Yankee 7.25%, 2/23/04 ....... BBB- 750 707,813
----------
Croatia--0.1%
Croatia Series A 6.625%,
7/31/10 (e) ................. BBB- 420 369,600
----------
Ecuador--0.2%
Ecuador Bearer PDI Euro,
PIK interest
capitalization, 6.688%,
2/27/15 (e) ................. B(c) 930 617,200
----------
Mexico--0.4%
United Mexican States
Global Bond 11.50%,
5/15/26 ..................... BB 1,065 1,260,161
----------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
------------- -------------------- -------------
<S> <C> <C> <C>
Panama--0.2%
Republic of Panama
8.875%, 9/30/27 ............... BB+ $ 800 $ 752,800
----------
Peru--0.2%
Peru PDI 4%, 3/7/17 (e) ......... BB 1,005 660,787
----------
Poland--0.3%
Poland PDI Bearer 4%,
10/27/14 (e) .................. BBB- 1,125 974,531
----------
Russia--0.5%
Russia Interest Notes
Series US 144A 6.719%,
12/15/15 (d) (e) .............. NR 2,300 1,633,000
----------
Venezuela--0.3%
Republic of Venezuela
9.25%, 9/15/27 ................ B+ 845 755,747
----------
TOTAL FOREIGN GOVERNMENT SECURITIES
(Identified cost $9,247,230) ...................................... 9,581,838
----------
FOREIGN NON-CONVERTIBLE BONDS--0.2%
Chile--0.2%
Compania Sud Americana
de Vapores SA 7.375%,
12/8/03 ....................... BBB 200 198,750
Petropower I Funding Trust
144A 7.36%,
2/15/14 (d) ................... BBB 500 506,420
----------
705,170
----------
TOTAL FOREIGN NON-CONVERTIBLE BONDS
(Identified cost $696,097) ....................................... 705,170
----------
SHARES
-------
COMMON STOCKS--70.0%
Banks (Major Regional)--6.1%
AmSouth Bancorporation .................... 34,000 1,846,625
Banc One Corp. ............................ 62,200 3,378,238
BankBoston Corp. .......................... 41,800 3,926,587
Compass Bankshares, Inc. .................. 25,900 1,133,125
Mellon Bank Corp. ......................... 42,000 2,546,250
NationsBank Corp. ......................... 37,300 2,268,306
Southtrust Corp. .......................... 23,000 1,459,063
Washington Mutual, Inc. ................... 47,700 3,043,856
----------
19,602,050
----------
Banks (Money Center)--1.7%
BankAmerica Corp. ......................... 61,700 4,504,100
Citicorp .................................. 7,500 948,281
----------
5,452,381
----------
Biotechnology--0.2%
Centocor, Inc. (b) ........................ 18,200 605,150
----------
Broadcasting (Television, Radio, & Cable)--0.7%
Chancellor Media Corp. (b) ................ 31,600 2,358,150
----------
Chemicals (Specialty)--0.4%
Solutia, Inc. (b) ......................... 43,900 1,171,581
----------
</TABLE>
See Notes to Financial Statements
5
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
------------------- ----------------
<S> <C> <C>
Communications Equipment--2.8%
Ciena Corp. (b) ...... 77,400 $ 4,731,075
Lucent Technologies, Inc. 51,300 4,097,588
------------
8,828,663
------------
Computers (Hardware)--4.2%
International Business
Machines Corp. ... 128,600 13,446,738
------------
Computers (Networking)--0.9%
Cisco Systems, Inc. (b) 51,000 2,843,250
------------
Computers (Peripherals)--0.4%
EMC Corp. (b) ........ 46,400 1,273,100
------------
Computers (Software & Services)--4.7%
Adaptec, Inc. (b) ... 83,000 3,081,375
BMC Software, Inc. (b) 84,200 5,525,625
Compuware Corp. (b) .. 130,000 4,160,000
Edwards (J.D.) & Co. (b) 58,600 1,728,700
Yahoo!, Inc. (b) .... 7,200 498,600
------------
14,994,300
------------
