<PAGE>
PAGE 1
1996 ANNUAL REPORT
IDS Strategy Aggressive Fund
(prospectus enclosed)
(icon of) chess piece
The goal of IDS Strategy Aggressive Fund, a part of IDS Strategy
Fund, Inc., is long-term growth of capital. The Fund invests
primarily in common stocks that are selected for their above-
average growth potential.
(This annual report includes a prospectus that describes in detail
the Fund's objective, investment policies, risks, sales charges,
fees and other matters of interest. Please read the prospectus
carefully before you invest or send money.)
Distributed by American Express Financial Advisors Inc.
<PAGE>
PAGE 2
(icon of) chess piece
Corporate climbers
All rapidly growing companies pass through various stages. During
their middle stage, they're known in the investment world as "mid-
caps." Stocks of such companies, which are the main focus of this
Fund, offer investors an attractive combination: the potential for
above-average corporate growth without the initial risks that are
inherent in brand-new businesses.
<PAGE>
PAGE 3
Contents
(Icon of) One open book inside of another.
The purpose of this annual report is to tell investors how the Fund
performed.
The prospectus, which is bound into the middle of this annual
report, describes the Fund in detail.
1996 annual report
From the president 4
From the portfolio manager 4
Ten largest holdings 6
Making the most of the Fund 7
Long-term performance 8
Independent auditors' report 9
Financial statements 10
Notes to financial statements 13
Investments in securities 24
IDS mutual funds 28
Federal income tax information 31
1996 prospectus
The Fund in brief 3p
Goal 3p
Types of Fund investments and their risks 3p
Manager and distributor 3p
Portfolio manager 3p
Alternative purchase arrangements 3p
Sales charge and Fund expenses 4p
Performance 6p
Financial highlights 6p
Total returns 8p
Investment policies and risks 10p
Facts about investments and their risks 10p
Alternative investment option 16p
Valuing Fund shares 16p
How to purchase, exchange or redeem shares 17p
Alternative purchase arrangements 17p
How to purchase shares 19p
How to exchange shares 22p
How to redeem shares 22p
Reductions and waivers of the sales charge 27p
Special shareholder services 34p
Services 34p
Quick telephone reference 34p
Distributions and taxes 35p
Dividend and capital gain distributions 35p
Reinvestments 36p
Taxes 37p
How to determine the correct TIN 38p
How the Fund is organized 39p
Shares 39p
Voting rights 40p
Shareholder meetings 40p
Board members and officers 40p
Investment manager and transfer agent 42p
Distributor 43p
About American Express Financial Corporation 45p
General information 45p
Appendix 46p
Descriptions of derivative instruments 46p
(This annual report is not part of the prospectus.)
<PAGE>
PAGE 4
To our shareholders
(photo of) William R. Pearce
President of the Fund
(photo of) David Bayer
Portfolio manager
From the president
If you're an experienced investor, you know that 1995 was an
unusually strong year for the U.S. financial markets. Perhaps just
as important, you also know that history shows that bull markets
don't last forever. Though they're often unpredictable, declines -
- - whether they're brief or long-lasting, moderate or substantial --
are always a possibility.
That fact reinforces the need for investors to review periodically
their long-term goals and assess whether their investment program
remains on track to achieving them. Your quarterly investment
statements are one part of that monitoring process. The other is a
meeting with your American Express financial advisor. That becomes
even more important if there's a major change in your financial
situation or in the financial markets.
William R. Pearce
From the portfolio manager
IDS Strategy Aggressive Fund built on its gain during the first
half of the fiscal year and ultimately provided investors in Class
A with a total return of 35.1% for the 12 months ended in March
1996. (A portion of the return came in the form of a capital gain,
which was paid to shareholders last December and reduced the Fund's
net asset value by a like amount at that time.)
Throughout most of the fiscal year, stocks had a highly favorable
environment. The economy grew modestly, the inflation rate
remained quite low, corporate profits were generally strong, and
long-term interest rates declined. In this environment, growth
stocks -- the core of this portfolio -- performed especially well.
Technology sets the early pace
Within the growth group, technology-related stocks easily racked up
the biggest gains last spring and summer. Particularly strong were
the stocks of semiconductor producers, whose products related to
the development of the "information superhighway" garnered
tremendous investor interest.
The Fund was well-positioned for this trend because of its emphasis
on technology stocks. In fact, such issues comprised upwards of
40% of the portfolio at times last year. As the period progressed,
we gradually trimmed this exposure to the 30% range. In
particular, we reduced our holdings among personal computer
producers, whose business prospects appeared to be weakening. This
<PAGE>
PAGE 5
reduction proved to be appropriate, as those stocks led to a slump
by technology late in 1995, followed by considerable volatility in
the first quarter of 1996.
Financial, health care contribute
Also productive for the Fund were our holdings in the financial
services sector, which benefitted from falling long-term interest
rates, and in health care, which gave us excellent performance over
the last half of the fiscal year. Further fueling our performance
was our decision early in the fiscal year to gradually, but
substantially, reduce our level of cash reserves and put that money
to work in stocks. That paid off as stocks far outperformed cash-
equivalent investments for the period as a whole.
As we begin a new fiscal year, the stock market volatility we've
recently seen probably will continue in the months ahead. While
the investment environment in our view remains largely favorable,
concerns about the strength of corporate profits and the lack of a
powerful tailwind created by a substantial decline in long-term
interest rates will almost surely make for a more challenging
journey this year. More important, though, is the longer-term
outlook for stocks, which we believe is as encouraging as it was a
few years ago. In the meantime, we remain invested in what we
consider to be the most dynamic and potentially rewarding sectors
of the American economy.
David Bayer
Class A
12-month performance
(All figures per share)
Net asset value (NAV)
____________________________
March 31, 1996 $18.99
____________________________
March 31, 1995 $14.91
____________________________
Increase $ 4.08
____________________________
Distributions
April 1, 1995-March 31, 1996
____________________________
From income $
--
____________________________
From capital gains $ 1.10
____________________________
Total distributions $ 1.10
____________________________
Total return* +35.1%**
____________________________
Class B
12-month performance
____________________________
(All figures per share)
Net asset value (NAV)
____________________________
March 31, 1996 $18.83
____________________________
March 31, 1995 $14.90
____________________________
Increase $ 3.93
____________________________
Distributions
April 1, 1995-March 31, 1996
____________________________
From income $ --
____________________________
From capital gains $ 1.10
____________________________
Total distributions $ 1.10
____________________________
Total return* +34.1%**
____________________________
Class Y
12-month performance
____________________________
(All figures per share)
Net asset value (NAV)
____________________________
March 31, 1996 $19.16
____________________________
March 31, 1995 $14.89
____________________________
Increase $ 4.27
____________________________
Distributions
April 1, 1995-March 31, 1996
____________________________
From income $ --
____________________________
From capital gains $ 1.10
____________________________
Total distributions $ 1.10
____________________________
Total return* +35.3%**
____________________________
*The prospectus discusses the
effects of sales charges, if any,
on the various classes.
