-----------------
DECEMBER 31, 1995
-----------------
VAN ECK
-----------------
GOLD
-----------------
OPPORTUNITY
-----------------
FUND
-----------------
ANNUAL
-----------------
REPORT
-----------------
[VAN ECK GLOBAL LOGO]
<PAGE>
Van Eck Gold Opportunity Fund
---------------------------------------
1995 Annual Report
Dear Fellow Shareholder:
During 1995*, your Fund's net asset value rose 4.4% compared to an average
gain of 2.5% for the 33 precious metals funds monitored by Micropal Inc., a
mutual fund evaluation service. During the same period, the price of gold
bullion rose just 1%, reflecting the low volatility in the gold price that
characterized most of the year. However, that low price volatility masked a
great deal of activity in a very healthy market supported on the downside by
strong physical demand, particularly from emerging markets, but capped on the
upside by very heavy forward sales from mining companies and by central bank
selling. These two factors kept the gold price in an ever-narrowing trading
range. This seeming quietude, in turn, discouraged investment buying in the
West, where soaring financial assets were the major attraction.
By November, the producer forward selling led to such demand for bullion by
dealers [who need to borrow gold to cover their (long) exposure as counterparty
to the producers' forward (short) sales] that overnight gold lease rates
charged on borrowed gold rose to 12% from their more normal 2-3%, which sent
gold into backwardation (i.e., when forward prices are lower than the spot
price) for the first time in 20 years. The surge in lease rates drew attention
not only to the short-term shortage of bullion, but also to its longer-term
healthy fundamentals--declining mine production, growing fabrication demand
(jewelry, coins, etc.), and the reduced benefits to producers of forward
selling now that the forward premium for a one- year contract is about 3%
versus about 6% a year ago. Since forward selling has been probably the single
most negative weight on the market, any let-up in these supplies would likely
be very positive for the gold price. Gold shares put in very mixed performances
in 1995, declining on average 26% in South Africa and 7% in Australia, but
rising about 10% in North America.
The weakness in the Australian gold-mining index last year belied a very robust
performance by the shares of several companies whose managements succeeded in
adding to reserves either by acquisition (e.g., Sons of Gwalia), or by
exploration (Plutonic), or that were the subject of takeovers (Zapopan,
Homestake Australia, Gold Mines of Kalgoorlie), in all of which we held
positions. The laggards typically were those companies suffering the lingering
effects of the heavy rainfalls associated with Cyclone Bobbie last spring or
other operating disappointments. Expecting weakness in the sector when the poor
operating results of the second and third quarters were reported, we lightened
our Australian exposure to about 16% of net assets in August, from about 20% at
midyear. We continue to believe Australia offers some of the best exploration
potential worldwide, particularly from those companies beginning to venture
into West Africa and Indonesia. In addition, the Australian industry is in a
consolidation phase and the potential for shareholder gains from corporate
activity has added a further positive dimension to investment there. At
year-end 1995, your Fund was 18% invested in Australian gold shares.
In the U.S., the investment climate continued to be dominated by environmental
concerns and permitting delays on the negative side and additions to reserves
on the positive. Newmont shares (3.4% of your Fund at year end) were among the
best performers, as management has plotted an aggressive course for growing
production and proving up reserves. During the second half of the year, we
reduced our exposure to U.S. miners from nearly 25% to approximately 20%,
believing most U.S. companies are fully valued and have limited near-term
growth potential.
Last year saw a number of "turnaround" situations in Canada regain favor among
investors (e.g., Echo Bay and Pegasus, to which we added exposure during the
second half after consolidation in their prices) among the large-
capitalization companies, while a few of our smaller names (Dayton, Bema)
benefited from anticipation of the start-up of new mines. Because of their
relatively strong performance during the year and because of strong growth
situations among the Canadians, our exposure to Canadian- based gold producers
rose to over 37% by year end, from 33% at midyear.