Distributors (Food & Health)--0.8%
Cardinal Health, Inc. 34,400 2,584,300
------------
Electrical Equipment--2.1%
General Electric Co. 89,000 6,530,375
------------
Electronics (Instrumentation)--0.4%
Linear Technology Corp. 20,000 1,152,500
------------
Electronics (Semiconductors)--1.6%
National Semiconductor
Corp. (b) ........... 109,900 2,850,531
Texas Instruments, Inc. 52,800 2,376,000
------------
5,226,531
------------
Entertainment--1.1%
Tele-Comm Liberty Media
Group (b) ........... 97,700 3,541,625
------------
Financial (Diversified)--0.9%
American Express Co. 32,900 2,936,325
------------
Health Care (Diversified)--2.3%
Bristol-Myers Squibb Co. 32,300 3,056,387
Warner-Lambert Co. 35,700 4,426,800
------------
7,483,187
------------
Health Care (Drugs-Major Pharmaceuticals)--3.4%
Lilly (Eli) & Co. .... 30,300 2,109,637
Pfizer, Inc. ......... 103,800 7,739,588
Watson Pharmaceuticals,
Inc. (b) ............ 33,300 1,080,169
------------
10,929,394
------------
Health Care (Hospital Management)--1.3%
HBO & Co. ............ 85,800 4,118,400
------------
Health Care (Long Term Care)--0.6%
HEALTHSOUTH Corp. (b) 71,400 1,981,350
------------
Health Care (Medical Products & Supplies)--2.4%
Guidant Corp. ........ 66,600 4,145,850
Medtronic, Inc. ...... 69,400 3,630,488
------------
7,776,338
------------
Household Furn. & Appliances--0.9%
Sunbeam Corp., Inc. ... 64,500 2,717,062
------------
Household Products (Non-Durables)--0.8%
Colgate-Palmolive Co. 35,600 2,616,600
------------
</TABLE>
<TABLE>
<CAPTION>
SHARES VALUE
------------------- ----------------
<S> <C> <C>
Insurance (Life/Health)--0.6%
UNUM Corp. .......... 38,000 $ 2,066,250
------------
Insurance (Multi-Line)--1.4%
Reliastar Financial Corp. 8,100 333,619
Travelers Group, Inc. 77,100 4,153,762
------------
4,487,381
------------
Insurance (Property-Casualty)--1.0%
Allstate Corp. ....... 34,900 3,171,538
------------
Investment Banking/Brokerage--0.5%
Merrill Lynch & Co., Inc. 23,700 1,728,619
------------
Machinery (Diversified)--0.7%
Deere & Co. .......... 36,900 2,151,731
------------
Manufacturing (Diversified)--2.2%
Tyco International Ltd. 153,900 6,935,119
------------
Oil (Domestic Integrated)--1.4%
Tosco Corp. .......... 113,800 4,303,062
------------
Oil & Gas (Drilling & Equipment)--6.3%
BJ Services Co. (b) .. 33,400 2,402,712
Cooper Cameron Corp. (b) 17,100 1,043,100
Diamond Offshore
Drilling, Inc. ...... 48,600 2,338,875
Halliburton Co. ...... 84,600 4,393,913
Nabors Industries,
Inc. (b) ........... 16,200 509,287
Noble Drilling
Corp. (b) ........... 38,500 1,179,063
Rowan Companies,
Inc. (b) ........... 32,700 997,350
Schlumberger Ltd. .... 59,700 4,805,850
Transocean Offshore, Inc. 51,200 2,467,200
------------
20,137,350
------------
Oil & Gas (Refining & Marketing)--0.4%
Santa Fe International
Corp. ............... 31,700 1,289,794
------------
Personal Care--1.7%
Gillette Co. ......... 52,700 5,293,056
------------
Retail (Building Supplies)--1.3%
Home Depot, Inc. ..... 69,800 4,109,475
------------
Retail (Drug Stores)--2.8%
CVS Corp. ............ 70,900 4,542,031
Rite Aid Corp. ....... 76,600 4,495,463
------------
9,037,494
------------
Retail (Food Chains)--1.6%
Safeway, Inc. (b) .... 81,800 5,173,850
------------
Retail (General Merchandise)--1.2%
Borders Group, Inc. (b) 75,800 2,373,487
Staples, Inc. (b) .... 57,100 1,584,525
------------
3,958,012
------------
Telecommunications (Cellular/Wireless)--2.1%