**The total return is a hypothetical
investment in the Fund with all
distributions reinvested.
<PAGE>
PAGE 6
<TABLE>
<CAPTION>
The Fund's ten largest holdings
(Pie chart)
The ten holdings listed here make up 20.76% of the Fund's net
assets
____________________________________________________________________________________________________________
Percent Value
(of Fund's net assets) (as of March 31, 1996)
______________________________________________________________________________________________________________
<S> <C> <C>
Parametric Technology 2.48% $26,213,750
A producer of software products for the automation of complex
engineering tasks that are essential to the development of
virtually all manufactured products.
Boston Scientific 2.33 24,614,600
Develops, manufactures and markets medical devices. The company's
products are used in a broad range of medical specialties, including
cardiology, vascular surgery, urology, gastroenterology and radiology.
Cisco Systems 2.15 22,760,850
A leader in the "router" segment of the networking industry. Cisco
routers allow interconnection of PCs, minicomputers and mainframe to
local and global networks.
HBO & Company 2.14 22,704,825
A health-care information service company that provides a variety
of computer-based information systems and services to hospitals
and their affiliates.
Medtronic 2.07 21,924,112
A major, diversified medical device company.
Oracle Systems 2.01 21,276,938
One of the largest independent vendors of database-management
software. They offer a variety of new products, enhancements and
applications software, supported by excellent service.
3Com 1.99 21,089,887
Designs, manufactures, markets, and supports a wide range of
networked client-server computing systems based on industry standards
and open systems architecture.
Pfizer 1.96 20,729,800
A leading producer of pharmaceuticals, hospital products, animal
health items, non-prescription medications and specialty chemicals.
IDEXX Laboratories 1.91 20,252,400
Manufacturer of animal biomedical test products.
Ascend Communications 1.72 18,252,850
Designs and manufactures the high-end microprocessor chips and
related components used in IBM and IBM-compatible personal computers.
</TABLE>
<PAGE>
PAGE 7
Making the most of your Fund
Average annual total return
(as of March 31, 1996)
1 year 5 years 10 years
Class A* +28.38% -- --
Class B +30.18% +11.87% +11.74%
Class Y* +35.32% -- --
*Inception date was March 20, 1995.
The performance of Class A and Class Y will vary from the
performance of Class B based on differences in sales charges and
fees.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
Figures for Class A and Class B reflect the effect of the maximum
5% sales charge. This was a period of widely fluctuating
securities prices. Past performance is no guarantee of future
results.
Build your assets systematically
One of the best ways to invest in the Fund is by dollar-cost
averaging -- a time-tested strategy that can make market
fluctuations work for you. To dollar-cost average, simply invest a
fixed amount of money regularly. You'll automatically buy more
shares when the Fund's share price is low, fewer shares when it is
high.
This does not ensure a profit or avoid a loss if the market
declines. But, if you can continue to invest regularly through
changing market conditions, it can be an effective way to
accumulate shares to meet your long-term goals.
How dollar-cost averaging works
Month Amount Per-share Number of shares purchased
invested market price
Jan $100 $20 5.00 XXXXX
Feb 100 18 5.56 XXXXXx
Mar 100 17 5.88 XXXXXx
Apr 100 15 6.67 XXXXXXx
May 100 16 6.25 XXXXXXx
June 100 18 5.56 XXXXXx
July 100 17 5.88 XXXXXx
Aug 100 19 5.26 XXXXXx
Sept 100 21 4.76 XXXXx
Oct 100 20 5.00 XXXXX
(footnotes to table) By investing an equal number of dollars each
month...
(arrow in table pointing to April) you automatically buy more
shares when the per share market price is low...
(arrow in table pointing to September) and fewer shares when the
per share market price is high.
You have paid an average price of only $17.91 per share over the 10
months, while the average market price actually was $18.10.
<PAGE>
PAGE 8
The Fund's long-term performance
Three ways to benefit from a mutual fund:
o your shares increase in value when the Fund's investments do
well
o you receive capital gains when the gains on investments sold
by the Fund exceed losses
o you receive income when the Fund's stock dividends, interest
and short-term gains exceed its expenses.
All three make up your total return. And you potentially can
increase your investment if, like most investors, you reinvest your
dividends and capital gain distributions to buy additional shares
of the Fund or another fund.
How your $10,000 has grown in IDS Strategy Aggressive Fund
$30,000
Graph showing the growth of the Fund,
the S&P 500, and the Lipper Small Company
$20,000 Growth Index over the past 10 years
$10,000
'86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96
Average annual total return
(as of March 31, 1996)
1 year 5 years 10 years
Class A* +28.38% -- --
Class B +30.18% +11.87% +11.74%
Class Y* +35.32% -- --
*Inception date was March 20, 1995.
(the following three paragraphs appear in the margin next to the
table:)
Assumes: -Holding period from 4/1/86 to 3/31/96. -Returns do not
reflect taxes payable on distributions. -Reinvestment of all
income and capital gain distributions for the Fund, with a value of
$9,907. -Also see "Performance" in the Fund's current prospectus.
Standard & Poor's 500 Stock Index (S&P 500), an unmanaged list of
common stocks, is frequently used as a general measure of market
performance. However, the S&P 500 companies are generally larger
than those in which the Fund invests.
The Lipper small Company Growth Fund Index includes 30 funds that
are generally similar to the Fund, although some funds in the index
may have somewhat different investment policies or objectives.
On the graph above you can see how the Fund's total return compared
to two widely cited performance indexes, the S&P 500 and the Lipper
Small Company Growth Fund Index.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
Figures reflect the impact of a deferred sales charge assuming
redemption at the end of the stated periods above. This was a
period of widely fluctuating security prices. Past performance is
no guarantee of future results.
