DREYFUS CAPITAL VALUE FUND (A Premier Fund) SEPTEMBER 30, 1995
LETTER TO SHAREHOLDERS
Dear Shareholder:
The general stock market has risen sharply during the past year in
parallel with long-term Treasury bonds and strong earnings. This has been in
contradiction to the investment approach of The Dreyfus Capital Value Fund (A
Premier Fund). The stock market remains at what has, in the past, proved to
be very expensive valuation levels, particularly as measured by dividend
yields on both an absolute basis and relative to Treasury bill yields.
Gauging the future direction of the market becomes more complex when one
considers that inflation remains tame, earnings continue to be strong, and
interest rates are declining. We feel that the correction of today's
overvaluation of financial assets will ultimately be triggered by a change in
the direction of any one of these bullish supports to stock prices.
For the fiscal year ended September 30, 1995, the Fund's Class A shares
posted a total return of -8.58%.* The Fund's Class B shares posted a total
return of -9.27%.* For the same period, the Standard & Poor's 500 Composite
Stock Price Index ("S&P 500") rose 29.71%.** Since their inception on August
22, 1995 through September 30, 1995, the Fund's Class C and Class R shares
posted aggregate total returns of -2.26% and -2.03%, respectively.*
Currently, the Fund holds index put positions and short positions that
should benefit from declines in the equity markets. The S&P 500 advanced
during the fiscal year, with the result that the value of the Fund's options
declined, but the capital lost has been limited to the cost of premiums paid.
The Fund has also lost value by selling both stocks and S&P 500 futures
short. Through our discipline of limiting losses, the Fund has exited these
positions during certain periods of the year. The bulk of the Fund's losses
during the last fiscal year can be attributed to these positions.
The Fund's gold share position stands at 26% of the total portfolio. Gold
bullion has failed to penetrate the $400 per ounce level significantly for
the past five years. Each rally approaching $400 per ounce is met by supply
from either central banks or gold mining companies selling their production
forward. At some point this supply could shift sharply into demand. Forward
selling of mine production is essentially a short position, which producers
may scramble to reverse in a rising gold market, while the complacency of
central banks may be altered due to a shift in the public's current positive
attitude toward financial assets. The gold share position has done little to
alter the performance of the Fund over the last year with the exception of
some net trading profits. We still believe that, should the gold market
penetrate the $400 per ounce level, it will precipitate a continuing rise
that will be both quick and sharp, warranting our core position.
We have maintained a 34% position in debt securities denominated in
Deutschemarks, Swiss francs, and Dutch guilders. The dollar's slide during
the first half of the fiscal year produced currency gains from these
positions. When it appeared that the dollar had stabilized, we hedged the
currency exposure. While we have maintained the hedge, we will continue to
monitor this position in the hope that the Fund can take advantage of another
dollar slide.
The Fund has purchased securities in a number of emerging markets. These
include debt securities of Russia, Venezuela and Argentina along with
closed-end investment funds that invest in Vietnam and Russia. In total, this
asset class has proven to be very profitable for the Fund.
Japan, a land mass the size of California, has a GDP in dollars roughly
equal to the U.S. This, along with other measures of valuation, recent trade
figures and Japan's continuing real estate problems, points to a lower yen
relative to the dollar and higher interest rates. The Fund has purchased put
options that would benefit if either the Japanese bond market or the relative
value of the Japanese yen declines. This position has been profitable for the
Fund as the yen/dollar foreign exchange rate has moved from 85 to 100.
The Fund has also purchased Japanese equities while hedging the currency
exposure this creates. The Japanese stock market appears to offer value after
declining over 50% from its peak in 1989. Even though Japan is facing a
difficult real estate problem, and the stock market still appears expensive
relative to earnings, there seem to be some signs of a change. The Japanese
market is cheap relative to book value and short-term interest rates.
Technical indicators such as volatility and volume patterns point to an end
of the six-year bear market. Most important, earnings are due to rebound as
the government provides liquidity to the economy to mitigate its real estate
problems, a situation similar to that of the U.S. in 1991. In addition, a
weaker yen will improve the health of export-oriented Japan tremendously by
making the price of its goods more competitive. The Fund has realized a small
profit on this investment theme.
The Fund holds Interest Only securities ("IOs"), which are one of the
cheapest and most liquid means to benefit from rising interest rates. Since
rates have not moved materially, the value of the Fund's IO investment
position has remained roughly the same.
The Fund's continued search for value in the stock market has resulted in
positions in companies such as Dole Food, Hartmarx, Horsham, P.T. Tri Polyta
Indonesia A.D.R., Duty Free International and Teledyne. These companies
appear to trade at a substantial discount to their net asset value, and now
account for approximately 4% of the Fund's portfolio.
In summary, the Fund's positions will generally benefit from stock market
declines, interest rate increases, a declining Japanese yen, rising gold
shares and a number of special situations both in the U.S. and abroad. In
addition, it will continue to hold a significant U.S. Treasury bill position
in anticipation of buying stocks at much cheaper levels.
The performance of the Fund has been poor over the last fiscal year.
While many themes that the Fund invested in have worked out well, the primary
thrust - profiting during a bear stock market - has proven to be a disaster
of late. Our investment policy committee has always understood that the price
for being bearish too early is poor performance, both absolute and relative.
In an attempt to limit losses during a rising market and minimize weak
absolute returns, the Fund has adhered to a policy of buying put options
along with a strict discipline of exiting short positions when appropriate.
During the last few years, the markets have surely tested our conviction, but
we feel more strongly than ever that today's investors should take a cautious
and conservative stance toward financial assets.
Sincerely,
Comstock Partners, Inc.
Investment Policy Committee
October 19, 1995
Jersey City, N.J.
* Total return includes reinvestment of dividends and any capital gains paid,
without taking into account the maximum initial
sales charge in the case of Class A shares or the applicable contingent
deferred sales charge imposed on redemptions in the case of Class B and Class
C shares.
** SOURCE: LIPPER ANALYTICAL SERVICES, INC. - Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of U.S. stock market performance.