AirTouch Communications,
Inc. (b) ........... 160,000 6,650,000
------------
Telecommunications (Long Distance)--1.6%
AT&T Corp. ........... 82,900 5,077,625
------------
Tobacco--2.5%
Philip Morris Companies,
Inc. ................ 175,900 7,970,469
------------
TOTAL COMMON STOCKS
(Identified cost $207,612,558) ........ 223,710,175
------------
</TABLE>
See Notes to Financial Statements
6
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES VALUE
-------- --------------
<S> <C> <C>
FOREIGN COMMON STOCKS--4.4%
Computers (Software & Services)--0.2%
Baan Company NV (Netherlands) (b) ......... 17,900 $ 590,700
------------
Health Care (Drugs-Major Pharmaceuticals)--1.3%
SmithKline Beecham PLC Sponsored ADR
(United Kingdom) ....................... 81,800 4,207,588
------------
Health Care (Medical Products & Supplies)--0.4%
Elan PLC Sponsored ADR (Ireland) (b) ...... 25,300 1,295,044
------------
Household Furn. & Appliances--1.4%
Philips Electronics NV ADR NY
Registered Shares (Netherlands) ........ 74,500 4,507,250
------------
Oil (International Integrated)--1.1%
Elf Aquitane SA Sponsored ADR (France) ..... 57,300 3,359,213
------------
TOTAL FOREIGN COMMON STOCKS
(Identified cost $15,648,155) ...................... 13,959,795
------------
TOTAL LONG-TERM INVESTMENTS--90.3%
(Identified cost $272,510,838) ..................... 288,474,384
------------
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000)
------------- ---------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--7.6%
Commercial Paper--5.8%
Corporate Receivables
Corp. 5.90%, 1/6/98 ..... A-1 $2,000 1,998,361
</TABLE>
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000) VALUE
------------- --------- --------------------
<S> <C> <C> <C>
Commercial Paper--continued
Greenwich Funding Corp.
5.91%, 1/9/98 .............. A-1+ $1,000 $ 998,687
Kimberly-Clark Corp.
6.15%, 1/9/98 .............. A-1+ 2,500 2,496,584
Minnesota Mining &
Manufacturing Co.
6.10%, 1/9/98 .............. A-1+ 2,410 2,406,733
Receivables Capital Corp.
6.15%, 1/23/98 ............. A-1+ 1,960 1,952,633
Procter & Gamble Co.
5.63%, 2/11/98 ............. A-1+ 3,000 2,980,764
Wisconsin Electric Power
Co. 5.75%, 2/13/98 ......... A-1+ 3,500 3,475,962
CXC, Inc. 5.75%, 3/23/98 ..... A-1+ 2,280 2,251,021
--------------
18,560,745
--------------
Federal Agency Securities--1.8%
Federal Home Loan Banks 5.75%,
1/2/98 ................................. 5,660 5,659,089
--------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $24,219,316)....................... 24,219,834
--------------
TOTAL INVESTMENTS--97.9%
(Identified cost $296,730,154)...................... 312,694,218(a)
Cash and receivables, less liabilities--2.1% 6,760,863
--------------
NET ASSETS--100.0% ................................... $ 319,455,081
==============
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $24,595,104 and gross
depreciation of $8,946,917 for income tax purposes. At December 31, 1997,
the aggregate cost of securities for federal income tax purposes was
$297,046,031.
(b) Non-income producing.
(c) As rated by Moody's, Fitch, or Duff & Phelps.
(d) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At December 31,
1997, these securities amounted to a value of $3,752,420 or 1.2% of net
assets.
(e) Variable or step coupon security; interest rate shown reflects the rate
currently in effect.
(f) All or a portion segregated as collateral.