<PAGE>
PAGE 9
Independent auditors' report
___________________________________________________________________
The board and shareholders
IDS Strategy Aggressive Fund:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments in securities,
of IDS Strategy Aggressive Fund (a series of IDS Strategy Fund,
Inc.) as of March 31, 1996, and the related statement of operations
for the year then ended and the statements of changes in net assets
for each of the years in the two-year period ended March 31, 1996,
and the financial highlights for each of the years in the ten-year
period ended March 31, 1996. These financial statements and the
financial highlights are the responsibility of fund management. Our
responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. Investment securities held in custody are
confirmed to us by the custodian. As to securities purchased and
sold but not received or delivered, and securities on loan, we
request confirmations from brokers, and where replies are not
received, we carry out other appropriate auditing procedures. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of IDS
Strategy Aggressive Fund at March 31, 1996, and the results of its
operations for the year then ended and the changes in its net
assets for each of the years in the two-year period ended March 31,
1996, and the financial highlights for the periods stated in the
first paragraph above, in conformity with generally accepted
accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
May 3, 1996
<PAGE>
PAGE 10
<TABLE>
<CAPTION>
Financial statements
Statement of assets and liabilities
IDS Strategy Aggressive Fund
March 31, 1996
______________________________________________________________________________________________________________
Assets
______________________________________________________________________________________________________________
<S> <C>
Investments in securities, at value (Note 1)
(identified cost $745,833,812) $1,061,036,118
Cash in bank on demand deposit 2,731,606
Dividends and accrued interest receivable 374,724
Receivable for investment securities sold 7,792,642
_____________________________________________________________________________________________________________
Total assets 1,071,935,090
_____________________________________________________________________________________________________________
Liabilities
_____________________________________________________________________________________________________________
Payable for investment securities purchased 12,182,917
Payable upon return of securities loaned (Note 4) 625,000
Unrealized depreciation on foreign currency contracts held, at value (Notes 1 and 5) 2,211
Accrued investment management services fee 34,208
Accrued distribution fee 28,741
Accrued service fee 9,995
Accrued transfer agency fee 12,621
Accrued administrative services fee 2,843
Other accrued expenses 253,284
_____________________________________________________________________________________________________________
Total liabilities 13,151,820
_____________________________________________________________________________________________________________
Net assets applicable to outstanding capital stock $1,058,783,270
_____________________________________________________________________________________________________________
Represented by
_____________________________________________________________________________________________________________
Capital stock -- authorized 10,000,000,000 shares of $.01 par value $ 560,693
Additional paid-in capital 694,128,263
Accumulated net realized gain (Notes 1) 48,894,219
Unrealized appreciation of investments and on translation
of assets and liabilities in foreign currencies 315,200,095
_____________________________________________________________________________________________________________
Total -- representing net assets applicable to outstanding capital stock $1,058,783,270
_____________________________________________________________________________________________________________
Net assets applicable to outstanding shares: Class A $ 348,335,728
Class B $ 710,446,143
Class Y $ 1,399
Net asset value per share of outstanding capital stock: Class A shares 18,346,551 $ 18.99
Class B shares 37,722,630 $ 18.83
Class Y shares 73 $ 19.16
See accompanying notes to financial statements. <PAGE>
PAGE 11
Statement of operations
IDS Strategy Aggressive Fund
Year ended March 31, 1996
_____________________________________________________________________________________________________________
Investment income
_____________________________________________________________________________________________________________
Income:
Interest $ 6,143,797
Dividends (net of foreign taxes withheld of $12,086) 3,757,241
_____________________________________________________________________________________________________________
Total income 9,901,038
_____________________________________________________________________________________________________________
Expenses (Note 2):
Investment management services fee 5,462,516
Distribution fee--Class B 6,510,086
Transfer agency fee 1,910,085
Incremental transfer agency fee--Class B 119,971
Service fee
Class A 72,469
Class B 1,511,816
Administrative services fee 455,030
Compensation of directors 12,936
Compensation of officers 8,204
Custodian fees 137,774
Postage 201,909
Registration fees 52,708
Reports to shareholders 90,420
Audit fees 20,000
Administrative 6,048
Other 11,384
_____________________________________________________________________________________________________________
Total expenses 16,583,356
Earnings credits on cash balances (Note 2) (25,054)
_____________________________________________________________________________________________________________
Total net expenses 16,558,302
_____________________________________________________________________________________________________________
Investment loss -- net (6,657,264)
_____________________________________________________________________________________________________________
Realized and unrealized gain -- net
_____________________________________________________________________________________________________________
Net realized gain on security and foreign currency transactions
(including loss of $1,033 from foreign currency transactions) (Note 3) 101,695,416
Net change in unrealized appreciation or depreciation of investments and on
translation of assets and liabilities in foreign currencies 170,135,689
_____________________________________________________________________________________________________________
Net gain on investments and foreign currency 271,831,105
_____________________________________________________________________________________________________________
Net increase in net assets resulting from operations $265,173,841
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
/TABLE
<PAGE>
PAGE 12
<TABLE>
<CAPTION>
Financial statements
Statements of changes in net assets
IDS Strategy Aggressive Fund
Year ended March 31,
_____________________________________________________________________________________________________________
Operations and distributions
_____________________________________________________________________________________________________________
1996 1995
<S> <C> <C>
Investment loss -- net $ (6,657,264) $ (2,825,273)
Net realized gain on investments and foreign currency 101,695,416 4,230,074
Net change in unrealized appreciation or depreciation of investments
and on translation of assets and liabilities in foreign currencies 170,135,689 36,275,562
_____________________________________________________________________________________________________________
Net increase in net assets resulting from operations 265,173,841 37,680,363
_____________________________________________________________________________________________________________
Distributions to shareholders from:
Net realized gain
Class A (1,780,677) --
Class B (55,138,913) (7,895,939)
Class Y (76) --
_____________________________________________________________________________________________________________
Total distributions (56,919,666) (7,895,939)
_____________________________________________________________________________________________________________
Capital share transactions (Note 6)
_____________________________________________________________________________________________________________
Proceeds from sales
Class A shares (Note 2) 91,207,686 8,137,518
Class B shares 105,680,879 188,093,770
Class Y shares 834 20
Reinvestment of distributions at net asset value
Class A shares 1,767,117 7,859,857
Class B shares 54,926,178 --
Class Y shares 76 --
Payments for redemptions
Class A shares (48,918,744) (877,592)
Class B shares (Note 2) (137,539,866) (101,845,298)
Conversion of shares (Note 1)
Class A shares 287,571,554 --
Class B shares (287,571,554) --
_____________________________________________________________________________________________________________
Increase in net assets from capital share transactions 67,124,160 101,368,275
_____________________________________________________________________________________________________________
Total increase in net assets 275,378,335 131,152,699
Net assets at beginning of year 783,404,935 652,252,236
_____________________________________________________________________________________________________________
Net assets at end of year $1,058,783,270 $783,404,935
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 13
Notes to financial statements
IDS Strategy Aggressive Fund
___________________________________________________________________
1. Summary of significant accounting policies
The Fund is a series of IDS Strategy Fund, Inc. and registered
under the Investment Company Act of 1940 (as amended) as a
diversified, open-end management investment company. The Fund
invests primarily in common stocks that are selected for their
above-average growth potential. The Fund offers Class A, Class B
and Class Y shares. Class A shares, are sold with a front-end sales
charge and Class B shares may be subject to a contingent deferred
sales charge and such shares automatically convert to Class A after
eight years. Class Y shares have no sales charge and are offered
only to qualifying institutional investors.
