<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND ANNUAL REPORT
PERFORMANCE AT A GLANCE
--------------------------------------------------------------------------------
The graph depicts the performance of PaineWebber Global Equity Fund (Class A)
versus the MSCI World Index. It is important to note PaineWebber Global Equity
Fund is a professionally managed mutual fund while the Index is not available
for investment and is unmanaged. The comparison is shown for illustrative
purposes only.
Comparison of the change of a $10,000 investment in PaineWebber Global
Equity Fund (Class A) and the MSCI World Index from November 30, 1991
through October 31, 2000.
<TABLE>
<CAPTION>
PAINEWEBBER GLOBAL EQUITY FUND (CLASS A) MSCI WORLD INDEX
<S> <C> <C>
Nov-91 $9,551 $10,000
Dec-91 $10,208 $10,725
Jan-92 $10,224 $10,523
Feb-92 $10,332 $10,338
Mar-92 $10,108 $9,848
Apr-92 $10,465 $9,982
May-92 $11,013 $10,376
Jun-92 $10,731 $10,026
Jul-92 $10,532 $10,048
Aug-92 $10,689 $10,289
Sep-92 $10,515 $10,191
Oct-92 $10,382 $9,912
Nov-92 $10,482 $10,086
Dec-92 $10,541 $10,165
Jan-93 $10,549 $10,195
Feb-93 $10,854 $10,434
Mar-93 $11,311 $11,036
Apr-93 $11,565 $11,545
May-93 $11,819 $11,808
Jun-93 $11,480 $11,707
Jul-93 $11,683 $11,944
Aug-93 $12,318 $12,489
Sep-93 $12,412 $12,255
Oct-93 $13,047 $12,590
Nov-93 $12,615 $11,875
Dec-93 $13,783 $12,453
Jan-94 $14,470 $13,271
Feb-94 $14,247 $13,096
Mar-94 $13,732 $12,529
Apr-94 $13,869 $12,914
May-94 $14,006 $12,943
Jun-94 $13,620 $12,904
Jul-94 $14,075 $13,147
Aug-94 $14,564 $13,540
Sep-94 $14,264 $13,181
Oct-94 $14,504 $13,553
Nov-94 $13,826 $12,962
Dec-94 $13,455 $13,084
Jan-95 $13,082 $12,884
Feb-95 $13,297 $13,068
Mar-95 $13,791 $13,695
Apr-95 $14,388 $14,169
May-95 $14,583 $14,287
Jun-95 $14,863 $14,280
Jul-95 $15,609 $14,991
Aug-95 $15,031 $14,653
Sep-95 $15,227 $15,077
Oct-95 $14,751 $14,836
Nov-95 $14,910 $15,348
Dec-95 $15,277 $15,793
Jan-96 $15,557 $16,075
Feb-96 $15,692 $16,170
Mar-96 $16,069 $16,435
Apr-96 $16,581 $16,818
May-96 $16,601 $16,830
Jun-96 $16,639 $16,913
Jul-96 $15,837 $16,312
Aug-96 $16,243 $16,497
Sep-96 $16,900 $17,138
Oct-96 $16,842 $17,255
Nov-96 $17,567 $18,218
Dec-96 $17,538 $17,922
Jan-97 $17,637 $18,136
Feb-97 $17,717 $18,341
Mar-97 $17,498 $17,974
Apr-97 $17,518 $18,558
May-97 $18,665 $19,699
Jun-97 $19,634 $20,678
Jul-97 $20,452 $21,628
Aug-97 $19,075 $20,176
Sep-97 $20,053 $21,270
Oct-97 $18,336 $20,147
Nov-97 $18,376 $20,499
Dec-97 $18,650 $20,745
Jan-98 $18,847 $21,320
Feb-98 $20,314 $22,759
Mar-98 $21,550 $23,717
Apr-98 $22,151 $23,945
May-98 $22,082 $23,641
Jun-98 $21,666 $24,199
Jul-98 $21,735 $24,155
Aug-98 $17,887 $20,931
Sep-98 $17,460 $21,297
Oct-98 $18,800 $23,218
Nov-98 $19,771 $24,595
Dec-98 $20,816 $25,792
Jan-99 $21,107 $26,355
Feb-99 $20,585 $25,651
Mar-99 $20,828 $26,715
Apr-99 $21,654 $27,765
May-99 $20,950 $26,746
Jun-99 $21,690 $27,990
Jul-99 $21,848 $27,903
Aug-99 $21,617 $27,850
Sep-99 $21,192 $27,577
Oct-99 $21,726 $29,006
Nov-99 $22,673 $29,818
Dec-99 $24,601 $32,236
Jan-00 $23,104 $30,392
Feb-00 $25,251 $30,477
Mar-00 $25,787 $32,586
Apr-00 $24,304 $31,211
May-00 $23,852 $30,425
Jun-00 $24,474 $31,453
Jul-00 $23,895 $30,572
Aug-00 $24,544 $31,572
Sep-00 $23,005 $29,896
Oct-00 $22,271 $29,399
</TABLE>
Past performance is no guarantee of future performance. The performance of the
other classes will vary from the performance of the class shown because of
differences in sales charges and fees paid by shareholders investing in
different classes.
AVERAGE ANNUAL TOTAL RETURNS, PERIODS ENDED 10/31/00
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------
6 Months 1 Year 5 Years Inception(0)
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A* -8.37% 2.51% 8.59% 9.38%
Before Deducting CLASS B** -8.61 1.75 7.72 6.99
Maximum Sales Charge CLASS C+ -8.71 1.74 7.76 8.17
CLASS Y++ -8.24 2.88 8.97 9.35
--------------------------------------------------------------------------------------------------------
CLASS A* -12.49 -2.08 7.59 8.81
After Deducting CLASS B** -13.18 -2.57 7.44 6.86
Maximum Sales Charge CLASS C+ -9.62 0.87 7.76 8.17
--------------------------------------------------------------------------------------------------------
MSCI World Index -5.81 1.39 15.03 12.63
Lipper Global Funds Median -5.97 8.94 13.77 12.34
--------------------------------------------------------------------------------------------------------
</TABLE>
Past performance is no guarantee of future performance. The investment return
and the principal value of an investment in the Fund will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost. Returns for periods of one year or less have not been annualized. The
performance data quoted assume reinvestment of all dividends and capital gains.
Lipper peer group data calculated by Lipper Inc.; used with permission. The
Lipper Median is the return of the fund that places in the middle of the peer
group.
(0) Inception: since commencement of issuance on November 14, 1991 for Class A
shares, August 25, 1995 for Class B shares and May 10, 1993 for Classes C
and Y shares. Inception returns for Index and Lipper Median are shown as of
nearest month-end of the oldest share class: October 31, 1991.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after one year. Class C shares bear ongoing 12b-1
distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing 12b-1 distribution
and service fees.
1
<PAGE>
ANNUAL REPORT PAINEWEBBER EMERGING MARKETS EQUITY FUND
PERFORMANCE AT A GLANCE
--------------------------------------------------------------------------------
The graph depicts the performance of PaineWebber Emerging Markets Equity Fund
(Classes A, C and Y) versus the MSCI Emerging Markets Free Index. It is
important to note PaineWebber Emerging Markets Equity Fund is a professionally
managed mutual fund while the Index is not available for investment and is
unmanaged. The comparison is shown for illustrative purposes only.
Comparison of the change of a $10,000 investment in PaineWebber Emerging
Markets Equity Fund (Classes A, C and Y) and the MSCI Emerging Markets Free
Index from January 31, 1994 through October 31, 2000.
<TABLE>
<CAPTION>
PAINEWEBBER EMERGING PAINEWEBBER EMERGING PAINEWEBBER EMERGING MSCI EMERGING MARKETS
MARKETS FUND EQUITY (CLASS A) MARKETS FUND EQUITY (CLASS C) MARKETS FUND EQUITY (CLASS Y) FREE INDEX
<S> <C> <C> <C> <C>
Jan-94 $9,549 $10,000 $10,000 $10,000
Feb-94 $9,319 $9,759 $9,768 $9,822
Mar-94 $8,733 $9,137 $9,146 $8,933
Apr-94 $8,694 $9,095 $9,113 $8,754
May-94 $8,860 $9,261 $9,287 $9,054
Jun-94 $8,543 $8,921 $8,955 $8,804
Jul-94 $8,899 $9,286 $9,328 $9,352
Aug-94 $9,620 $10,041 $10,091 $10,512
Sep-94 $9,699 $10,108 $10,174 $10,632
Oct-94 $9,485 $9,884 $9,950 $10,441
Nov-94 $9,066 $9,436 $9,511 $9,898
Dec-94 $8,306 $8,647 $8,723 $9,103
Jan-95 $7,316 $7,610 $7,678 $8,134
Feb-95 $7,047 $7,328 $7,405 $7,925
Mar-95 $7,176 $7,455 $7,536 $7,976
Apr-95 $7,375 $7,663 $7,754 $8,334
May-95 $7,622 $7,912 $8,013 $8,777
Jun-95 $7,749 $8,028 $8,146 $8,804
Jul-95 $8,116 $8,410 $8,539 $9,001
Aug-95 $7,885 $8,161 $8,288 $8,789
Sep-95 $7,972 $8,252 $8,389 $8,747
Oct-95 $7,630 $7,887 $8,029 $8,412
Nov-95 $7,319 $7,571 $7,703 $8,263
Dec-95 $7,375 $7,621 $7,770 $8,629
Jan-96 $7,797 $8,045 $8,205 $9,243
Feb-96 $7,813 $8,061 $8,230 $9,096
Mar-96 $7,805 $8,045 $8,221 $9,167
Apr-96 $8,172 $8,418 $8,606 $9,534
May-96 $8,100 $8,344 $8,539 $9,491
Jun-96 $8,012 $8,252 $8,447 $9,550
Jul-96 $7,550 $7,762 $7,962 $8,897
Aug-96 $7,702 $7,912 $8,121 $9,125
Sep-96 $7,765 $7,970 $8,188 $9,204
Oct-96 $7,534 $7,737 $7,946 $8,959
Nov-96 $7,646 $7,845 $8,063 $9,109
Dec-96 $7,734 $7,928 $8,163 $9,150
Jan-97 $8,100 $8,294 $8,547 $9,774
Feb-97 $8,379 $8,584 $8,848 $10,193
Mar-97 $8,323 $8,518 $8,790 $9,925
Apr-97 $8,331 $8,518 $8,798 $9,942
May-97 $8,785 $8,983 $9,283 $10,227
Jun-97 $9,350 $9,547 $9,876 $10,774
Jul-97 $9,589 $9,788 $10,135 $10,934
Aug-97 $8,649 $8,817 $9,149 $9,544
Sep-97 $9,016 $9,182 $9,533 $9,808
Oct-97 $7,479 $7,613 $7,904 $8,198
Nov-97 $7,232 $7,356 $7,637 $7,899
Dec-97 $7,383 $7,505 $7,795 $8,090
Jan-98 $6,913 $7,023 $7,311 $7,455
Feb-98 $7,407 $7,522 $7,829 $8,234
Mar-98 $7,654 $7,762 $8,088 $8,591
Apr-98 $7,718 $7,829 $8,163 $8,497
May-98 $6,626 $6,716 $7,002 $7,333
Jun-98 $5,934 $6,011 $6,283 $6,564
Jul-98 $6,228 $6,301 $6,584 $6,772
Aug-98 $4,460 $4,508 $4,712 $4,814
Sep-98 $4,659 $4,707 $4,930 $5,119
Oct-98 $5,193 $5,247 $5,498 $5,659
Nov-98 $5,424 $5,471 $5,740 $6,129
Dec-98 $5,432 $5,479 $5,748 $6,040
Jan-99 $5,416 $5,454 $5,740 $5,943
Feb-99 $5,352 $5,388 $5,665 $6,001
Mar-99 $6,029 $6,069 $6,392 $6,792
Apr-99 $6,714 $6,758 $7,119 $7,632
May-99 $6,618 $6,650 $7,018 $7,588
Jun-99 $7,423 $7,455 $7,871 $8,449
Jul-99 $7,200 $7,223 $7,628 $8,219
Aug-99 $7,216 $7,231 $7,653 $8,294
Sep-99 $6,889 $6,891 $7,302 $8,014
Oct-99 $7,001 $6,999 $7,428 $8,184
Nov-99 $7,614 $7,613 $8,088 $8,918
Dec-99 $8,769 $8,759 $9,308 $10,053
Jan-00 $8,649 $8,634 $9,182 $10,113
Feb-00 $8,602 $8,584 $9,141 $10,247
Mar-00 $8,769 $8,742 $9,316 $10,297
Apr-00 $7,789 $7,762 $8,272 $9,321
May-00 $7,439 $7,414 $7,904 $8,936
Jun-00 $7,710 $7,679 $8,196 $9,250
Jul-00 $7,288 $7,248 $7,745 $8,775
Aug-00 $7,471 $7,422 $7,937 $8,818
Sep-00 $6,722 $6,675 $7,152 $8,048
Oct-00 $6,149 $6,110 $6,542 $7,464
</TABLE>
Past performance is no guarantee of future performance. The performance of the
classes varies based on the difference in sales charges and fees paid by
shareholders investing in different classes. Class B shares are not shown
because they were first offered at a later date.
AVERAGE ANNUAL TOTAL RETURNS, PERIODS ENDED 10/31/00
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
6 Months 1 Year 5 Years Inception(0)
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CLASS A* -21.06% -12.17% -4.23% -6.21%
Before Deducting CLASS B** -21.27 -12.68 NA -4.08
Maximum Sales Charge CLASS C+ -21.28 -12.69 -4.98 -6.94
CLASS Y++ -20.91 -11.92 -4.01 -5.99
-------------------------------------------------------------------------------------------------------
CLASS A* -24.61 -16.09 -5.10 -6.85
After Deducting CLASS B** -25.21 -17.04 NA -4.48
Maximum Sales Charge CLASS C+ -22.07 -13.57 -4.98 -6.94
-------------------------------------------------------------------------------------------------------
MSCI Emerging Markets -19.92 -8.87 -2.37 -4.25
Free Index
Lipper Emerging Markets -19.83 -4.19 -1.45 -5.55
Funds Median
-------------------------------------------------------------------------------------------------------
</TABLE>
Past performance is no guarantee of future performance. The investment return
and the principal value of an investment in the Fund will fluctuate, so that
an investor's shares, when redeemed, may be worth more or less than their
original cost. Returns for periods of one year or less have not been
annualized. The performance data quoted assume reinvestment of all dividends
and capital gains. Lipper peer group data calculated by Lipper Inc.; used
with permission. The Lipper Median is the return of the fund that places in
the middle of the peer group.
(0) Inception: since commencement of issuance on January 19, 1994 for Class A,
C and Y shares, and December 5, 1995 for Class B shares. Inception returns
for Index and Lipper Median are as of nearest month-end of the oldest share
class: January 31, 1994.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after one year. Class C shares bear ongoing 12b-1
distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing 12b-1 distribution
and service fees.
2
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND ANNUAL REPORT
PERFORMANCE AT A GLANCE
--------------------------------------------------------------------------------
The graph depicts the performance of PaineWebber Asia Pacific Growth Fund
(Classes A, B and C) versus the MSCI All Country Asia Pacific Free (ex-Japan)
Index. It is important to note PaineWebber Asia Pacific Growth Fund is a
professionally managed mutual fund while the Index is not available for
investment and is unmanaged. The comparison is shown for illustrative purposes
only.
Comparison of the change of a $10,000 investment in PaineWebber Asia
Pacific Growth Fund (Classes A, B and C) and the MSCI All Country Asia
Pacific Free (ex-Japan) Index from March 31, 1997 through October 31, 2000.
<TABLE>
<CAPTION>
MSCI ALL COUNTRY ASIA
PAINEWEBBER ASIA PACIFIC PAINEWEBBER ASIA PACIFIC PAINEWEBBER ASIA PACIFIC PACIFIC FREE (EX-JAPAN)
GROWTH FUND (CLASS A) GROWTH FUND (CLASS B) GROWTH FUND (CLASS C) INDEX
<S> <C> <C> <C> <C>
Mar-97 $9,549 $10,000 $10,000 $10,000
Apr-97 $9,534 $9,976 $9,976 $9,837
May-97 $10,122 $10,592 $10,592 $10,260
Jun-97 $10,435 $10,912 $10,912 $10,615
Jul-97 $10,405 $10,864 $10,864 $10,682
Aug-97 $8,686 $9,072 $9,072 $8,773
Sep-97 $8,808 $9,184 $9,192 $8,721
Oct-97 $6,845 $7,136 $7,136 $6,769
Nov-97 $6,417 $6,688 $6,688 $6,295
Dec-97 $6,310 $6,568 $6,568 $6,047
Jan-98 $5,959 $6,200 $6,200 $5,513
Feb-98 $6,746 $7,016 $7,016 $6,672
Mar-98 $6,623 $6,888 $6,888 $6,559
Apr-98 $6,219 $6,456 $6,456 $5,972
May-98 $5,424 $5,632 $5,632 $5,043
Jun-98 $4,905 $5,088 $5,088 $4,460
Jul-98 $4,798 $4,968 $4,976 $4,336
Aug-98 $4,179 $4,328 $4,328 $3,700
Sep-98 $4,645 $4,808 $4,816 $4,059
Oct-98 $5,210 $5,392 $5,392 $4,934
Nov-98 $5,462 $5,648 $5,656 $5,324
Dec-98 $5,569 $5,760 $5,760 $5,426
Jan-99 $5,584 $5,768 $5,768 $5,333
Feb-99 $5,409 $5,584 $5,592 $5,221
Mar-99 $5,921 $6,112 $6,112 $5,829
Apr-99 $6,883 $7,104 $7,104 $6,887
May-99 $6,730 $6,936 $6,936 $6,698
Jun-99 $7,670 $7,896 $7,896 $7,765
Jul-99 $7,594 $7,816 $7,816 $7,581
Aug-99 $7,731 $7,952 $7,960 $7,759
Sep-99 $7,212 $7,416 $7,416 $7,209
Oct-99 $7,418 $7,616 $7,624 $7,434
Nov-99 $8,380 $8,600 $8,608 $8,135
Dec-99 $9,320 $9,560 $9,568 $8,787
Jan-00 $9,374 $9,608 $9,616 $8,734
Feb-00 $9,190 $9,416 $9,424 $8,544
Mar-00 $9,488 $9,712 $9,720 $8,726
Apr-00 $8,571 $8,768 $8,776 $7,913
May-00 $7,976 $8,152 $8,160 $7,214
Jun-00 $8,549 $8,736 $8,744 $7,575
Jul-00 $8,052 $8,216 $8,232 $7,240
Aug-00 $8,182 $8,344 $8,352 $7,180
Sep-00 $7,426 $7,568 $7,584 $6,350
Oct-00 $6,845 $6,976 $6,984 $5,844
</TABLE>
Past performance is no guarantee of future performance. The performance of the
classes varies based on the difference in sales charges and fees paid by
shareholders investing in different classes. Class Y shares are not shown
because they were first offered at a later date.
AVERAGE ANNUAL TOTAL RETURNS, PERIODS ENDED 10/31/00
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
6 Months 1 Year Inception(0)
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CLASS A* -20.14% -7.72% -8.81%
Before Deducting CLASS B** -20.44 -8.40 -9.50
Maximum Sales Charge CLASS C+ -20.42 -8.39 -9.47
CLASS Y++ -20.00 -7.44 1.30
------------------------------------------------------------------------------------------------
CLASS A* -23.74 -11.90 -9.97
After Deducting CLASS B** -24.42 -12.98 -10.00
Maximum Sales Charge CLASS C+ -21.22 -9.31 -9.47
------------------------------------------------------------------------------------------------
MSCI All Country Asia Pacific -21.46 -17.02 -9.86
Free (ex-Japan) Index
Lipper Pacific Ex-Japan -23.09 -12.22 -7.66
Funds Median
------------------------------------------------------------------------------------------------
</TABLE>
Past performance is no guarantee of future performance. The investment return
and the principal value of an investment in the Fund will fluctuate, so that an
investor's shares, when redeemed, may be worth more or less than their original
cost. Returns for periods of one year or less have not been annualized. The
performance data quoted assume reinvestment of all dividends and capital gains.
Lipper peer group data calculated by Lipper Inc.; used with permission. The
Lipper Median is the return of the fund that places in the middle of the peer
group.
(0) Inception: since commencement of issuance on March 25, 1997 for Class A, B
and C shares and March 13, 1998 for Class Y shares. Inception returns for
Index and Lipper Median are as of nearest month-end of the oldest share
class: March 31, 1997.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge
for Class C shares is 1% and is reduced to 0% after one year. Class C
shares bear ongoing 12b-1 distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing 12b-1 distribution
and service fees.
3
<PAGE>
ANNUAL REPORT PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND
AND ASIA PACIFIC GROWTH FUND
--------------------------------------------------------------------------------
PAINEWEBBER GLOBAL
EQUITY FUND
INVESTMENT GOAL:
Long-term growth of
capital
PORTFOLIO MANAGERS:
DOMESTIC INVESTMENT
Kirk Barneby
Frank Vallario
Mitchell Hutchins Asset
Management Inc.
FOREIGN INVESTMENT
Portfolio Management Team
Martin Currie Inc.
(Subadvisor)
COMMENCEMENT:
November 14, 1991 (Class A)
August 25, 1995 (Class B)
May 10, 1993 (Classes C and Y)
DIVIDEND PAYMENTS:
Annually, if any
--------------------------------------------------------------------------------
Dear Shareholder, December 15, 2000
We are pleased to present you with the annual reports for PaineWebber Global
Equity Fund, PaineWebber Emerging Markets Equity Fund and PaineWebber Asia
Pacific Growth Fund for the fiscal year ended October 31, 2000.
PAINEWEBBER GLOBAL EQUITY FUND
--------------------------------------------------------------------------------
[GRAPHIC] MARKET REVIEW
For the 12 months ended October 31, 2000, the international equity markets
reported the following returns: the Fund's benchmark, the Morgan Stanley Capital
International (MSCI) World Index, gained 1.39%; the United States, as measured
by the S&P 500 Index, gained 6.08%; Japan, as measured by the MSCI Japan Index,
declined 11.49%; continental Europe, as measured by the MSCI Europe ex-UK Index,
gained 3.83%; emerging markets, as measured by the MSCI Emerging Markets Free
Index, declined 8.87%.