See Notes to Financial Statements
7
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1997
<TABLE>
<S> <C>
Assets
Investment securities at value
(Identified cost $296,730,154) $ 312,694,218
Short-term investments held as collateral
for loaned securities 5,520,892
Cash 1,520,024
Receivables
Investment securities sold 8,475,339
Fund shares sold 114,172
Interest and dividends 1,007,021
-------------
Total assets 329,331,666
-------------
Liabilities
Payables
Investment securities purchased 3,644,881
Collateral on securities loaned 5,520,892
Fund shares repurchased 265,385
Investment advisory fee 176,146
Distribution fee 74,607
Transfer agent fee 60,335
Financial agent fee 12,546
Directors' fee 2,256
Accrued expenses 119,537
-------------
Total liabilities 9,876,585
-------------
Net Assets $ 319,455,081
=============
Net Assets Consist of:
Capital paid in on shares of common stock $ 295,899,930
Undistributed net investment income 445,183
Accumulated net realized gain 7,145,904
Net unrealized appreciation 15,964,064
-------------
Net Assets $ 319,455,081
=============
Class A
Shares of common stock, $1 par value,
50,000,000 shares authorized
(Net Assets $308,523,643) 19,999,964
Net asset value per share $15.43
Offering price per share
$15.43/(1-4.75%) $16.20
Class B
Shares of common stock, $1 par value,
50,000,000 shares authorized
(Net Assets $10,931,438) 714,369
Net asset value and offering price per share $15.30
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1997
<TABLE>
<S> <C>
Investment Income
Interest $ 6,943,251
Dividends 2,248,442
Security lending 67,148
-----------
Total investment income 9,258,841
-----------
Expenses
Investment advisory fee 2,109,677
Distribution fee--Class A 785,416
Distribution fee--Class B 103,992
Financial agent fee 149,370
Transfer agent 490,092
Printing 92,432
Custodian 35,972
Professional 35,916
Registration 31,026
Directors 23,481
Miscellaneous 23,478
-----------
Total expenses 3,880,852
-----------
Net investment income 5,377,989
-----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 55,261,609
Net realized loss on written options (205,711)
Net realized gain on foreign currency transactions 195
Net change in unrealized appreciation (depreciation)
on investments 166,401
-----------
Net gain on investments 55,222,494
-----------
Net increase in net assets resulting from
operations $60,600,483
===========
</TABLE>
See Notes to Financial Statements
8
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, 1997 December 31, 1996
------------------- ------------------
<S> <C> <C>
From Operations
Net investment income $ 5,377,989 $ 6,069,898
Net realized gain 55,056,093 32,225,004
Net change in unrealized appreciation (depreciation) 166,401 (9,313,255)
------------- -------------
Increase in net assets resulting from operations 60,600,483 28,981,647
------------- -------------
From Distributions to Shareholders
Net investment income--Class A (5,272,416) (5,622,283)
Net investment income--Class B (110,138) (90,090)
Net realized gains--Class A (50,054,070) (29,211,894)
Net realized gains--Class B (1,756,759) (899,061)
------------- -------------
Decrease in net assets from distributions to shareholders (57,193,383) (35,823,328)
------------- -------------
From Share Transactions
Class A
Proceeds from sales of shares (609,276 and 918,493 shares, respectively) 10,117,463 14,942,495
Net asset value of shares issued from reinvestment of distributions
(3,143,046 and 1,918,313 shares, respectively) 47,891,238 30,240,866
Cost of shares repurchased (3,705,438 and 5,512,257 shares, respectively) (62,577,057) (90,484,207)
------------- -------------
Total (4,568,356) (45,300,846)
------------- -------------
Class B
Proceeds from sales of shares (85,000 and 168,248 shares, respectively) 1,421,465 2,738,747
Net asset value of shares issued from reinvestment of distributions
(112,967 and 55,850 shares, respectively) 1,704,113 875,001
Cost of shares repurchased (105,293 and 108,645 shares, respectively) (1,781,004) (1,770,975)
------------- -------------
Total 1,344,574 1,842,773
------------- -------------
Decrease in net assets from share transactions (3,223,782) (43,458,073)
------------- -------------
Net increase (decrease) in net assets 183,318 (50,299,754)
Net Assets
Beginning of period 319,271,763 369,571,517
------------- -------------
End of period (including undistributed net investment income of $445,183 and
$448,303, respectively) $ 319,455,081 $ 319,271,763
============= =============
</TABLE>
See Notes to Financial Statements
9
<PAGE>
Phoenix Strategic Allocation Fund, Inc.