All classes of shares have identical voting, dividend, liquidation
and other rights, and the same terms and conditions, except that
the level of distribution fee, transfer agency fee and service fee
(class specific expenses) differs among classes. Income, expenses
(other than class specific expenses) and realized and unrealized
gains or losses on investments are allocated to each class of
shares based upon its relative net assets.
Significant accounting policies followed by the Fund are summarized
below:
Use of estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of increase and decrease in net assets from
operations during the period. Actual results could differ from
those estimates.
Valuation of securities
All securities are valued at the close of each business day.
Securities traded on national securities exchanges or included in
national market systems are valued at the last quoted sales price;
securities for which market quotations are not readily available
are valued at fair value according to methods selected in good
faith by the board. Determination of fair value involves, among
other things, reference to market indexes, matrixes and data from
independent brokers. Short-term securities maturing in more than 60
days from the valuation date are valued at the market price or
approximate market value based on current interest rates; those
maturing in 60 days or less are valued at amortized cost.
<PAGE>
PAGE 14
Option transactions
In order to produce incremental earnings, protect gains, and
facilitate buying and selling of securities for investment
purposes, the Fund may buy or write options traded on any U.S. or
foreign exchange or in the over-the-counter market where the
completion of the obligation is dependent upon the credit standing
of the other party. The Fund also may buy and sell put and call
options and write covered call options on portfolio securities and
may write cash-secured put options. The risk in writing a call
option is that the Fund gives up the opportunity of profit if the
market price of the security increases. The risk in writing a put
option is that the Fund may incur a loss if the market price of the
security decreases and the option is exercised. The risk in buying
an option is that the Fund pays a premium whether or not the option
is exercised. The Fund also has the additional risk of not being
able to enter into a closing transaction if a liquid secondary
market does not exist.
Option contracts are valued daily at the closing prices on their
primary exchanges and unrealized appreciation or depreciation is
recorded. The Fund will realize a gain or loss upon expiration or
closing of the option transaction. When an option is exercised, the
proceeds on sales for a written call option, the purchase cost for
a written put option or the cost of a security for a purchased put
or call option is adjusted by the amount of premium received or
paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the
market, the Fund may buy and sell stock index futures contracts
traded on any U.S. or foreign exchange. The Fund also may buy or
write put and call options on these futures contracts. Risks of
entering into futures contracts and related options include the
possibility that there may be an illiquid market and that a change
in the value of the contract or option may not correlate with
changes in the value of the underlying securities.
Upon entering into a futures contract, the Fund is required to
deposit either cash or securities in an amount (initial margin)
equal to a certain percentage of the contract value. Subsequent
payments (variation margin) are made or received by the Fund each
day. The variation margin payments are equal to the daily changes
in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the
contract is closed or expires.
Foreign currency translations and
foreign currency contracts
Securities and other assets and liabilities denominated in foreign
currencies are translated daily into U.S. dollars at the closing
rate of exchange. Foreign currency amounts related to the purchase
or sale of securities and income and expenses are translated at the
exchange rate on the transaction date. The effect of changes in
foreign exchange rates on realized and unrealized security gains or
<PAGE>
PAGE 15
losses is reflected as a component of such gains or losses. In the
statement of operations, net realized gains or losses from foreign
currency transactions may arise from sales of foreign currency,
closed forward contracts, exchange gains or losses realized between
the trade date and settlement dates on securities transactions, and
other translation gains or losses on dividends, interest income and
foreign withholding taxes.
The Fund may enter into forward foreign currency exchange contracts
for operational purposes and to protect against adverse exchange
rate fluctuation. The net U.S. dollar value of foreign currency
underlying all contractual commitments held by the Fund and the
resulting unrealized appreciation or depreciation are determined
using foreign currency exchange rates from an independent pricing
service. The Fund is subject to the credit risk that the other
party will not complete the obligations of the contract.
Federal taxes
Since the Fund's policy is to comply with all sections of the
Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to shareholders, no
provision for income or excise taxes is required.
Net investment income (loss) and net realized gains (losses) may
differ for financial statement and tax purposes primarily because
of the deferral of losses on certain futures contracts, the
recognition of certain foreign currency gains (losses) as ordinary
income (loss) for tax purposes, and losses deferred due to "wash
sale" transactions. The character of distributions made during the
year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax
purposes. Also, due to the timing of dividend distributions, the
fiscal year in which amounts are distributed may differ from the
year that the income or realized gains (losses) were recorded by
the Fund.
On the statement of assets and liabilities, as a result of
permanent book-to-tax differences, undistributed net investment
income has been increased by $6,657,264 and accumulated net
realized gain has been increased by $1,033, resulting in a net
reclassification adjustment to decrease paid-in-capital by
$6,658,297.
Dividends to shareholders
An annual dividend declared and paid by the end of the calendar
year from net investment income is reinvested in additional shares
of the Fund at net asset value or payable in cash. Capital gains,
when available, are distributed along with the income dividend.
Other
Security transactions are accounted for on the date securities are
purchased or sold. Dividend income is recognized on the ex-dividend
date and interest income, including level-yield amortization of
premium and discount, is accrued daily.
<PAGE>
PAGE 16
___________________________________________________________________
2. Expenses and sales charges
Effective March 20, 1995, the Fund entered into agreements with
American Express Financial Corporation (AEFC) for managing its
portfolio, providing administrative services and serving as
transfer agent as follows: Under its Investment Management Services
Agreement, AEFC determines which securities will be purchased, held
or sold. The management fee is a percentage of the Fund's average
daily net assets in reducing percentages from 0.6% to 0.5%
annually.