South African shares were under pressure from rising costs and labor unrest at
several mines, which reduced profits significantly. Much of the negative news
is probably discounted in the share prices; however, we believe the South
African gold-mining industry requires considerable rationalization to remain
viable. We will likely continue to keep only a small core position in South
African shares (6% of your Fund at year-end 1995), and will increase that
proportion only in strong gold markets, when the South African shares, because
of their high price leverage to gold, tend to outperform.
- ------------
* From inception on January 5, 1995 to December 31, 1995.
<PAGE>
Believing gold shares generally were vulnerable to correction if bullion failed
to break out of its narrow trading range, we were 18% in cash equivalents at
year end. However, bullion has decisively broken several technical resistance
points since the beginning of the year, and as of this writing, we are fully
invested, using gold equities rather than the metal itself--this because the
shares, whose prices tend to move two to three times greater than the price of
gold, are expected to outperform in the current bull market.
Outlook
We believe that gold market fundamentals are healthy for several reasons:
(bullet) Physical demand, which had declined after the sharp price run-up in
1993, rebounded significantly last year according to the World Gold
Council. In fact, both fabrication demand (80% of total demand) and
total demand reached record levels in 1995. Importantly, the demand
has returned at ever-higher prices, with little "sticker price shock"
evident yet.
(bullet) Mine supply, which saw its first absolute decline in nearly 15 years
in 1994, declined further in 1995, primarily due to another
appreciable decrease in South African output (to its lowest level in
40 years) and to the storms in Australia. This year may see some
improvement, but not significant.
(bullet) Central bank sales from monetary reserves have diminished from the
very high levels of 500 tonnes and 600 tonnes in 1992 and 1993,
respectively, to about 140 tonnes in 1995. The Belgian central bank
sold 175 tonnes, making up most of the net sales of 231 tonnes in the
first half of 1995. Subsequent buying from central banks in Latin
America, the former Soviet Union and China in the second half helped
bring full-year net sales to only about 140 tonnes. We believe
outright sales by the official sector will continue to be moderate
because most of the selling in the late Eighties and early Nineties
came from countries in economic distress who were selling their
reserves to keep their systems afloat. Most of those countries have
little or no gold reserves left to sell.
(bullet) Producer hedging programs appear to have impacted the gold market more
heavily in 1995 than in recent years, bringing accelerated supply of
over 600 tonnes to the market. The static gold price and attractive
contangos of 6% most of the year (which meant a gold miner could
contract to get $20 to $25 an ounce more for his production one year
forward) made hedging a very profitable exercise. The firmer gold
price and smaller contango ($12 an ounce) has made hedging less
attractive, and indications are that mining companies are slowing
their hedging activity significantly.
Central bank sales and producer hedging, in our opinion, have been the
two most negative influences on bullion in recent years. With their
roles in the market noticeably diminished, we believe the biggest
roadblock to gold prices holding above $400 an ounce is removed.
(bullet) Western investment demand, noticeably absent in recent years, is
rebounding in the face of lofty valuations for financial assets and
the likelihood that most global monetary authorities will resort to
currency debasement to get their economies going, just as they have
always done in the past. Gold will then prove itself to be the
ultimate currency hedge--an owned asset and no one's liability.
We appreciate your participation in the Gold Opportunity Fund and we look
forward to helping you meet your investment objectives in the future.
(Photo of John C. van Eck) (Photo of Lucille Palermo)
John C. van Eck Lucille Palermo
Chairman Portfolio Manager
January 25, 1996
<TABLE>
<CAPTION>
- -----------------------------------------------------------
Performance Record as of 12/31/95*
- -----------------------------------------------------------
After Maximum Before Sales
Total Return Sales Charge** Charge
- -----------------------------------------------------------
<S> <C> <C>
A shares (since 1/5/95) (1.7)% 4.4%
- -----------------------------------------------------------
C shares (since 1/5/95) 3.4% 4.4%
- -----------------------------------------------------------
</TABLE>
The performance data represents past performance and is not indicative of
future results. Investment return and principal value of an investment in the
Fund will vary so that shares, when redeemed, may be worth more or less than
their original cost.
The Advisor is currently waiving all expenses of the Fund. Had the Fund
incurred expenses, investment returns would have been reduced.