DREYFUS CAPITAL VALUE FUND (A Premier Fund) SEPTEMBER 30, 1995
[Exhibit A]
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS CAPITAL VALUE
FUND (A PREMIER FUND) CLASS A SHARES AND THE STANDARD & POOR'S 500 COMPOSITE
STOCK PRICE INDEX
Dollars
$44,171
Standard & Poor's 500
Composite
Stock Price Index*
$22,730
Dreyfus Capital Value
Fund (Class A Shares)
*Source: Lipper Analytical Services, Inc.
[Exhibit A]
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in Class A shares of the
Dreyfus Capital Value Fund on 10/10/85 (Inception Date) to a $10,000
investment made in the Standard & Poor's 500 Composite Stock Price Index on
that date. For comparative purposes the value of the Index on 9/30/85 is used
as the beginning value on 10/10/85. All dividends and capital gain
distributions are reinvested. Performance for Class B shares, Class C shares
and Class R shares will vary from the performance of Class A shares shown
above due to differences in charges and expenses.
The Fund's performance shown in the line graph takes into account the maximum
initial sales charge on Class A shares and all other applicable fees and
expenses. The Standard & Poor's 500 Composite Stock Price Index is a widely
accepted, unmanaged index of overall stock market performance which does not
take into account charges, fees and other expenses. Further information
relating to Fund performance is contained in the Condensed Financial
Information section of the Prospectus and elsewhere in this report.
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund) SEPTEMBER 30, 1995
AVERAGE ANNUAL TOTAL RETURNS
CLASS A CLASS B
--------------------------------- ------------------------------
% Return Reflecting
% Return Applicable Contingent
Reflecting % Return Deferred Sales
% Return Without Maximum Initial Assuming No Charge Upon
PERIOD ENDED 9/30/95 Sales Charge Sales Charge (4.5%) PERIOD ENDED 9/30/95 Redemption Redemption*
- -------------------- ---------- ------------------ ------------------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
1 Year (8.58)% (12.70)% 1 Year (9.27)% (12.83)%
5 Years (1.28) (2.19) From Inception (1/15/93) 0.83 (0.26)
From 4/28/87** 4.93 4.36
From Inception (10/10/85) 9.08 8.58
ACTUAL AGGREGATE TOTAL RETURNS
CLASS C CLASS R
---------------------------- ------------------------------
% Return Reflecting
Applicable Contingent
% Return Deferred Sales
Assuming No Charge Upon
Redemption Redemption***
________ __________________
From Inception (8/22/95) From Inception (8/22/95)
to September 30, 1995 (2.26)% (3.23)% to September 30, 1995 (2.03)%
* Maximum contingent deferred sales charge for Class B shares is 4%
and is reduced to 0% after six years.
** The Fund changed its investment objective as of April 28, 1987.
***Maximum contingent deferred sales charge for Class C shares is 1% within
one year of the date of purchase.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF INVESTMENTS SEPTEMBER 30, 1995
COMMON STOCKS-40.1% SHARES VALUE
-------- -------
<S> <C> <C>
BASIC INDUSTRIES-29.4%
Gold Mining-26.4% Amax Gold............................. (a) 225,500 $1,381,188
Ashanti Goldfields, G.D.R. .......... (b) 425,000 8,526,563
Barrick Gold........................... 261,200 6,758,550
Battle Mountain Gold................... 215,000 2,123,125
Cambior................................ 150,000 1,593,128
Driefontein Consolidated, A.D.R. ...... 127,000 1,730,375
East Rand Gold & Uranium, A.D.R. ...... 100,000 290,000
Echo Bay Mines......................... 250,000 2,718,750
Elandsrand Gold Mining, A.D.R. ........ 251,100 1,462,657
Free State Consolidated Gold Mines, A.D.R. 135,000 1,535,625
Goldcorp, Cl. A........................ 237,860 2,348,994
Golden Shamrock Mines................ (a) 440,000 272,945
Hartebeesfontein Gold Mining, A.D.R. .. 433,000 1,309,825
Hecla Mining......................... (a) 313,500 3,801,188
Homestake Mining....................... 424,800 7,221,600
Kinross Mines, A.D.R. ................. 144,000 1,584,000
Newmont Gold........................... 200,000 8,100,000
Newmont Mining......................... 118,000 5,015,000
Pegasus Gold......................... (a) 363,300 4,949,962
Placer Dome............................ 501,400 13,161,750
Royal Oak Mines...................... (a) 400,000 1,725,000
Santa Fe Pacific Gold................ (a) 677,082 8,548,160
TVX Gold............................. (a) 467,000 3,269,000
Vaal Reefs Exploration & Mining, A.D.R. 347,500 2,280,469
Western Area Gold Mining, A.D.R. ...... 18,100 313,356
Western Deep Levels, A.D.R. ........... 38,000 1,313,375
Winkelhaak Mines, A.D.R. .............. 175,600 1,569,425
-----------
94,904,010
-----------
Metals-3.0% Freeport-McMoRan Copper & Gold, Cl. A... 400,000 10,250,000
Impala Platinum Holdings, A.D.R. ...... 15,000 371,816
-----------
10,621,816
-----------
TOTAL BASIC INDUSTRIES................. 105,525,826
============
RESTRUCTURING-10.7%
Broadcasting-.5% Tele-Communications Liberty Media, Cl. A. 17,500 468,125
Tele-Communications-TCI, Cl. A....... (a) 70,000 1,225,000
-----------
1,693,125
-----------
Chemicals-.6% P.T. Tri Polyta Indonesia, A.D.R. ...... 102,000 2,193,000
-----------
Conglomerates-.6% Teledyne................................ 75,000 2,034,375
-----------
Electrical Equipment-.3% Hitachi, A.D.R. ........................ 10,000 1,101,250
-----------
Energy-.8% Baker Hughes............................ 150,000 3,056,250
-----------
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995
COMMON STOCKS (CONTINUED) SHARES VALUE
_______ _______
RESTRUCTURING (CONTINUED)
Foods and Beverages-.6% Dole Food............................... 68,200 $ 2,361,425
-----------
Holding Companies-1.7% Horsham................................. 464,200 6,092,625
-----------
Industrial-1.5% Pepgro ................................. 848,700 2,760,425
Pepgro ((N) Shares).................... 848,700 2,557,025