Under an Administrative Services Agreement, the Fund pays AEFC for
administration and accounting services at a percentage of the
Fund's average daily net assets in reducing percentages from 0.05%
to 0.03% annually.
Under a separate Transfer Agency Agreement, AEFC maintains
shareholder accounts and records. The Fund pays AEFC an annual fee
per shareholder account for this service as follows:
o Class A $15
o Class B $16
o Class Y $15
Also effective March 20, 1995, the Fund entered into agreements
with American Express Financial Advisors Inc. for distribution and
shareholder servicing - related services as follows: Under a Plan
and Agreement of Distribution, the Fund pays a distribution fee at
an annual rate of 0.75% of the Fund's average daily net assets
attributable to Class B shares for distribution-related services.
Under a Shareholder Service Agreement, the Fund pays a fee for
service provided to shareholders by financial advisors and other
servicing agents. The fee is calculated at a rate of 0.175% of the
Fund's average daily net assets attributable to Class A and Class B
shares.
AEFC will assume and pay any expenses (except taxes and brokerage
commissions) that exceed the most restrictive applicable state
expense limitation.
Sales charges received by American Express Financial Advisors Inc.
for distributing Fund shares were $548,311 for Class A and $580,076
for Class B for year ended March 31, 1996. The Fund also pays
custodian fees to American Express Trust Company, an affiliate of
AEFC.
During the year ended March 31, 1996, the Fund's custodian and
transfer agency fees were reduced by $25,054 as a result of
earnings credits from overnight cash balances.
<PAGE>
PAGE 17
The Fund has a retirement plan for its independent board members.
Upon retirement, board members receive monthly payments equal to
one-half of the retainer fee for as many months as they served as
board members up to 120 months. There are no death benefits. The
plan is not funded but the Fund recognizes the cost of payments
during the time the board members serve on the board. The
retirement plan expense amounted to $12,383 for the year ended
March 31, 1996. The plan was terminated on April 30, 1996. The
total liability for the plan is $32,891, which will be paid out at
some future date.
___________________________________________________________________
3. Securities transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $822,202,827 and $837,628,095,
respectively, for the year ended March 31, 1996. Realized gains and
losses are determined on an identified cost basis.
Brokerage commissions paid to brokers affiliated with AEFC were
$9,363 for the year ended March 31, 1996.
___________________________________________________________________
4. Lending of portfolio securities
At March 31, 1996, securities valued at $606,250 were on loan to
brokers. For collateral, the Fund received $625,000 in cash. Income
from securities lending amounted to $76,176 for the year ended
March 31, 1996. The risks to the Fund of securities lending are
that the borrower may not provide additional collateral when
required or return the securities when due.
___________________________________________________________________
5. Foreign currency contracts
At March 31, 1996, the Fund had entered into two foreign currency
exchange contracts that obligate the Fund to deliver currencies at
specified future dates. The unrealized appreciation and/or
depreciation of these contracts is included in the accompanying
financial statements. The terms of the open contracts are as
follows:
<TABLE>
<CAPTION>
Currency to be Currency to be Unrealized
Exchange date delivered received depreciation
______________________________________________________________________________
<S> <C> <C> <C>
April 9, 1996 744,480 4,771,967 $ 667
U.S. Dollar Norwegian Krona
April 9, 1996 2,100,459 13,465,694 1,544
U.S. Dollar Norwegian Krona _______
$2,211
</TABLE>
<PAGE>
PAGE 18
___________________________________________________________________
6. Capital share transactions
Transactions in shares of capital stock for the years indicated are
as follows:
<TABLE>
<CAPTION>
_____________________________________________________________________________
Year ended March 31, 1996
Class A Class B Class Y
_____________________________________________________________________________
<S> <C> <C> <C>
Sold 5,063,088 6,139,128 68
Issued for reinvested 98,502 3,081,595 4
distributions
Redeemed (2,702,011) (8,067,106) --
Conversion of shares 15,398,745 (15,518,404)
_____________________________________________________________________________
Net increase (decrease) 17,858,324 (14,364,787) 72
_____________________________________________________________________________
Year ended March 31, 1995
Class A* Class B Class Y*
_____________________________________________________________________________
Sold 546,769 13,396,433 1
Issued for reinvested -- 560,846 --
distributions
Redeemed (58,542) (7,193,696) --
_____________________________________________________________________________
Net increase 488,227 6,763,583 1
_____________________________________________________________________________
Inception date was March 20, 1995 for Class A and Class Y.
</TABLE>
___________________________________________________________________
7. Financial highlights
"Financial highlights" showing per share data and selected
information is presented on pages 6 and 7 of the prospectus.
<PAGE>
PAGE 19
<TABLE>
<CAPTION>
Investments in securities
IDS Strategy Aggressive Fund (Percentages represent value of
March 31, 1996 investments compared to net assets)
_____________________________________________________________________________________________________________________________
Common stocks (89.5%)
_____________________________________________________________________________________________________________________________
Issuer Shares Value(a)
_____________________________________________________________________________________________________________________________
<S> <C> <C>
Aerospace & defense (2.0%)
Loral 167,200 $ 8,192,800
Precision Castparts 131,400 5,256,000
Rohr 301,100 (b) 5,419,800
Thiokol 57,000 2,500,875
_____________
Total 21,369,475
_____________________________________________________________________________________________________________________________
Banks and savings & loans (0.5%)
Charter One Financial 147,200 4,968,000
_____________________________________________________________________________________________________________________________
Building materials (0.7%)
Clayton Homes 130,100 2,715,838
Tyco Intl 138,000 4,933,500
______________
Total 7,649,338
_____________________________________________________________________________________________________________________________
Chemicals (4.2%)
Culligan Water 204,100 (b) 6,633,250
Ecolab 299,000 8,970,000
Morton Intl 143,600 5,510,650
Pall 89,700 2,298,563
Praxair 361,900 14,430,762
U.S. Filter 245,000 (b) 6,860,000
_____________
Total 44,703,225
_____________________________________________________________________________________________________________________________
Communications equipment (5.0%)
Ascend Communications 338,800 (b) 18,252,850
Cascade Communications 146,850 (b) 13,179,787
StrataCom 241,400 (b) 8,841,275
Tellabs 270,500 (b) 13,085,438
____________
Total 53,359,350
_____________________________________________________________________________________________________________________________
Computers & office equipment (16.6%)
America Online 155,300 (b) 8,696,800
Ceridian 175,600 (b) 7,550,800
Checkfree 253,700 (b) 4,439,750
Cisco Systems 490,800 (b) 22,760,850
Computer Associates 50,600 3,624,225
Computer Sciences 168,100 (b) 11,830,037
Cylink 100,000 (b) 1,775,000
First Data 118,942 8,385,411
FORE Systems 178,100 (b) 12,734,150
Informix 244,700 (b) 6,453,963
See accompanying notes to investments in securities.