* Not annualized.
** A shares: maximum sales charge = 5.75%
C shares: 1% redemption charge, 1st year.
<PAGE>
Gold Opportunity Fund
Investment Portfolio December 31, 1995
-------------------------------------------------------------------
<TABLE>
<CAPTION>
No. of Shares Securities (a) Value (Note 1)
<S> <C> <C>
- -------------------------------------------------------------------
Gold Production & Exploration: 100%
Australia: 18.4%
30,000 Acacia Resources Ltd.+ $ 53,924
20,000 Emperor Mines Ltd.+ 31,938
50,000 Golden Shamrock Mines
Limited+ 30,824
60,000 Great Central Mines N.L.+ 115,869
10,000 Placer Pacific Limited 20,648
20,000 Resolute Samantha Gold N.L.* 42,337
10,000 Sons of Gwalia Ltd. 54,964
---------
350,504
---------
Canada: 37.3%
8,000 Agnico Eagle Mines Limited 101,000
2,500 Barrick Gold Corp. 65,937
20,000 Bema Gold Corporation+ 38,821
10,000 Cathedral Gold Corp.+ 10,987
15,000 Dayton Mining Corporation+ 63,175
5,000 Echo Bay Mines Ltd. 51,875
20,000 El Callao Mining Corp.+ 8,790
3,000 Goldcorp Inc. Cl. A+ 35,250
20,000 Granges Inc.+ 32,961
3,000 Miramar Mining Corporation+ 14,832
6,000 Pegasus Gold Inc.+ 83,250
2,000 Placer Dome Inc. 48,250
12,500 Prime Resources Group, Inc.+ 85,836
6,000 TVX Gold Inc.+ 42,750
6,000 Viceroy Resource
Corporation+ 26,369
---------
710,083
---------
</TABLE>
<TABLE>
<CAPTION>
No. of Shares Securities (a) Value (Note 1)
<S> <C> <C>
-------------------------------------------------------------------
South Africa: 6.0%
3,000 Driefontein Consolidated Ltd.
(ADR) $ 37,125
4,000 Freestate Consolidated Mines
(ADR) 29,000
5,000 Kloof Gold Mining Limited
(ADR) 47,187
----------
113,312
----------
United States: 20.0%
9,000 Battle Mountain Gold
Company 75,375
20,000 Canyon Resources
Corporation+ 48,750
10,000 Crown Resources
Corporation+ 49,375
8,300 FMC Gold Company 34,238
3,000 Homestake Mining Company 46,875
1,500 Newmont Gold Company 65,625
5,000 Santa Fe Pacific Gold Corp. 60,625
----------
380,863
----------
Total Stocks: 81.7%
(Cost $1,579,137) 1,554,762
----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Short-Term Obligations: 18.3% Value (Note 1)
<S> <C> <C>
- --------------------------------------------------
$350,000 U.S. Treasury Bill due 1/18/96
Interest Yield 4.45%
(Amortized Cost: $349,264) 349,264
----------
Total Investments: 100%
(Cost $1,928,401) $1,904,026
==========
</TABLE>
- ------------
+ Non-income producing
* Formerly Samantha Gold N.L.
(a) Unless otherwise indicated, securities owned are shares of common stock.
See Notes to Financial Statements.