Early in the fiscal year, telecommunications, media and technology stocks
pushed world equity markets higher. In the U.S., the NASDAQ Composite Index,
which is heavily weighted in technology stocks, reached a record high. As the
year progressed, however, U.S. investors became increasingly concerned that
equity markets, particularly the technology sector, had become overvalued. In
addition, economic data began to indicate that the Federal Reserve Board's tight
monetary policy of raising short-term interest rates was slowing the pace of
economic growth. Uncertainty in the U.S. market led to a sell-off, first in the
technology sector and then in the broader market. The turbulence in the U.S.
market rippled throughout the world's equity markets, and European, Asian and
Emerging Market equity markets were extremely volatile.
PORTFOLIO HIGHLIGHTS
The Fund outperformed the MSCI World Index (before deducting any sales
charges), but trailed its peer group for the fiscal year ended October 31, 2000.
The U.S. equity portion of the Global Equity Fund, mirroring the same stock
selection discipline applied to the management of our U.S. equity portfolios for
most of the period, hampered performance during the year. While a smaller-cap
(within the universe of large cap stocks) bias aided performance, specific stock
selection resulted in underperformance. Unisys, Apple, and Circuit City (all
sold during the fiscal period) in particular hurt the Fund's overall
performance. The United States, at 46.8%* of net assets, accounted for the
largest country weighting at the end of the 12-month period.
At 16.7%,* Japan was the Fund's second largest country weighting. Japanese
market performance was mixed during the period. While some economic data
indicates a strengthening economy, consumer spending continues to be weak.
In Europe, investment returns were eroded by three key factors. First, the
U.S. dollar continued to strengthen against almost every other currency in the
world. The continued strength of the U.S. economy and the eagerness of
international investors to purchase U.S. securities drove
* Weightings represent percentages of net assets as of October 31, 2000. The
Fund's portfolio is actively managed and its composition will vary over
time.
4
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND ANNUAL REPORT
AND ASIA PACIFIC GROWTH FUND
the U.S. dollar higher. Of the major currencies--the yen, pound and euro--the
euro was particularly weak. Second, there were concerns about U.S. corporate
earnings growth during the rest of 2000 and into 2001. While European companies
had fewer negative earnings reports, their stock prices declined because
investors became concerned that earnings expectations will become more difficult
to meet should global income slow. Finally, oil prices were an area of concern
for the international markets. Rising oil prices could have a negative impact on
inflation and economic growth. Geopolitical risk is also higher because of the
world's dependence on oil from the Middle East.
OUTLOOK
In the U.S., consumer spending has declined, unemployment has risen
slightly and corporate profits have been somewhat weaker. All of this has led
investors to believe that the Federal Reserve Board (the "Fed") has finished
raising interest rates, which should be positive for the equity market.
In Europe, particularly in the Euro zone countries, there is evidence that
the pace of growth is slowing. This has been reflected in important survey data
in Germany, France and Italy. Although the data indicate a slower pace of
growth, economic indicators are still well above long-term averages. In this
economic environment, price pressures from oil and other imports will likely
keep inflation above the European Central Bank's 2% target.
PROPOSED MERGER AND NEW FUND
MANAGEMENT
--------------------------------------------------------------------------------
On October 6, 2000, PaineWebber Global Equity Fund's board of trustees
unanimously approved the submission to shareholders of the merger of the Fund
into the PACE International Equity Investments. The proposed merger will be
submitted to shareholders at a meeting expected to be held in January 2001. If
approved by the Fund's shareholders, the merger is expected to become effective
in February 2001.
Also, on October 6, 2000, the board of trustees for the Fund approved the
termination of the existing Investment Advisory and Administration Contract with
Mitchell Hutchins and approved new interim investment management arrangements
that became effective on October 10, 2000, including a new interim sub-advisory
contract with Martin Currie Inc. which assumed the day-to-day portfolio
management responsibilities of the foreign portion of the Fund effective October
10, 2000. Mitchell Hutchins continues to manage the domestic portion of the
Fund.
More information about the proposed merger, the new investment management
arrangements and the related investment strategy changes is set out in the
October 10, 2000 supplement to the prospectus dated March 1, 2000. Additional
information is being provided to shareholders in proxy solicitation materials
that were expected to be mailed in December 2000.
5
<PAGE>
ANNUAL REPORT
PAINEWEBBER GLOBAL EQUITY FUND--PORTFOLIO STATISTICS
<TABLE>
<CAPTION>
CHARACTERISTICS* 10/31/00 4/30/00
--------------------------------------------------------------------------------------
<S> <C> <C>
Net Assets ($mm) $310.6 $371.9
Number of Securities 112 178
Stocks and Equity Futures 97.9% 91.9%
U.S. Allocation 46.8% 37.7%
International Allocation 53.2% 62.3%
--------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
TOP FIVE SECTORS* 10/31/00 4/30/00
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
Financial Services 12.2% Technology 31.3%
Technology 10.8 Financial Services 14.6
Utilities 10.2 Utilities 12.0
Consumer Cyclicals 8.6 Consumer Cyclicals 11.1
Healthcare 4.4 Healthcare 5.9
--------------------------------------------------------------------------------------
Total 46.2 Total 74.9
</TABLE>
<TABLE>
<CAPTION>
TOP FIVE COUNTRIES* 10/31/00 4/30/00
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
United States 46.8% United States 37.7%
Japan 16.7 United Kingdom 14.4
United Kingdom 10.5 Japan 8.2
France 8.3 France 8.0
Netherlands 2.4 Netherlands 6.4
--------------------------------------------------------------------------------------
Total 84.7 Total 74.7
</TABLE>
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS* 10/31/00 4/30/00
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
Vodafone Group 2.5% Autonomy Corp. 2.3%
Rhone Poulenc 1.5 Cisco Systems 2.2
Total Fina Elf 1.3 Philips Electronics 1.8
Ericsson 1.3 Ericsson 1.6
Zurich Financial Services 1.2 Nokia 1.5
VNU NV 1.2 Alcatel 1.3
Glaxo Wellcome 1.2 Vodafone Group 1.3
AXA 1.1 Nordic Baltic Holding 1.2
Vivendi 1.1 BP Amoco 1.2
Nokia 1.0 Total Fina Elf 1.2
--------------------------------------------------------------------------------------
Total 13.4 Total 15.6
</TABLE>
* Weightings represent percentages of net assets as of the dates indicated.
The Fund's portfolio is actively managed and its composition will vary over
time.
6
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND ANNUAL REPORT
AND ASIA PACIFIC GROWTH FUND
PAINEWEBBER EMERGING MARKETS EQUITY FUND
--------------------------------------------------------------------------------
[GRAPHIC] MARKET REVIEW
Higher oil prices, U.S. monetary policy and the volatility of the U.S.
equity markets affected emerging markets during the 12-month period. Many
emerging markets are closely correlated with the U.S. technology market and the
Nasdaq Composite's volatility had a significant negative impact on emerging
markets.
The higher risk profile of emerging markets contributed to their
underperformance, as investors considered the implication of escalating oil
prices on global growth. Because of its dependence on imported oil, Asia
experienced the steepest declines. In addition, the Asian markets were held back
by weakness in Korea and in the Taiwanese financial services sector.
In Latin America, markets benefited from upgrades in Brazilian and Mexican
debt ratings. In addition, the release of better-than-expected second quarter
GDP growth in Mexico and the strengthening of the Mexican currency were
supportive for the market.
In Europe, markets had divergent returns. Supported by stronger oil prices,
the Russian market gained. The Greek market, however, continued to underperform;
valuations were relatively unattractive, and investors chose to put their money
elsewhere.
PORTFOLIO HIGHLIGHTS
For the fiscal year ended October 31, 2000, the Fund trailed its benchmark.
Poor stock selection was the primary driver of the Fund's underperformance. The
Fund suffered from poor stock selection in Asia, particularly in the technology
sector in India (5.62%)* and Korea (11.30%).* Stock selection in Turkey (4.45%)*
also dragged on performance. Our overweighted positions in Latin America
(26.40%),* which experienced an economic recovery, and in Russia (3.69%),* which
benefited from higher oil prices, only partially offset the lackluster
performance.
During the fiscal year, we reduced the Fund's exposure to Mexico (10.71%)*
because we were concerned about the widening current account deficit and
potential for currency weakness should oil prices decline. Elsewhere in Latin
America, we continued to favor Brazil (11.73%),* which benefited from strong
economic recovery and broad earnings support. The decision by the Brazilian
Central Bank to maintain interest rates at current levels was well received by
the market. This move signaled prudence in matching interest rates with
sustainable economic growth. Latin American equity markets responded favorably
to the easing of U.S. macroeconomic concerns and ongoing domestic improvements.
Within Asia, we maintain an interest in China (0.94%),* where we expect the
market to benefit from sustained economic growth that should provide support for
structural reforms.
The Fund was underweighted in the large markets of Korea (11.30%)* and
Taiwan (8.78%),* which are likely to remain vulnerable to concerns over slowing
export growth and delays in corporate reform. In Taiwan, investor confidence was
affected by irregularities in the banking industry. There is concern in Taiwan
that some of the administration's programs may lead to slower domestic economic
growth.
--------------------------------------------------------------------------------
PAINEWEBBER EMERGING
MARKETS EQUITY FUND
INVESTMENT GOAL:
Long-term capital
appreciation
SUBADVISOR:
Schroder Investment
Management North
America Inc.
COMMENCEMENT:
January 19, 1994
(Classes A, C and Y)
December 5, 1995 (Class B)
DIVIDEND PAYMENTS:
Annually, if any
--------------------------------------------------------------------------------
* Weightings represent percentages of net assets as of October 31, 2000. The
Fund's portfolio is actively managed and its composition will vary over
time.
7
<PAGE>
ANNUAL REPORT
The Fund was overweighted in Russia, which is using strong oil revenues to
implement structural reforms. Investor concerns about the levels of U.S. oil
inventories boosted oil prices to new highs driving the Russian equity market
which contributed to the Fund's performance. While we overweighted the Fund in
the Russian oil sector, we are cautious of the susceptibility of the market to
any correction in oil prices.
OUTLOOK
Most emerging markets should continue to be influenced by economic and
market conditions in the U.S. These new markets export a significant percentage
of their products to the U.S. Should U.S. economic growth and consumer and
business spending decline, it is likely that corporate profits in emerging
markets may also take a downward turn. On a more positive note, it appears that
the U.S. Federal Reserve Board is at the end of its interest rate-raising cycle.
This bodes well for a stable or declining U.S. interest rate environment.
Positive developments in the U.S. are often beneficial for emerging markets.
PROPOSED MERGER
--------------------------------------------------------------------------------
On October 6, 2000, PaineWebber Emerging Markets Equity Fund's board of
trustees unanimously approved the submission to shareholders of the merger of
the Fund into the PACE International Emerging Markets Equity Investments. The
proposed merger will be submitted to shareholders at a meeting expected to be
held in January 2001. If approved by the Fund's shareholders, the merger is
expected to become effective in February 2001.
More information about the proposed merger is set out in the October 10,
2000 supplement to the prospectus dated March 1, 2000. Additional information is
being provided to shareholders in proxy solicitation materials that were to be
mailed in December 2000.
8
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND ANNUAL REPORT
AND ASIA PACIFIC GROWTH FUND
PAINEWEBBER EMERGING MARKETS EQUITY FUND--PORTFOLIO STATISTICS
<TABLE>
<CAPTION>
CHARACTERISTICS* 10/31/00 4/30/00
-------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Assets($mm) $5.8 $8.5
Number of Securities 146 177
Stocks 95.0% 98.8%
Cash and Other Assets in Excess of Liabilities 5.0% 1.2%
-------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
REGIONAL ALLOCATION* 10/31/00 4/30/00
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Asia 34.6% Asia 44.2%
Europe/Africa/Middle East 34.0 Europe/Africa/Middle East 28.8
Latin America 26.4 Latin America 25.8
Cash and Other Assets in Excess Cash and Other Assets in Excess
of Liabilities 5.0 of Liabilities 1.2
-------------------------------------------------------------------------------------------------
Total 100.0 Total 100.0
</TABLE>
<TABLE>
<CAPTION>
TOP TEN COUNTRIES* 10/31/00 4/30/00
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Brazil 11.7% Taiwan 15.1%
Korea 11.3 Korea 11.9
Mexico 10.7 Mexico 11.7
Taiwan 8.8 Brazil 10.1
Hong Kong 7.9 India 8.7
South Africa 7.8 South Africa 6.7
Israel 6.0 Turkey 6.1
India 5.6 Israel 5.3
Turkey 4.5 Malaysia 4.0
Russia 3.7 Russia 3.5
-------------------------------------------------------------------------------------------------
Total 78.0 Total 83.1
</TABLE>
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS* 10/31/00 4/30/00
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Telefonos de Mexico ADR 4.2% Samsung Electronics 4.7%
China Unicom 4.0 United Micro Electric 4.4
China Mobile 3.6 Telefonos de Mexico 3.2
Samsung Electronics 3.3 Infosys Technologies 2.0
Infosys Technologies 2.8 Korea Electric Power 1.7
Korea Telecom ADR 2.6 Yapi ve Kredi Bankasi 1.6
Taiwan Semiconductor 2.4 Taiwan Semiconductor 1.5
Korea Electric Power 2.1 Lukoil Holdings 1.4
Check Point Software Tech 1.8 Carso Global Telecom 1.4
SK Telecom 1.8 Tenaga Nasional Berhad 1.4
-------------------------------------------------------------------------------------------------
Total 28.6 Total 23.3
</TABLE>
* Weightings represent percentages of net assets as of the dates indicated.
The Fund's portfolio is actively managed and its composition will vary over
time.
9
<PAGE>
ANNUAL REPORT
--------------------------------------------------------------------------------
PAINEWEBBER ASIA PACIFIC
GROWTH FUND
INVESTMENT GOAL:
Long-term capital
appreciation
SUBADVISOR:
Schroder Investment
Management North America
Inc.
COMMENCEMENT:
March 25, 1997 (Classes A, B
and C), March 13, 1998
(Class Y)
DIVIDEND PAYMENTS:
Annually, if any
--------------------------------------------------------------------------------
PAINEWEBBER ASIA PACIFIC GROWTH FUND
--------------------------------------------------------------------------------
[GRAPHIC] MARKET REVIEW
Asia Pacific markets were volatile during the fiscal year. At the beginning
of the period, "new economy" stocks in the telecommunications, media and
technology area were relatively strong performers. During the second half of the
fiscal year, however, concerns about rising oil prices, earnings disappointments
from a number of U.S. technology companies and weakening semiconductor prices
had a negative impact on investor sentiment. For the year ended October 31,
2000, the MSCI All Country Asia Pacific Index Free (ex-Japan) declined
17.02%.
PORTFOLIO HIGHLIGHTS
During the period ended October 31, 2000, the Fund outperformed its
benchmarks: the MSCI All Country Asia Pacific Free (ex-Japan) Index and the
Lipper Pacific ex-Japan Funds Median. The Fund suffered disappointing returns
due to poor stock selections in Hong Kong (29.03%),* Korea (12.64%),* and
Singapore (8.77%).* Our positions in India (6.24%)* and Taiwan (10.87%)* helped
offset these losses somewhat.
In Hong Kong, telecommunications and electronics stocks declined. However,
bank and utility stocks were strong performers.
The Singapore market benefited from strong economic data and an increase in
non-oil exports and in industrial production. There has been a pick-up in loan
demand, and real estate companies outperformed. Technology companies continued
to be weak with the contract manufacturers hit hard by concerns over slowing
personal computer demand. We continue to favor banks and real estate stocks.
In recent months, Malaysia (5.14%)* has benefited from rising oil prices;
however, there continues to be concern over corporate governance. Because
valuations remain high and because there is a risk of earnings downgrades, we
have reduced the Fund's exposure to Malaysia.
In Korea (12.64%),* weak memory D-RAM prices and Ford Motor Company's
decision to withdraw from the purchase of Daewoo Motor was negative for the
market. The Daewoo situation reawakened concerns over corporate restructuring
and the health of the financial sector. In response, the government has
accelerated its restructuring efforts, pushing privatization and bank reform.
In Taiwan, concerns over weaker personal computer demand and political
uncertainty weighed on market sentiment. Although political uncertainty is
likely to remain high, export orders are strong and stock valuations are
attractive in the technology sector.
OUTLOOK
Because many Asia Pacific countries export their products to larger world
markets, a downturn in global economic growth could be troublesome in the short
term. Longer term, however, widespread corporate restructuring and financial
reforms bode well for the Asia Pacific region. When the larger economies recover
from their slower growth cycles, the Asia Pacific countries should be well
positioned to take advantage of a step up in worldwide demand for goods.
* Weightings represent percentages of net assets as of October 31, 2000. The
Fund's portfolio is actively managed and its composition will vary over
time.
10
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND ANNUAL REPORT
AND ASIA PACIFIC GROWTH FUND
PROPOSED MERGER
--------------------------------------------------------------------------------
On October 6, 2000, PaineWebber Asia Pacific Growth Fund's board of
trustees unanimously approved the submission to shareholders of the merger of
the Fund into the PACE International Emerging Markets Equity Investments. The
proposed merger will be submitted to shareholders at a meeting expected to be
held in January 2001. If approved by the Fund's shareholders, the merger is
expected to become effective in February 2001.
More information about the proposed merger is set out in the October 10,
2000 supplement to the prospectus dated March 1, 2000. Additional information is
being provided to shareholders in proxy solicitation materials that were mailed
in December 2000.
11
<PAGE>
ANNUAL REPORT
PAINEWEBBER ASIA PACIFIC GROWTH FUND--PORTFOLIO STATISTICS
<TABLE>
<CAPTION>
CHARACTERISTICS* 10/31/00 4/30/00
------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Assets ($mm) $23.8 $36.5
Number of Securities 80 100
Stocks 96.6% 98.1%
Cash and Other Assets in Excess of Liabilities 3.4% 1.9%
------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
TOP TEN COUNTRIES* 10/31/00 4/30/00
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Hong Kong 29.0% Hong Kong 21.2%
Australia 21.0 Australia 16.1
Korea 12.6 Taiwan 13.2
Taiwan 10.9 Korea 13.1
Singapore 8.8 Singapore 10.0
India 6.3 Malaysia 9.2
Malaysia 5.1 India 8.7
Thailand 1.3 Thailand 2.7
Indonesia 0.9 Indonesia 1.4
Philippines 0.7 United States 1.0
------------------------------------------------------------------------------------------------------
Total 96.6 Total 96.6
</TABLE>
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS* 10/31/00 4/30/00
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Hutchison Whampoa 5.6% Samsung Electronics 6.2%
Taiwan Semiconductor 5.5 Taiwan Semiconductor 6.0
News Corp. 3.8 Hutchison Whampoa 4.3
DBS Group Holdings 3.2 Cheung Hong Holdings 3.6
Broken Hill Proprietary 3.2 News Corp. 3.5
Samsung Electronics 3.1 Na Yan Plastic 3.0
Korea Electric Power 3.0 DBS Group Holdings 2.6
China Mobile(0) 2.9 Infosys Technologies 2.5
Sun Hung Kai Properties 2.8 China Telecom(0) 2.2
Infosys Technologies 2.5 Broken Hill Proprietary 2.2
------------------------------------------------------------------------------------------------------
Total 35.6 Total 36.1
</TABLE>
* Weightings represent percentages of net assets as of the dates indicated.
The Fund's portfolio is actively managed and its composition will vary over
time.
(0) China Telecom (Hong Kong) Limited changed its name to China Mobile (Hong
Kong) Limited effective June 28, 2000.
12
<PAGE>
ANNUAL REPORT
Our ultimate objective in managing your investments is to help you
successfully meet your financial goals. We thank you for your continued support
and welcome any comments or questions you may have. For a QUARTERLY REVIEW on
PaineWebber Global Equity Fund, PaineWebber Emerging Markets Equity Fund,
PaineWebber Asia Pacific Growth Fund or another fund in the PaineWebber Family
of Funds,(1) please contact your Financial Advisor. For additional information,
visit us at www.painewebber.com.
Sincerely,
/s/ Brian M. Storms
BRIAN M. STORMS
President and
Chief Operating Officer
Mitchell Hutchins
Asset Management Inc.
MARTIN CURRIE INC.
Portfolio Management Team,
PaineWebber Global Equity Fund
/s/ T. Kirkham Barneby
T. KIRKHAM BARNEBY
Managing Director and Chief
Investment Officer - Quantitative
Investments
Mitchell Hutchins Asset
Management Inc.
Portfolio Manager,
PaineWebber Global Equity Fund
SCHRODER INVESTMENT
MANAGEMENT NORTH AMERICA
INC.
PaineWebber Emerging Markets
Equity Fund, PaineWebber Asia
Pacific Growth Fund
/s/ Frank A. Vallario
FRANK A. VALLARIO
Portfolio Manager, PaineWebber
Global Equity Fund
This letter is intended to assist shareholders in understanding how the
funds performed during the fiscal year ended October 31, 2000, and reflects
views at the time of its writing. Of course, these views may change in response
to changing circumstances. We encourage you to consult your Financial Advisor
regarding your personal investment program.
(1) Mutual funds are sold by prospectus only. The prospectuses for the funds
contain more complete information regarding risks, charges and expenses, and
should be read carefully before investing.