<PAGE>
PAGE 20
Microsoft 70,000 (b) 7,218,750
Oracle Systems 451,500 (b) 21,276,938
Parametric Technology 670,000 (b) 26,213,750
Prism Entertainment 7,900 (b) 209,350
Reynolds & Reynolds Cl A 128,700 5,276,700
Sterling Software 17,600 (b) 541,200
Synopsys 162,300 (b) 5,193,600
3Com 528,900 (b) 21,089,887
_____________
Total 175,271,161
_____________________________________________________________________________________________________________________________
Energy (2.1%)
Enron Oil & Gas 455,000 12,000,625
Pogo Producing 336,700 10,521,875
_____________
Total 22,522,500
_____________________________________________________________________________________________________________________________
Energy equipment & services (1.1%)
Fluor 78,900 5,384,925
Input/Output 180,800 (b) 5,604,800
_____________
Total 10,989,725
_____________________________________________________________________________________________________________________________
Financial services (3.6%)
Dean Witter 92,000 5,267,000
Green Tree Financial 147,100 5,056,562
Household Intl 97,700 6,570,325
MBNA 216,450 6,412,331
Morgan Stanley Group 107,600 5,568,300
Paychex 159,300 9,319,050
____________
Total 38,193,568
_____________________________________________________________________________________________________________________________
Health care (13.7%)
ALZA 158,600 (b) 4,876,950
Amgen 224,800 (b) 13,066,500
Arrow Intl 119,400 4,970,025
Boston Scientific 535,100 (b) 24,614,600
Centocor 200,000 (b) 7,225,000
Chiron 56,100 (b) 5,511,825
CNS 39,100 (b) 972,613
Cohr 26,800 (b) 435,500
Genzyme 108,600 (b) 5,973,000
Gilead Sciences 284,000 (b) 8,165,000
IDEXX Laboratories 482,200 (b) 20,252,400
INCYTE Pharmaceuticals 45,350 (b) 1,292,475
Liposome 109,700 (b) 2,289,988
Medtronic 367,700 21,924,112
Optical Sensors 20,200 (b) 248,713
Pfizer 309,400 20,729,800
Sofamor/Danek Group 84,300 (b) 2,855,663
____________
Total 145,404,164
_____________________________________________________________________________________________________________________________
Health care services (8.8%)
AmeriSource Health 104,400 (b) 3,445,200
Cardinal Distribution 135,800 8,725,150
HBO & Company 240,900 22,704,825
Health Mgmt Associates 416,300 (b) 14,570,500
Healthsource 231,200 (b) 8,959,000
HEALTHSOUTH 227,700 (b) 7,741,800
Medaphis 108,900 (b) 5,281,650
Neuromedical Systems 128,400 (b) 2,792,700
Service Corp Intl 200,100 9,754,875
Stewart Enterprises 140,000 5,985,000
Vivra 89,800 (b) 2,671,550
___________
Total 92,632,250
_____________________________________________________________________________________________________________________________
Household products (0.5%)
Duracell Intl 97,900 4,858,288
_____________________________________________________________________________________________________________________________
Industrial equipment & services (1.5%)
Case 147,000 7,478,625
Fastenal 66,100 2,544,850
Sanifill 144,500 (b) 5,545,187
___________
Total 15,568,662
<PAGE>
PAGE 21
_____________________________________________________________________________________________________________________________
Insurance (5.2%)
ACE Limited 117,200 5,230,050
American Re 144,000 5,760,000
EXEL Limited 69,700 4,809,300
Horace Mann Educators 108,000 3,294,000
PennCorp Financial Group 270,100 8,508,150
Progressive Corp Ohio 166,900 7,447,912
Prudential Reinsurance 197,400 4,663,575
UNUM 259,300 15,428,350
____________
Total 55,141,337
_____________________________________________________________________________________________________________________________
Leisure time & entertainment (1.8%)
Carmike Cinemas 157,900 (b) 3,592,225
Galoob (Lewis) Toys 158,600 (b) 3,211,650
Gaylord Entertainment 266,300 7,190,100
Mattel 190,500 5,167,313
_____________
Total 19,161,288
______________________________________________________________________________________________________________________________
Media (3.4%)
AMC Entertainment 173,700 (b,c) 4,212,225
Cox Broadcast 337,300 (b) 7,378,438
Gartner Group 113,400 (b) 6,917,400
Liberty Media Cl A 292,000 (b) 7,701,500
New World 412,600 (b) 8,097,275
Regal Cinemas 37,700 (b) 1,394,900
_______________
Total 35,701,738
_____________________________________________________________________________________________________________________________
Metals (0.5%)
Pittson Brinks 206,300 5,518,525
_____________________________________________________________________________________________________________________________
Multi-industry conglomerates (3.9%)
Alco Standard 233,300 12,160,762
Manpower 176,500 5,471,500
Olsten 196,500 6,337,125
Robert Half Intl 248,600 (b) 12,088,175
Wackenhut 116,900 4,559,100
____________
Total 40,616,662
_____________________________________________________________________________________________________________________________
Restaurants & lodging (4.2%)
Applebee's Intl 222,300 5,557,500
Boston Chicken 285,300 (b) 9,718,031
HFS 360,800 (b) 17,543,900
Longhorn Steaks 18,800 (b) 432,400
Promus Hotel 441,700 (b) 11,484,200
____________
Total 44,736,031
_____________________________________________________________________________________________________________________________
Retail (3.3%)
Corporate Express 279,900 (b) 9,236,700
General Nutrition 241,900 (b) 6,047,500
Kohl's 83,700 (b) 5,304,487
PETsMART 182,850 (b) 6,628,313
Viking Office Products 137,200 (b) 7,631,750
_____________
Total 34,848,750
_____________________________________________________________________________________________________________________________
Textiles & apparel (0.9%)
NIKE Cl B 122,800 9,977,500
______________________________________________________________________________________________________________________________
Utilities-telephone (2.8%)
LCI Intl 294,600 (b) 7,217,700
MFS Communications 105,400 (b) 6,561,150
MobileMedia Cl A 223,400 (b) 4,635,550
Omnipoint 39,100 (b) 997,050
Orange 123,000 (b) 2,106,375
Paging Network 227,200 (b) 5,680,000
WorldCom 62,400 (b) 2,870,400
____________
Total 30,068,225
_____________________________________________________________________________________________________________________________
Foreign (3.2%)(d)
Adidas 49,100 (b,e) 1,782,840
<PAGE>
PAGE 22
Baan 89,500 (b) 5,157,438
National Mutual 5,100,000 4,646,100
Reuters Holdings ADR 88,300 5,750,537
Schibsted 210,000 (b,e) 2,880,360
Sun Hung Kai Properties 585,000 (b) 5,237,505