<PAGE>
Gold Opportunity Fund Financial Statements
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
Statement of Assets and Liabilities
<S> <C>
December 31, 1995
Assets:
Investments at value (cost, $1,928,401) (Note 1) $1,904,026
Cash 9,470
Cash--initial margin for futures (Note 6) 8,000
Receivables:
Dividends 1,781
Capital shares sold 70,073
From Advisor 49,442
Due from broker--variation margin (Note 6) 1,750
Other 1,657
Deferred organization costs (Note 1) 3,679
----------
Total assets 2,049,878
----------
Liabilities:
Payables:
Capital shares redeemed 3,626
Deferred organization costs 3,083
Dividend payable 1,565
Accounts payable 29,967
----------
Total liablities 38,241
----------
Net Assets $2,011,637
==========
Class A
Net asset value and redemption price per share
($1,906,298/197,078) $ 9.67
======
Maximum offering price per share (NAV/(1-maximum sales
commission)) $10.26
======
Class C
Net asset value, offering price and redemption price per
share ($105,339/10,894)
(Redemption may be subject to a contingent
deferred sales charge within the first year of
ownership) $ 9.67
======
Net assets consist of:
Aggregate paid in capital $2,039,135
Unrealized depreciation of investments, futures and
foreign denominated assets and liabilities (23,537)
Cumulative realized losses (3,961)
----------
$2,011,637
==========
</TABLE>
<TABLE>
<CAPTION>
Statement of Operations
<S> <C> <C>
For the Period January 5, 1995 (commencement
of operations) to December 31, 1995
Income:
Dividends (less foreign taxes withheld of
$504) $ 8,668
Interest income 238
------
Total income $8,906
Expenses:
Management (Note 2) 14,095
Distribution Class A (Note 4) 6,759
Distribution Class C (Note 4) 664
Administration (Note 2) 288
Transfer agency 28,045
Registration 35,870
Professional 12,019
Reports to shareholders 5,931
Amortization of deferred organization costs 904
Other 2,685
------
Total expenses 107,260
Expenses assumed by the Advisor (Note 2) (107,260)
------
Net expenses --
------
Net investment income $8,906
</TABLE>
Statement of Operations--(cont'd)
<TABLE>
<CAPTION>
<S> <C> <C>
Realized and Unrealized Gain (Loss) on
Investments (Note 3)
Realized gain from security transactions
(excluding short-term securities):
Proceeds from sales 2,131,953
Cost of securities sold 2,100,091
Realized gain 31,862
Realized loss from futures contracts (2,600)
Realized loss from options (9,962)
Realized gain from foreign currency transactions 359
Change in unrealized depreciation of investments,
futures and foreign denominated assets and liabilities (23,537)
--------
Net Increase in Net Assets Resulting from
Operations $ 5,028
========
</TABLE>
- ---------------------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
For the Period
January 5, 1995+
to
December 31,
1995
----------------
<S> <C>
Increase in Net Assets:
Operations:
Net investment income $ 8,906
Realized gain from security transactions 31,862
Realized loss from futures contracts (2,600)
Realized loss from options (9,962)
Realized gain from foreign currency
transactions 359
Change in unrealized depreciation of
investments, futures and foreign
denominated assets and liabilities (23,537)
-----------
Increase in net assets resulting from
operations 5,028
-----------
Dividends to shareholders from:
Net investment income:
Class A (31,261)
Class C (1,865)
-----------
(33,126)
-----------
(28,098)
-----------
Capital share transactions (Note 5):
Net proceeds from sales of shares:
Class A Shares 3,583,107
Class C Shares 237,042
-----------
3,820,149
-----------
Reinvestment of dividends:
Class A Shares 29,788
Class C Shares 1,777
-----------
31,565
-----------
Cost of shares reacquired:
Class A Shares (1,693,121)
Class C Shares (118,858)
-----------
(1,811,979)
-----------
Increase in net assets resulting from capital
share transactions 2,039,735
-----------
Total increase in net assets 2,011,637
Net Assets:
Beginning of period --
-----------
End of period $ 2,011,637
===========
</TABLE>
- ------------
+ Commencement of operations.
See Notes to Financial Statements.