-----------
5,317,450
-----------
Miscellaneous-.7% Fleming Russia Securities Fund.......... 220,765 1,545,355
Lazard Vietnam Fund.................... 87,000 913,500
-----------
2,458,855
-----------
Oil-.9% Amerada Hess............................ 31,000 1,507,375
Total S.A., A.D.R. .................... 54,000 1,626,750
-----------
3,134,125
-----------
Oil and Gas Exploration-.3% Petro-Canada........................... 113,500 1,223,756
___________
Retail- 1.6% Duty Free International................. 111,200 1,417,800
Hartmarx............................. (a) 260,000 1,560,000
K mart............................ 187,000 2,711,500
___________
5,689,300
___________
Semiconductors-.6% Fujitsu ................................ 27,000 338,176
NEC, A.D.R. ........................... 18,400 1,285,700
OKI Electric Industry................ (a) 32,000 294,349
Toshiba................................ 37,000 268,788
___________
2,187,013
___________
TOTAL RESTRUCTURING.................... 38,542,549
============
TOTAL COMMON STOCKS
(cost $124,782,969).................. $144,068,375
============
PREFERRED STOCKS-.1%
Conglomerates; Teledyne, Series E
(cost $11,063)....................... 750 $ 10,406
============
CONTRACTS
SUBJECT
PUT OPTIONS-2.6% TO PUT
_______
AMEX Security Broker/Dealer Index:
January `96 @ $355................... 33,400 $ 81,413
Brokerage Basket;
November `95 @ $95................. (n) 224,323 0
Nasdaq 100 Index:
March `96 @ $550..................... 4,000 76,000
June `96 @ $550...................... 3,500 84,438
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995
CONTRACTS
SUBJECT
PUT OPTIONS (CONTINUED) TO PUT VALUE
_______ _______
Philadelphia Semi-Conductor Index;
June `96 @ $280...................... 4,200 $152,250
Standard & Poor's 500 Index Flex
Options:
December `95 @ $450.................. 122,000 26,688
December `96 @ $525.................. 32,500 365,625
Standard & Poor's 500 Index:
December `95 @ $375.................. 45,500 5,687
December `95 @ $400.................. 45,500 2,844
December `95 @ $450.................. 71,500 20,109
December `95 @ $475.................. 40,100 15,037
December `95 @ $485.................. 30,000 15,000
December `95 @ $550.................. 41,500 140,063
March `96 @ $453................... (n) 90,930 3,637
March `96 @ $500..................... 113,000 268,375
March `96 @ $525..................... 84,000 351,750
June `96 @ $450...................... 23,500 36,719
June `96 @ $475...................... 113,000 268,375
June `96 @ $500...................... 73,000 310,250
June `96 @ $550...................... 52,000 546,000
September `96 @ $550................. 101,000 1,350,875
December `96 @ $525.................. 32,500 357,500
PRINCIPAL
AMOUNT
SUBJECT
TO PUT
-------
Japanese Government Bond:
4.60%, 9/20/2004:
May `96 @ $1.288............... (c,d,n) $ 27,955,912 2,591,910
June `96 @ $1.343................(c,d,n) 13,271,002 2,248,909
U.S. Treasury Bond;
7.625%, 2/15/2025;
April `96 @ $103.078................(n) 30,000,000 120,000
___________
TOTAL PUT OPTIONS
(cost $25,556,433)................... $9,439,454
=============
PRINCIPAL
BONDS AND NOTES-37.4% AMOUNT
--------
BONDS-36.6%.......... Argentinian Securities;
Republic of Argentina,
5%, 3/31/2023................(e,f,g) $ 2,250,000 $1,092,656
Austrian Securities;
Republic of Austria,
4.50%, 2/12/2000................(h) 27,744,166 28,881,677
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995
PRINCIPAL
BONDS AND NOTES (CONTINUED) AMOUNT VALUE
------- -------
BONDS (CONTINUED)...... Danish Securities;
Kingdom of Denmark,
4.25%, 9/30/1999................(h) $ 12,964,564 $ 13,411,841
Dutch Securities;
Netherlands Government,
7.25%, 7/15/1999................(j) 4,062,754 4,308,550
German Securities;
Bundesrepublik Deutschland:
8.50%, 4/22/1996................(i) 42,337,299 43,323,758
9%, 10/20/2000................(i) 16,710,987 18,893,442
8.875%, 12/20/2000............(i) 12,596,221 14,193,422
Venezuelan Securities;
Republic of Venezuela,
6.75%, 3/31/2020.............(e,f) 14,000,000
7,175,000
___________
131,280,346
___________
NOTES-.8% Federal National Mortgage Association,
Non-Callable Strips, (collateralized by
FNMA Strip, 10/1/2024) Cl. 267-2,
8.50%, 10/25/2024 (Interest Only Obligation) 11,748,490 (k) 2,915,094
___________
TOTAL BONDS AND NOTES
(cost $115,829,424).................. $134,195,440
=============
LOAN PARTICIPATIONS-2.3%
FOREIGN LOAN PARTICIPATIONS:Vnesheconombank (Bank for Foreign
Economic Affairs of the USSR)
5/3/2025................... (h,n) $19,446,845 $ 6,077,139
5/3/2025.................. (i,n) 6,298,111 2,212,211
___________
TOTAL LOAN PARTICIPATIONS
(cost $6,703,509).................... $ 8,289,350
=============
SHORT-TERM INVESTMENTS-21.5%
U.S. TREASURY BILLS:. 5.35%, 10/5/95 (l,m) $ 44,201,000 $ 44,169,617
5.35%, 10/12/95.............. (l,m) 3,453,000 3,447,026
5.36%, 11/9/95......................... 409,000 406,595
5.38%, 11/16/95........................ 16,567,000 16,452,191
5.37%, 11/24/95................ (l,m) 9,429,000 9,352,625
5.24%, 12/7/95......................... 3,377,000 3,343,028
___________
TOTAL SHORT-TERM INVESTMENTS
(cost $77,178,940)................... $ 77,171,082
=============
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1995
VALUE
_______
TOTAL INVESTMENTS (cost $350,062,338) ................................ 104.0% $373,174,107
====== =============
LIABILITIES, LESS CASH AND RECEIVABLES ..................................... (4.0%) $ (14,273,638)
====== =============
NET ASSETS.................................................................. 100.0% $ 358,900,469
====== =============
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) 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 September
30, 1995, this security amounted to $8,526,563 or 2.4% of net assets.