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
Class A
------------------------------------------------------------------------------------
Year Ended December 31,
1997 1996 1995 1994 1993
------------- ------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 15.52 $ 15.98 $ 14.82 $ 15.48 $ 14.89
Income from investment operations(6)
Net investment income 0.30 0.31 0.45 0.34 0.06(2)
Net realized and unrealized gain (loss) 2.81 1.10 2.22 (0.69) 1.49
--------- --------- -------- -------- -----------
Total from investment operations 3.11 1.41 2.67 (0.35) 1.55
--------- --------- -------- -------- -----------
Less distributions
Dividends from net investment income (0.30) (0.29) (0.52) (0.31) (0.11)
Dividends from net realized gains (2.90) (1.58) (0.99) (0.001) (0.85)
--------- --------- -------- -------- -----------
Total distributions (3.20) (1.87) (1.51) (0.311) (0.96)
--------- --------- -------- -------- -----------
Change in net asset value (0.09) (0.46) 1.16 (0.66) 0.59
--------- --------- -------- -------- -----------
Net asset value, end of period $ 15.43 $ 15.52 $ 15.98 $ 14.82 $ 15.48
========= ========= ======== ======== ===========
Total return(1) 20.68% 8.78% 18.23% (2.26)% 10.49%
Ratios/supplemental data:
Net assets, end of period (thousands) $308,524 $309,678 $361,526 $335,177 $370,440
Ratio to average net assets of:
Operating expenses 1.17% 1.21% 1.21% 1.24% 1.29%
Net investment income 1.68% 1.78% 2.67% 2.18% 1.26%
Portfolio turnover 355% 275% 184% 225% 246%
Average commission rate paid(5) $ 0.0547 $ 0.0529 N/A N/A N/A
</TABLE>
<TABLE>
<CAPTION>
Class B
-------------------------------------------------------------------
From
Inception
Year Ended December 31, 10/24/94 to
1997 1996 1995 12/31/94
---------- --------- --------- --------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 15.43 $ 15.89 $ 14.79 $ 14.98
Income from investment operations(6)
Net investment income 0.18 0.19 0.30 (2) 0.07
Net realized and unrealized gain (loss) 2.77 1.09 2.22 (0.09)
-------- --------- ----------- --------
Total from investment operations 2.95 1.28 2.52 (0.02)
-------- --------- ----------- --------
Less distributions
Dividends from net investment income (0.18) (0.16) (0.43) (0.17)
Dividends from net realized gains (2.90) (1.58) (0.99) --
-------- --------- ----------- --------
Total distributions (3.08) (1.74) (1.42) (0.17)
---------- -------- ----------- --------
Change in net asset value (0.13) (0.46) 1.10 (0.19)
-------- --------- ----------- --------
Net asset value, end of period $ 15.30 $ 15.43 $ 15.89 $ 14.79
======== ========= =========== ========
Total return(1) 19.74% 7.95% 17.31% (0.12)%(4)
Ratios/supplemental data:
Net assets, end of period (thousands) $10,931 $ 9,594 $ 8,046 $ 1,328
Ratio to average net assets of:
Operating expenses 1.92% 1.96% 1.97% 2.26%(3)
Net investment income 0.92% 1.01% 1.88% 1.74%(3)
Portfolio turnover 355% 275% 184% 225%
Average commission rate paid(5) $0.0547 $0.0529 N/A N/A
</TABLE>
(1) Maximum sales load is not reflected in total return calculation.
(2) Computed using average shares outstanding.
(3) Annualized
(4) Not annualized
(5) For fiscal years beginning on or after September 1, 1995, a fund is
required to disclose its average commission rate per share for securities
trades on which commissions are charged. This rate generally does not
reflect mark-ups, mark-downs, or spreads on shares traded on a principal
basis.
(6) Distributions are made in accordance with the prospectus; however, class
level per share income from investment operations may vary from
anticipated results depending on the timing of share purchases and
redemptions.
See Notes to Financial Statements
10
<PAGE>
PHOENIX STRATEGIC ALLOCATION FUND, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1997
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES
Phoenix Strategic Allocation Fund, Inc. ("the Fund") 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 achieve
the highest total return consistent with reasonable risk by investing in
stocks, bonds and money market instruments. The Fund offers both Class A and
Class B shares. Class A shares are sold with a front-end sales charge of up to
4.75%. Class B shares are sold with a contingent deferred sales charge which
declines from 5% to zero depending on the period of time the shares are held.
Both classes of shares have identical voting, dividend, liquidation and other
rights and the same terms and conditions, except that each class bears
different distribution expenses and has exclusive voting rights with respect to
its distribution plan. Income and expenses of the Fund are borne pro rata by
the holders of both classes of shares, except that each class bears
distribution expenses unique to that class.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. 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, liabilities, revenues and expenses.
Actual results could differ from those estimates.
A. Security valuation:
Equity securities are valued at the last sale price, or if there had been
no sale that day, at the last bid price. Debt securities are valued on the
basis of broker quotations or valuations provided by a pricing service which
utilizes information with respect to recent sales, market transactions in
comparable securities, quotations from dealers, and various relationships
between securities in determining value. Short-term investments having a
remaining maturity of 60 days or less are valued at amortized cost which
approximates market. All other securities and assets are valued at fair value
as determined in good faith by or under the direction of the Directors.
B. Security transactions and related income:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date or, in the case of certain foreign securities,
as soon as the Fund is notified. Interest income is recorded on the accrual
basis. The Fund does not amortize premiums but does amortize discounts using
the effective interest method. Realized gains or losses are determined on the
identified cost basis.