Sun Intl Hotels 145,000 (b) 5,220,000
Television Broadcasts 900,000 3,310,200
____________
Total 33,984,980
_____________________________________________________________________________________________________________________________
Total common stocks
(Cost: $632,036,800) $947,244,742
</TABLE>
<TABLE>
<CAPTION>
_____________________________________________________________________________________________________________________________
Preferred stock & other (--%)
_____________________________________________________________________________________________________________________________
Issuer Shares Value(a)
_____________________________________________________________________________________________________________________________
<S> <C> <C>
Jan Bell
Warrants 2,473 $ 386
_____________________________________________________________________________________________________________________________
Total preferred stock & other
(Cost: $--) $ 386
_____________________________________________________________________________________________________________________________
</TABLE>
Short-term securities (10.7%)
<TABLE>
<CAPTION>
_____________________________________________________________________________________________________________________________
Issuer Annualized Amount Value(a)
yield on payable at
date of maturity
purchase
_____________________________________________________________________________________________________________________________
<S> <C> <C> <C>
U.S. government agencies (0.7%)
Federal Home Loan Mtge Corp Disc Nt
04-19-96 5.29% $1,900,000 $ 1,894,437
Federal Natl Mtge Assn Disc Nt
04-16-96 5.31 5,700,000 5,685,734
____________
Total 7,580,171
______________________________________________________________________________________________________________________________
Commercial paper (9.0%)
Alabama Power
05-30-96 5.16 3,700,000 3,664,634
Aon
05-06-96 5.29 2,700,000 2,685,431
CAFCO
04-16-96 5.19 3,000,000 (f) 2,992,006
Campbell Soup
04-12-96 5.29 7,200,000 (f) 7,186,298
Clorox
05-20-96 5.31 2,500,000 2,481,024
Consolidated Rail
04-17-96 5.30 7,800,000 (f) 7,779,408
Dean Witter
04-22-96 5.32 6,000,000 5,979,683
Gannett
04-22-96 5.37 3,600,000 (f) 3,587,695
Metlife Funding
04-09-96 5.27 4,100,000 4,094,021
04-29-96 5.35 3,800,000 3,783,153
04-29-96 5.30 5,500,000 5,475,846
05-06-96 5.19 3,700,000 3,680,089
Natl Australia Funding
04-04-96 5.43 3,200,000 3,197,587
04-15-96 5.32 6,900,000 6,883,747
PepsiCo
04-26-96 5.33 5,000,000 4,980,125
05-03-96 5.37 7,000,000 (f) 6,964,630
<PAGE>
PAGE 23
SAFECO
04-08-96 5.22 4,500,000 4,494,150
04-19-96 5.17 4,100,000 4,087,035
Sandoz
04-22-96 5.35 4,200,000 (f) 4,185,698
Toyota Motor Credit
04-23-96 5.33 4,800,000 4,783,008
USAA Capital
05-20-96 5.34 2,400,000 2,381,980
_____________
Total 95,347,248
_____________________________________________________________________________________________________________________________
Letters of credit (1.0%)
BankAmerica
AES Barbers Point
04-19-96 5.25 5,900,000 5,882,890
04-25-96 5.37 5,000,000 4,980,681
_____________
Total 10,863,571
_____________________________________________________________________________________________________________________________
Total short-term securities
(Cost: $113,797,012) $ 113,790,990
_____________________________________________________________________________________________________________________________
Total investments in securities
(Cost: $745,833,812)(g) $1,061,036,118
_____________________________________________________________________________________________________________________________
Notes to investments in securities
_____________________________________________________________________________________________________________________________
(a) Securities are valued by procedures described in Note 1 to the financial statements.
(b) Presently non-income producing.
(c) Security is partially or fully on loan. See Note 4 to the financial statements.
(d) Foreign security values are stated in U.S. dollars.
(e) Represents security sold under Rule 144A and is exempt from registration under the Securities Act
of 1933, as amended. This security has been determined to be liquid under guidelines established by the
board of directors.
(f) Commercial paper sold within terms of a private placement memorandum, exempt from registration under
Section 4(2) of the Securities Act of 1933, as amended, and may be sold only to dealers in that program
or other "accredited investors." This security has been determined to be liquid under guidelines
established by the board of directors.
(g) At March 31, 1996, the cost of securities for federal income tax purposes was $745,833,812
and the aggregate gross unrealized appreciation and depreciation based on that cost was:
Unrealized appreciation $319,247,369
Unrealized depreciation (4,045,063)
___________________________________________________________________________________________
Net unrealized appreciation $315,202,306
___________________________________________________________________________________________
</TABLE>
<PAGE>
PAGE 24
IDS mutual funds
Cash equivalent investments
These money market funds have three main goals: conservation of
capital, constant liquidity and the highest possible current income
consistent with these objectives. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial
paper, bankers' acceptances, certificates of deposits (CDs) and
other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and
local governments to seek high current income exempt from federal
income taxes.
(icon of) shield with piggy bank enclosed
Income investments
The funds in this group invest their assets primarily in corporate
bonds or government securities to seek interest income. Secondary
objective is capital growth. Risk varies by bond quality.
IDS Global Bond Fund
Invests primarily in debt securities of U.S. and foreign issuers to
seek high total return through income and growth of capital.
(icon of) globe
IDS Extra Income Fund
Invests mainly in long-term, high-yielding corporate fixed-income
securities in the lower rated, higher risk bond categories to seek
high current income. Secondary objective is capital growth.
(icon of) coins
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher
rated, lower risk bond categories, or the equivalent, and in
government bonds.