(c) Strike price converted to U.S. Dollars at the prevailing rate of
exchange.
(d) Denominated in Japanese Yen.
(e) Denominated in U.S. Dollars.
(f) Secured by U.S. Treasury securities.
(g) Scheduled variable interest rate.
(h) Denominated in Swiss Francs.
(i) Denominated in German Marks.
(j) Denominated in Dutch Guilder.
(k) Notional face amount.
(l) Partially held by broker as collateral for open short positions.
(m) Partially held by the custodian in a segregated account as
collateral for open financial futures positions.
(n) Securities restricted as to public resale. Investments in restricted
securities, with an aggregate market value of $13,253,806, represents
approximately 3.7% of net assets:
<TABLE>
<CAPTION>
ACQUISITION PURCHASE PERCENTAGE OF
PUT OPTIONS: DATE PRICE NET ASSETS VALUATION*
- ----------- -------- ----- -------- ---------
<S> <C> <C> <C> <C>
Brokerage Basket**
November `95 @ $95....................... 11/11/94 $ 5.70 0.00 fair value
Japanese Government Bond:
4.60%, 9/20/2004, May `96 @ $1.288....... 5/16/95 $ .07 0.72 fair value
4.60%, 9/20/2004, June `96 @ $1.343...... 6/21/95 $ .08 0.63 fair value
Standard & Poor's 500 Index
March `96 @ $453......................... 12/14/94 $21.99 0.00 fair value
U.S. Treasury Bond;
7.625%, 2/15/2025, April `96 @ $103.078.. 4/12/95 $4.72 0.03 fair value
LOAN PARTICIPATIONS;
_____________________
Vnesheconombank (Bank for Foreign Economic Affairs
of the USSR)
5/3/2025............................... 5/2/95 $ .24 2.30 fair value
6/29/95
* The valuation of these securities has been determined in good faith under
the direction of the Board of Directors.
** Consists of Common Stocks of six publicly traded brokerage firms.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF FINANCIAL FUTURES SEPTEMBER 30, 1995
UNREALIZED
MARKET VALUE APPRECIATION
NUMBER OF COVERED (DEPRECIATION)
FINANCIAL FUTURES PURCHASED; CONTRACTS BY CONTRACTS EXPIRATION AT 9/30/95
------------ ------------- --------- -------------
<S> <C> <C> <C> <C>
Nikkei 225................................... 22 $ 1,980,550 December `95 $(23,400)
FINANCIAL FUTURES SOLD SHORT:
Hang Seng.................................... 70 (4,371,553) October `95 (3,625)
Japanese Yen................................. 22 (2,823,975) March `96 84,000
-------
$ 56,975
=========
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF SECURITIES SOLD SHORT SEPTEMBER 30, 1995
COMMON STOCKS-18.9% SHARES VALUE
___________ _____________
<S> <C> <C>
AUTO RELATED-.3%...... Ford Motor 40,000 $1,245,000
-------------
COMPUTERS-.4%..... Compaq Computer 32,000 1,548,000
-------------
CONSUMERS-6.1%.. Anheuser-Busch 5,700 355,537
B.A.T. Industries, A.D.R. ............. 23,100 392,700
Clorox................................. 22,000 1,570,250
Coca-Cola.............................. 41,000 2,829,000
Disney (Walt) ......................... 10,000 573,750
General Mills.......................... 52,000 2,899,000
Gillette............................... 23,000 1,095,375
Heinz (H.J.)........................... 35,900 1,642,425
Kellogg................................ 50,000 3,618,750
Reebok International................... 53,900 1,852,813
Rubbermaid............................. 60,300 1,665,787
Sara Lee............................... 81,000 2,409,750
Wrigley, (Wm), Jr...................... 20,000 1,010,000
_____________
21,915,137
_____________
.......FINANCE-4.2%.......... ADVANTA, Cl. A 2,500 112,500
Alex Brown............................. 19,900 1,161,663
Bear Stearns........................... 122,587 2,635,620
CMAC Investment........................ 15,000 789,375
Conseco................................ 22,000 1,152,250
MGIC Investment........................ 22,000 1,259,500
Merrill Lynch.......................... 42,000 2,625,000
PMI Group.............................. 10,000 473,750
Paine Webber Group..................... 88,000 1,738,000
Schwab (Charles)....................... 80,000 2,240,000
United Asset Management................ 20,000 802,500
_____________
14,990,158
_____________
HEALTH CARE-.3%... Healthsource 23,000 1,106,875
_____________
MACHINERY-CONSTRUCTION &
MATERIAL-.7%....... Deere & Co ............... 18,200 1,481,025
Ingersoll-Rand......................... 26,500 993,750
_____________
2,474,775
_____________
RESTAURANTS-.6%. Outback Steakhouse 74,500 2,290,875
_____________
RETAIL-1.5%........ Home Depot 64,233 2,561,291
Sysco.................................. 25,000 681,250
Wal-Mart Stores........................ 81,000 2,014,875
_____________
5,257,416
_____________
TECHNOLOGY-4.2%.... American Power Conversion 47,000 575,750
Applied Materials...................... 16,700 1,707,575
Integrated Device Technology........... 36,000 900,000
Intel ................................. 30,600 1,839,825
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF SECURITIES SOLD SHORT (CONTINUED) SEPTEMBER 30, 1995
COMMON STOCKS (CONTINUED) SHARES VALUE
__________ _________
TECHNOLOGY (CONTINUED)....... KLA Instruments 19,500 $ 1,564,875
Kulicke & Soffa Industries............. 38,000 1,387,000
Maxim Integrated Products.............. 15,000 1,110,000
Micron Technology...................... 10,000 795,000
Microsoft.............................. 11,000 995,500
Motorola............................... 21,000 1,603,875
Novellus Systems....................... 14,000 980,000
Texas Instruments...................... 20,000 1,597,500
_____________
15,056,900
_____________
TELECOMMUNICATIONS-.6% Hong Kong Telecom, A.D.R. 114,000 2,080,500
_____________
TOTAL SECURITIES SOLD SHORT
(proceeds $65,428,414)............... $67,965,636
==============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 1995
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $350,062,338)-see statement..................................... $373,174,107
Cash.................................................................... 620,787
Receivable from broker for proceeds on securities sold short............ 65,428,414
Dividends and interest receivable....................................... 5,945,967
Receivable for investment securities sold............................... 1,234,459
Receivable for subscriptions to Common Stock............................ 236,972
Prepaid expenses........................................................ 76,703
_____________
446,717,409
LIABILITIES:
Due to investment adviser............................................... $132,304