<PAGE>
Gold Opportunity Fund
- -------------------------------------------------------------------------------
Financial Highlights
For a share outstanding throughout the period
<TABLE>
<CAPTION>
Class A Class C
For the Period For the Period
January 5, 1995(a) January 5, 1995(a)
to to
December 31, 1995 December 31, 1995
------------------ --------------------
<S> <C> <C>
Net Asset Value, Beginning of Period ........................... $ 9.43 $ 9.43
------ -------
Income from Investment Operations:
Net Investment Income+ ...................................... 0.06 0.07
Net Gains on Investments (both realized and unrealized) ....... 0.35 0.34
------ ------
Total from Investment Operations ............................... 0.41 0.41
------ -------
Less: Distributions from Net Investment Income ................. (0.17) (0.17)
------ ------
Net Asset Value, End of Period ................................. $ 9.67 $ 9.67
====== =======
Total Return (b) ............................................... 4.35% 4.35%
- ---------------------------------------------------------------------------------------------------------------
Ratios/Supplementary Data
Net Assets, End of Period (000) ............................... $ 1,906 $105
Ratio of Expenses to Average Net Assets (c) .................... 0%* 0%*
Ratio of Net Investment Income to Average Net Assets ........... .63%* .68%*
Portfolio Turnover Rate ........................................ 184.76% 184.76%
</TABLE>
- ---------------------
(a) Commencement of operations.
(b) Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period and a redemption on the last day
of the period. A sales charge is not reflected in the calculation of total
return. Total return for a period of less than one year is not annualized.
(c) The expense ratios for Class A shares and Class C shares would have been
6.73%* and 24.34%*, respectively if the expenses were not assumed by the
Advisor.
* Annualized.
+ Based on average shares outstanding.
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Notes to Financial Statements
Note 1--Significant Accounting Policies:
Van Eck Funds (the "Trust"), organized as a Massachusetts business trust on
April 3, 1985, is registered under the Investment Company Act of 1940. The
following is a summary of significant accounting policies consistently followed
by the Gold Opportunity Fund series, a non- diversified fund (the "Fund") of
the Trust in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles.
A. Security Valuation--Securities traded on national or foreign exchanges are
valued at the last sales prices reported at the close of business on the last
business day of the period. Over-the-counter securities and listed securities
for which no sale was reported are valued at the mean of the bid and asked
prices. Short-term obligations are valued at cost which with accrued interest
approximates value. Securities for which quotations are not available are
stated at fair value as determined by the Board of Trustees.
B. Federal Income Taxes--It is the Fund's policy to comply with the provisions
of the Internal Revenue Code applicable to regulated investment companies and
to distribute all of its taxable income to its shareholders. Therefore, no
federal income tax provision is required.
C. Currency Translation--Assets and liabilities denominated in foreign
currencies and commitments under forward currency contracts are translated
into U.S. dollars at the mean of the quoted bid and asked prices of such
currencies. Purchases and sales of investments are translated at the
exchange rates prevailing when such investments were acquired or sold.
Income and expenses are translated at the exchange rates prevailing when
accrued. The portion of realized and unrealized gains and losses on
investments that result from fluctuations in foreign currency exchange rates
are not separately disclosed. Recognized gains or losses and the
appreciation or depreciation attributable to foreign currency fluctuations
on other foreign denominated assets and liabilities are recorded as net
realized gains and losses from foreign currency transactions and unrealized
appreciation/ depreciation on foreign denominated assets and liabilities,
respectively.
D. Other--Security transactions are accounted for on the date the securities
are purchased or sold. Dividend income is recorded on the ex-dividend date.
Interest income is accrued as earned.
<PAGE>
Gold Opportunity Fund
- -------------------------------------------------------------------------------
E. Distributions to Shareholders--Distributions from net investment income and
realized gains, if any, are recorded on the ex-dividend date. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for foreign
currency transactions, short-term capital gains and Post-October losses. The
effect of these differences for the period ended December 31, 1995 decreased
accumulated distributions in excess of net investment income by $24,220,
decreased cumulative realized gains by $23,620 and decreased aggregate paid
in capital by $600.
F. Deferred Organization Costs--Deferred organization costs are being amortized
over a period of five years beginning on January 5, 1995 (commencement of
operations).