13
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
PERFORMANCE RESULTS (UNAUDITED)
<TABLE>
<CAPTION>
NET ASSET VALUE TOTAL RETURN(1)
----------------------------------------- ----------------------------------------
12 MONTHS 6 MONTHS
10/31/00 04/30/00 10/31/99 ENDED 10/31/00 ENDED 10/31/00
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A Shares $15.77 $17.21 $17.90 2.51% (8.37)%
-------------------------------------------------------------------------------------------------------------------------------
Class B Shares 14.54 15.91 16.81 1.75 (8.61)
-------------------------------------------------------------------------------------------------------------------------------
Class C Shares 14.57 15.96 16.84 1.74 (8.71)
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS A SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
----------------------- CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
11/14/91-12/31/91 $12.00 $12.29 -- -- 2.42%
-------------------------------------------------------------------------------------------------------------------------------
1992 12.29 12.45 $0.1610 $0.0800 3.26
-------------------------------------------------------------------------------------------------------------------------------
1993 12.45 16.07 0.2100 -- 30.77
-------------------------------------------------------------------------------------------------------------------------------
1994 16.07 14.43 1.2530 -- (2.38)
-------------------------------------------------------------------------------------------------------------------------------
1995 14.43 15.81 0.5743 -- 13.54
-------------------------------------------------------------------------------------------------------------------------------
1996 15.81 17.57 0.5784 -- 14.80
-------------------------------------------------------------------------------------------------------------------------------
1997 17.57 16.14 2.4768 -- 6.34
-------------------------------------------------------------------------------------------------------------------------------
1998 16.14 17.15 0.8142 0.0185 11.61
-------------------------------------------------------------------------------------------------------------------------------
1999 17.15 17.42 2.7044 -- 18.19
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 17.42 15.77 -- -- (9.47)
-------------------------------------------------------------------------------------------------------------------------------
Total: $8.7721 $0.0985
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: 123.46%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS B SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
----------------------- CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
08/25/95-12/31/95 $15.83 $15.46 $0.5743 -- 1.29%
-------------------------------------------------------------------------------------------------------------------------------
1996 15.46 17.03 0.5784 -- 13.91
-------------------------------------------------------------------------------------------------------------------------------
1997 17.03 15.42 2.4768 -- 5.49
-------------------------------------------------------------------------------------------------------------------------------
1998 15.42 16.22 0.8142 -- 10.67
-------------------------------------------------------------------------------------------------------------------------------
1999 16.22 16.15 2.7044 -- 17.13
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 16.15 14.54 -- -- (9.97)
-------------------------------------------------------------------------------------------------------------------------------
Total: $7.1481 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: 42.03%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions, if any, at net asset value on the payable dates and do not
include sales charges; results for each class would be lower if sales
charges were included. Total investment returns for periods of less than
one year have not been annualized.
The data above represents past performance of the Fund's shares, which is no
guarantee of future results. The principal value of an investment in the Fund
will fluctuate, so that an investor's shares, when redeemed, may be worth more
or less than their original cost.
14
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
PERFORMANCE RESULTS (UNAUDITED) (CONCLUDED)
PERFORMANCE SUMMARY CLASS C SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
----------------------- CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
05/10/93-12/31/93 $13.80 $15.99 $0.2100 -- 17.39%
-------------------------------------------------------------------------------------------------------------------------------
1994 15.99 14.23 1.2530 -- (3.12)
-------------------------------------------------------------------------------------------------------------------------------
1995 14.23 15.46 0.5743 -- 12.67
-------------------------------------------------------------------------------------------------------------------------------
1996 15.46 17.03 0.5784 -- 13.91
-------------------------------------------------------------------------------------------------------------------------------
1997 17.03 15.43 2.4768 -- 5.55
-------------------------------------------------------------------------------------------------------------------------------
1998 15.43 16.24 0.8142 -- 10.73
-------------------------------------------------------------------------------------------------------------------------------
1999 16.24 16.19 2.7044 -- 17.23
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 16.19 14.57 -- -- (10.01)
-------------------------------------------------------------------------------------------------------------------------------
Total: $8.6111 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: 79.98%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions, if any, at net asset value on the payable dates and do not
include sales charges; results for each class would be lower if sales
charges were included. Total investment returns for periods of less than
one year have not been annualized.
Note: The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and may invest in PaineWebber mutual funds. For the six months, one
and five years ended October 31, 2000, and since inception, May 10, 1993,
through October 31, 2000, Class Y shares had a cumulative total return of
(8.24)%, 2.88%, 53.64% and 95.20%, respectively. Class Y shares do not have
initial or contingent deferred sales charges or ongoing distribution and service
fees.
The data above represents past performance of the Fund's shares, which is no
guarantee of future results. The principal value of an investment in the Fund
will fluctuate, so that an investor's shares, when redeemed, may be worth more
or less than their original cost.
AVERAGE ANNUAL TOTAL RETURNS, PERIODS ENDED 9/30/00
<TABLE>
<CAPTION>
6 Months 1 Year 5 Years Inception(0)
<S> <C> <C> <C> <C> <C>
CLASS A* -10.79% 8.56% 8.60% 9.87%
Before Deducting CLASS B** -11.25 7.52 7.67 7.75
Maximum Sales Charge
CLASS C+ -11.10 7.72 7.76 8.75
CLASS Y++ -10.60 8.97 8.97 9.94
CLASS A* -14.80 3.69 7.61 9.30
After Deducting
Maximum Sales Charge CLASS B** -15.69 2.95 7.39 7.62
CLASS C+ -11.99 6.80 7.76 8.75
</TABLE>
Past performance is no guarantee of future performance. The investment
return and the principal value of an investment in the Fund will fluctuate,
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. Returns for periods of one year or less have not been
annualized. The performance data quoted assume reinvestment of all
dividends and capital gains.
(0) Inception: since commencement of issuance on November 14, 1991 for Class A
shares, August 25, 1995 for Class B shares and May 10, 1993 for Classes C
and Y shares.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after one year. Class C shares bear ongoing 12b-1
distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing distribution and
service fees.
15
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
PERFORMANCE RESULTS (UNAUDITED)
<TABLE>
<CAPTION>
NET ASSET VALUE TOTAL RETURN(1)
----------------------------------------- ----------------------------------------
12 MONTHS SIX MONTHS
10/31/00 04/30/00 10/31/99 ENDED 10/31/00 ENDED 10/31/00
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A Shares $8.96 $11.22 $9.71 (7.72)% (20.14)%
-------------------------------------------------------------------------------------------------------------------------------
Class B Shares 8.72 10.96 9.52 (8.40) (20.44)
-------------------------------------------------------------------------------------------------------------------------------
Class C Shares 8.73 10.97 9.53 (8.39) (20.42)
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS A SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
03/25/97-12/31/97 $12.50 $ 8.26 -- -- (33.92)%
-------------------------------------------------------------------------------------------------------------------------------
1998 8.26 7.29 -- -- (11.74)
-------------------------------------------------------------------------------------------------------------------------------
1999 7.29 12.20 -- -- 67.35
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 12.20 8.96 -- -- (26.56)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (28.32)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS B SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
03/25/97-12/31/97 $12.50 $ 8.21 -- -- (34.32)%
-------------------------------------------------------------------------------------------------------------------------------
1998 8.21 7.20 -- -- (12.30)
-------------------------------------------------------------------------------------------------------------------------------
1999 7.20 11.95 -- -- 65.97
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 11.95 8.72 -- -- (27.03)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (30.24)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS C SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
03/25/97-12/31/97 $12.50 $ 8.21 -- -- (34.32)%
-------------------------------------------------------------------------------------------------------------------------------
1998 8.21 7.20 -- -- (12.30)
-------------------------------------------------------------------------------------------------------------------------------
1999 7.20 11.96 -- -- 66.11
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 11.96 8.73 -- -- (27.01)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (30.16)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions, if any, at net asset value on the payable dates and do not
include sales charges; results would be lower if sales charges were
included. Total investment returns for periods of less than one year have
not been annualized.
Note: The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and may invest in PaineWebber mutual funds. For the six months and
one year ended October 31, 2000 and since inception, March 13, 1998 through
October 31, 2000, Class Y shares had a cumulative total return of (20.00)%,
(7.44)% and 3.46%, respectively. Class Y shares do not have initial or
contingent deferred sales charges or ongoing distribution and service fees.
The above data represents past performance of the Fund's shares, which is no
guarantee of future results. The principal value of an investment in the Fund
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than their original cost.
16
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
PERFORMANCE RESULTS (UNAUDITED) (CONCLUDED)
AVERAGE ANNUAL TOTAL RETURN, PERIODS ENDED 9/30/00
<TABLE>
<CAPTION>
6 Months 1 Year Inception(0)
<S> <C> <C> <C> <C>
CLASS A* -21.74% 2.97% -6.89%
Before Deducting CLASS B** -22.08 2.05 -7.60
Maximum Sales Charge
CLASS C+ -21.98 2.27 -7.55
CLASS Y++ -21.69 3.19 4.58
CLASS A* -25.29 -1.62 -8.10
After Deducting
Maximum Sales Charge CLASS B** -25.97 -2.95 -8.40
CLASS C+ -22.76 1.27 -7.55
</TABLE>
Past performance is no guarantee of future performance. The investment
return and the principal value of an investment in the Fund will fluctuate,
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. Returns for periods of one year or less have not been
annualized. The performance data quoted assume reinvestment of all
dividends and capital gains.
(0) Inception: since commencement of issuance on March 25, 1997 for Class A, B
and C shares and March 13, 1998 for Class Y shares.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after one year. Class C shares bear ongoing 12b-1
distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing distribution and
service fees.
17
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
PERFORMANCE RESULTS(UNAUDITED)
<TABLE>
<CAPTION>
NET ASSET VALUE TOTAL RETURN(1)
----------------------------------------- ----------------------------------------
12 MONTHS 6 MONTHS
10/31/00 04/30/00 10/31/99 ENDED 10/31/00 ENDED 10/31/00
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Class A Shares $7.72 $9.78 $8.79 (12.17)% (21.06)%
-------------------------------------------------------------------------------------------------------------------------------
Class B Shares 7.44 9.45 8.52 (12.68) (21.27)
-------------------------------------------------------------------------------------------------------------------------------
Class C Shares 7.36 9.35 8.43 (12.69) (21.28)
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS A SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
01/19/94-12/31/94 $12.00 $10.49 -- -- (12.58)%
-------------------------------------------------------------------------------------------------------------------------------
1995 10.49 9.26 -- $0.0517 (11.20)
-------------------------------------------------------------------------------------------------------------------------------
1996 9.26 9.71 -- -- 4.86
-------------------------------------------------------------------------------------------------------------------------------
1997 9.71 9.27 -- -- (4.53)
-------------------------------------------------------------------------------------------------------------------------------
1998 9.27 6.82 -- -- (26.43)
-------------------------------------------------------------------------------------------------------------------------------
1999 6.82 11.01 -- -- 61.44
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 11.01 7.72 -- -- (29.88)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0517
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (35.29)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS B SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
12/05/95-12/31/95 $9.13 $ 9.18 -- -- 0.55%
-------------------------------------------------------------------------------------------------------------------------------
1996 9.18 9.56 -- -- 4.14
-------------------------------------------------------------------------------------------------------------------------------
1997 9.56 9.06 -- -- (5.23)
-------------------------------------------------------------------------------------------------------------------------------
1998 9.06 6.66 -- -- (26.49)
-------------------------------------------------------------------------------------------------------------------------------
1999 6.66 10.66 -- -- 60.06
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 10.66 7.44 -- -- (30.21)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0000
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (18.51)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
PERFORMANCE SUMMARY CLASS C SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
------------------------ CAPITAL GAINS
PERIOD COVERED BEGINNING ENDING DISTRIBUTED DIVIDENDS PAID TOTAL RETURN(1)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
01/19/94-12/31/94 $12.00 $10.42 -- -- (13.17)%
-------------------------------------------------------------------------------------------------------------------------------
1995 10.42 9.18 -- $0.0034 (11.87)
-------------------------------------------------------------------------------------------------------------------------------
1996 9.18 9.55 -- -- 4.03
-------------------------------------------------------------------------------------------------------------------------------
1997 9.55 9.04 -- -- (5.34)
-------------------------------------------------------------------------------------------------------------------------------
1998 9.04 6.60 -- -- (26.99)
-------------------------------------------------------------------------------------------------------------------------------
1999 6.60 10.55 -- -- 59.85
-------------------------------------------------------------------------------------------------------------------------------
01/01/00-10/31/00 10.55 7.36 -- -- (30.24)
-------------------------------------------------------------------------------------------------------------------------------
Total: $0.0000 $0.0034
-------------------------------------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 10/31/00: (38.64)%
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Figures assume reinvestment of all dividends and capital gain
distributions, if any, at net asset value on the payable dates and do not
include sales charges; results for each class would be lower if sales
charges were included. Total investment returns for periods of less than
one year have not been annualized.
Note: The Fund offers Class Y shares to a limited group of eligible investors
including participants in certain investment programs that are sponsored by
PaineWebber and may invest in PaineWebber mutual funds. For the six months
ended, one and five years ended October 31, 2000 and since inception, January
19, 1994 through October 31, 2000, Class Y shares had a cumulative total return
of (20.91)%, (11.92)%, (18.52)% and (34.25)%, respectively. Class Y shares do
not have initial or contingent deferred sales charges or ongoing distribution
and service fees.
The data above represents past performance of the Fund's shares, which is no
guarantee of future results. The principal value of an investment in the Fund
will fluctuate, so that an investor's shares, when redeemed, may be worth more
or less than their original cost.
18
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
PERFORMANCE RESULTS (UNAUDITED) (CONCLUDED)
AVERAGE ANNUAL TOTAL RETURNS, PERIODS ENDED 9/30/00
<TABLE>
<CAPTION>
6 Months 1 Year 5 Years Inception(0)
<S> <C> <C> <C> <C> <C>
CLASS A* -23.34% -2.43% -3.35% -5.03%
Before Deducting CLASS B** -23.59 -3.10 NA -2.37
Maximum Sales Charge
CLASS C+ -23.65 -3.13 -4.15 -5.79
CLASS Y++ -23.23 -2.06 -3.14 -4.81
CLASS A* -26.80 -6.84 -4.24 -5.69
After Deducting
Maximum Sales Charge CLASS B** -27.41 -7.94 NA -2.78
CLASS C+ -24.41 -4.10 -4.15 -5.79
</TABLE>
Past performance is no guarantee of future performance. The investment
return and the principal value of an investment in the Fund will fluctuate,
so that an investor's shares, when redeemed, may be worth more or less than
their original cost. Returns for periods of one year or less have not been
annualized. The performance data quoted assume reinvestment of all
dividends and capital gains.
(0) Inception: since commencement of issuance on January 19, 1994 for Class A,
C and Y shares and December 5, 1995 for Class B shares.
* Maximum sales charge for Class A shares is 4.5% of the public offering
price. Class A shares bear ongoing 12b-1 service fees.
** Maximum contingent deferred sales charge for Class B shares is 5% and is
reduced to 0% after six years. Class B shares bear ongoing 12b-1
distribution and service fees.
+ Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after one year. Class C shares bear ongoing 12b-1
distribution and service fees.
++ The Fund offers Class Y shares to a limited group of eligible investors,
including participants in certain investment programs that are sponsored by
PaineWebber and that may invest in PaineWebber mutual funds, as well as the
trustee of the PaineWebber 401(k) Plus Plan. Class Y shares do not bear
initial or contingent deferred sales charges or ongoing distribution and
service fees.
19
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
PORTFOLIO OF INVESTMENTS OCTOBER 31, 2000
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C>
COMMON STOCKS--51.92%
AUSTRALIA--0.53%
BANKS--0.12%
26,000 Commonwealth Bank of Australia ........... $ 386,914
---------------
ELECTRICAL & ELECTRONICS--0.13%
15,000 Brambles Industries Ltd. ................. 391,095
---------------
INSURANCE--0.13%
43,000 AMP Ltd. ................................. 387,607
---------------
MEDIA--0.15%
45,000 News Corp. Ltd. .......................... 470,714
---------------
Total Australia Common Stocks ....................... 1,636,330
---------------
CHINA--0.22%
WIRELESS TELECOMMUNICATIONS--0.22%
33,000 China Unicom* ............................ 676,500
---------------
FINLAND--1.12%
COMPUTER SOFTWARE--0.11%
17,682 Tieto Corp. .............................. 339,862
---------------
ELECTRICAL EQUIPMENT--1.01%
76,637 Nokia AB OY .............................. 3,153,508
---------------
Total Finland Common Stocks ......................... 3,493,370
---------------
FRANCE--8.26%
COMPUTER-BUSINESS SERVICES--0.31%
5,932 Cap Gemini S.A. .......................... 946,373
---------------
ENERGY SOURCES--1.26%
27,401 Total Fina Elf S.A. (Class B) ............ 3,920,371
---------------
FINANCIAL SERVICES--0.98%
19,907 Lyonnaise Des Eaux S.A. .................. 3,037,377
---------------
FOOD RETAIL--0.90%
26,127 Carrefour ................................ 1,753,756
6,595 Sodexho Alliance ......................... 1,032,558
---------------
2,786,314
---------------
HEALTH & PERSONAL CARE--1.50%
64,723 Rhone Poulenc S.A. ....................... 4,668,537
---------------
INDUSTRIAL SERVICES & SUPPLIES--1.11%
48,082 Vivendi .................................. 3,455,963
---------------
INSURANCE--1.12%
26,135 AXA ...................................... 3,459,795
---------------
WATER--0.30%
25,142 Vivendi Environnement* ................... 938,762
---------------
WIRELESS TELECOMMUNICATIONS--0.78%
39,895 Alcatel .................................. 2,434,168