Due to sub-investment adviser........................................... 93,263
Due to Distributor...................................................... 130,083
Securities sold short, at value
(proceeds $65,428,414)-see statement.................................. 67,965,636
Bank loans payable-Note 2............................................... 10,000,000
Net unrealized depreciation on forward currency
exchange contracts-Note 4(a).......................................... 5,203,133
Payable for investment securities purchased............................. 2,539,142
Payable for Common Stock redeemed....................................... 1,335,306
Interest payable........................................................ 56,623
Payable for futures variation margin-Note 4(a).......................... 6,806
Accrued expenses........................................................ 354,644 87,816,940
------- ____________
NET ASSETS.................................................................. $358,900,469
=============
REPRESENTED BY:
Paid-in capital......................................................... $469,863,103
Accumulated undistributed investment income-net......................... 14,105,924
Accumulated net realized (loss) on investments, securities sold short,
foreign currency transactions and financial futures................... (140,552,041)
Accumulated net unrealized appreciation on investments, securities
sold short, and foreign currency transactions
(including $56,975 net unrealized appreciation
on financial futures)-Note 4(b)....................................... 15,483,483
_____________
NET ASSETS at value......................................................... $358,900,469
=============
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF ASSETS AND LIABILITIES (CONTINUED) SEPTEMBER 30, 1995
Shares of Common Stock outstanding:
Class A Shares
(100 million shares of $.01 par value authorized)..................... 25,543,483
=============
Class B Shares
(100 million shares of $.01 par value authorized)..................... 8,438,630
=============
Class C Shares
(100 million shares of $.01 par value authorized)..................... 94
=============
Class R Shares
(100 million shares of $.01 par value authorized)..................... 92
=============
NET ASSET VALUE per share:
Class A Shares
($271,051,783 / 25,543,483 shares).................................... $10.61
=========
Class B Shares
($87,846,730 / 8,438,630 shares)...................................... $10.41
=========
Class C Shares
($979 / 94 shares).................................................... $10.41
=========
Class R Shares
($977 / 92 shares).................................................... $10.62
=========
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 1995
<S> <C> <C>
INVESTMENT INCOME:
INCOME:
Interest.............................................................. $ 20,726,708
Cash dividends (net of $75,753 foreign taxes withheld at source)...... 1,924,318
___________
TOTAL INCOME...................................................... $ 22,651,026
EXPENSES:
Investment advisory fee-Note 3(a)..................................... 1,840,790
Sub-investment advisory fee-Note 3(a)................................. 1,365,789
Dividends on securities sold short.................................... 1,861,794
Shareholder servicing costs-Note 3(c)................................. 1,659,621
Distribution fees-Note 3(b)........................................... 738,585
Prospectus and shareholders' reports.................................. 120,170
Custodian fees........................................................ 106,205
Professional fees..................................................... 73,048
Registration fees..................................................... 72,468
Interest expense-Note 2............................................... 59,145
Directors' fees and expenses-Note 3(d)................................ 49,789
Miscellaneous......................................................... 22,130
___________
TOTAL EXPENSES.................................................... 7,969,534
___________
INVESTMENT INCOME-NET............................................. 14,681,492
___________
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments-Note 4(a):
Long transactions (including options transactions and foreign
currency transactions)............................................ $2,696,163
Short sale transactions............................................... (22,403,778)
Net realized gain on forward currency exchange contracts-Note 4(a);
Long transactions..................................................... 118,547
Net realized (loss) on financial futures-Note 4(a);
Short transactions.................................................... (7,893,569)
___________
NET REALIZED (LOSS)................................................... (27,482,637)
Net unrealized (depreciation) on investments, securities sold short
and foreign currency transactions [including ($1,427,125) net
unrealized (depreciation) on financial futures]....................... (28,971,658)
___________
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS................. (56,454,295)
___________
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $(41,772,803)
=============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SEPTEMBER 30,
-------------------------------
1994 1995
-------- --------
<S> <C> <C>
OPERATIONS:
Investment income-net................................................... $9,823,170 $14,681,492
Net realized (loss) on investments, securities sold short,
foreign currency transactions and financial futures................... (9,217,163) (27,482,637)
Net unrealized appreciation (depreciation) on investments, securities
sold short,
foreign currency transactions and financial futures for the year...... 26,168,303 (28,971,658)
------------- ______________
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS..... 26,774,310 (41,772,803)
------------- ______________
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income-net:
Class A shares........................................................ (8,633,848) (8,406,886)
Class B shares........................................................ (913,770) (1,940,644)