(icon of) greek column
<PAGE>
PAGE 25
IDS Selective Fund
Invests in high-quality corporate bonds and other highly rated debt
instruments including government securities and short-term
investments. Seeks current income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests primarily in securities issued or guaranteed as to the
timely payment of principal and interest by the U.S. government,
its agencies and instrumentalities. Seeks a high level of current
income and safety of principal consistent with its type of
investments.
(icon of) shield with eagle head enclosed
Tax-exempt income investments
These funds provide tax-free income by investing in municipal
bonds. The income is generally free from federal income tax. Risk
varies by bond quality.
IDS High Yield Tax-Exempt Fund
Invests primarily in medium- and lower-quality municipal bonds and
notes. Lower-quality securities generally involve greater risk of
principal and income.
(icon of) shield with basket of apples enclosed
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities to
provide income to residents of each respective state that is exempt
from federal, state and local income taxes. (New York is the only
state that is exempt at the local level.)
(icon of) shield with U.S. enclosed
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government
units, with at least 75% in the four highest rated, lowest risk
bond categories.
(icon of) shield with Greek column enclosed
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to
the timely payment of principal and interest. The insurance
feature minimizes credit risk of the fund but does not guarantee
the market value of the fund's shares.
(icon of) shield with star enclosed
<PAGE>
PAGE 26
Growth and income investments
These funds focus on securities of medium to large, well-
established companies that offer long-term growth of capital and
reasonable income from dividends and interest. Moderate risk.
IDS International Fund
Invests primarily in common stocks of foreign companies that offer
potential for superior growth. The fund may invest up to 20% of
its assets in the U.S. market.
(icon of) three flags
IDS Managed Retirement Fund
Invests in U.S. equity securities, U.S. and foreign debt
securities, foreign equity securities and money market instruments.
The fund provides diversification among these major investment
categories and has a target mix that represents the way the fund's
investments will be allocated over the long term.
(icon of) bird in a nest
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks,
higher-yielding equities and bonds. Seeks growth of capital and
income.
(icon of) three pine trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities
purchased are those recommended by our research analysts as the
best from each industry represented on the index. Offers potential
for long-term growth as well as dividend income.
(icon of) ribbon
IDS Stock Fund
Invests in common stock of companies representing many sectors of
the economy. Seeks current income and growth of capital.
(icon of) building with columns
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential
for growth of capital and income.
(icon of) three growing flowers
<PAGE>
PAGE 27
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek
high current income and growth of income and capital with reduced
volatility.
(icon of) light bulb
IDS Diversified Equity Income Fund
Invests primarily in high-yielding common stocks to seek high
current income and, secondarily, to benefit from the growth
potential offered by stock investments.
(icon of) two puzzle pieces
IDS Mutual
Invests in a balance between common stocks and senior securities
(preferred stocks and bonds). Seeks a balance of growth of capital
and current income.
(icon of) scale of justice
Growth investments
Funds in this group seek capital growth, primarily from common
stocks. They are high risk mutual funds with a potential for high
reward.
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies
emphasizing technological innovation and productivity enhancement.
Buys and holds larger growth-oriented stocks.
(icon of) ship
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected
for their potential for above-average growth. Above-average means
that their growth potential is better, in the opinion of the
portfolio's investment manager, than the Standard & Poor's
Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Growth Fund
Invests primarily in companies that have above-average potential
for long-term growth as a result of new management, marketing
opportunities or technological superiority.
(icon of) trees
<PAGE>
PAGE 28
IDS Global Growth Fund
Invests in stocks of companies throughout the world that are
positioned to meet market needs in a changing world economy. These
companies offer above-average potential for long-term growth.
(icon of) world
IDS New Dimensions Fund
Invests primarily in companies with significant growth potential
due to superiority in technology, marketing or management. The
fund frequently changes its industry mix.
(icon of) dimension
IDS Progressive Fund
Invests primarily in undervalued common stocks. The fund holds
stocks for the long term with the goal of capital growth.
(icon of) shooting star
Specialty growth investment
This fund aggressively seeks capital growth as a hedge against
inflation.
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic
companies that explore for, mine and process or distribute gold and
other precious metals. This is the most aggressive and most
speculative IDS mutual fund.
(icon of) cart of precious gems
For more complete information about any of these funds, including
charges and expenses, you can obtain a prospectus by contacting
your financial advisor or writing to American Express Shareholder
Service, P.O. Box 534, Minneapolis, MN 55440-0534. Read it
carefully before you invest or send money.
<PAGE>
PAGE 29
Federal income tax information
IDS Strategy Aggressive Fund
___________________________________________________________________
The Fund is required by the Internal Revenue Code of 1986 to tell
its shareholders about the tax treatment of the dividends it pays
during its fiscal year. The dividends listed below were reported
to you on a Form 1099-DIV, Dividends and Distributions, last
January. Shareholders should consult a tax advisor on how to report
distributions for state and local purposes.
IDS Strategy Aggressive Fund
Fiscal year ended March 31, 1996
Class A
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $1.1000
Total distribution $1.1000
Class B
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $1.1000
Total distribution $1.1000
Class Y
Capital gain distribution
taxable as long-term capital gain.
Payable date Per share
Dec. 29, 1995 $1.1000
Total distribution $1.1000
<PAGE>
PAGE 30
Quick telephone reference
American Express Telephone Transaction Service
Redemptions and exchanges, dividend payments or reinvestments and
automatic payment arrangements
National/Minnesota: 800-437-3133
Mpls./St. Paul area: 671-3800
American Express Shareholder Service
Fund performance, objectives and account inquiries
612-671-3733
TTY Service
For the hearing impaired
800-846-4852
American Express Infoline
Automated account information (TouchToneR phones only), including
current fund prices and performance, account values and recent
account transactions
National/Minnesota: 800-272-4445
Mpls./St. Paul area: 671-1630
AMERICAN
EXPRESS
Financial
Advisors
IDS Strategy Aggressive Fund
IDS Tower 10
Minneapolis, MN 55440-0010
<PAGE>
PAGE 31
STATEMENT OF DIFFERENCES
Difference Description
1) The layout is different 1) Some of the layout in the
throughout the annual report. annual report to
shareholders is in two
columns.
2) Headings. 2) The headings in the
annual report and
prospectus are placed
in a blue strip at the
top of the page.
3) There are pictures, icons 3) Each picture, icon and
and graphs throughout the graph is described in
annual report and prospectus. parentheses.
4) Footnotes for charts and 4) The footnotes for each
graphs are described at chart or graph are typed
the left margin. below the description of
the chart or graph.