---------------
Total France Common Stocks .......................... 25,647,660
---------------
GERMANY--1.01%
FINANCIAL SERVICES--1.01%
9,285 Allianz AG ............................... 3,148,156
---------------
GREECE--0.22%
BANKS--0.12%
10,000 National Bank of Greece .................. $ 380,098
---------------
ELECTRICAL EQUIPMENT--0.10%
6,800 NICE Systems Ltd., ADR* .................. 317,900
---------------
Total Greece Common Stocks .......................... 697,998
---------------
HONG KONG--0.94%
BANKS--0.22%
300,000 Bank of East Asia ........................ 677,010
---------------
REAL ESTATE--0.60%
67,000 Cheung Kong Holdings Ltd. ................ 740,960
58,000 Hutchison Whampoa Ltd. ................... 721,375
50,000 Sun Hung Kai Properties Ltd. ............. 410,309
---------------
1,872,644
---------------
WIRELESS TELECOMMUNICATIONS--0.12%
60,000 China Telecom Ltd.* ...................... 384,665
---------------
Total Hong Kong Common Stocks ....................... 2,934,319
---------------
IRELAND--0.53%
DRUGS & MEDICINE--0.53%
32,000 Elan Corp. PLC, ADR*(1) .................. 1,662,005
---------------
ISRAEL--0.13%
ELECTRICAL EQUIPMENT--0.13%
7,521 Orbotech Ltd.* ........................... 398,143
---------------
ITALY--1.88%
BANKS--0.46%
86,993 San Paolo - IMI SPA ...................... 1,410,006
---------------
LIFE & HEALTH INSURANCE--0.37%
85,473 Alleanza Assicuraz ....................... 1,133,681
---------------
LONG DISTANCE & PHONE COMPANIES--0.44%
118,207 Telecom Italia SPA ....................... 1,369,238
---------------
SPECIALTY RETAIL--0.28%
151,722 Autostrade SPA ........................... 881,947
---------------
WIRELESS TELECOMMUNICATIONS--0.33%
121,600 Telecom Italia Mobilare .................. 1,033,962
---------------
Total Italy Common Stocks ........................... 5,828,834
---------------
JAPAN--16.65%
APPAREL, RETAIL--0.21%
2,700 Fast Retailing Co.(1) .................... 664,391
---------------
CHEMICALS--1.48%
261,000 Asahi Chemical Industries ................ 1,616,973
35,000 Shin Etsu Chemical Co. Ltd. .............. 1,437,016
139,000 Sumitomo Bakelite(1) ..................... 1,555,414
---------------
4,609,403
---------------
</TABLE>
20
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C>
COMMON STOCKS--(CONTINUED)
JAPAN--(CONTINUED)
COMPUTER-BUSINESS SERVICES--0.93%
11,000 Benesse Corp. ............................ $ 604,866
32,000 Secom Co. Ltd. ........................... 2,281,630
---------------
2,886,496
---------------
COMPUTER SOFTWARE--0.46%
47,000 MKC Stat ................................. 775,329
7,000 Trend Micro Inc* ......................... 660,770
---------------
1,436,099
---------------
CONSTRUCTION, REAL PROPERTY--0.23%
115,000 Daiwa House Industries ................... 721,945
---------------
DATA PROCESSING & REPRODUCTION--0.86%
67,000 Canon Inc. ............................... 2,658,754
---------------
DIVERSIFIED RETAIL--0.73%
30,000 Ito Yokado Co. Ltd. ...................... 1,355,451
62,000 Marui Co. Ltd. ........................... 914,814
---------------
2,270,265
---------------
DRUGS & MEDICINE--1.20%
41,000 Taisho Pharmaceutical Co. ................ 1,179,856
56,000 Yamanouchi Pharmaceutical ................ 2,535,307
---------------
3,715,163
---------------
ELECTRICAL & ELECTRONICS--0.60%
23,200 Sony Corp. ............................... 1,854,044
---------------
ELECTRICAL EQUIPMENT--1.49%
28,000 Fuji Photo Film Co ....................... 1,039,271
195,000 Hitachi Ltd. ............................. 2,090,913
11,400 Matsushita Communication ................. 1,494,020
---------------
4,624,204
---------------
ELECTRONIC COMPONENTS--1.10%
74,000 Fujitsu .................................. 1,318,389
6,600 Kyocera Corp. ............................ 858,910
11,700 Mabuchi Motor Co. ........................ 1,250,259
---------------
3,427,558
---------------
ELECTRONIC COMPONENTS & INSTRUMENTS--0.71%
120,000 Sumitomo Electric Industries Ltd. ........ 2,216,011
---------------
ENTERTAINMENT & LEISURE--0.27%
33,000 Namco .................................... 852,862
---------------
FINANCIAL SERVICES--0.75%
117,000,000 Sanwa International Finance ............. 1,007,928
13,300 Takefuji Corp. ........................... 1,316,409
---------------
2,324,337
---------------
FOOD & HOUSEHOLD PRODUCTS--0.21%
24,000 Familymart Co. ........................... 635,660
---------------
JAPAN--(CONCLUDED)
HOUSEHOLD PRODUCTS--0.65%
67,000 Kao Corp. ................................ $ 2,007,882
---------------
LONG DISTANCE & PHONE COMPANIES--0.85%
289 Nippon Telephone & Telegraph Co. ......... 2,630,042
---------------
MANUFACTURING-GENERAL--0.45%
360,000 Mitsubishi Heavy Industry ................ 1,398,891
---------------
MEDIA--0.45%
66,000 Nomura Securities Co. Ltd. ............... 1,400,266
---------------
MOTOR VEHICLES--0.61%
60,000 Bridgestone Corp. ........................ 594,968
38,000 Honda Motor Co. .......................... 1,312,927
---------------
1,907,895
---------------
OTHER INSURANCE--0.14%
85,000 Mitsui Marine & Fire ..................... 431,563
---------------
PRINTING-COMMERCIAL--0.52%
184,000 Toppan Printing Co. ...................... 1,625,588
---------------
SEMICONDUCTOR--0.77%
9,500 Rohm Co. Ltd. ............................ 2,395,133
---------------
WIRELESS TELECOMMUNICATIONS--0.98%
123 NTT Mobile Communication ................. 3,032,305
---------------
Total Japan Common Stocks ........................... 51,726,757
---------------
MEXICO--1.53%
DIVERSIFIED RETAIL--0.31%
400,000 Wal-Mart de Mexico Series V* ............. 962,092
---------------
FINANCIAL SERVICES--0.14%
285,000 Grupo Financiero Banamex* 442,886
---------------
LONG DISTANCE & PHONE COMPANIES--0.61%
35,000 Telefonos de Mexico, S.A. de C.V., ADR ... 1,887,812
---------------
MEDIA--0.47%
27,000 Grupo Televisa, S.A. de C.V., ADR* ....... 1,461,375
---------------
Total Mexico Common Stocks .......................... 4,754,165
---------------
NETHERLANDS--2.41%
BANKS--0.39%
17,730 ING Groep NV ............................. 1,217,497
---------------
PUBLISHING--1.68%
114,463 Elsevier N.V. ............................ 1,461,857
79,896 VNU NV ................................... 3,762,887
---------------
5,224,744
---------------
SEMICONDUCTOR--0.34%
26,440 Koninklijke Philips Electronics N.V. .... 1,039,057
---------------
Total Netherlands Common Stocks ..................... 7,481,298
---------------
</TABLE>
21
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
--------- --------------
<S> <C>
COMMON STOCKS--(CONCLUDED)
POLAND--0.16%
OIL REFINING--0.16%
65,000 Polski Koncern Naftowy Orlen S.A. ........ $ 500,500
---------------
SINGAPORE--0.41%
BANKS--0.20%
130,000 Overseas Union Bank ...................... 629,163
---------------
FINANCIAL SERVICES--0.21%
55,000 DBS Group Holdings ....................... 648,238
---------------
Total Singapore Common Stocks ....................... 1,277,401
---------------
SOUTH AFRICA--0.17%
DIVERSIFIED INDUSTRIALS--0.07%
43,000 Barlow Ltd. .............................. 224,619
---------------
MINING--0.10%
7,450 Anglo American Platinum .................. 290,642
---------------
Total South Africa Common Stocks .................... 515,261
---------------
SPAIN--2.33%
AIRLINES--0.32%
120,438 Amadeus Global Travel* ................... 984,222
---------------
BANKS--1.29%
145,577 Banco Bilbao Vizcaya ..................... 1,939,526
213,307 Banco Santander Central
Hispanome .............................. 2,067,162
---------------
4,006,688
---------------
LONG DISTANCE & PHONE COMPANIES--0.72%
23,300 Telefonica S.A.* ......................... 444,285
30,838 Telefonica S.A., ADR* .................... 1,786,677
---------------
2,230,962
---------------
Total Spain Common Stocks ........................... 7,221,872
---------------
SWEDEN--1.65%
BANKS--0.40%
85,000 Forenings Sparbanken AB .................. 1,220,690
---------------
WIRELESS TELECOMMUNICATIONS--1.25%
292,188 Ericsson LM B Shares ..................... 3,889,095
---------------
Total Sweden Common Stocks .......................... 5,109,785
---------------
SWITZERLAND--1.23%
INSURANCE--1.23%
7,892 Zurich Financial Services Group* ......... 3,819,560
---------------
UNITED KINGDOM--10.54%
BUSINESS & PUBLIC SERVICES--0.31%
72,400 WPP Group PLC ............................ 971,701
---------------
UNITED KINGDOM--(CONCLUDED)
COMPUTER SOFTWARE--1.20%
270,000 Sage Group ............................... $ 1,970,534
140,000 Sema Group ............................... 1,767,256
---------------
3,737,790
---------------
CONSTRUCTION, REAL PROPERTY--0.54%
210,000 Shell Transportation & Trading Co. ....... 1,689,558
---------------
DIVERSIFIED RETAIL--0.11%
55,000 Kingfisher ............................... 328,785
---------------
DRUGS & MEDICINE--1.18%
126,880 Glaxo Wellcome PLC ....................... 3,652,473
---------------
FINANCIAL SERVICES--2.32%
120,000 3I Group ................................. 2,724,883
170,000 HSBC Holdings ............................ 2,422,214
160,000 Smithkline Beecham ....................... 2,066,152
---------------
7,213,249
---------------
LIFE & HEALTH INSURANCE--0.61%
140,000 Prudential PLC .......................... 1,883,042
---------------
OIL REFINING--0.35%
128,832 BP Amoco ................................. 1,092,598
---------------
SEMICONDUCTOR--0.55%
135,610 Marconi .................................. 1,711,840
---------------
WIRELESS TELECOMMUNICATIONS--3.37%
96,076 Cable & Wireless PLC ..................... 1,359,164
140,000 Energis* ................................. 1,197,468
1,899,313 Vodafone Group PLC ....................... 7,902,276
---------------
10,458,908
---------------
Total United Kingdom Common Stocks .................. 32,739,944
---------------
Total Common Stocks (cost--$159,993,876) ............ 161,269,858
---------------
PREFERRED STOCKS--1.30%
BRAZIL--1.30%
AEROSPACE & DEFENSE--0.37%
40,000 Embraer Empresa Brasileira
de Aeronautica S.A. .................... 1,157,500
---------------
OIL EXPLORATION & PRODUCTION--0.66%
70,000 Petroleo Brasileiro S.A.* ................ 2,034,375
---------------
WIRELESS TELECOMMUNICATIONS--0.27%
52,000 Embratel Participacoes S.A., ADR ......... 841,750
---------------
Total Brazil Preferred Stocks ....................... 4,033,625
---------------
Total Preferred Stocks (cost--$4,030,376) ........... 4,033,625
---------------
</TABLE>
22
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) MATURITY DATES INTEREST RATES VALUE
---------- -------------- ------------- -----
<S> <C> <C> <C>
U.S. AGENCY OBLIGATIONS--34.53%
$ 87,490 Federal Home Loan Bank Consolidated Discount Notes++ ++ ++ .. 11/10/00 6.370% $ 87,350,672
20,000 Federal National Mortgage Association Discount Notes ........ 11/30/00 6.400 19,896,889
-----------
Total U.S. Agency Obligations (cost--$107,247,561) ........................................................ 107,247,561
-----------
Total Investments (cost--$271,271,813) .................................................................... 272,551,044
-----------
REPURCHASE AGREEMENTS--10.89%
5,679 Repurchase Agreement dated 10/31/00 with Dresdner Bank
AG, collaterized by $4,860,000 U.S. Treasury Bonds,
7.500% due 11/15/16; (value--$5,792,843); proceeds:
$5,680,033 ................................................ 11/01/00 6.550 5,679,000
14,156 Repurchase Agreement dated 10/31/00 with Societe Generale,
collaterized by $15,568,000 U.S. Treasury Bonds, 5.250%
due 02/15/29; (value--$14,439,320); proceeds: $14,158,572 . 11/01/00 6.540 14,156,000
14,000 Repurchase Agreement dated 10/31/00 with Zions Bancorp,
collaterized by $14,720,000 U.S. Treasury Bills, 6.500%
due 04/26/01; (value--$14,281,344); proceeds: $14,002,539 . 11/01/00 6.530 14,000,000
-----------
Total Repurchase Agreements (cost--$33,835,000) ........................................................... 33,835,000
-----------
Total Investments and Repurchase Agreements (cost--$305,106,813)--98.64% .................................. 306,386,044
Other assets in excess of liabilities--1.36% .............................................................. 4,219,242
-----------
Net Assets--100.00% ....................................................................................... $310,605,286
===========
</TABLE>
* Non-income producing security.
ADR American Depository Receipt
(1) Security, or portion thereof, was on loan at October 31, 2000.
++ ++ ++ Entire or partial amount pledged as collateral for futures and
transactions.
FUTURES CONTRACTS
<TABLE>
<CAPTION>
UNREALIZED
NUMBER OF IN EXPIRATION APPRECIATION
CONTRACTS OUTSTANDING FUTURES CONTRACTS EXCHANGE FOR DATES (DEPRECIATION)
----------- -------------------------------------------------------- ------------ ---------- ---------------
<S> <C> <C> <C> <C>
5 CAC40 Ten Euro (France) $ 279,334 Nov 2000 $ (6,354)
1 DAX Index (Germany) 154,742 Dec 2000 (3,544)
6 FTSE Index (United Kingdom) 570,957 Dec 2000 (6,093)
1 Hang Seng Index (Hong Kong) 96,721 Nov 2000 (277)
1 IBEX Plus (Spain) 88,084 Nov 2000 228
381 S&P 500 (United States) 134,033,251 Dec 2000 3,145,799
1 SPI Futures (Australia) 42,531 Dec 2000 261
4 Topix Index (Japan) 500,911 Dec 2000 12,053
------------
$ 3,142,073
============
</TABLE>
The face value of futures purchased as a percentage of net assets--44.7%
See accompanying notes to financial statements
23
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
PORTFOLIO OF INVESTMENTS OCTOBER 31, 2000
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--96.58%
AUSTRALIA--20.98%
BANKS--3.80%
35,400 Commonwealth Bank of Australia ....... $ 526,799
27,000 National Australia Bank Ltd. ......... 375,078
----------
901,877
----------
BREWERIES, PUBS, & RESTAURANTS--1.35%
142,000 Foster's Brewing Group Ltd. .......... 321,657
----------
COMPUTER SOFTWARE--0.65%
35,800 Securenet Ltd.* ...................... 154,950
----------
DIVERSIFIED INDUSTRIALS--3.21%
77,739 Broken Hill Proprietary Co. Ltd. ..... 753,536
19,435 OneSteel Ltd.* ....................... 9,268
----------
762,804
----------
DIVERSIFIED INDUSTRIES--0.97%
58,000 Woolworths Ltd. ...................... 231,074
----------
EXTRACTIVE INDUSTRIES--0.48%
31,400 Coles Myer Ltd. ...................... 113,771
----------
HEALTH/PERSONAL CARE--0.58%
51,500 Mayne Nickless Ltd. .................. 136,679
----------
LEISURE & HOTELS--0.96%
42,100 TABCORP Holdings Ltd. ................ 228,875
----------
MEDIA--3.82%
86,700 News Corp. Ltd. ...................... 906,908
----------
MINING--1.97%
8,700 Brambles Industries Ltd. ............. 225,568
17,700 Rio Tinto Ltd. ....................... 242,967
----------
468,535
----------
OIL EXPLORATION & PRODUCTION--0.61%
19,700 Woodside Petroleum Ltd. .............. 143,982
----------
PHARMACEUTICALS--0.78%
10,400 CSL Ltd. ............................. 185,003
----------
REAL ESTATE--1.80%
36,500 Lend Lease Corp. Ltd. ................ 427,303
----------
Total Australia Common Stocks ..................... 4,983,418
----------
HONG KONG--29.03%
BANKS--5.82%
68,000 Bank of East Asia .................... 153,455
140,000 Cosco Pacific Ltd. ................... 103,218
47,500 Dao Heng Bank Group .................. 239,967
114,000 Hong Kong Exchange ................... 198,795
65,000 Hong Kong Land Holdings Ltd. ......... 120,250
40,800 HSBC Holdings PLC .................... 567,611
----------
1,383,296
----------
COMMUNICATIONS--5.28%
9,400 Asia Global Crossing Ltd. (1)* ....... 65,800
108,000 China Mobile* ........................ 692,397
HONG KONG--(CONCLUDED)
145,000 China Unicom Ltd. * .................. $ 290,967
176,000 Global Technology Holdings ........... 204,231
----------
1,253,395
----------
FINANCIAL--0.58%
32,000 Dah Sing Financial ................... 137,453
----------
REAL ESTATE--14.29%
50,000 Cheung Kong Holdings Ltd. ............ 552,956
253,000 China Resources Developement
Enterprises, Ltd. .................... 287,094
106,800 Hutchison Whampoa Ltd. ............... 1,328,324
82,000 Sun Hung Kai Properties Ltd. ......... 672,907
272,000 Wharf Ltd. ........................... 554,533
----------
3,395,814
----------
SERVICES--1.11%
48,000 Television Broadcasting Ltd. ......... 262,803
----------
SHIPPING--0.68%
234,000 China Merchants Holdings International 162,021
----------
TRANSPORTATION--1.27%
167,000 Cathay Pacific Air ................... 302,994
----------
Total Hong Kong Common Stocks ..................... 6,897,776
----------
INDIA--6.24%
CHEMICALS--0.97%
35,700 Reliance Industries Ltd. ............. 231,027
----------
HEALTH/PERSONAL CARE--0.76%
49,000 Hindustan Lever ...................... 181,638
----------
OIL EXPLORATION & PRODUCTION--0.11%
11,050 Hindustan Petroleum Corp. ............ 25,228
----------
OIL & GAS--0.27%
17,500 Bharat Petroleum Corp. ............... 64,460
----------
PHARMACEUTICALS--0.69%
11,050 Ranbaxy Laboratories Ltd. ............ 164,505
----------
SUPPORT SERVICES--2.48%
3,850 Infosys Technologies Ltd. ............ 589,224
----------
TELECOMMUNICATIONS--0.96%
41,600 MahanagarTelephone Nigam Ltd. ........ 125,213
22,500 Videsh Sanchar Nigam Ltd. ............ 101,345
----------
226,558
----------
Total India Common Stocks ......................... 1,482,640
----------
INDONESIA--0.90%
COMMUNICATIONS--0.44%
406,680 P.T. Telekomunikasi Indonesia ........ 104,277
----------
FOODS--0.46%
93,500 H.M. Sampoerna ....................... 109,882
----------
Total Indonesia Common Stocks ..................... 214,159
----------
</TABLE>
24
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--(CONCLUDED)
KOREA--12.64%
BANKS--3.05%
45,382 Kookmin Bank .......................... $ 518,651
20,500 Shinhan Bank .......................... 205,451
----------
724,102
----------
COMMUNICATIONS--3.45%
300 Korea Telecom ......................... 17,670
7,500 Korea Telecom, ADR .................... 276,562
1,620 SK Telecom Ltd. ....................... 345,363
7,210 SK Telecom Ltd., ADS .................. 180,701
----------
820,296
----------
ELECTRICAL APPLIANCES--3.12%
5,914 Samsung Electronics Corp. ............. 740,875
----------
ELECTRICITY & GAS--3.02%
32,200 Korea Electric Power Corp. ............ 719,015
----------
Total Korea Common Stocks ......................... 3,004,288
----------
MALAYSIA--5.14%
BANKS--1.66%
98,500 Malayan Banking Berhad ................ 394,000
----------
COMMUNICATIONS--0.56%
89,000 Digi.com Berhad* ...................... 133,500
----------
CONSTRUCTION--0.75%
156,000 Gamuda Berhad ......................... 178,989
----------
DISTRIBUTORS--0.21%
5,400 British American Tobacco .............. 49,382
----------
ELECTRICITY & GAS--0.90%
66,000 Tenaga Nasional Berhad ................ 213,631
----------
MISCELLANEOUS FINANCIAL--0.58%
151,000 Arab Malaysian Finance Berhad ......... 139,079
----------
MISCELLANEOUS MANUFACTURING--0.48%
20,000 Malaysian Pacific Industries Berhad ... 113,158
----------
Total Malaysia Common Stocks ...................... 1,221,739
----------
PHILIPPINES--0.72%
COMMUNICATIONS--0.44%
6,900 Philippine Long Distance Telephone Co.. 104,545
----------
ELECTRICITY & GAS--0.28%
81,360 Manila Electric Co. ................... 66,806
----------
Total Philippines Common Stocks ................... 171,351
----------
SINGAPORE--8.77%
BANKS--3.19%
64,339 DBS Group Holdings .................... 758,309
----------
ELECTRICAL APPLIANCES--0.49%
27,000 Chartered Semiconductors* ............. 116,836
----------
HEALTH/PERSONAL CARE--0.37%
43,000 Parkway Holdings Ltd. ................. 88,140
----------
SINGAPORE--(CONCLUDED)
MISCELLANEOUS MANUFACTURING--0.53%
13,000 Venture Manufacturing Ltd. $ 125,833
----------
REAL ESTATE--1.39%
46,000 City Development Ltd. ................. 212,151
153,000 Wing Tai Holdings Ltd. ................ 118,476
----------
330,627
----------
SERVICES--0.88%
14,642 Singapore Press Holdings .............. 209,255
----------
SHIPPING--0.48%
21,000 Sembcorp Logistics Ltd. ............... 113,591
----------
TRANSPORTATION--1.44%
34,000 Singapore International Airlines ...... 340,716
----------
Total Singapore Common Stocks ..................... 2,083,307
----------
TAIWAN--10.87%
CHEMICALS--1.35%
267,848 Nan Ya Plastic ........................ 319,262
----------
COMMERCE/INDUSTRIAL--1.05%
50,121 Asustek Computer Inc. ................. 249,829
----------
ELECTRICAL APPLIANCES--8.47%
276,812 Acer Inc. ............................. 229,677
96,000 Compeq Manufacturing Ltd. ............. 362,600
73,450 Macronix International ................ 104,604
433,817 Taiwan Semiconductor
Manufacturing Company Ltd. ............ 1,316,225
----------
2,013,106
----------
Total Taiwan Common Stocks ........................ 2,582,197
----------
THAILAND--1.29%
COMMUNICATIONS--1.00%
10,000 Advanced Information Service PLC* ..... 82,254
257,500 TelecomAsia Corp. PLC (1)* ............ 155,050
----------
237,304
----------
CONSTRUCTION--0.29%
7,300 Siam Cement Co.* ...................... 68,671
----------
Total Thailand Common Stocks ...................... 305,975
----------
Total Common Stocks (cost--$21,541,357) ........... 22,946,850
----------
<CAPTION>
NUMBER OF
RIGHTS
------------
<S> <C>
RIGHTS--0.00%
THAILAND--0.00%
COMMUNICATIONS--0.00%
81,316 TelecomAsia Corp. PLC (cost--$0) ...... 0
----------
</TABLE>
25
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) MATURITY DATE INTEREST RATE VALUE
----- ------------- ------------- -----
<S> <C> <C> <C>
REPURCHASE AGREEMENT--3.35%
$ 795 Repurchase Agreement dated 10/31/00 with State Street Bank &
Trust Company, collateralized by $805,000
U.S. Treasury Notes, 6.125% due 08/31/02 (value--$815,063);
proceeds: $795,144 (cost--$795,000) ............................. 11/01/00 6.500% $ 795,000
-----------
Total Investments and Repurchase Agreement (cost--$22,336,357)--99.93% ..... 23,741,850
Other assets in excess of liabilities--0.07% ............................... 16,959
-----------
Net Assets--100.00% ........................................................ $23,758,809
===========
</TABLE>
-------------------
* Non-income producing securities
ADR American Depository Receipt
ADS American Depository Shares
(1) Security, or portion thereof, was on loan at October 31, 2000.
See accompanying notes to financial statements.