C. Income taxes:
It is the policy of the Fund to comply with the requirements of the
Internal Revenue Code (the Code), applicable to regulated investment companies,
and to distribute all of its taxable income to its shareholders. In addition,
the Fund intends to distribute an amount sufficient to avoid the imposition of
any excise tax under Section 4982 of the Code. Therefore, no provision for
federal income taxes or excise taxes has been made.
D. Distributions to shareholders:
Distributions to shareholders are recorded on the ex-dividend date. Income
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences include the treatment of non-taxable dividends, expiring
capital loss carryforwards, foreign currency gain/loss, partnerships, and losses
deferred due to wash sales and excise tax regulations. Permanent book and tax
basis differences relating to shareholder distributions will result in
reclassifications to paid in capital.
E. Foreign currency translation:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at
the trade date. The gain or loss resulting from a change in currency exchange
rates between the trade and settlement dates of a portfolio transaction is
treated as a gain or loss on foreign currency. Likewise, the gain or loss
resulting from a change in currency exchange rates between the date income is
accrued and paid is treated as a gain or loss on foreign currency. The Fund
does not separate that portion of the results of operations arising from
changes in exchange rates and that portion arising from changes in the market
prices of securities.
F. Options:
The Fund may write covered options or purchase options contracts for the
purpose of hedging against changes in the market value of the underlying
securities or foreign currencies.
11
<PAGE>
PHOENIX STRATEGIC ALLOCATION FUND, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1997 (Continued)
The Fund will realize a gain or loss upon the expiration or closing of the
option transaction. Gains and losses on written options are reported separately
in the Statement of Operations. When a written option is exercised, the
proceeds on sales or amounts paid are adjusted by the amount of premium
received. Options written are reported as a liability in the Statement of
Assets and Liabilities and subsequently marked-to-market to reflect the current
value of the option. The risk associated with written options is that the
change in value of options contracts may not correspond to the change in value
of the hedged instruments. In addition, losses may arise from changes in the
value of the underlying instruments, or if a liquid secondary market does not
exist for the contracts.
The Fund may purchase options which are included in the Fund's Schedule of
Investments and subsequently marked-to-market to reflect the current value of
the option. When a purchased option is exercised, the cost of the security is
adjusted by the amount of premium paid. The risk associated with purchased
options is limited to the premium paid.
G. Security lending:
The Fund loans securities to qualified brokers through an agreement with
State Street Bank and Trust Company (State Street). Under the terms of the
agreement, the Fund receives collateral with a market value not less than 100%
of the market value of loaned securities. Collateral consists of cash,
securities issued or guaranteed by the U.S. Government or its agencies and the
sovereign debt of foreign countries. Interest earned on the collateral and
premiums paid by the borrower are recorded as income by the Fund net of fees
charged by State Street for its services in connection with this securities
lending program. Lending portfolio securities involves a risk of delay in the
recovery of the loaned securities or in the foreclosure on collateral. At
December 31, 1997, the Fund had loaned securities with a market value of
$5,376,860 and received collateral of $5,520,892.
NOTE 2. INVESTMENT ADVISORY FEES AND RELATED PARTY TRANSACTIONS
As compensation for its services to the Fund, the Investment Adviser,
Phoenix Investment Counsel, Inc., an indirect majority-owned subsidiary of
Phoenix Home Life Mutual Insurance Company ("PHL"), is entitled to a fee at an
annual rate of 0.65% of the average daily net assets of the Fund for the first
$1 billion.
As Distributor of the Fund's shares, Phoenix Equity Planning Corp.
("PEPCO"), an indirect majority-owned subsidiary of PHL, has advised the Fund
that it retained net selling commissions of $16,801 for Class A shares and
deferred sales charges of $35,846 for Class B shares for the year ended
December 31, 1997. In addition, the Fund pays PEPCO a distribution fee at an
annual rate of 0.25% for Class A shares and 1.00% for Class B shares of the
average daily net assets of the Fund. The Distributor has advised the Fund that
of the total amount expensed for the year ended December 31, 1997, $214,049 was
retained by the Distributor, $626,034 was paid to unaffiliated participants and
$49,325 was paid to W.S. Griffith, an indirect subsidiary of PHL.