Class C shares........................................................ -- --
Class R shares........................................................ -- --
------------- --------------
TOTAL DIVIDENDS................................................... (9,547,618) (10,347,530)
------------- --------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold:
Class A shares........................................................ 116,664,797 39,533,363
Class B shares.................................................... 85,400,651 26,973,391
Class C shares........................................................ -- 1,000
Class R shares........................................................ -- 1,000
Dividends reinvested:
Class A shares........................................................ 4,857,514 5,143,774
Class B shares........................................................ 489,988 990,338
Class C shares........................................................ -- --
Class R shares........................................................ -- --
Cost of shares redeemed:
Class A shares........................................................ (147,154,408) (136,312,596)
Class B shares........................................................ (8,939,968) (36,549,208)
Class C shares........................................................ -- --
Class R shares........................................................ -- --
------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS. 51,318,574 (100,218,938)
------------- ---------------
TOTAL INCREASE (DECREASE) IN NET ASSETS..................... 68,545,266 (152,339,271)
NET ASSETS:
Beginning of year....................................................... 442,694,474 511,239,740
------------- --------------
End of year (including undistributed investment income-net:
$9,771,962 in 1994 and $14,105,924 in 1995)........................... $ 511,239,740 $ 358,900,469
=============== ===============
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED
SHARES
CLASS C CLASS R
---------- --------
CLASS A CLASS B PERIOD ENDED PERIOD ENDED
------------------ ------------------
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
------------------------ ---------------------
1994 1995 1994 1995 1995* 1995*
--------- -------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Shares sold....... 9,919,385 3,569,389 7,342,835 2,464,126 94 92
Shares issued for
dividends reinvested. 411,308 466,343 41,951 91,024 __ __
Shares redeemed........ (12,560,968) (12,382,551) (783,960) (3,400,272) __ __
-------- -------- --------- ---------- --------- --------
(DECREASE) IN
SHARES OUTSTANDING (2,230,275) (8,346,819) 6,600,826 (845,122) 94 92
=========== =========== =========== =========== =========== ===========
* From August 22, 1995 (commencement of initial offering) to September 30, 1995.
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment
return, ratios to average net assets and other supplemental data for each
year indicated. This information has been derived from
the Fund's financial statements.
CLASS A CLASS B CLASS C CLASS R
------------------------------------------ -------------------- ---------- ---------
PERIOD ENDED PERIOD ENDED
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30 SEPTEMBER 30, SEPTEMBER 30,
----------------------------------------- ----------------------- --------- --------
PER SHARE DATA: 1991 1992 1993 1994 1995 1993(1) 1994 1995 1995(2) 1995(2)
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year..... $15.08 $12.97 $12.41 $11.42 $11.88 $10.58 $11.32 $11.69 $10.64 $10.84
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
INVESTMENT OPERATIONS:
Investment income-net.... .73 .40 .24 .24 .36 .03 .23 .31 .02 .04
Net realized and
unrealized
gain (loss) on
investments,
securities sold short,
foreign currency
transactions and
financial futures... (.89) (.39) (.62) .46 (1.37) .71 .38 (1.38) (.25) (.26)
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL FROM
INVESTMENT OPERATIONS.. (.16) .01 (.38) .70 (1.01) .74 .61 (1.07) (.23) (.22)
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
DISTRIBUTIONS:
Dividends from
investment
income-net............ (.99) (.57) (.61) (.24) (.26) -- (.24) (.21) -- --
Dividends from net
realized gain
on investments......... (.96) -- -- -- -- -- -- -- -- --
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL DISTRIBUTIONS (1.95) (.57) (.61) (.24) (.26) -- (.24) (.21) -- --
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
Net asset value,
end of year $12.97 $12.41 $11.42 $11.88 $10.61 $11.32 $11.69 $10.41 $10.41 $10.62
===== ===== ===== ===== ===== ===== ===== ===== ===== =====
TOTAL INVESTMENT RETURN (3). (.70%) (.02%) (2.70%) 6.14% (8.58%) 6.99%(4) 5.35% (9.27%) (2.26%)(4) (2.03%)(4)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating
expenses to
average net assets. 1.19% 1.19% 1.23% 1.21% 1.24% 1.49%(4) 1.99% 1.99% .26%(4) .14%(4)
Ratio of interest
expense and dividends
on securities sold
short to average
net assets .49% .39% .45% .39% .45% .31%(4) .40% .45% .06%(4) .04%(4)
Ratio of net investment
income
to average net assets 5.58% 2.83% 1.94% 2.06% 3.61% .83%(4) 1.39% 2.86% .23%(4) .38%(4)
Portfolio Turnover Rate 154.07% 344.29% 41.78% 45.57% 54.70% 41.78% 45.57% 54.70% 54.70% 54.70%
Net Assets, end of year
(000's Omitted)... $755,450 $537,392 $412,316 $402,708 $271,052 $30,378 $108,532 $87,847 $1 $1
(1) From January 15, 1993 (commencement of initial offering) to September 30, 1993.
(2) From August 22, 1995 (commencement of initial offering) to September 30, 1995.
(3) Exclusive of sales load.
(4) Not annualized.
See notes to financial statements.
</TABLE>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a diversified open-end management investment company. The Dreyfus
Corporation ("Dreyfus") serves as the Fund's investment adviser. Comstock
Partners, Inc. ("Comstock Partners") serves as the Fund's sub-investment
adviser. Premier Mutual Fund Services, Inc. (the "Distributor") acts as the
distributor of the Fund's shares. The Distributor, located at One Exchange
Place, Boston, Massachusetts 02109, is a wholly-owned subsidiary of FDI
Distribution Services, Inc., a provider of mutual fund administration
services, which in turn is a wholly-owned subsidiary of FDI Holdings, Inc.,
the parent company of which is Boston Institutional Group, Inc. Dreyfus is a
direct subsidiary of Mellon Bank, N.A.