26
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
PORTFOLIO OF INVESTMENTS OCTOBER 31, 2000
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--82.99%
ARGENTINA--0.24%
BEVERAGES--0.24%
1,700 Quilmes Industrial S.A., ADR ........... $ 14,025
----------
BRAZIL--1.95%
BREWERIES, PUBS, & RESTAURANTS--0.73%
1,200 Companhia Brasileire
de Distribuicao, ADR ................. 42,750
----------
MEDIA--0.46%
1,800 Aracruz Celulose S.A., ADR ............. 27,000
----------
OIL EXPLORATION & PRODUCTION--0.40%
800 Petroleo Brasileiro S.A. (Petrobras) ... 23,174
----------
TELECOMMUNICATIONS--0.36%
150 Brasil Telecom Participacoes, ADR ...... 8,128
300 Telecomunicacoes Brasileiras
S.A., ADR ............................ 0
400 Telesp Celular Participacoes, ADR ...... 12,650
----------
20,778
----------
Total Brazil Common Stocks ........................ 113,702
----------
CHILE--3.21%
BANKS--0.22%
660 Banco Santiago, ADR .................... 13,035
----------
BREWERIES, PUBS, & RESTAURANTS--0.56%
1,700 Compania Cervecerias Unidas
S.A., ADR ............................ 32,831
----------
ELECTRICITY--1.03%
2,482 Enersis S.A., ADR ...................... 44,055
1,300 Gener S.A., ADR ........................ 15,763
----------
59,818
----------
RETAILERS, FOOD--0.49%
1,600 Distribucion Y Servicio D&S, ADR ....... 28,600
----------
TELECOMMUNICATIONS--0.91%
3,465 Compania de Telecomunicaciones
de Chile S.A., ADR ................... 52,842
----------
Total Chile Common Stocks ......................... 187,126
----------
CHINA--0.94%
OILS--0.94%
279,000 China Petrolium & Chemicals ............ 54,734
----------
CZECH REPUBLIC--0.57%
BANKS--0.00%
1 Komercni Banka AS, GDR ................. 7
----------
ELECTRICITY--0.24%
5,700 Ceske Energeticke Zavody AS ............ 13,860
----------
TELECOMMUNICATIONS--0.33%
1,450 Cesky Telecom .......................... 19,070
----------
Total Czech Republic Common Stocks ................ 32,937
----------
EGYPT--0.31%
TELECOMMUNICATIONS--0.31%
910 Mobinil ................................ $ 18,003
----------
GREECE--1.96%
BANKS--0.26%
415 Alpha Bank ............................. 15,338
----------
BEVERAGE/TOBACCO MANUFACTURING--0.38%
1,600 Coca Cola Hellenic Bottling
Company .............................. 21,871
----------
TELECOMMUNICATIONS--1.32%
1,600 Cosmote Mobile Telecom, GDR ............ 11,995
3,050 Hellenic Telecommunications
Organization SA ...................... 53,278
800 Stet Hellas
Telecommunications, ADR* ............. 11,600
----------
76,873
----------
Total Greece Common Stocks ........................ 114,082
----------
HONG KONG--7.85%
TELECOMMUNICATIONS--7.65%
33,000 China Mobile* .......................... 211,566
117,000 China Unicom* .......................... 234,780
----------
446,346
----------
ELECTRICAL APPLIANCES--0.20%
14,000 Legend Holdings Ltd. ................... 11,847
----------
Total Hong Kong Common Stocks ..................... 458,193
----------
HUNGARY--1.16%
BANKS--0.29%
377 OTP Bank Reg S, GDR .................... 17,210
----------
UTILITIES--0.87%
2,150 Matav RT, ADR .......................... 50,525
----------
Total Hungary Common Stocks ....................... 67,735
----------
INDIA--5.62%
BANKS--0.70%
7,703 HDFC Bank .............................. 41,101
----------
HOUSEHOLD GOODS & TEXTILES--0.56%
8,500 Hindustan Lever ........................ 31,509
200 Reliance Industry ...................... 1,294
----------
32,803
----------
PHARMACEUTICALS--0.77%
3,000 Ranbaxy Laboratories Ltd. .............. 44,662
----------
</TABLE>
27
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--(CONTINUED)
INDIA--(CONCLUDED)
SUPPORT SERVICES--3.03%
1,050 Infosys Technologies Ltd. .............. $ 160,698
2,500 Satyam Computer ........................ 16,397
----------
177,095
----------
TELECOMMUNICATIONS--0.50%
2,900 Mahanagar Telephone Nigam Ltd. ......... 8,729
4,566 Videsh Sanchar Nigam Ltd. .............. 20,566
----------
29,295
----------
TOBACCO--0.06%
200 ITC Ltd ................................ 3,252
----------
Total India Common Stocks ......................... 328,208
----------
INDONESIA--0.87%
TELECOMMUNICATIONS--0.27%
61,040 P.T. Telekomunikasi Indonesia .......... 15,651
----------
FOODS--0.60%
22,000 H.M. Sampoerna ......................... 25,855
115,000 Indofoods Sukses Makmur* ............... 9,522
----------
35,377
----------
Total Indonesia Common Stocks 51,028
----------
ISRAEL--6.03%
BANKS--2.02%
31,300 Bank Hapoalim Ltd. ..................... 79,176
19,700 Bank Leumi ............................. 38,696
----------
117,872
----------
COMPUTER SOFTWARE--1.79%
660 Check Point Software Tech Ltd. ......... 104,527
----------
ELECTRONICS--0.25%
310 NICE-Systems Ltd., ADR* ................ 14,493
----------
FOOD & DRUG RETAILERS--0.32%
2,020 Blue Square Israel Ltd., ADR ........... 18,685
----------
PHARMACEUTICALS--1.11%
1,100 Teva Pharmaceutical Industries
Ltd., ADS ............................ 65,038
----------
TELECOMMUNICATIONS--0.54%
900 ECI Telecommunications Ltd., ADR ....... 21,262
200 Gilat Satellite Networks Ltd.* ......... 10,238
----------
31,500
----------
Total Israel Common Stocks ........................ 352,115
----------
KOREA--11.30%
BANKS--1.43%
3,832 Kookmin Bank ........................... $ 43,794
3,980 Shinhan Bank ........................... 39,888
----------
83,682
----------
TELECOMMUNICATIONS--1.75%
480 SK Telecom ............................. 102,330
----------
ELECTRICAL APPLIANCES--3.35%
37 Locus Corp. ............................ 832
1,554 Samsung Electronics Corp. .............. 194,677
----------
195,509
----------
ELECTRICITY & GAS--2.14%
5,600 Korea Electric Power Corp. ............. 125,046
----------
TELECOMMUNICATIONS--2.63%
2,600 Korea Telecom Corp. .................... 153,143
----------
Total Korea Common Stocks ......................... 659,710
----------
MALAYSIA--2.91%
COMMERCE/INDUSTRIAL--0.13%
6,800 AMMB Holdings Berhad ................... 7,623
----------
COMMUNICATIONS--0.69%
13,000 Telekom Malaysia ....................... 40,026
----------
CONSTRUCTION--0.46%
19,000 United Engineers Malaysia Ltd. ......... 27,000
----------
ELECTRICITY & GAS--1.06%
19,000 Tenaga Nasional Berhad ................. 61,500
----------
SERVICES--0.57%
9,000 Genting Berhad ......................... 22,974
6,000 Resorts World Berhad ................... 10,500
----------
33,474
----------
Total Malaysia Common Stocks ...................... 169,623
----------
MEXICO--9.56%
ALCOHOLIC BEVERAGES--0.66%
14,500 Grupo Modelo S.A. de C.V. .............. 38,667
----------
BANKS--1.20%
35,100 Grupo Financiero Banamex ............... 54,545
25,000 Grupo Financiero Bancomer .............. 15,477
----------
70,022
----------
BREWERIES, PUBS, & RESTAURANTS--0.55%
8,500 Fomento Economico Mexicano,
S.A. de C.V. Series B ................ 32,356
----------
BUILDING MATERIALS & MERCHANTS--0.85%
11,789 Cemex, S.A. de C.V. .................... 49,560
----------
</TABLE>
28
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--(CONTINUED)
MEXICO--(CONCLUDED)
MEDIA--1.14%
18,000 Grupo Televisa, S.A. de C.V. ........... $ 48,659
330 Grupo Televisa, S.A. de C.V., GDS ...... 17,861
----------
66,520
----------
METALS--0.60%
2,300 Tubos de Acero de Mexico,
S.A. de C.V., ADR ...................... 34,983
----------
PAPER, PACKAGING & PRINTING--0.39%
8,900 Kimberly Clark de Mexico
S.A. de C.V. ........................... 22,756
----------
TELECOMMUNICATIONS--4.17%
4,510 Telefonos de Mexico,
S.A. de C.V., ADR ...................... 243,258
----------
Total Mexico Common Stocks ........................ 558,122
----------
PERU--0.50%
BANKS--0.38%
3,000 Credicorp Ltd., ADR .................... 21,938
----------
BUILDING & CONSTRUCTION--0.00%
2 Cementos Norte Pacasmayo, S.A. ......... 0
----------
EXTRACTIVE INDUSTRIES--0.12%
560 Compania de Minas
Buenaventura, ADR ...................... 7,210
----------
Total Peru Common Stocks .......................... 29,148
----------
PHILIPPINES--0.63%
COMMUNICATIONS--0.50%
1,931 Philippine Long Distance Telephone Co. . 29,257
----------
ELECTRICITY & GAS--0.13%
9,433 Manila Electric Co. Class B ............ 7,746
----------
Total Philippines Common Stocks ................... 37,003
----------
POLAND--1.52%
BANKS--0.18%
600 Powszechny Bank Kredytowy, ADR ......... 10,500
----------
DIVERSIFIED HOLDINGS COMPANIES--0.44%
3,220 Elektrim Spolka Akcyjna S.A.* .......... 25,502
----------
METALS & MINING--0.29%
1,570 Kghm Polska Miedz SA, GDR .............. 16,878
----------
OIL & GAS--0.21%
1,600 Polski Koncern Naftowy Orlen, ADR ...... 12,320
----------
UTILITIES--0.40%
4,710 Telekomunikacja Polska S.A., ADR ....... 23,314
----------
Total Poland Common Stocks ........................ 88,514
----------
RUSSIA--2.60%
ELECTRICITY--0.80%
3,240 Unified Energy System, GDR* ............ 46,980
----------
RUSSIA--(CONCLUDED)
OILS--1.31%
1,460 Lukoil Holdings, ADR ................... $ 76,285
----------
TELECOMMUNICATIONS--0.10%
700 RosteleKom ............................. 6,125
----------
UTILITIES--0.39%
818 Mobile Telesystems, ADR* ............... 22,597
----------
Total Russia Common Stocks ........................ 151,987
----------
SOUTH AFRICA--7.79%
BANKS--0.54%
39,800 African Bank Investments* .............. 31,528
----------
DIVERSIFIED INDUSTRIALS--0.11%
1,277 Barlow Ltd. ............................ 6,671
----------
ELECTRONIC & ELECTRICAL EQUIPMENT--0.65%
4,415 Dimension Data Holdings Ltd. ........... 38,010
----------
FINANCIAL SERVICES--0.73%
47,250 First Rand Ltd. ........................ 42,490
----------
HOUSEHOLD GOODS & TEXTILES--0.47%
56,362 Profurn Ltd. ........................... 27,578
----------
INSURANCE--0.65%
36,418 Sanlam Ltd. ............................ 37,806
----------
MEDIA--0.22%
1,700 Naspers Ltd. ........................... 12,635
----------
MINING--1.93%
1,500 Anglo American Platinum Corp. .......... 58,518
1,800 De Beers Centenary ..................... 49,513
400 Johnnic Holdings ....................... 4,549
----------
112,580
----------
OIL EXPLORATION & PRODUCTION--1.09%
8,275 Sasol Ltd. ............................. 63,362
----------
OTHER FINANCIAL--0.17%
3,400 Fedsure Holdings Ltd. .................. 9,847
----------
PAPER, PACKAGING & PRINTING--1.19%
14,800 Nampak Ltd. ............................ 21,530
7,000 Sappi .................................. 47,952
----------
69,482
----------
RETAILERS, GENERAL--0.04%
15,068 L.A. Retail Stores Ltd. ................. 2,610
----------
Total South Africa Common Stocks .................. 454,599
----------
TAIWAN--8.78%
BANKS--0.27%
25,000 China Trust Commercial Bank ............ 15,867
----------
COMMUNICATIONS--0.75%
21,000 Taiwan Cellular ........................ 43,885
----------
</TABLE>
29
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
COMMON STOCKS--(CONCLUDED)
TAIWAN--(CONCLUDED)
ELECTRICAL APPLIANCES--6.22%
16,000 Advanced Semiconductor
Engineering ............................ $ 18,378
10,000 Compal Electronics ..................... 15,263
17,400 Compeq Manufacturing Ltd. .............. 65,721
10,000 Delta Electronics ...................... 31,888
46,000 Taiwan Semiconductor
Manufacturing Company Ltd.* ............ 139,567
3,400 United Micro Electric .................. 6,000
6,000 United Micro Electric, ADR ............. 68,250
2,500 Via Technologies Inc. .................. 17,957
----------
363,024
----------
MACHINERY/ENGINE SERVICES--0.20%
2,200 Hon Hai Precision ...................... 11,511
----------
MISCELLANEOUS MANUFACTURING--0.48%
5,947 Ambit Microsystems ..................... 27,618
----------
TEXTILES--0.86%
61,000 Far East Textile ....................... 50,235
----------
Total Taiwan Common Stocks ........................ 512,140
----------
THAILAND--1.33%
COMMUNICATIONS--1.07%
4,300 Advanced Information Service PLC* ...... 35,370
45,000 TelecomAsia Corporation PLC(1) ......... 27,096
----------
62,466
----------
CONSTRUCTION--0.26%
1,600 Siam Cement Co.* ....................... 15,051
----------
Total Thailand Common Stocks ...................... 77,517
----------
TURKEY--4.45%
BANKS--2.89%
3,760,690 T Garanti Bankasi* ..................... 38,572
3,412,200 T Is Bankasi ........................... 64,995
7,502,451 Yapi ve Kredi Bankasi A.S. ............. 64,858
----------
168,425
----------
BREWERY--0.25%
250,951 Anadolu Efes* .......................... 14,708
----------
COMMUNICATIONS--0.21%
274,000 Turkcell Iletisim* ..................... 12,044
----------
DIVERSIFIED INDUSTRIALS--0.41%
412,500 Arcelik ................................ 13,297
170,400 Koc Holding AS ......................... 10,861
----------
24,158
----------
MEDIA--0.26%
1,150,450 Dogan Yayin Holdings ................... 15,003
----------
TURKEY--(CONCLUDED)
RETAIL--0.22%
93,770 Migros Turk T.A.S. .................... $ 12,915
----------
STEEL & OTHER MATERIALS--0.21%
396,000 Eregli Demir ve Celik Fabrik * ........ 12,475
----------
Total Turkey Common Stocks ........................ 259,728
----------
ZIMBABWE--0.91%
LEISURE & HOTELS--0.91%
204,600 Econet Wireless Holdings* .............. 53,000
----------
Total Common Stocks (cost--$5,239,409) ............ 4,842,979
----------
PREFERRED STOCKS--12.03%
BRAZIL--9.79%
BANKS--2.00%
4,769,994 Banco Bradesco S.A. .................... 29,485
530,000 Banco Itau S.A. ........................ 41,228
2,000 Companhia Vale do Rio Doce ............. 46,097
----------
116,810
----------
BREWERIES, PUBS, & RESTAURANTS--0.88%
230,000 Companhia de Bebidas ................... 51,327
----------
BUILDING MATERIALS & MERCHANTS--0.36%
130,000 Companhia Cimento
Portland Itau (CLA) .................... 20,702
----------
ELECTRICITY--1.07%
4,900 Companhia Paranaense
de Energia, ADR ........................ 44,406
326,400 Eletropaulo Metropolitana-
Electricidade de Sao Paulo S.A. ........ 18,295
----------
62,701
----------
OIL EXPLORATION & PRODUCTION--2.14%
2,340 Petroleo Brasileiros S.A. (Petrobras) .. 62,036
1,500 Petroleo Brasileiro S.A.
(Petrobras), ADR ....................... 43,594
1,900 Ultrapar Participacoes S.A. ............ 19,119
----------
124,749
----------
TELECOMMUNICATIONS--3.34%
2,547,000 Brasil Telecom Participacoes ........... 27,578
3,510,000 Brasil Telecom S.A. .................... 26,973
3,400 Embratel Participacoes S.A., ADR ....... 55,038
1,968 Tele Norte Leste Participacoes, ADR .... 43,550
3,546,549 Telecomunicacoes
do Parana S.A. (Telepar) ............... 41,949
----------
195,088
----------
Total Brazil Preferred Stocks ..................... 571,377
----------
</TABLE>
30
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
------ ----------
<S> <C>
PREFERRED STOCKS--(CONCLUDED)
MEXICO--1.15%
RETAILERS, GENERAL--1.15%
29,400 Wal-Mart de Mexico "C" ................. $ 67,024
----------
RUSSIA--1.09%
OILS--1.09%
4,940 Surgutneftegaz, ADR .................... 63,603
----------
Total Preferred Stocks (cost--$980,439) ........... 702,004
----------
<CAPTION>
NUMBER OF
WARRANTS/RIGHTS VALUE
------ ----------
<S> <C>
WARRANTS--0.00%
MEXICO--0.00%
BUILDING & CONSTRUCTION--0.00%
1,000 Cemex Appreciation (cost--$346) ........ $ 203
----------
RIGHTS--0.00%
THAILAND--0.00%
TELECOMMUNICATIONS--0.00%
4,105 TelecomAsia Corp PLC (cost--$0) ........ 0
----------
Total Long Term Investments (cost--$6,220,194) .... 5,545,186
----------
<CAPTION>
PRINCIPAL
AMOUNT
(000) MATURITY DATE INTEREST RATE VALUE
----- ------------- ------------- -------------
<S> <C> <C>
REPURCHASE AGREEMENT--2.57%
$ 150 Repurchase Agreement dated 10/31/00 with State Steet Bank & Trust
Company, collateralized by $150,000 U.S. Treasury Notes, 6.375% due
06/30/02 (value--$153,938); proceeds: $150,027 (cost--$150,000) ...... 11/01/00 6.500% 150,000
----------
Total Investments and Repurchase Agreement (cost--$6,370,194)--97.59% .......... 5,695,186
Other assets in excess of liabilities--2.41% ................................... 140,866
----------
Net Assets--100.00% ............................................................ $5,836,052
==========
</TABLE>
-----------------
* Non-Income producing securities.
ADR American Depository Receipts
ADS American Depository Shares
GDR Global Depositary Receipts
GDS Global Depositary Shares
(1) Security or portion thereof, was on loan at October 31, 2000.
FORWARD FOREIGN CURRENCY CONTRACTS
<TABLE>
<CAPTION>
IN MATURITY UNREALIZED
CONTRACTS TO DELIVER EXCHANGE FOR DATE APPRECIATION
-------------------- ------------ -------- ------------
<S> <C> <C> <C> <C>
Mexican Peso ................................. 812,000 USD 83,756 03/07/01 $3,444
======
</TABLE>
-----------------
USD United States Dollars
See accompanying notes to financial statements
31
<PAGE>
PAINEWEBBER
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 2000
GLOBAL EQUITY ASIA PACIFIC EMERGING MARKETS
FUND GROWTH FUND EQUITY FUND
------------- ------------ ----------------
<S> <C> <C> <C>
ASSETS
Investments, at value (cost--$271,271,813, $21,541,357 and $6,220,194, respectively) $272,551,044 $ 22,946,850 $ 5,545,186
Repurchase agreements, at value (cost--$33,835,000; $795,000 and
$150,000, respectively ....................................................... 33,835,000 795,000 150,000
------------ ------------ ------------
306,386,044 23,741,850 5,695,186
Investments of cash collateral received for securities
loaned, at value (cost--$3,562,562, $217,675 and $25,350, respectively) ...... 3,562,562 217,675 25,350
Cash .............................................................................. 1,157 492 32,666
Cash denominated in foreign currencies, at value
(cost--$1,825,163, $135,236 and $120,684, respectively) ...................... 1,825,409 133,065 118,512
Receivable for investments sold ................................................... 2,341,924 -- 48,653
Receivable for shares of beneficial interest sold ................................. 52,689 456 --
Dividends and interest receivable ................................................. 563,832 37,722 16,609
Unrealized appreciation of foreign forward currency contracts ..................... -- -- 3,444
Futures variation margin receivable ............................................... 2,749,215 -- --
Deferred organizational expenses .................................................. -- 42,147 --
Other assets ...................................................................... 213,066 6,408 109,812
------------ ------------ ------------
Total assets ...................................................................... 317,695,898 24,179,815 6,050,232
------------ ------------ ------------
LIABILITIES
Collateral for securities loaned .................................................. 3,562,562 217,675 25,350
Payable for investments purchased ................................................. 2,139,157 -- 16,601
Payable for shares of beneficial interest repurchased ............................. 828,414 61,388 43,366
Payable to affiliates ............................................................. 295,676 39,720 2,536
Accrued expenses and other liabilities ............................................ 264,803 102,223 126,327
------------ ------------ ------------
Total liabilities ................................................................. 7,090,612 421,006 214,180
------------ ------------ ------------
NET ASSETS
Beneficial interest shares of $0.001 par value outstanding
(unlimited number authorized) ................................................ 250,933,943 47,439,942 24,699,530
Accumulated net investment loss ................................................... -- (72,313) (3,444)
Accumulated net realized gains (losses) from investments transactions ............. 55,251,602 (24,975,284) (18,185,275)
Net unrealized appreciation/(depreciation) of investments, futures, other
assets, liabilities and forward contracts denominated in foreign currencies .. 4,419,741 1,366,464 (674,759)
------------ ------------ ------------
Net assets ........................................................................ $310,605,286 $ 23,758,809 $ 5,836,052
============ ============ ============
CLASS A:
Net assets ........................................................................ $232,909,887 $ 8,744,964 $ 3,244,645
------------ ------------ ------------
Shares outstanding ................................................................ 14,765,504 976,291 420,130
------------ ------------ ------------
Net asset and redemption value per share .......................................... $15.77 $8.96 $7.72
====== ===== =====
Maximum offering price per share (net asset value plus sales charge of
4.50% of offering price) ..................................................... $16.51 $9.38 $8.08
====== ===== =====
CLASS B:
Net assets ........................................................................ $ 7,875,340 $ 9,774,186 $ 614,833
------------ ------------ ------------
Shares outstanding ................................................................ 541,621 1,121,266 82,694
------------ ------------ ------------
Net asset value and offering price per share ...................................... $14.54 $8.72 $7.44
====== ===== =====
CLASS C:
Net assets ........................................................................ $ 23,654,558 $ 5,057,542 $ 1,400,191
------------ ------------ ------------
Shares outstanding ................................................................ 1,623,466 579,536 190,311
------------ ------------ ------------
Net asset value and offering price per share ...................................... $14.57 $8.73 $7.36
====== ===== =====
CLASS Y:
Net assets ........................................................................ $ 46,165,501 $ 182,117 $ 576,383
------------ ------------ ------------
Shares outstanding ................................................................ 2,840,528 20,336 73,604
------------ ------------ ------------
Net asset value, offering price and redemption value per share .................... $16.25 $8.96 $7.83
====== ===== =====
</TABLE>
32 See accompanying notes to financial statements
<PAGE>
PAINEWEBBER
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS FOR THE YEAR ENDED OCTOBER 31, 2000
GLOBAL EQUITY ASIA PACIFIC EMERGING MARKETS
FUND GROWTH FUND EQUITY FUND
------------- ------------ ----------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $523,697, $52,398
and $13,926, respectively) ................................................... $ 4,593,588 $ 529,192 $ 106,009
Interest .......................................................................... 2,399,881 29,187 5,973
------------ ------------ ------------
6,993,469 558,379 111,982
------------ ------------ ------------
EXPENSES:
Investment advisory and administration ............................................ 3,079,506 438,571 103,962
Service fees--Class A ............................................................. 658,425 33,337 11,639
Service and distribution fees--Class B ............................................ 149,939 148,120 8,766
Service and distribution fees--Class C ............................................ 301,382 82,163 22,894
Custody and accounting ............................................................ 911,661 122,646 32,566
Transfer agency and related services fees ......................................... 344,916 50,610 19,532
Reports and notices to shareholders ............................................... 187,259 29,172 28,351
Professional fees ................................................................. 151,883 52,940 76,870
State registration fees ........................................................... 82,714 29,376 35,763
Trustees' fees .................................................................... 15,750 15,750 15,750
Amortization of organizational expenses ........................................... -- 30,308 --
Other expenses .................................................................... 28,387 2,285 6,228
------------ ------------ ------------
5,911,822 1,035,278 362,321
Less: Fee waivers and reimbursements from adviser ................................. (12,698) (192) (129,572)
------------ ------------ ------------
Net expenses ...................................................................... 5,899,124 1,035,086 232,749
------------ ------------ ------------
Net investment income (loss) ...................................................... 1,094,345 (476,707) (120,767)
------------ ------------ ------------
REALIZED AND UNREALIZED GAINS (LOSSES) FROM INVESTMENT TRANSACTIONS:
Net realized gains (losses) from:
Investments (net of foreign withholding tax of $518,467, $0 and $0,
respectively) ................................................................ 93,371,931 2,903,795 614,945
Foreign currency transactions ................................................ (861,569) (71,149) (33,382)
Futures transactions ......................................................... 3,598,396 -- --
Net change in unrealized appreciation/depreciation of:
Investments .................................................................. (82,305,649) (2,193,126) (1,103,530)
Futures ...................................................................... 1,252,194 -- --
Other assets and liabilities denominated in foreign currencies ............... 23,232 72,155 21,222
------------ ------------ ------------
NET REALIZED AND UNREALIZED GAINS (LOSSES) FROM INVESTMENT TRANSACTIONS ........... 15,078,535 711,675 (500,745)
------------ ------------ ------------
NET INCREASE (DECREASE)IN NET ASSETS RESULTING FROM OPERATIONS .................... $ 16,172,880 $ 234,968 $ (621,512)
============ ============ ============
</TABLE>
See accompanying notes to financial statements
33
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED
OCTOBER 31,
-------------------------------------
2000 1999
------------- -------------
<S> <C> <C>
FROM OPERATIONS:
Net investment income ............................................................ $ 1,094,345 $ 1,214,949
Net realized gains (losses) from:
Investments ................................................................. 93,371,931 46,487,900
Foreign currency transactions ............................................... (861,569) (1,365,472)
Futures transactions ........................................................ 3,598,396 5,084,466
Net change in unrealized appreciation/depreciation of:
Investments ................................................................. (82,305,649) 7,994,891
Futures ..................................................................... 1,252,194 (974,505)
Other assets and liabilities denominated in foreign currencies .............. 23,232 (134,422)
------------- -------------
Net increase in net assets resulting from operations ............................. 16,172,880 58,307,807
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income Class A .................................................... -- (270,090)
Net investment income Class Y .................................................... -- (131,022)
Net realized gains from investment transactions--Class A ......................... (34,539,223) (11,886,871)
Net realized gains from investment transactions--Class B ......................... (3,680,562) (2,646,732)
Net realized gains from investment transactions--Class C ......................... (4,988,411) (2,064,240)
Net realized gains from investment transactions--Class Y ......................... (7,503,843) (2,546,029)
------------- -------------
(50,712,039) (19,544,984)
------------- -------------
FROM BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from the sale of shares ............................................. 269,501,057 536,072,491
Shares issued in connection with the reorganization
involving Global Small Cap Fund Inc. ........................................ 85,973,872 --
Cost of shares repurchased ....................................................... (407,431,417) (640,967,908)
Proceeds from dividends reinvested ............................................... 48,073,171 18,643,467
------------- -------------
Net decrease in net assets from beneficial interest transactions ................. (3,883,317) (86,251,950)
------------- -------------
Net decrease in net assets ....................................................... (38,422,476) (47,489,127)
NET ASSETS:
Beginning of year ................................................................ 349,027,762 396,516,889
------------- -------------
End of year ...................................................................... $ 310,605,286 $ 349,027,762
============= =============
</TABLE>
See accompanying notes to financial statements
34
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED
OCTOBER 31,
-------------------------------------
2000 1999
------------- -------------
<S> <C> <C>
FROM OPERATIONS:
Net investment loss .............................................................. $ (476,707) $ (355,336)
Net realized gains (losses) from:
Investments ................................................................. 2,903,795 656,105
Foreign currency transactions ............................................... (71,149) (63,531)
Net change in unrealized appreciation/depreciation of:
Investments ................................................................. (2,193,126) 11,632,148
Other assets and liabilities denominated in foreign currencies .............. 72,155 (62,473)
------------- -------------
Net increase in net assets resulting from operations ............................. 234,968 11,806,913
------------- -------------
FROM BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from the sale of shares ............................................. 49,848,596 21,653,386
Cost of shares repurchased ....................................................... (65,387,905) (24,936,295)
------------- -------------
Net decrease in net assets from beneficial interest transactions ................. (15,539,309) (3,282,909)
------------- -------------
Net increase (decrease) in net assets ............................................ (15,304,341) 8,524,004
NET ASSETS:
Beginning of year ................................................................ 39,063,150 30,539,146
------------- -------------
End of year ...................................................................... $ 23,758,809 $ 39,063,150
============= =============
</TABLE>
See accompanying notes to financial statements
35
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEARS
ENDED
OCTOBER 31,
-------------------------------------
2000 1999
------------- -------------
<S> <C> <C>
FROM OPERATIONS:
Net investment loss .............................................................. $ (120,767) $ (45,188)
Net realized gains (losses) from:
Investments ................................................................. 614.945 (394,899)
Foreign currency transactions ............................................... (33,382) (4,458)
Net change in unrealized appreciation/depreciation of:
Investments ................................................................. (1,103,530) 2,873,966
Other assets and liabilities denominated in foreign currencies .............. 21,222 (5,666)
------------- -------------
Net increase (decrease) in net assets resulting from operations .................. (621,512) 2,423,755
------------- -------------
FROM BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from the sale of shares ............................................. 8,800,671 3,860,845
Cost of shares repurchased ....................................................... (10,822,812) (5,955,453)
------------- -------------
Net decrease in net assets from beneficial interest transactions ................. (2,022,141) (2,094,608)
------------- -------------
Net increase (decrease) in net assets ............................................ (2,643,653) 329,147
NET ASSETS:
Beginning of year ................................................................ 8,479,705 8,150,558
------------- -------------
End of year ...................................................................... $ 5,836,052 $ 8,479,705
============= =============
</TABLE>
See accompanying notes to financial statements
36
<PAGE>
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The PaineWebber Global Equity Fund ("Global Equity Fund"), a diversified
series of PaineWebber Investment Trust ("Investment Trust"), the PaineWebber
Asia Pacific Growth Fund ("Asia Pacific Growth Fund"), a diversified series of
PaineWebber Managed Investments Trust ("Managed Trust") and the PaineWebber
Emerging Markets Equity Fund ("Emerging Markets Equity Fund"), a diversified
series of PaineWebber Investment Trust II ("Investment Trust II") (each a
"Fund"), are registered with the Securities and Exchange Commission under the
Investment Company Act of 1940, as amended, as open-end management investment
companies. Global Equity Fund seeks long-term growth of capital by investing
primarily in U.S. and foreign equity securities. Asia Pacific Growth Fund seeks
long-term capital appreciation by investing primarily in equity securities of
companies in the Asia Pacific region, excluding Japan. Emerging Markets Equity
Fund seeks long-term capital appreciation by investing primarily in equity
securities of companies in emerging market countries. (Investment Trust, Managed
Trust and Investment Trust II are each sometimes referred to herein as a
"Trust.") Organizational costs have been deferred and are being (or, in the case
of Global Equity Fund and Emerging Markets Equity Fund, have been) amortized
using the straight-line method over a period not to exceed 60 months from the
date the Fund commenced operations.