As Financial Agent of the Fund, PEPCO receives a fee for bookkeeping,
administration, and pricing services at an annual rate of 0.05% of average
daily net assets up to $100 million, 0.04% of average daily net assets of $100
million to $300 million, 0.03% of average daily net assets of $300 million
through $500 million, and 0.015% of average daily net assets greater than $500
million; a minimum fee may apply. PEPCO serves as the Fund's Transfer Agent
with State Street Bank and Trust Company as sub-transfer agent. For the year
ended December 31, 1997, transfer agent fees were $490,092 of which PEPCO
retained $195,024 which is net of the fees paid to State Street.
At December 31, 1997, PHL and affiliates held 60 Class A shares and 9,994
Class B shares of the Fund with a combined value of $153,828.
NOTE 3. PURCHASES AND SALES OF SECURITIES
During the year ended December 31, 1997, purchases and sales of
investments, excluding short-term securities and U.S. Government and agency
securities, amounted to $812,234,727 and $872,141,033, respectively. Purchases
and sales of long-term U.S. Government and agency securities amounted to
$154,459,567 and $155,029,546, respectively.
Written option activity for the year ended December 31, 1997, aggregated
the following:
<TABLE>
<CAPTION>
Call Options
-----------------------------
Number of Amount of
Options Premiums
----------- ---------------
<S> <C> <C>
Options outstanding at
December 31, 1996 -- $ --
Options written 4,595 1,357,023
Options canceled in closing
purchase transactions (4,445) (1,317,162)
Options expired -- --
Options exercised (150) (39,861)
------ ----------
Options outstanding at
December 31, 1997 -- $ --
====== ==========
</TABLE>
12
<PAGE>
PHOENIX STRATEGIC ALLOCATION FUND, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1997 (Continued)
NOTE 4. CREDIT RISK
In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such investments
may be volatile. The consequences of political, social or economic changes in
these markets may have disruptive effects on the market prices of these
investments and the income they generate, as well as a fund's ability to
repatriate such amounts.
NOTE 5. RECLASSIFICATION OF CAPITAL ACCOUNTS
In accordance with accounting pronouncements, the Fund has recorded
several reclassifications in the capital accounts. These reclassifications have
no impact on the net asset value of the Fund and are designed generally to
present undistributed income and realized gains on a tax basis which is
considered to be more informative to the shareholder. During the year ended
December 31, 1997, the Fund increased undistributed net investment income by
$1,445 and decreased accumulated net realized gains by $1,445.
- ----------------------------------
TAX INFORMATION NOTICE (Unaudited)
Long-Term Capital Gains:
The Taxpayer Relief Act of 1997 included changes in the taxability of
long-term capital gains for individuals and certain other taxpayers. The
long-term capital gain distributions these shareholders receive from the Fund
are now taxed at either a 28% or 20% maximum rate, depending on how long an
asset was held and when it was sold. For the fiscal year ended December 31,
1997, the Fund distributed long-term capital gain dividends as follows:
28% rate gain distributions: $1,354,333
20% rate gain distributions: $631,201
Corporate Dividends Received Deduction:
For federal income tax purposes, 2.73% of the ordinary income dividends
paid by the Fund qualify for the dividends received deduction for corporate
shareholders.
This report is not authorized for distribution to prospective investors
in the Phoenix Strategic Allocation Fund, Inc. unless preceded or accompanied
by an effective prospectus which includes information concerning the sales
charge, the Fund's record and other pertinent information.
13
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP [LOGO]
To the Board of Directors and Shareholders of
Phoenix Strategic Allocation Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments (except for bond ratings), and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
Phoenix Strategic Allocation Fund, Inc. (the "Fund") at December 31, 1997, and
the results of its operations, the changes in its net assets and the financial
highlights for each of the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which 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, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at December 31, 1997 by
correspondence with the custodian and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above.
/s/ Price Waterhouse LLP
Boston, Massachusetts
February 16, 1998
<PAGE>
RESULTS OF SHAREHOLDER MEETING (Unaudited)
A special meeting in lieu of the Annual Meeting of shareholders of the Phoenix
Strategic Allocation Fund, Inc. was held on September 19, 1997 to approve the
following matters:
1. Fix the number of directors at fourteen and elect such number as detailed
below.
2. Ratify selection of Price Waterhouse LLP, independent accountants, as
auditors for the fiscal year ending December 31, 1997.
On the record date for this meeting, there were 18,860,230 shares outstanding
and 57.34% of the shares outstanding and entitled to vote were present by
proxy.