The Fund offers Class A, Class B, Class C and Class R shares. Class A
shares are subject to a sales charge imposed at the time of purchase, Class B
shares are subject to a contingent deferred sales charge imposed at the time
of redemption on redemptions made within six years of purchase, Class C
shares are subject to a contingent deferred sales charge imposed at the time
of redemption on redemptions made within one year of purchase and Class R
shares are sold at net asset value per share only to institutional investors.
Other differences between the four Classes include the services offered to
and the expenses borne by each Class and certain voting rights.
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Securities for which there are no such valuations are valued at fair value as
determined in good faith under the direction of the Board of Directors.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange.
(B) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions, the difference between
the amounts of dividends, interest, and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities, resulting from changes in exchange rates. Such gains and losses
are included with net realized and unrealized gain or loss on investments.
(C) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain, if any, are normally declared and paid annually, but the Fund
may make distributions on a more frequent basis to comply with the
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
distribution requirements of the Internal Revenue Code. This may result in
distributions that are in excess of investment income-net and net realized
gain on a fiscal year basis. To the extent that net realized capital gain can
be offset by capital loss carryovers, it is the policy of the Fund not to
distribute such gain.
(E) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately
$122,600,000 available for Federal income tax purposes to be applied against
future net securities profits, if any, realized subsequent to September 30,
1995. The carryover does not include net realized securities losses from
November 1, 1994 through September 30, 1995 which are treated, for Federal
income tax purposes, as arising in fiscal 1995. If not applied, $9,100,000 of
the carryover expires in fiscal 1999, $29,800,000 expires in fiscal 2000,
$17,800,000 expires in fiscal 2001, $56,700,000 expires in fiscal 2002, and
$9,200,000 expires in fiscal 2003.
NOTE 2-BANK LINE OF CREDIT:
In accordance with an agreement with a bank, the Fund may borrow up to
$10 million under a short-term unsecured line of credit. Interest on
borrowings is charged at rates which are related to Federal Funds rates in
effect from time to time. Outstanding borrowings on September 30, 1995 under
the line of credit, amounted to $10 million, at an annualized rate of 7.05%.
The average daily amount of short-term debt outstanding during the year
ended September 30, 1995 was approximately $859,000, with a related weighted
average annualized interest rate of 6.89%. The maximum amount borrowed at any
time during the year ended September 30, 1995 was $10 million.
NOTE 3-INVESTMENT ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE AND OTHER
TRANSACTIONS WITH AFFILIATES:
(A) Fees payable by the Fund pursuant to the provisions of an Investment
Advisory Agreement with Dreyfus and a Sub-Investment
Advisory Agreement with Comstock Partners (together "Agreements") are payable
monthly, computed on the average daily value of the Fund's net assets at the
following annual rates:
AVERAGE NET ASSETS DREYFUS COMSTOCK PARTNERS
-------------------- ------- --------------
0 up to $25 million................ .60 of 1% .15 of 1%
$25 up to $75 million.............. .50 of 1% .25 of 1%
$75 up to $200 million............. .45 of 1% .30 of 1%
$200 up to $300 million............ .40 of 1% .35 of 1%
In excess of $300 million.......... .375 of 1% .375 of 1%
The Agreements further provide that the Fund may deduct from the fees to
be paid to Dreyfus and Comstock Partners, or Dreyfus
and Comstock Partners will bear such excess expense, to the extent required
by state law, should the Fund's aggregate expenses, exclusive of taxes,
brokerage, interest on borrowings (which, in the view of Stroock & Stroock &
Lavan, counsel to the Fund, also contemplates dividends and interest accrued
on securities sold short), and extraordinary expenses, exceed the expense
limitation of any state having jurisdiction over the Fund. The most stringent
state expense limitation applicable to the Fund presently requires
reimbursement in any full fiscal year that such expenses (exclusive of
distribution expenses and certain expenses as described above) exceed 21\2%
of the first $30
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
million, 2% of the next $70 million and 11\2% of the excess over $100 million
of the average value of the Fund's net assets in accordance with California
"blue sky" regulations. No expense reimbursement was required for the year
ended September 30, 1995.
Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus,
retained $13,897 during the year ended September 30, 1995 from commissions
earned on sales of Fund shares.
(B) Under the Distribution Plan adopted pursuant to Rule 12b-1 under the
Act, the Fund pays the Distributor for distributing the Fund's Class B and
Class C shares at an annual rate of .75 of 1% of the value of the average
daily net assets of Class B and Class C. During the year ended September 30,
1995, $738,584 was charged to the Fund for the Class B shares and $1 was
charged to the Fund for the Class C shares.
(C) Under the Shareholder Services Plan, the Fund pays the Distributor,
at an annual rate of .25 of 1% of the value of the average daily net assets
of Class A, Class B and Class C shares for the provision of certain services.
The services provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the
maintenance of shareholder accounts. The Distributor may make payments to
Service Agents in respect of these services. The Distributor determines the
amount to be paid to Service Agents. For the year ended September 30, 1995,
$822,664, $246,195 were charged to Class A and B shares, respectively, and no
amounts were charged to the Class C shares, by the Distributor pursuant to
the Shareholder Services Plan.
(D) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $4,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation and each director emeritus receives 50% of such compensation.
NOTE 4-SECURITIES TRANSACTIONS:
(A) The following summarizes the aggregate amount of purchases and sales
of investment securities and securities sold short, excluding short-term
securities, financial futures, forward currency exchange contracts and
options transactions during the year ended September 30, 1995:
PURCHASES SALES
_______________ _______________
Long transactions.............. $ 87,407,314 $ 77,568,367
Short sale transactions........ 136,098,892 76,244,500
_______________ _______________
TOTAL........................ $223,506,206 $153,812,867
============== ==============
The Fund is engaged in short-selling which obligates the Fund to replace
the security borrowed by purchasing the security at current market value. The
Fund would incur a loss if the price of the security increases between the
date of the short sale and the date on which the Fund replaces the borrowed
security. The Fund would realize a gain if the price of the security declines
between those dates. Until the Fund replaces the borrowed security, the Fund
will maintain daily, a segregated account with a broker and custodian, of
cash and/or U.S. Government securities sufficient to cover its short
position. Securities sold short at September 30, 1995 and their related
market values and proceeds are set forth in the Statement of Securities Sold
Short.