Currently, each Fund offers Class A, Class B, Class C and Class Y shares.
Each class represents interests in the same assets of the Fund, and the classes
are identical except for differences in their sales charge structures, ongoing
service and distribution charges and certain transfer agency and related
expenses. In addition, Class B shares and all corresponding dividend reinvested
shares automatically convert to Class A shares approximately six years after
initial issuance. All classes of shares have equal voting privileges, except
that Class A, Class B and Class C shares have exclusive voting rights with
respect to their service and/or distribution plan.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires the Funds'
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The following is a summary of significant accounting policies:
VALUATION OF INVESTMENTS--Each Fund calculates its net asset value based on
the current market value, where available, for its portfolio securities. The
Funds normally obtain market values for their securities from independent
pricing sources. Independent pricing sources may use reported last sale prices,
current market quotations or valuations from computerized "matrix" systems that
derive values based on comparable securities. Securities traded in the
over-the-counter ("OTC") market and listed on The Nasdaq Stock Market, Inc.
("Nasdaq") normally are valued at the last sale price on Nasdaq prior to
valuation. Other OTC securities are valued at the last bid price available prior
to valuation. Securities which are listed on U.S. and foreign stock exchanges
normally are valued at the last sale price on the day the securities are valued
or, lacking any sales on such day, at the last available bid price. In cases
where securities are traded on more than one exchange, the securities are valued
on the exchange designated as the primary market by Mitchell Hutchins Asset
Management Inc. ("Mitchell Hutchins"), the investment adviser (or manager) and
administrator of the Fund, or by the Fund's sub-advisor(s). Mitchell Hutchins is
a wholly owned asset management subsidiary of PaineWebber Incorporated
("PaineWebber"), an indirect wholly owned subsidiary of UBS AG. If a market
value is not available from an independent pricing source for a particular
security, that security is valued at fair value as determined in good faith by
or under the direction of the Trust's board of trustees (the "Board"). The
amortized cost method of valuation, which approximates market value, generally
is used to value short-term debt instruments with sixty days or less remaining
to maturity, unless the Board determines that this does not represent fair
value. All
37
<PAGE>
NOTES TO FINANCIAL STATEMENTS
investments quoted in foreign currencies will be valued daily in U.S. dollars on
the basis of the foreign currency exchange rates prevailing at the time such
valuation is determined by the Funds' custodian.
Foreign currency exchange rates are generally determined prior to the close
of regular trading on the New York Stock Exchange ("NYSE"). Occasionally, events
affecting the value of foreign investments and such exchange rates occur between
the time at which they are determined and the close of the NYSE, which will not
be reflected in the computation of the Funds' net asset value. If events
materially affecting the value of such securities or currency exchange rates
occur during such time periods, the securities will be valued at their fair
value as determined in good faith by or under the direction of the Trust's
board.
REPURCHASE AGREEMENTS--Each Fund's custodian takes possession of the
collateral pledged for investments in repurchase agreements. The underlying
collateral is valued daily on a mark-to-market basis to ensure that the value,
including accrued interest, is at least equal to the repurchase price. In the
event of default of the obligation to repurchase, the Funds have the right to
liquidate the collateral and apply the proceeds in satisfaction of the
obligation. Under certain circumstances, in the event of default or bankruptcy
by the other party to the agreement, realization and/or retention of the
collateral may be subject to legal proceedings. The Funds occasionally
participate in joint repurchase agreement transactions with other funds managed
by Mitchell Hutchins.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME--Investment transactions are
recorded on the trade date. Realized gains and losses from investment and
foreign exchange transactions are calculated using the identified cost method.
Dividend income is recorded on the ex-dividend date ("ex-date") (except in the
case of certain foreign dividends which are recorded as soon after the
ex-dividend date as each Fund using reasonable diligence becomes aware of such
dividends). Interest income is recorded on an accrual basis. Discounts are
accreted and premiums are amortized as adjustments to interest income and the
identified cost of investments.
Income, expenses (excluding class-specific expenses) and
realized/unrealized gains/losses are allocated proportionately to each class of
shares based upon the relative net asset value of outstanding shares (or the
value of dividend-eligible shares, as appropriate) of each class at the
beginning of the day (after adjusting for current capital share activity of the
respective classes). Class-specific expenses are charged directly to the
applicable class of shares.
FOREIGN CURRENCY TRANSLATION--The books and records of each Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars as follows: (1) the foreign currency market value of investment
securities and other assets and liabilities stated in foreign currencies are
translated at the exchange rates prevailing at the end of the period; and (2)
purchases, sales, income and expenses are translated at the rate of exchange
prevailing on the respective dates of such transactions. The resulting exchange
gains and losses are reflected in the Statements of Operations.
Although the net assets and the market values of each Funds' securities are
presented at the foreign exchange rates at the end of the period, the Funds do
not generally isolate the effect of fluctuations in foreign exchange rates from
the effect of the changes in market prices of securities. However, the Funds do
isolate the effect of fluctuations in foreign exchange rates when determining
the realized gain or loss upon the sale or maturity of foreign currency
denominated debt obligations pursuant to federal income tax regulations. Certain
foreign exchange gains and losses included in realized and unrealized gains and
losses are included in or are a reduction of ordinary income in accordance with
federal income tax regulations. Net realized foreign currency gain (loss) is
treated as ordinary income for income tax reporting purposes. Gains/losses from
translating foreign currency denominated assets and liabilities at year-end
exchange rates are included in the change in unrealized
appreciation/depreciation of other assets and liabilities denominated in foreign
currencies.
38
<PAGE>
NOTES TO FINANCIAL STATEMENTS
FORWARD FOREIGN CURRENCY CONTRACTS--The Funds may enter into forward
foreign currency exchange contracts ("forward contracts") in connection with
planned purchases or sales of securities or to hedge the U.S. dollar value of
portfolio securities denominated in a particular currency. The Funds may also
engage in cross-hedging by using forward contracts in one currency to hedge
fluctuations in the value of securities denominated in a different currency if
the applicable sub-adviser anticipates that there is a correlation between the
two currencies. Forward contracts may also be used to shift a Fund's exposure to
foreign currency fluctuations from one country to another.
The Funds have no specific limitation on the percentage of assets which may
be committed to such contracts; however, the value of all forward contracts will
not exceed the total market value of a Fund's total assets. The Funds may enter
into forward contracts or maintain a net exposure to forward contracts only if
(1) the consummation of the contracts would not obligate the each Fund to
deliver an amount of foreign currency in excess of the value of the positions
being hedged by such contracts or (2) the Fund maintains cash or liquid
securities in a segregated account in an amount not less than the value of the
Fund's total assets committed to the consummation of the forward contracts and
not covered as provided in (1) above, as marked-to-market daily.
Risks may arise upon entering into forward contracts from the potential
inability of counterparties to meet the terms of their contracts and from
unanticipated movements in the value of foreign currencies relative to the U.S.
dollar.
Fluctuations in the value of open forward contracts are recorded for book
purposes as unrealized gains or losses by the Funds. Realized gains and losses
include net gains or losses recognized by the each Fund on contracts which have
matured.
FUTURES CONTRACTS--Using financial futures contracts involves various
market risks. The maximum amount at risk from the purchase of a futures contract
is the contract value. The Funds use financial futures contracts for hedging
purposes, and in the case of Global Equity Fund, to adjust Global Equity's
exposure to U.S. and foreign equity markets in connection with a reallocation of
that Fund's assets as well as in an attempt to replicate the investment
performance of the Standard & Poor's 500 Composite Stock Index, rather than
buying and selling stocks, with respect to the U.S. portion of that Fund.
However, imperfect correlations between futures contracts and the related
securities or markets, or market disruptions, do not normally permit full
control of these risks at all times.
Upon entering into a financial futures contract, a Fund is required to
pledge to a broker an amount equal to a certain percentage of the contract
amount. This amount is known as the "initial margin." Subsequent payments, known
as "variation margin," are made or received by the Fund each day, depending on
the daily fluctuations in the value of the underlying financial futures
contracts. Such variation margin is recorded for financial statement purposes on
a daily basis as an unrealized gain or loss until the financial futures contract
is closed, at which time the net gain or loss is reclassified to realized.
DIVIDENDS AND DISTRIBUTIONS--Dividends and distributions to shareholders
are recorded on the ex-date. The amount of dividends and distributions are
determined in accordance with federal income tax regulations, which may differ
from accounting principles generally accepted in the United States. These
"book/tax" differences are either considered temporary or permanent in nature.
To the extent these differences are permanent in nature, such amounts are
reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassification.
CONCENTRATION OF RISK
Investing in securities of foreign issuers and currency transactions may
involve certain considerations and risks not typically associated with
investments in the United States. These risks include revaluation of currencies,
adverse
39
<PAGE>
NOTES TO FINANCIAL STATEMENTS
fluctuations in foreign currency values and possible adverse political, social
and economic developments, including those particular to a specific industry,
country or region, which could cause the securities and their markets to be less
liquid and prices more volatile than those of comparable U.S. companies. These
risks are greater with respect to securities of issuers located in emerging
market countries in which each of the Funds invest. The ability of the issuers
of debt securities held by a Fund to meet their obligations may be affected by
economic and political developments in a specific industry, country or region.
INVESTMENT ADVISER/MANAGER AND ADMINISTRATOR
Each Fund has an investment advisory (or management) and administration
contract ("Advisory Contract") with Mitchell Hutchins, under which Mitchell
Hutchins serves as investment adviser (or manager) and administrator of the
Fund. In accordance with the Advisory Contract for the Global Equity Fund,
Mitchell Hutchins receives compensation from the Fund, computed daily and paid
monthly, at an annual rate of 0.85% of the Fund's average daily net assets up to
and including $500 million, 0.83% of its average daily net assets over $500
million and up to and including $1 billion and 0.805% of its average daily net
assets over $1 billion. In accordance with the Advisory Contract for the Asia
Pacific Growth Fund, Mitchell Hutchins receives compensation from the Fund,
computed daily and paid monthly, at an annual rate of 1.20% of the Fund's
average daily net assets up to and including $100 million and 1.10% of its
average daily net assets over $100 million. In accordance with the Advisory
Contract for the Emerging Markets Equity Fund, Mitchell Hutchins receives
compensation from the Fund, computed daily and paid monthly, at a rate of 1.20%
of its average daily net assets.
Mitchell Hutchins has entered into an interim sub-advisory contract
("Interim Sub-Advisory Contract") with Martin Currie Inc. ("Martin Currie"),
dated October 10, 2000, pursuant to which Martin Currie serves as investment
sub-adviser for the foreign investments of Global Equity Fund. Mitchell Hutchins
allocates the Fund's investments between domestic and foreign investments and is
responsible for the day-to-day management of the Fund's domestic investments.
Under the Interim Sub-Advisory Contract, Mitchell Hutchins (not the Fund) is
obligated to pay Martin Currie at the annual rate of 0.35% of the Fund's average
daily net assets up to and including $150 million, 0.30% of the Fund's average
daily net assets in excess of $150 million up to and including $250 million,
0.25% of the Fund's average daily net assets in excess of $250 million up to and
including $350 million, and 0.20% of such assets in excess of $350 million.
Prior to October 10, 2000 Mitchell Hutchins had entered into a contract with
Invista Capital Management LLC ("Invista") ("Invista Contract"), pursuant to
which Invista served as investment sub-adviser for the foreign investments of
Global Equity Fund. Mitchell Hutchins allocated the Fund's investments between
domestic and foreign investments and was responsible for the day-to-day
management of the Fund's domestic investments. Under the Invista Contract,
Mitchell Hutchins (not the Fund) was obligated to pay Invista at the annual rate
of 0.40% of the Fund's average daily net assets allocated to Invista's
management up to and including $100 million, 0.29% of the Fund's average daily
net assets allocated to Invista's management in excess of $100 million up to and
including $300 million, and 0.26% of such assets in excess of $300 million.
Under a contract with Mitchell Hutchins ("Sub-Advisory Contract"), Schroder
Investment Management North America Inc. ("Schroder") serves as the sub-adviser
to the Emerging Markets Equity Fund. Under the Sub-Advisory Contract, Mitchell
Hutchins (not the Fund) pays Schroder a fee, computed daily and paid monthly, at
an annual rate of 0.70% of the Fund's average daily net assets.
Under a contract with Mitchell Hutchins ("Sub-Advisory Contract"), Schroder
serves as the sub-adviser to the Asia Pacific Growth Fund. Under the
Sub-Advisory Contract, Mitchell Hutchins (not the Fund) pays Schroder a fee,
computed daily and paid monthly, at an annual rate of 0.65% of the Fund's
average daily net assets up to and including $100 million and 0.55% of the
Fund's average daily net assets over $100 million.
40
<PAGE>
NOTES TO FINANCIAL STATEMENTS
At October 31, 2000 the Global Equity Fund, the Asia Pacific Growth Fund
and the Emerging Markets Equity Fund owed Mitchell Hutchins $219,006, $24,929
and $0, respectively, in investment advisory and administrative fees. Mitchell
Hutchins waived $103,962 of its management fee and reimbursed other expenses of
$25,610 for the Emerging Markets Equity Fund for the year ended October 31,
2000. Mitchell Hutchins also waived a portion of its investment advisory and
administration fees in connection with each Fund's investment of cash collateral
from securities lending in the Mitchell Hutchins Private Money Market Fund LLC.
For the year ended October 31, 2000, Mitchell Hutchins waived $12,698, $192, and
$0 for the Global Equity Fund, the Asia Pacific Growth Fund and the Emerging
Markets Equity Fund, respectively.
For the year ended October 31, 2000, the Global Equity Fund, the Asia
Pacific Growth Fund and the Emerging Markets Equity Fund paid $10,377, $0 and $0
respectively, in brokerage commissions to PaineWebber for transactions executed
on behalf of the Funds.
DISTRIBUTION PLAN
Mitchell Hutchins is the distributor of each Fund's shares and has
appointed PaineWebber as the exclusive dealer for the sale of those shares.
Under separate plans of service and/or distribution pertaining to Class A, Class
B and Class C shares, each Fund pays Mitchell Hutchins monthly service fees at
the annual rate of 0.25% of the average daily net assets of Class A, Class B and
Class C shares and monthly distribution fees at the annual rate of 0.75% of the
average daily net assets of Class B and Class C shares. At October 31, 2000 the
Global Equity Fund, the Asia Pacific Growth Fund and the Emerging Markets Equity
Fund owed Mitchell Hutchins $75,256, $14,737 and $2,531, respectively, in
service and distribution fees.
Mitchell Hutchins also receives the proceeds of the initial sales charges
paid by shareholders upon the purchase of Class A shares and the contingent
deferred sales charges paid by the shareholders upon certain redemptions of
Class A, Class B and Class C shares. Mitchell Hutchins has informed the Global
Equity Fund, the Asia Pacific Growth Fund and the Emerging Markets Equity Fund
that for the period ended October 31, 2000 it had earned $70,459, $138,829 and
$5,126, respectively, in sales charges.
REORGANIZATION INVOLVING GLOBAL SMALL CAP FUND INC.
Effective as of the close of business on January 28, 2000 (the
"Reorganization Date"), the Global Equity Fund acquired all of the assets and
assumed all of the liabilities of Global Small Cap Fund Inc. ("Global Small Cap
Fund"). The acquisition was accomplished by a tax-free exchange of 5,257,445
Class A shares of the Global Equity Fund for 3,801,667 shares of Global Small
Cap Fund outstanding on the Reorganization Date. Global Small Cap Fund's net
assets at that date, valued at $85,973,872 including net unrealized appreciation
of investments of $35,296,466 were combined with those of the Global Equity
Fund. All shares were exchanged at net asset value. Accordingly, no shareholder
had any gain or loss as a result of the exchange. The Global Equity Fund's
statement of operations and financial highlights do not include the operations
of Global Small Cap Fund prior to the Reorganization Date.
SECURITY LENDING
Each Fund may lend securities up to 33 1/3% of its total assets to
qualified institutions. The loans are secured at all times by cash or U.S.
government securities in an amount at least equal to the market value of the
securities loaned, plus accrued interest and dividends, determined on a daily
basis and adjusted accordingly. Each Fund will regain record ownership of
loaned securities to exercise certain beneficial rights; however, each Fund
may bear the risk of delay in recovery of, or even loss of rights in, the
securities loaned should the borrower fail financially. Each Fund receives
compensation, which is included in interest income, for lending its
securities from interest earned on the cash or U.S. government securities
held as collateral, net of fee rebates paid to the borrower plus reasonable
administrative and
41
<PAGE>
NOTES TO FINANCIAL STATEMENTS
custody fees. Each Fund's lending agent is PaineWebber, who received
compensation from the Funds for the year ended October 31, 2000 as follows:
<TABLE>
<S> <C>
Global Equity Fund ....................................... $36,034
Asia Pacific Growth Fund ................................. 1,835
Emerging Markets Equity Fund ............................. 56
</TABLE>
At October 31, 2000, the Global Equity Fund, Asia Pacific Growth Fund and
Emerging Markets Equity Fund owed PaineWebber $1,414, $54 and $5, respectively,
in securities lending fees.