NUMBER OF VOTES:
1. Election of Directors For Withheld
---------- --------
C. Duane Blinn 10,430,569 383,906
Robert Chesek 10,440,160 374,315
E. Virgil Conway 10,421,775 392,700
Harry Dalzell-Payne 10,430,690 383,785
Francis E. Jeffries 10,440,186 374,289
Leroy Keith, Jr. 10,444,898 369,577
Philip R. McLoughlin 10,440,269 374,206
Everett L. Morris 10,432,841 381,634
James M. Oates 10,444,108 370,367
Calvin J. Pedersen 10,441,968 372,507
Philip R. Reynolds 10,428,195 386,280
Herbert Roth, Jr. 10,432,917 381,558
Richard E. Segerson 10,441,145 373,330
Lowell P. Weicker, Jr. 10,389,380 425,095
For Against Abstain
---------- ------- -------
2. Price Waterhouse LLP 10,347,945 88,307 378,223
<PAGE>
PHOENIX STRATEGIC ALLOCATION FUND, INC.
101 Munson Street
Greenfield, Massachusetts 01301
Directors
C. Duane Blinn
Robert Chesek
E. Virgil Conway
Harry Dalzell-Payne
Francis E. Jeffries
Leroy Keith, Jr.
Philip R. McLoughlin
Everett L. Morris
James M. Oates
Calvin J. Pedersen
Philip R. Reynolds
Herbert Roth, Jr.
Richard E. Segerson
Lowell P. Weicker, Jr.
Officers
Philip R. McLoughlin, President
Michael E. Haylon, Executive Vice President
David R. Pepin, Executive Vice President
William J. Newman, Senior Vice President
James D. Wehr, Senior Vice President
Mary E. Canning, Vice President
William E. Keen, III, Vice President
William R. Moyer, Vice President
Leonard J. Saltiel, Vice President
Nancy G. Curtiss, Treasurer
G. Jeffrey Bohne, Secretary and Clerk
Investment Adviser
Phoenix Investment Counsel, Inc.
56 Prospect St.
Hartford, Connecticut 06115-0480
Principal Underwriter
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
Transfer Agent
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, Massachusetts 02101
Independent Accountants
Price Waterhouse LLP
160 Federal Street
Boston, Massachusetts 02110
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[BACK COVER]
-------------------
Phoenix Funds BULK RATE MAIL
PO Box 2200 U.S. POSTAGE
Enfield CT 06083-2200 PAID
SPRINGFIELD, MA
PERMIT NO. 444
-------------------
[LOGO] PHOENIX
DUFF & PHELPS
PDP 454 (2/98)
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 001
<NAME> PHOENIX STRATEGIC ALLOCATION FUND, INC. CLASS A
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 296730
<INVESTMENTS-AT-VALUE> 312694
<RECEIVABLES> 9597
<ASSETS-OTHER> 7041
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 329332
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<OTHER-ITEMS-LIABILITIES> 6232
<TOTAL-LIABILITIES> 9877
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<PAID-IN-CAPITAL-COMMON> 295900
<SHARES-COMMON-STOCK> 20000
<SHARES-COMMON-PRIOR> 19953
<ACCUMULATED-NII-CURRENT> 445
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<ACCUMULATED-NET-GAINS> 7146
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<ACCUM-APPREC-OR-DEPREC> 15964
<NET-ASSETS> 319455
<DIVIDEND-INCOME> 2249
<INTEREST-INCOME> 6943
<OTHER-INCOME> 67
<EXPENSES-NET> (3881)
<NET-INVESTMENT-INCOME> 5378
<REALIZED-GAINS-CURRENT> 55056
<APPREC-INCREASE-CURRENT> 166
<NET-CHANGE-FROM-OPS> 60600
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5272)
<DISTRIBUTIONS-OF-GAINS> (50054)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 609
<NUMBER-OF-SHARES-REDEEMED> (3705)
<SHARES-REINVESTED> 3143
<NET-CHANGE-IN-ASSETS> (1154)
<ACCUMULATED-NII-PRIOR> 448
<ACCUMULATED-GAINS-PRIOR> 3902
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2110
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 3881
<AVERAGE-NET-ASSETS> 324566
<PER-SHARE-NAV-BEGIN> 15.52
<PER-SHARE-NII> 0.30
<PER-SHARE-GAIN-APPREC> 2.81
<PER-SHARE-DIVIDEND> (0.30)
<PER-SHARE-DISTRIBUTIONS> (2.90)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 15.43
<EXPENSE-RATIO> 1.17
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 002
<NAME> PHOENIX STRATEGIC ALLOCATION FUND, INC. CLASS B
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<S> <C>
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</TABLE>