Note 2--Van Eck Associates Corporation (the "Advisor") earned fees of $14,095
for investment management and advisory services. The fee is based on an annual
rate of 1% of the Fund's average daily net assets. Van Eck Associates
Corporation agreed to waive its management fees and administrative fees for the
period January 5, 1995 (commencement of operations) to December 31, 1995. Van
Eck Associates Corp. also agreed to assume all distribution expenses and all
other expenses for the period January 5, 1995 (commencement of operations) to
December 31, 1995. Van Eck Securities Corporation received $1,740 for the
period ended December 31, 1995 from commissions earned on sales of Class A
shares after deducting $7,164 allowed to other dealers. Certain of the officers
and trustees of the Trust are officers, directors or stockholders of Van Eck
Associates Corporation and Van Eck Securities Corporation. As of December 31,
1995, Van Eck Associates Corporation owned 27.65% and 5.0% of the outstanding
shares of beneficial interest of Class A and Class C, respectively.
Note 3--Purchases of investments other than short-term obligations aggregated
$3,679,228 for the period ended December 31, 1995. For federal income tax
purposes the cost of investments owned at December 31, 1995 was $1,928,401. As
of December 31, 1995 net unrealized depreciation for federal income tax
purposes aggregated $24,375 of which $66,790 related to appreciated investments
and $91,165 related to depreciated investments.
Note 4--Pursuant to a Rule 12b-1 Plan of Distribution (the "Plan"), the Fund is
authorized to incur distribution expenses which will principally be payments to
securities dealers who have sold shares and service shareholder accounts and
payments to Van Eck Securities Corporation ("VESC"), the distributor, for
reimbursement of other actual promotion and distribution expenses incurred by
the distributor on behalf of the Fund. The amount paid under the Plan in any
one year is limited to .50% of average daily net assets for Class A shares and
1.00% of average daily net assets for Class C shares (the "Annual
Limitations"). For Class C shares, the Fund will pay to the selling broker at
the time of sale 1% of the amount of the purchase. Such 12b-1 advanced fees
will be expensed by the Fund over the course of the first twelve months from
the time of purchase. Should the payments to the brokers made by the Fund
exceed, on an annual basis, 1% of average daily net assets, VESC will reimburse
the Fund for any excess. Shareholders redeeming within one year of purchase
will be subject to a 1% redemption charge which will be retained by the Fund.
After the first year, the 1% 12b-1 fee will be paid to VESC which will retain a
portion of the fee for distribution services and pay the remainder to brokers.
All distribution fees and contingent deferred sales charges have been waived by
the Fund for Class C shares until May 1, 1996 and VESC has agreed to assume the
Fund's obligation to pay the dealers. No payments have been made for the year
ended December 31, 1995.
Distribution expenses incurred under the Plan that have not been paid because
they exceed the Annual Limitation may be carried forward to future years and
paid by the Fund within the Annual Limitation. VESC has waived its right to
reimbursement of the carried forward amounts incurred for the period January 5,
1995 through April 30, 1996 in the event the Plan is terminated, unless the
Board of Trustees determines that reimbursement of the carried forward amounts
is appropriate. The cumulative amount of excess distribution expenses incurred
over the Annual Limitation at December 31, 1995 was $27,119 for Class A shares
and $22,061 for Class C shares.
Note 5--Shares of Beneficial Interest Issued and Redeemed (unlimited number of
$.001 par value shares authorized):
<TABLE>
<CAPTION>
For the Period
January 5, 1995+
to
December 31, 1995
------------------
<S> <C>
Class A
Shares sold 363,031
Reinvestment of dividends 3,080
Shares reacquired (169,033)
========
Net increase 197,078
========
Class C
Shares sold 22,841
Reinvestment of dividends 184
Shares reacquired (12,131)
--------
Net increase 10,894
========
</TABLE>
- -------------
+ Commencement of operations.
Note 6--As of December 31, 1995 the Fund was long 5 Gold futures contracts
which expire February 27, 1996 with a contract value of $193,050. The gold
futures contracts were acquired in lieu of gold bullion. The advisor deems the
futures contract to be more advantageous than an acquisition of the bullion. As
7 of December 31, 1995, $950 is the unrealized appreciation of the futures
contracts. In the remote chance the broker cannot fulfill its obligation, the
Fund could lose the variation margin due it. Subsequent payments are made or
received each day dependent on the daily fluctuations in the value of the
underlying commodity. Risks may be caused by an imperfect correlation between
the movements in the price of the futures contract and the price of the
underlying commodity.