For the period ended October 31, 2000, each Fund earned compensation for
lending its securities as follows:
<TABLE>
<S> <C>
Global Equity Fund ....................................... $102,928
Asia Pacific Growth Fund ................................. 5,384
Emerging Markets Equity Fund ............................. 229
</TABLE>
As of October 31, 2000, Global Equity Fund, Asia Pacific Growth Fund and
Emerging Markets Equity Fund held cash and/or cash equivalents as collateral for
securities loaned as follows:
<TABLE>
<CAPTION>
MARKET
COLLATERAL FOR VALUE OF
SECURITIES SECURITIES
LOANED LOANED
-------------- ----------
<S> <C> <C>
Global Equity Fund ....................... $3,562,562 $3,373,223
Asia Pacific Growth Fund ................. 217,675 198,194
Emerging Markets Equity .................. 25,350 23,483
</TABLE>
As of October 31, 2000 Global Equity Fund, Asia Pacific Growth Fund and
Emerging Markets Equity Fund invested the collateral in the following money
market funds:
<TABLE>
<CAPTION>
NUMBER OF
SHARES MARKET
(000) VALUE
--------- ----------
GLOBAL EQUITY FUND
<S> <C>
1,572 AIM Liquid Assets Portfolio...................................... $1,572,315
12 AIM Prime Portfolio.............................................. 12,374
1,854 Mitchell Hutchins Private Money Market Fund LLC.................. 1,853,585
112 Scudder Institutional Fund....................................... 111,566
13 Temp Cash Portfolio.............................................. 12,722
----------
Total investments of cash collateral received for securities on loan (cost--$3,562,562) $3,562,562
==========
ASIA PACIFIC GROWTH FUND
218 AIM Liquid Assets Portfolio...................................... $ 217,518
-- AIM Prime Portfolio.............................................. 157
----------
Total investments of cash collateral received for securities on loan (cost--$217,675) $ 217,675
==========
EMERGING MARKETS FUND
25 AIM Liquid Assets Portfolio (cost--$25,350).......................$ 25,350
==========
</TABLE>
42
<PAGE>
NOTES TO FINANCIAL STATEMENTS
BANK LINE OF CREDIT
Each Fund may participate with other funds managed by Mitchell Hutchins in
a $200 million committed credit facility ("Facility") to be utilized for
temporary financing until settlement of sales or purchases of portfolio
securities, the repurchase or redemption of shares of each Fund at the request
of the shareholders and other temporary or emergency purposes. In connection
therewith, each Fund has agreed to pay a commitment fee, pro rata, based on the
relative asset size of the funds in the Facility. Interest is charged to a fund
at rates based on prevailing market rates in effect at the time of borrowings.
For the year ended October 31, 2000, the Funds did not borrow under the
Facility.
TRANSFER AGENCY AND RELATED SERVICES FEES
PaineWebber provides transfer agency related services to each Fund pursuant
to a delegation of authority from PFPC Inc., the Funds' transfer agent, and is
compensated for these services by PFPC Inc., not the Funds. For the year ended
October 31, 2000, PaineWebber received from PFPC, Inc., not the Funds,
approximately 50%, 51% and 43% of the total transfer agency and related services
fees collected by PFPC from the Global Equity Fund, Asia Pacific Growth Fund and
Emerging Markets Equity Fund, respectively.
INVESTMENTS IN SECURITIES
For federal income tax purposes, the cost of securities owned at October
31, 2000 was substantially the same as the cost of securities for financial
statement purposes.
At October 31, 2000, the components of net unrealized
appreciation/(depreciation) were as follows:
<TABLE>
<CAPTION>
GLOBAL ASIA PACIFIC EMERGING
EQUITY GROWTH MARKETS
FUND FUND EQUITY FUND
------------ ------------- ------------
<S> <C> <C> <C>
Gross appreciation (investments having an excess of value over cost) . $8,988,083 $ 3,679,533 $ 444,122
Gross depreciation (investments having an excess of cost over value) . (7,708,852) (2,274,040) (1,119,130)
------------ ------------- ------------
Net appreciation/depreciation of investments ......................... $ 1,279,231 $ 1,405,493 $ (675,008)
============ ============= ============
</TABLE>
For the year ended October 31, 2000, total aggregate purchases and sales of
portfolio securities, excluding short term securities, were as follows:
<TABLE>
<CAPTION>
GLOBAL ASIA PACIFIC EMERGING
EQUITY GROWTH MARKETS
FUND FUND EQUITY FUND
------------- ----------- --------------
<S> <C> <C> <C>
Purchases ........................................... $422,221,106 $19,138,981 $ 9,516,193
Sales ............................................... $615,386,327 $33,333,858 $11,693,797
</TABLE>
FEDERAL INCOME TAX STATUS
The Funds intend to distribute substantially all of their taxable income
and to comply with the other requirements of the Internal Revenue Code
applicable to regulated investment companies. Accordingly, no provision for
federal income taxes is required. In addition, by distributing during each
calendar year, substantially all of their net investment income, capital gains
and certain other amounts, if any, the Funds intend not to be subject to a
federal excise tax.
At October 31, 2000 the Funds had the following net capital loss
carryforwards available as reductions, to the extent provided in the
regulations, of future net realized capital gains which expire as follows:
<TABLE>
<CAPTION>
GLOBAL ASIA PACIFIC EMERGING
EQUITY GROWTH MARKETS
FISCAL YEAR ENDING FUND FUND EQUITY FUND
------------------ --------- -------------- ------------
<S> <C> <C> <C>
2002 ................................................ -- -- $ 7,295,489
2003 ................................................ -- -- 2,285,302
2004 ................................................ -- -- 5,437,965
2005 ................................................ -- $ 2,145,015 --
2006 ................................................ -- 22,379,279 2,795,275
2007 ................................................ -- -- 308,374
--------- ----------- -----------
-- $24,524,294 $18,122,405
========= ============= ===========
</TABLE>
43
<PAGE>
NOTES TO FINANCIAL STATEMENTS
At October 31, 2000, the effect of permanent "book/tax" reclassification
resulted in increases (decreases) to the components of net assets as follows:
<TABLE>
<CAPTION>
ACCUMULATED ACCUMULATED
NET INVESTMENT NET REALIZED BENEFICIAL
FUND INCOME (LOSS) GAINS (LOSSES) INTEREST
---- -------------- -------------- -----------
<S> <C> <C> <C>
Global Equity Fund .......................... $(932,023) $(38,092,343) $39,024,366
Asia Pacific Growth Fund .................... 484,802 60,171 (544,973)
Emerging Markets Fund ....................... 117,323 33,382 (150,705)
</TABLE>
SHARES OF BENEFICIAL INTEREST
There is an unlimited amount of $0.001 par value shares of beneficial
interest authorized. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
------------------------- ---------------------- ----------------------- ----------------------
GLOBAL EQUITY FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
------------------------- ---------------------- ----------------------- ----------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE YEAR ENDED
OCTOBER 31, 2000
Shares sold................ 13,360,465 $228,216,729 102,555 $ 1,638,615 2,145,853 $ 34,072,281 309,667 $ 5,573,432
Shares issued in
connection with the
acquisition of Global
Small Cap Fund Inc....... 5,257,445 85,973,872 -- -- -- -- -- --
Shares repurchased......... (19,925,098) (341,995,016) (374,373) (6,065,053) (2,787,944) (44,634,884) (822,284) (14,736,464)
Shares converted from
Class B to Class A....... 970,022 17,047,808 (1,045,285) (17,047,808) -- -- -- --
Dividend reinvested........ 1,955,268 32,340,121 226,266 3,470,929 310,907 4,781,751 440,281 7,480,370
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net increase (decrease).... 1,618,102 $ 21,583,514 (1,090,837) $(18,003,317) (331,184) $ (5,780,852) (72,336) $(1,682,662)
=========== ============ ========== ============ ========== ============ ========== ===========
FOR THE YEAR ENDED
OCTOBER 31, 1999
Shares sold................ 28,421,476 $494,825,105 122,855 $ 2,029,493 1,081,106 $ 17,855,027 1,215,474 $21,362,866
Shares repurchased......... (32,560,467) (568,014,661) (869,246) (14,272,845) (1,914,606) (31,600,728) (1,536,448) (27,079,674)
Shares converted from
Class B to Class A....... 1,124,691 19,785,833 (1,193,678) (19,785,833) -- -- -- --
Dividend reinvested........ 697,012 11,514,629 157,538 2,459,166 127,935 1,999,640 158,271 2,670,032
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net decrease............... (2,317,288) $(41,889,094) (1,782,531) $(29,570,019) (705,565) $(11,746,061) (162,703) $(3,046,776)
=========== ============ ========== ============ ========== ============ ========== ===========
CLASS A CLASS B CLASS C CLASS Y
-------------------------- ---------------------- ----------------------- ----------------------
ASIA PACIFIC GROWTH FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------------------------- ---------------------- ----------------------- ----------------------
FOR THE YEAR ENDED
OCTOBER 31, 2000
Shares sold................ 2,492,274 $ 27,358,087 187,315 $ 2,118,833 1,917,676 $ 20,293,296 7,078 $ 78,380
Shares repurchased......... (3,003,090) (33,139,841) (577,008) (6,320,501) (2,393,287) (25,855,060) (6,635) (72,503)
Shares converted from
Class B to Class A........ 21,056 247,100 (21,485) (247,100) -- -- -- --
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net increase (decrease).... (489,760) $ (5,534,654) (411,178) $(4,448,768) (475,611) $ (5,561,764) 443 $ 5,877
=========== ============ ========== ============ ========== ============ ========== ===========
FOR THE YEAR ENDED
OCTOBER 31, 1999
Shares sold................ 1,036,280 $ 8,955,201 239,544 $ 2,161,071 1,136,400 $ 10,349,051 21,021 $ 188,063
Shares repurchased......... (1,272,336) (10,989,257) (585,637) (4,734,916) (1,003,723) (9,137,522) (8,039) (74,600)
Shares converted from
Class B to Class A........ 12,506 111,461 (12,706) (111,461) -- -- -- --
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net increase (decrease).... (223,550)$ (1,922,595) (358,799) $(2,685,306) 132,677 $ 1,211,529 12,982 $ 113,463
=========== ============ ========== ============ ========== ============ ========== ===========
</TABLE>
44
<PAGE>
NOTES TO FINANCIAL STATEMENTS
SHARES OF BENEFICIAL INTEREST(CONCLUDED)
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
-------------------------- ---------------------- ----------------------- ----------------------
EMERGING MARKETS EQUITY FUND SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
-------------------------- ---------------------- ----------------------- ----------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE YEAR ENDED
OCTOBER 31, 2000
Shares sold................ 25,298 $ 266,308 101,741 $ 1,017,748 736,122 $ 7,366,565 15,878 $ 150,050
Shares repurchased......... (188,332) (1,860,919) (68,873) (635,804) (797,885) (7,993,339) (32,745) (332,750)
Shares converted from
Class B to Class A....... 3,924 41,350 (4,058) (41,350) -- -- -- --
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net increase (decrease).... (159,110) $(1,553,261) 28,810 $ 340,594 (61,763) $ (626,774) (16,867) $(182,700)
=========== ============ ========== ============ ========== ============ ========== ===========
FOR THE YEAR ENDED
OCTOBER 31, 1999
Shares sold................ 148,096 $ 1,164,102 25,296 $ 195,455 283,950 $ 2,392,088 13,275 $ 109,200
Shares repurchased......... (226,551) (1,668,885) (35,460) (270,936) (439,625) (3,562,262) (56,046) (453,370)
Shares converted from
Class B to Class A....... 8,142 61,851 (8,361) (61,851) -- -- -- --
----------- ------------ ---------- ------------ ---------- ------------ ---------- -----------
Net decrease............... (70,313) $ (442,932) (18,525) $ (137,332) (155,675) $(1,170,174) (42,771) $(344,170)
=========== ============ ========== ============ ========== ============ ========== ===========
</TABLE>
PROPOSED MERGERS
On October 6, 2000, (1) the board of trustees of Investment Trust
unanimously approved the submission to shareholders of the merger of Global
Equity Fund into PACE International Equity Investments, a series of PaineWebber
PACE Select Advisors Trust ("PACE Trust"); (2) the board of trustees of Managed
Trust unanimously approved the submission to shareholders of the merger of Asia
Pacific Growth Fund into PACE International Emerging Markets Equity Investments,
a series of PACE Trust; and (3) the board of trustees of Investment Trust II
unanimously approved the submission to shareholders of the merger of Emerging
Markets Equity Fund into PACE International Emerging Markets Equity Investments,
a series of PACE Trust. Each merger will be submitted to a Fund's shareholders
at meetings expected to be held in January 2001. If approved by a Fund's
shareholders, a merger is expected to be consummated in February or March 2001.
45
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding in each class
throughout each period is presented below:
<TABLE>
<CAPTION>
CLASS A
-----------------------------------------------------------
FOR THE
FOR THE YEARS TWO MONTHS
ENDED OCTOBER 31, ENDED
--------------------------------------------- OCTOBER 31,
2000++ 1999 1998# 1997 1996
--------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............................. $ 17.90 $ 16.27 $ 18.37 $17.43 $ 16.81
--------- --------- --------- --------- -----------
Net investment income (loss) ..................................... 0.06@ 0.08@ 0.03@ -- (0.02)
Net realized and unrealized gains from
investments and foreign currency ............................... 0.51@ 2.38@ 0.35@ 1.52 0.64
--------- --------- --------- --------- -----------
Net increase from investment operations .......................... 0.57 2.46 0.38 1.52 0.62
--------- --------- --------- --------- -----------
Dividends from net investment income ............................. -- (0.02) -- -- --
Distributions from net realized gains
from investment transactions ................................... (2.70) (0.81) (2.48) (0.58) --
--------- --------- --------- --------- -----------
Total dividends and distributions to shareholders ................ (2.70) (0.83) (2.48) (0.58) --
--------- --------- --------- --------- -----------
Net asset value, end of period ................................... $ 15.77 $ 17.90 $ 16.27 $18.37 $ 17.43
========= ========= ========= ========= ===========
Total investment return (1) ...................................... 2.51% 15.56% 2.53% 8.87% 3.69%
========= ========= ========= ========= ===========
Ratios/Supplemental Data:
Net assets, end of period (000's) ................................ $232,910 $235,341 $251,680 $294,878 $307,267
Expenses to average net assets, net of waivers from adviser (2) .. 1.58% 1.56% 1.55% 1.44% 1.53%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ........................ 0.37% 0.45% 0.17% 0.01% (0.80)%*
Portfolio turnover rate .......................................... 131% 72% 151% 86% 3%
----------------------------
* Annualized
++ Effective October 10, 2000, Martin Currie, Inc. began overseeing the
day-to-day management of the foreign portion of the Fund's assets and
Mitchell Hutchins continues to allocate the portfolio between domestic and
foreign investments and manages the domestic portion of the Fund's assets.
# Effective October 1, 1998, Invista Capital Management, Inc. began
overseeing the day-to-day management of the foreign portion of the Fund's
assets and Mitchell Hutchins allocates the portfolio between domestic and
foreign investments and manages the domestic portion of the Fund's assets.
@ Calculated using the average monthly shares outstanding for the period.
(1) Total investment return is calculated assuming a $10,000 investment on the
first day of each period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of each period reported. The figures do not
include sales charges or program fees; results would be lower if sales
charges or program fees were included. Total investment return for periods
of less than one year has not been annualized.
(2) During the years ended October 31, 2000 and October 31, 1999 Mitchell
Hutchins waived a portion of its advisory and administration fees. The
ratios excluding the waivers would be the same since the fee waivers
represents less than 0.005%.
46
<PAGE>
<CAPTION>
CLASS A CLASS B
------------ -------------------------------------------------------------------------
FOR THE FOR THE FOR THE
YEAR FOR THE TWO MONTHS YEAR
ENDED ENDED OCTOBER 31, ENDED ENDED
AUGUST 31, -------------------------------------------- OCTOBER 31, AUGUST 31,
1996 2000++ 1999 1998# 1997 1997 1996
---------- --------- --------- --------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 16.12 $ 16.81 $ 15.43 $ 17.69 $ 16.93 $ 16.35 $ 15.82
---------- --------- --------- --------- --------- ----------- -----------
Net investment income (loss) ................ 0.02 (0.09)@ (0.06)@ (0.12)@ (0.21) (0.05) (0.12)
Net realized and unrealized gains from
investments and foreign currency .......... 1.24 0.52@ 2.25@ 0.34@ 1.55 0.63 1.22
---------- --------- --------- --------- --------- ----------- -----------
Net increase from investment operations ..... 1.26 0.43 2.19 0.22 1.34 0.58 1.10
---------- --------- --------- --------- --------- ----------- -----------
Dividends from net investment income ........ -- -- -- -- -- -- --
Distributions from net realized gains
from investment transactions .............. (0.57) (2.70) (0.81) (2.48) (0.58) -- (0.57)
---------- --------- --------- --------- --------- ----------- -----------
Total dividends and distributions
to shareholders ........................... (0.57) (2.70) (0.81) (2.48) (0.58) -- (0.57)
---------- --------- --------- --------- --------- ----------- -----------
Net asset value, end of period .............. $ 16.81 $ 14.54 $ 16.81 $ 15.43 $ 17.69 $ 16.93 $ 16.35
========== ========= ========= ========= ========= =========== ===========
Total investment return (1) ................. 8.06% 1.75% 14.63% 1.62% 8.05% 3.55% 7.18%
========== ========= ========= ========= ========= =========== ===========
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $305,218 $ 7,875 $ 27,435 $ 52,709 $ 87,104 $113,445 $113,235
Expenses to average net assets, net of
waivers from adviser (2) .................. 1.48% 2.45% 2.42% 2.38% 2.26% 2.34%* 2.25%
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ... 0.10% (0.62)% (0.40)% (0.74)% (0.80)% (1.61)%* (0.68)%
Portfolio turnover rate ..................... 33% 131% 72% 151% 86% 3% 33%
</TABLE>
47
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
FINANCIAL HIGHLIGHTS (CONCLUDED)
Selected data for a share of beneficial interest outstanding in each class
throughout each period is presented below:
<TABLE>
<CAPTION>
CLASS C
----------------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED YEAR
OCTOBER 31, ENDED
------------------------------------------------------- OCTOBER 31,
2000++ 1999 1998# 1997 1996
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 16.84 $ 15.45 $ 17.69 $ 16.93 $ 16.35
---------- ---------- ---------- ---------- ----------
Net investment income (loss) ................ (0.07)@ (0.05)@ (0.11)@ (0.23) (0.05)
Net realized and unrealized gains from
investments and foreign currency .......... 0.50@ 2.25@ 0.35@ 1.57 0.63
---------- ---------- ---------- ---------- ----------
Net increase from investment operations ..... 0.43 2.20 0.24 1.34 0.58
---------- ---------- ---------- ---------- ----------
Dividends from net investment income ........ -- -- -- -- --
Distributions from net realized gains
from investment transactions .............. (2.70) (0.81) (2.48) (0.58) --
---------- ---------- ---------- ---------- ----------
Total dividends and distributions
to shareholders ........................... (2.70) (0.81) (2.48) (0.58) (0.00)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period .............. $ 14.57 $ 16.84 $ 15.45 $ 17.69 $ 16.93
========== ========== ========== ========== ==========
Total investment return (1) ................. 1.74% 14.67% 1.74% 8.05% 3.55%
========== ========== ========== ========== ==========
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $ 23,655 $ 32,917 $ 41,103 $ 54,510 $ 67,530
Expenses to average net assets, net of
waivers from adviser (2) .................. 2.38% 2.34% 2.32% 2.20% 2.30%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ... (0.45)% (0.33)% (0.65)% (0.75)% (1.57)%*
Portfolio turnover rate ..................... 131% 72% 151% 86% 3%
----------
* Annualized
++ Effective October 10, 2000, Martin Currie, Inc. began overseeing the
day-to-day management of the foreign portion of the Fund's assets and
Mitchell Hutchins continues to allocate the portfolio between domestic and
foreign investments and manages the domestic portion of the Fund's assets.
# Effective October 1, 1998, Invista Capital Management, Inc. began
overseeing the day-to-day management of the foreign portion of the Fund's
assets and Mitchell Hutchins allocates the portfolio between domestic and
foreign investments and manages the domestic portion of the Fund's assets.
@ Calculated using the average monthly shares outstanding for the year.
(1) Total investment return is calculated assuming a $10,000 investment on the
first day of each period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of each period reported. The figures do not
include sales charges or program fees; results would be lower if sales
charges or program fees were included. Total investment return for periods
of less than one year has not been annualized.
(2) During the years ended October 31, 2000 and October 31, 1999 Mitchell
Hutchins waived a portion of its advisory and administration fees. The
ratios excluding the waivers would be the same since the fee waivers
represents less than 0.005%.