<TABLE>
<CAPTION>
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The following summarizes open forward currency contracts at
September 30, 1995:
U.S. DOLLAR UNREALIZED
FORWARD CURRENCY CONTRACTS: PROCEEDS VALUE (DEPRECIATION)
------- ------- --------------
<S> <C> <C> <C>
SALES:
Dutch Guilders, expiring 11/20/95...................... $4,072,948 $4,203,262 $ (130,314)
German Deutschemarks, expiring 11/17/95................ 73,520,652 75,890,661 (2,370,009)
Swiss Francs, expiring 11/17/95........................ 42,549,364 45,252,174 (2,702,810)
COST
-------
PURCHASES;
Hong Kong Dollars, expiring 10/3/95.................... $181,174 181,174 --
-------------
TOTAl.............................................. $ (5,203,133)
=============
</TABLE>
The Fund enters into forward currency exchange contracts in order to hedge
its exposure to changes in foreign currency
exchange rates on its foreign portfolio holdings. When executing forward
currency exchange contracts, the Fund is obligated to buy or sell a foreign
currency at a specified rate on a certain date in the future. With respect to
sales of forward currency exchange contracts, the Fund would incur a loss if
the value of the contract increases between the date the forward contract is
opened and the date the forward contract is closed. The Fund realizes a gain
if the value of the contract decreases between those dates. With respect to
purchases of forward currency exchange contracts, the Fund would incur a loss
if the value of the contract decreases between the date the forward contract
is opened and the date the forward contract is closed. The Fund realizes a
gain if the value of the contract increases between those dates. The Fund is
also exposed to credit risk associated with counter party nonperformance on
these forward currency exchange contracts which is typically limited to the
unrealized gains on such contracts that are recognized in the statement of
assets and liabilities.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments (see the Statement of Financial Futures). Investments in
financial futures require the Fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contracts at the close
of each day's trading. Typically, variation margin payments are made or
received to reflect daily unrealized gains or losses. When the contracts are
closed, the Fund recognizes a realized gain or loss. These investments
require initial margin deposits with a custodian, which consist of cash or
cash equivalents, up to approximately 10% of the contract amount. The amount
of these deposits is determined by the exchange or Board of Trade on which
the contract is traded and is subject to change. Contracts open at September
30, 1995 and their related unrealized market appreciation (depreciation) are
set forth in the Statement of Financial Futures.
The Fund may purchase put and call options, including restricted options,
which are not exchange traded in order to gain exposure to or protect against
changes in the market. The Fund's exposure to credit risk associated with
counter party nonperformance on these investments is typically limited to the
market value of such investments that are disclosed in the Statement of
Investments.
The Fund may invest in fixed and floating rate loans arranged through
private negotiations between an issuer of Sovereign Debt Obligations and one
or more financial institutions. The Fund's investments in loans are expected
in most instances to be in the form of participations in loans and
assignments of all or a portion of loans from third parties. As a result the
Fund may be subject to credit risk from the issuer of
DREYFUS CAPITAL VALUE FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Sovereign Debt Obligations and the third party. In addition such loans may be
less liquid and may be subject to greater price volatility.
(B) At September 30, 1995, accumulated net unrealized appreciation on
investments was $20,631,522, consisting of $46,860,961 gross unrealized
appreciation and $26,229,439 gross unrealized depreciation, excluding foreign
currency transactions.
At September 30, 1995, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS CAPITAL VALUE FUND (A PREMIER FUND)
We have audited the accompanying statement of assets and liabilities of
Dreyfus Capital Value Fund
(A Premier Fund), including the statements of investments, financial futures
and securities sold short, as of September 30, 1995, and the related statement
of operations for the year then ended, the statement of changes in net
assets for each of the two years in the period then ended, and financial
highlights for each of the years indicated therein. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of September 30, 1995 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus Capital Value Fund (A Premier Fund) at September 30,
1995, the results of its operations for the year then ended, the changes in
its net assets for each of the two years in the period then ended, and the
financial highlights for each of the indicated years, in conformity with
generally accepted accounting principles.
[Ernst & Young LLP signature logo]
New York, New York
November 13, 1995
[Dreyfus lion "d" logo]
DREYFUS
CAPITAL VALUE FUND
(A Premier Fund)
200 Park Avenue
New York, NY 10166
INVESTMENT ADVISER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
SUB-INVESTMENT ADVISER
Comstock Partners
10 Exchange Place, Suite 2010
Jersey City, NJ 07302
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
The Shareholder Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 107/634/607AR959
[Dreyfus logo]
Capital Value Fund
(A Premier Fund)
Annual Report
September 30, 1995
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN DREYFUS CAPITAL VALUE FUND ( A PREMIER FUND)
CLASS A SHARES AND THE STANDARD & POOR'S 500 COMPOSITE
STOCK PRICE INDEX
EXHIBIT A:
____________________________________________________
| | STANDARD | DREYFUS |
| | & POOR'S 500 | CAPITAL |
| PERIOD | COMPOSITE STOCK | VALUE FUND |
| | PRICE INDEX * | CLASS A SHARES |
|-----------|--------------------| -----------------|
| 10/10/85 | 10,000 | 9,552 |
| 9/30/86 | 13,174 | 12,569 |
| 9/30/87 | 18,894 | 17,562 |
| 9/30/88 | 16,553 | 18,140 |
| 9/30/89 | 22,007 | 21,941 |
| 9/30/90 | 19,974 | 24,250 |
| 9/30/91 | 26,184 | 24,079 |
| 9/30/92 | 29,075 | 24,075 |
| 9/30/93 | 32,846 | 23,425 |
| 9/30/94 | 34,054 | 24,864 |
| 9/30/95 | 44,171 | 22,730 |
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*Source: Lipper Analytical Services, Inc.