Note 7--The Fund invests in foreign securities. Investments in foreign
securities may involve a greater degree of risk than investments in domestic
securities due to political, economic or social instability. In addition, some
foreign companies are not generally subject to the same uniform accounting,
auditing and financial rules as are American companies, and there may be less
governmental supervision and regulation. Foreign investments may also be
subject to foreign taxes, dividend collection fees and settlement delays.
<PAGE>
Gold Opportunity Fund
- -------------------------------------------------------------------------------
The Fund may concentrate its investments in companies which are significantly
engaged in the exploration, development, production or distribution of gold and
other metals, minerals, oil, natural gas and coal, and by investing in gold
bullion and coins. Since the Fund may so concentrate, it may be subject to
greater risks and market fluctuations than other more diversified portfolios.
The production and marketing of gold and other natural resources may be
affected by actions and changes in governments. In addition, gold and natural
resources securities may be cyclical in nature.
- -------------------------------------------------------------------------------
Report of Independent Accountants
To the Board of Trustees and Shareholders of the
Van Eck Funds:
We have audited the accompanying statement of assets and liabilities, including
the investment portfolio, of the Gold Opportunity Fund (the "Fund") (one of the
series constituting the Van Eck Funds) as of December 31, 1995, and the related
statement of operations, changes in net assets and the financial highlights for
the period January 5, 1995 (commencement of operations) to December 31, 1995.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides 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 the
Gold Opportunity Fund series of the Van Eck Funds as of December 31, 1995, and
the results of its operations, changes in its net assets, and the financial
highlights for the period January 5, 1995 (commencement of operations) to
December 31, 1995, in conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
New York, New York
February 12, 1996
<PAGE>
VAN ECK FAMILY OF FUNDs
- -------------------------------------------------------------------------------
Global Hard Assets Fund
Seeks long-term capital appreciation by investing globally, primarily in
"Hard Asset Securities". Income is a secondary consideration.
International Investors Gold Fund
Founded in 1955, this Fund is the oldest gold-oriented mutual fund in the U.S.
It invests in gold-mining shares globally and seeks long-term capital
appreciation, moderate yield and protection against monetary uncertainties.
Gold/Resources Fund
Seeking a long-term global hedge against inflation and other risks, this Fund
invests in gold-mining and natural resources companies outside South Africa.
Gold Opportunity Fund
Seeks capital appreciation by investing globally in equity securities of
companies engaged in the exploration, development, production and distribution
of gold and other precious metals, and through active asset allocation between
gold-related assets and cash instruments.
Asia Dynasty Fund
This Fund seeks long-term capital appreciation by investing in the equity
securities of companies that are expected to benefit from the development and
growth of the economies in the Asia Region. AIG Global Investment Corp. serves
as sub-investment advisor to this Fund.
Asia Infrastructure Fund
Seeks long-term capital appreciation by investing in the equity securities of
infrastructure companies that are expected to benefit from the development and
growth of the economies in the Asia Region. AIG Global Investment Corp. serves
as sub-investment advisor to this Fund.
Global Balanced Fund
This Fund seeks long-term capital appreciation together with current income by
investing in stocks, bonds and money market instruments worldwide. Fiduciary
International, Inc. serves as sub-investment advisor to this Fund.
Global Income Fund
This Fund seeks high total return through a flexible policy of investing
globally, primarily in debt securities.
U.S. Government Money Fund
This Fund seeks the highest safety of principal and daily liquidity by
investing in U.S. Treasury bills and repurchase agreements collateralized by
U.S. Government obligations.
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This report must be accompanied or preceded by a Van Eck Gold & Money Funds
prospectus which includes more complete information such as charges and
expenses and the risks associated with international investing including
currency fluctuations or controls, expropriation, nationalization and
confiscatory taxation. For a free Van Eck Global Funds prospectus, please call
the number listed below. Please read the prospectus before investing.
[Van Eck Global Logo]
X96-0130-006
Van Eck Securities Corporation
99 Park Avenue, New York, NY 10016
For account assistance please call (800) 544-4653