48
<PAGE>
<CAPTION>
CLASS C CLASS Y
---------- --------------------------------------------------------
FOR THE
YEAR FOR THE YEARS ENDED
ENDED OCTOBER 31,
OCTOBER 31, -------------------------------------------------------
1996 2000++ 1999 1998# 1997
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 15.82 $ 18.31 $ 16.59 $ 18.63 $ 17.60
---------- ---------- ---------- ---------- ----------
Net investment income (loss) ................ (0.13) 0.13@ 0.14@ 0.09@ 0.10
Net realized and unrealized gains from
investments and foreign currency .......... 1.23 0.51@ 2.43@ 0.35@ 1.51
---------- ---------- ---------- ---------- ----------
Net increase from investment operations ..... 1.10 0.64 2.57 0.44 1.61
---------- ---------- ---------- ---------- ----------
Dividends from net investment income ........ -- -- (0.04) -- --
Distributions from net realized gains
from investment transactions .............. (0.57) (2.70) (0.81) (2.48) (0.58)
---------- ---------- ---------- ---------- ----------
Total dividends and distributions
to shareholders ........................... (0.57) (2.70) (0.85) (2.48) (0.58)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period .............. $ 16.35 $ 16.25 $ 18.31 $ 16.59 $ 18.63
========== ========== ========== ========== ==========
Total investment return (1) ................. 7.18% 2.88% 15.97% 2.86% 9.31%
========== ========== ========== ========== ==========
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $ 66,585 $ 46,166 $ 53,334 $ 51,025 $ 57,683
Expenses to average net assets, net of
waivers from adviser (2) .................. 2.27% 1.24% 1.23% 1.21% 1.10%
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ... (0.70)% 0.70% 0.79% 0.50% 0.36%
Portfolio turnover rate ..................... 33% 131% 72% 151% 86%
<CAPTION>
CLASS Y
--------------------------
FOR THE FOR THE
TWO MONTHS YEAR
ENDED ENDED
OCTOBER 31, AUGUST 31,
1996 1996
---------- ----------
<S> <C> <C>
Net asset value, beginning of period ........ $ 16.97 $ 16.22
---------- ----------
Net investment income (loss) ................ (0.01) 0.07
Net realized and unrealized gains from
investments and foreign currency .......... 0.64 1.25
---------- ----------
Net increase from investment operations ..... 0.63 1.32
---------- ----------
Dividends from net investment income ........ -- --
Distributions from net realized gains
from investment transactions .............. -- (0.57)
---------- ----------
Total dividends and distributions
to shareholders ........................... (0.00) (0.57)
---------- ----------
Net asset value, end of period .............. 17.60 $ 16.97
========== ==========
Total investment return (1) ................. 3.71% 8.39%
========== ==========
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $ 63,225 $ 61,736
Expenses to average net assets, net of
waivers from adviser (2) .................. 1.18%* 1.17%
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ... (0.45)%* 0.46%
Portfolio turnover rate ..................... 3% 33%
</TABLE>
49
<PAGE>
PAINEWEBBER ASIA PACIFIC GROWTH FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding in each class
throughout each period is presented below:
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------
FOR THE YEARS FOR THE PERIOD
ENDED OCTOBER 31, ENDED
-------------------------------------------- OCTOBER 31,
2000 1999 1998 1997+
---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period .......... $ 9.71 $ 6.82 $ 8.96 $ 12.50
-------- -------- -------- --------
Net investment income (loss) .................. (0.09)@ (0.05)@ -- 0.03
Net realized and unrealized gains (losses)
from investments and foreign currency ....... (0.66)@ 2.94@ (2.14)@ (3.57)
-------- -------- -------- --------
Net increase (decrease) from investment
operations .................................. (0.75) 2.89 (2.14) (3.54)
-------- -------- -------- --------
Net asset value, end of period ................ $ 8.96 $ 9.71 $ 6.82 $ 8.96
======== ======== ======== ========
Total investment return (1) ................... (7.72)% 42.38% (23.88)% (28.32)%
======== ======== ======== ========
Ratios/Supplemental Data:
Net assets, end of period (000's) ............. $ 8,745 $ 14,229 $ 11,526 $ 21,466
Expenses to average net assets, net of
waivers from adviser (2) .................... 2.35% 2.73% 2.88% 2.33%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ..... (0.81)% (0.53)% (0.02)% 0.37%*
Portfolio turnover rate ....................... 54% 70% 59% 13%
----------
* Annualized
+ For the period March 25, 1997 (commencement of operations) through
October 31, 1997.
++ For the period March 13, 1998 (commencement of offering) through
October 31, 1998.
@ Calculated using the average monthly shares outstanding for the period.
(1) Total investment return is calculated assuming a $10,000 investment on the
first day of each period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of each period reported. The figures do not
include sales charges or program fees; results would be lower if sales
charges or program fees were included. Total investment return for periods
of less than one year has not been annualized.
(2) During the years ended October 31, 2000 and October 31, 1999 Mitchell
Hutchins waived a portion of its advisory and administration fees. The
ratios excluding the waivers would be the same since the fee waiver
represents less than 0.005%.
50
<PAGE>
<CAPTION>
CLASS B
--------------------------------------------------------------
FOR THE YEARS FOR THE PERIOD
ENDED OCTOBER 31, ENDED
-------------------------------------------- OCTOBER 31,
2000 1999 1998 1997+
---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period .......... $ 9.52 $ 6.74 $ 8.92 $ 12.50
-------- -------- -------- ---------
Net investment income (loss) .................. (0.18)@ (0.11)@ (0.06)@ (0.03)
Net realized and unrealized gains (losses)
from investments and foreign currency ....... (0.62)@ 2.89@ (2.12)@ (3.55)
-------- -------- -------- ---------
Net increase (decrease) from investment
operations .................................. (0.80) 2.78 (2.18) (3.58)
-------- -------- -------- ---------
Net asset value, end of period ................ $ 8.72 $ 9.52 $ 6.74 $ 8.92
======== ======== ======== =========
Total investment return (1) ................... (8.40)% 41.25% (24.44)% (28.64)%
======== ======== ======== =========
Ratios/Supplemental Data:
Net assets, end of period (000's) ............. $ 9,774 $ 14,589 $ 12,746 $ 22,949
Expenses to average net assets, net of
waivers from adviser (2) .................... 3.13% 3.52% 3.63% 3.12%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ..... (1.60)% (1.34)% (0.78)% (0.43)%*
Portfolio turnover rate ....................... 54% 70% 59% 13%
<CAPTION>
CLASS C
--------------------------------------------------------------
FOR THE YEARS FOR THE PERIOD
ENDED OCTOBER 31, ENDED
-------------------------------------------- OCTOBER 31,
2000 1999 1998 1997+
---------- ---------- ---------- -----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period .......... $ 9.53 $ 6.74 $ 8.92 $ 12.50
-------- -------- -------- ---------
Net investment income (loss) .................. (0.17)@ (0.10)@ (0.06)@ (0.03)
Net realized and unrealized gains (losses)
from investments and foreign currency ....... (0.63)@ 2.89@ (2.12)@ (3.55)
-------- -------- --------- ---------
Net increase (decrease) from investment
operations .................................. (0.80) 2.79 (2.18) (3.58)
-------- -------- -------- ---------
Net asset value, end of period ................ $ 8.73 $ 9.53 $ 6.74 $ 8.92
======== ======== ======== =========
Total investment return (1) ................... (8.39)% 41.39% (24.44)% (28.64)%
======== ======== ======== =========
Ratios/Supplemental Data:
Net assets, end of period (000's) ............. $ 5,058 $ 10,052 $ 6,220 $ 13,887
Expenses to average net assets, net of
waivers from adviser (2) .................... 3.11% 3.45% 3.60% 3.10%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ..... (1.60)% (1.23)% (0.79)% (0.42)%*
Portfolio turnover rate ....................... 54% 70% 59% 13%
<CAPTION>
CLASS Y
-----------------------------------------------
FOR THE YEARS FOR THE PERIOD
ENDED OCTOBER 31, ENDED
--------------------------- OCTOBER 31,
2000 1999 1998++
---------- ---------- ----------
<S> <C> <C> <C>
Net asset value, beginning of period .......... $ 9.68 $ 6.79 $ 8.66
-------- -------- --------
Net investment income (loss) .................. (0.06)@ -- 0.06@
Net realized and unrealized gains (losses)
from investments and foreign currency ....... (0.66)@ 2.89@ (1.93)@
-------- -------- --------
Net increase (decrease) from investment
operations .................................. (0.72) 2.89 (1.87)
-------- -------- --------
Net asset value, end of period ................ $ 8.96 $ 9.68 $ 6.79
======== ======== ========
Total investment return (1) ................... (7.44)% 42.56% (21.59)%
======== ======== ========
Ratios/Supplemental Data:
Net assets, end of period (000's) ............. $ 182 $ 192 $ 47
Expenses to average net assets, net of
waivers from adviser (2) .................... 2.06% 2.34% 2.66%*
Net investment income (loss) to average net
assets, net of waivers from adviser (2) ..... (0.50)% (0.06)% (1.46)%*
Portfolio turnover rate ....................... 54% 70% 59%
</TABLE>
51
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding in each class
throughout each period is presented below:
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------
FOR THE
FOR THE YEARS ENDED FOUR MONTHS
OCTOBER 31, ENDED
---------------------------------------------- OCTOBER 31,
2000 1999 1998 1997** 1996
--------- -------- --------- -------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 8.79 $ 6.52 $ 9.39 $ 9.46 $ 10.06
------- ------ ------- ------ -------
Net investment loss ......................... (0.11)@ (0.02)@ (0.01)@ (0.06) (0.13)
Net realized and unrealized gains (losses)
from investments and foreign currency ..... (0.96)@ 2.29@ (2.86)@ (0.01) (0.47)
------- ------ ------- ------ -------
Net increase (decrease) from investment
operations ................................ (1.07) 2.27 (2.87) (0.07) (0.60)
------- ------ ------- ------ -------
Net asset value, end of period .............. $ 7.72 $ 8.79 $ 6.52 $ 9.39 $ 9.46
======= ====== ======= ====== =======
Total investment return (1) ................. (12.17)% 34.82% (30.56)% (0.74)% (5.96)%
======= ====== ======= ====== =======
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $ 3,245 $5,090 $ 4,237 $9,222 $14,992
Expenses to average net assets, net of fee
waivers ................................... 2.44% 2.44% 2.44% 2.44% 2.44%*
Expenses to average net assets, before fee
waivers ................................... 3.90% 3.56% 3.71% 3.01% 3.48%*
Net investment loss, net of fee waivers,
to average net assets ..................... (1.16)% (0.31)% (0.16)% (0.40)% (1.42)%*
Net investment loss, before fee waivers,
to average net assets ..................... (2.62)% (1.43)% (1.43)% (0.97)% (2.46)%*
Portfolio turnover rate ..................... 117% 80% 64% 87% 22%
----------
++ For the period December 5, 1995 (commencement of offering of shares) to
June 30, 1996.
@ Calculated using the average shares outstanding for the period.
* Annualized.
** Investment Sub-Advisory functions for the Fund were transferred from
Emerging Markets Management to Schroder Investment Management North America
Inc. effective February 25, 1997.
(1) Total investment return is calculated assuming a $10,000 investment on the
first day of each period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of each period reported. The figures do not
include sales charges or program fees; results would be lower if sales
charges or program fees were included. Total investment return for periods
of less than one year has not been annualized.
52
<PAGE>
<CAPTION>
CLASS A CLASS B
--------- ---------------------------------------------------------------------------
FOR THE FOR THE FOR THE
YEAR FOR THE YEARS ENDED FOUR MONTHS YEAR
ENDED OCTOBER 31, ENDED ENDED
JUNE 30, ---------------------------------------------- OCTOBER 31, JUNE 30,
1996 2000 1999 1998 1997** 1996 1996++
--------- --------- -------- --------- -------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 9.73 $ 8.52 $ 6.37 $ 9.19 $ 9.32 $ 9.94 $ 9.13
------- ------ ------ --------- ------- ------ ------
Net investment loss ......................... (0.14) (0.17)@ (0.08)@ (0.08)@ (0.10) (0.07) (0.01)
Net realized and unrealized gains (losses)
from investments and foreign currency ..... 0.47 (0.91)@ 2.23@ (2.74)@ (0.03) (0.55) 0.82
------- ------ ------ --------- ------- ------ ------
Net increase (decrease) from investment
operations ................................ 0.33 (1.08) 2.15 (2.82) (0.13) (0.62) 0.81
------- ------ ------ --------- ------- ------ ------
Net asset value, end of period .............. $ 10.06 $ 7.44 $ 8.52 $ 6.37 $ 9.19 $ 9.32 $ 9.94
======= ====== ====== ========= ======= ====== ======
Total investment return (1) ................. 3.39% (12.68)% 33.75% (30.69)% (1.39)% (6.24)% 8.87%
======= ====== ====== ========= ======= ====== ======
Ratios/Supplemental Data:
Net assets, end of period (000's) ........... $20,680 $ 615 $ 459 $ 461 $ 1,598 $ 879 $ 936
Expenses to average net assets, net of fee
waivers ................................... 2.44% 3.19% 3.19% 3.19% 3.19% 3.19%* 3.19%*
Expenses to average net assets, before fee
waivers ................................... 3.42% 4.71% 4.50% 4.92% 3.82% 4.23%* 4.97%*
Net investment loss, net of fee waivers,
to average net assets ..................... (0.52)% (1.82)% (1.06)% (0.99)% (1.25)% (2.12)%* (0.21)%*
Net investment loss, before fee waivers,
to average net assets ..................... (1.50)% (3.34)% (2.37)% (2.72)% (1.88)% (3.16)%* (1.99)%*
Portfolio turnover rate ..................... 69% 117% 80% 64% 87% 22% 69%
</TABLE>
53
<PAGE>
PAINEWEBBER EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS(CONCLUDED)
Selected data for a share of beneficial interest outstanding in each class
throughout each period is presented below:
<TABLE>
<CAPTION>
CLASS C
-----------------------------------------------------------
FOR THE
FOR THE YEARS FOUR MONTHS
ENDED OCTOBER 31, ENDED
--------------------------------------------- OCTOBER 31,
2000 1999 1998 1997** 1996
------- ------ -------- ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...............................$ 8.43 $ 6.32 $ 9.17 $ 9.32 $ 9.94
------- ------ -------- ------ ------
Net investment income (loss) ....................................... (0.18)@ (0.08)@ (0.08)@ (0.14) (0.22)
Net realized and unrealized gains (losses) from investments
and foreign currency ........................................... (0.89)@ 2.19@ (2.77)@ (0.01) (0.40)
------- ------ -------- ------ ------
Net increase (decrease) from investment operations ................. (1.07) 2.11 (2.85) (0.15) (0.62)
------- ------ -------- ------ ------
Net asset value, end of period .....................................$ 7.36 $ 8.43 $ 6.32 $ 9.17 $ 9.32
======= ====== ======== ====== ======
Total investment return (1) ........................................ (12.69)% 33.39% (31.08)% (1.61)% (6.24)%
======= ====== ======== ====== ======
Ratios/Supplemental Data:
Net assets, end of period (000's) ..................................$ 1,400 $2,126 $ 2,575 $5,345 $7,882
Expenses to average net assets, net of fee waivers ................. 3.19% 3.19% 3.19% 3.19% 3.19%*
Expenses to average net assets, before fee waivers ................. 4.72% 4.43% 4.42% 3.78% 4.23%*
Net investment loss to average net assets, net of fee waivers ...... (1.88)% (1.06)% (0.96)% (1.18)% (2.16)%*
Net investment loss to average net assets, before fee waivers ...... (3.41)% (2.30)% (2.19)% (1.77)% (3.20)%*
Portfolio turnover rate ............................................ 117% 80% 64% 87% 22%
</TABLE>
-----------
@ Calculated using the average shares outstanding for the period.
* Annualized.
** Investment Sub-Advisory functions for the Fund were transferred from
Emerging Markets Management to Schroder Investment Management North America
Inc. effective February 25, 1997.
(1) Total investment return is calculated assuming a $10,000 investment on the
first day of each period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of each period reported. The figures do not
include sales charges or program fees; results would be lower if sales
charges or program fees were included. Total investment return for periods
of less than one year has not been annualized.
54
<PAGE>
<TABLE>
<CAPTION>
CLASS C CLASS Y
----------- --------------------------------------------------------------
FOR THE FOR THE FOR THE
YEAR FOR THE FOUR MONTHS YEAR
ENDED ENDED OCTOBER 31, ENDED ENDED
JUNE 30, ---------------------------------------- OCTOBER 31, JUNE 30,
1996 2000 1999 1998 1997** 1996 1996
------ ------ ------ ------ ------ ------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ..................... $ 9.67 $ 8.89 $ 6.58 $ 9.46 $ 9.51 $ 10.11 $ 9.75
------ ------ ------ ------ ------ ------- ------
Net investment income (loss) ............................. (0.24) (0.09)@ 0.00@ (0.01)@ (0.02) (0.05) (0.01)
Net realized and unrealized gains (losses) from
investments and foreign currency ..................... 0.51 (0.97)@ 2.31@ (2.87)@ (0.03) (0.55) 0.37
------ ------ ------ ------ ------ ------- ------
Net increase (decrease) from investment operations ....... 0.27 (1.06) 8.89 (2.88) (0.05) (0.60) 0.36
------ ------ ------ ------ ------ ------- ------
Net asset value, end of period ........................... $ 9.94 $ 7.83 $ 8.89 $ 6.58 $ 9.46 $ 9.51 $10.11
====== ====== ====== ====== ====== ======= ======
Total investment return (1) .............................. 2.79% (11.92)% 35.11% (30.44)% (0.53)% (5.93)% 3.69%
====== ====== ====== ====== ====== ======= ======
Ratios/Supplemental Data:
Net assets, end of period (000's) ........................$11,561 $ 576 $ 804 $ 877 $10,053 $11,375 $12,979
Expenses to average net assets, net of fee waivers ....... 3.19% 2.19% 2.19% 2.19% 2.19% 2.19%* 2.19%
Expenses to average net assets, before fee waivers ....... 4.17% 3.73% 3.46% 3.36% 2.69% 3.23%* 3.29%
Net investment loss to average net assets, net of
fee waivers .......................................... (1.28)% (0.92)% (0.03)% (0.08)% (0.15)% (1.13)%* (0.15)%
Net investment loss to average net assets, before
fee waivers .......................................... (2.26)% (2.46)% (1.31)% (1.25)% (0.65)% (2.17)%* (1.25)%
Portfolio turnover rate .................................. 69% 117% 80% 64% 87% 22% 69%
</TABLE>
55
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
PAINEWEBBER ASIA PACIFIC GROWTH FUND
PAINEWEBBER EMERGING MARKETS EQUITY FUND
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
The Boards of Trustees and Shareholders
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of PaineWebber Global Equity Fund,
PaineWebber Asia Pacific Growth Fund, and PaineWebber Emerging Markets Equity
Fund (the "Funds") as of October 31, 2000, and the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, and the financial highlights for
each of the periods indicated therein. These financial statements and financial
highlights are the responsibility of the Funds' 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 auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audits 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 and financial highlights. Our procedures included
confirmation of investments owned at October 31, 2000, 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
PaineWebber Global Equity Fund, PaineWebber Asia Pacific Growth Fund and
PaineWebber Emerging Markets Equity Fund at October 31, 2000, the results of
their operations for the year then ended, the changes in their net assets for
each of the two years in the period then ended, and the financial highlights for
each of the indicated periods, in conformity with accounting principles
generally accepted in the United States.
/s/ Ernst & Young LLP
New York, New York
December 22, 2000
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PAINEWEBBER GLOBAL EQUITY FUND, EMERGING MARKETS EQUITY FUND
AND ASIA PACIFIC GROWTH FUND
TAX INFORMATION (UNAUDITED)
In order to meet certain requirements of Subchapter M of the Internal
Revenue Code, we are advising you that $35,199,702 has been designated by the
PaineWebber Global Equity Fund as long-term capital gain.
The percentage of ordinary income dividends paid by the PaineWebber Global
Equity Fund qualifying for the dividends received deduction available to
corporate shareholders is 3.92%.
PaineWebber Global Equity Fund intends to make an election under Internal
Revenue Code Section 853 to pass through foreign taxes paid by the portfolio to
its shareholders. The amount of foreign source income for information reporting
purposes is $3,377,918 and the amount of foreign taxes paid is $1,042,164 .
Shareholders should not use the above information to prepare their tax
returns. Because the Fund's fiscal year is not the calendar year, another
notification will be sent in respect of calendar year 2000. The second
notification, which will reflect the amount to be used by calendar year
taxpayers on their federal income tax returns, will be made in conjunction with
Form 1099 DIV and will be mailed in January 2001. Shareholders are advised to
consult their own tax advisers with respect to the tax consequences of their
investment in the Fund.
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PaineWebber offers a family of 26 funds which encompass a diversified range of
investment goals.
BOND FUNDS
- High Income Fund
- Investment Grade Income Fund
- Low Duration U.S. Government Income Fund
- Strategic Income Fund
- U.S. Government Income Fund
TAX-FREE BOND FUNDS
- California Tax-Free Income Fund
- Municipal High Income Fund
- National Tax-Free Income Fund
- New York Tax-Free Income Fund
STOCK FUNDS
- Enhanced S&P 500 Fund
- Enhanced Nasdaq-100 Fund
- Financial Services Growth Fund
- Growth Fund
- Growth and Income Fund
- Mid Cap Fund
- Small Cap Fund
- S&P 500 Index Fund
- Strategy Fund
- Tax-Managed Equity Fund
ASSET ALLOCATION FUNDS
- Balanced Fund
- Tactical Allocation Fund
GLOBAL FUNDS
- Asia Pacific Growth Fund
- Emerging Markets Equity Fund
- Global Equity Fund
- Global Income Fund
PAINEWEBBER MONEY MARKET FUND
PAINEWEBBER-Registered Trademark-
-C- 2000 PaineWebber Incorporated
All Rights Reserved
PAINEWEBBER-Registered Trademark-
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GLOBAL EQUITY
FUND
EMERGING
MARKETS
EQUITY FUND
ASIA PACIFIC
GROWTH FUND
ANNUAL REPORT
OCTOBER 31, 2000
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TRUSTEES
E. Garrett Bewkes, Jr.
CHAIRMAN
Margo N. Alexander
Richard Q. Armstrong
Richard R. Burt
Meyer Feldberg
George W. Gowen
Frederic V. Malek
Carl W. Schafer
Brian M. Storms
PRINCIPAL OFFICERS
Brian M. Storms
PRESIDENT
Amy R. Doberman
VICE PRESIDENT
Dianne E. O'Donnell
VICE PRESIDENT AND SECRETARY
T. Kirkham Barneby
VICE PRESIDENT
Paul H. Schubert
VICE PRESIDENT AND TREASURER
INVESTMENT ADVISER/MANAGER,
ADMINISTRATOR AND DISTRIBUTOR
Mitchell Hutchins Asset Management Inc.
51 West 52nd Street
New York, New York 10019
INVESTMENT SUBADVISERS
Martin Currie, Inc.
Saltire Court
20 Castle Terrace
Edinburgh, Scotland EHI ZES
Schroder Investment Management North America Inc.
1301 Avenue of the Americas
New York, New York 10019
THIS REPORT IS NOT TO BE USED IN CONNECTION WITH THE OFFERING OF SHARES OF THE
FUNDS UNLESS ACCOMPANIED OR PRECEDED BY AN EFFECTIVE PROSPECTUS.
A PROSPECTUS CONTAINING MORE COMPLETE INFORMATION FOR ANY OF THE FUNDS LISTED ON
THE BACK COVER CAN BE OBTAINED FROM A PAINEWEBBER FINANCIAL ADVISOR OR
CORRESPONDENT FIRM. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
