<PAGE> 1
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
Two World Trade Center, New York, New York 10048
LETTER TO THE SHAREHOLDERS March 31, 1999
DEAR SHAREHOLDER:
The six-month period ended March 31, 1999, saw U.S. equity markets rally to
record highs amid continued global economic uncertainty. During this period, the
Standard & Poor's 500 Composite Stock Price Index (S&P 500) gained more than 27
percent, led by surging growth and technology stocks. Solid corporate earnings
results, combined with low inflation, unemployment, and interest rates,
bolstered investor confidence and helped the market rebound from its late-summer
correction. The convertible market also bounced back during the period as
underlying equities improved and investors clamored to buy attractive new
technology issues.
PERFORMANCE
For the period under review, Morgan Stanley Dean Witter Convertible Securities
Trust's Class B shares posted a total return of 9.68 percent, compared to 15.69
percent for the Goldman Sachs Convertible 100 Index and 13.70 percent for the
Lipper Convertible Securities Funds Average. During the same period, the Fund's
Class A, C and D shares returned 10.25 percent, 9.72 percent and 10.33 percent,
respectively. The performance of the Fund's four share classes varies because of
differing expenses.
The Fund's underperformance relative to its peer group and benchmark index was
due primarily to its emphasis on small-capitalization issues, which continued to
underperform the large-caps. The relative weakness of small-caps and ongoing
liquidity problems continue to plague the small-cap convertible market.
On the positive side, narrowing credit spreads increased the attractiveness of
lower-quality, higher-yielding issues, though spreads remain at historically
wide levels. Also, the Fund's increasing involvement in higher-quality large-cap
growth and technology issues provided it some participation in the large-cap
equity rally that occurred during the period.
<PAGE> 2
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
LETTER TO THE SHAREHOLDERS March 31, 1999, continued
INVESTMENT STRATEGY
The Fund uses a value-oriented, bottom-up approach to evaluate companies and
their investment merits. The Fund's emphasis is on companies and industries with
strong underlying fundamentals and solid long-term growth potential. We invest
primarily in small- and medium-capitalization companies that issue convertible
securities which we believe offer excellent participation in a rising equity
market and downside protection in a declining one. The Fund has recently
increased its exposure to large-cap convertibles to provide better credit
stability and greater equity participation where the underlying equity
fundamentals are attractive.
In an attempt to minimize volatility, the Fund generally concentrates on issues
with shorter maturities while diversifying its assets across a wide range of
industries. The Fund also searches for convertible securities with good
risk/reward characteristics. These features include a relatively high yield to
support the convertible if the underlying stock declines and a reasonable
conversion premium to ensure participation in any appreciation of the underlying
stock.
LOOKING AHEAD
We believe that the convertible market overall, and the small-cap convertible
market in particular, will remain highly attractive from a risk/reward
perspective. We expect that convertibles will perform well over the long run,
offering potentially superior returns in modestly increasing, stable or
declining equity markets, although they may lag equities during periods of
strong stock market performance.
On May 1, 1999, Mitchell M. Merin was named President of the Morgan Stanley Dean
Witter Funds. Mr. Merin is also the President and Chief Operating Officer of
Asset Management of Morgan Stanley Dean Witter & Co., and President, Chief
Executive Officer and Director of Morgan Stanley Dean Witter Advisors Inc., the
Fund's Investment Manager. He also serves as Chairman, Chief Executive Officer
and Director of the Fund's distributor and transfer agent.
We appreciate your ongoing support of Morgan Stanley Dean Witter Convertible
Securities Trust and look forward to continuing to serve your investment needs.
Very truly yours,
/S/ CHARLES A. FIUMEFREDDO /S/ MITCHELL M. MERIN
CHARLES A. FIUMEFREDDO MITCHELL M. MERIN
Chairman of the Board President
2
<PAGE> 3
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
CONVERTIBLE BONDS (59.6%)
Advertising (1.0%)
$ 2,000 Doubleclick Inc. - 144A**............ 4.75% 03/15/06 $ 2,504,240
------------
Aerospace (1.2%)
4,000 Spacehab, Inc. - 144A**.............. 8.00 10/15/07 3,120,000
------------
Assisted Living Services (1.2%)
2,000 Assisted Living Concepts,
Inc. - 144A**....................... 5.625 05/01/03 1,140,000
2,540 Emeritus Corp. - 144A**.............. 6.25 01/01/06 1,749,425
------------
2,889,425
------------
Auto Parts: O.E.M. (2.6%)
2,000 Magna International, Inc. (Canada) -
144A**.............................. 4.875 02/15/05 2,006,260
5,750 MascoTech, Inc. ..................... 4.50 12/15/03 4,485,000
------------
6,491,260
------------
Biotechnology (3.7%)
2,500 Centocor Inc. ....................... 4.75 02/15/05 2,435,250
2,000 Chiron Corp. ........................ 1.90 11/17/00 1,934,960
8,500 Elan Finance Corp. - 144A**.......... 0.00 12/14/18 4,867,950
------------
9,238,160
------------
Broadcasting (2.4%)
5,000 Scandinavian Broadcasting System SA
(Luxembourg)........................ 7.00 12/01/04 6,124,100
------------
Cable Television (3.0%)
6,500 Tele-Communications International,
Inc. ............................... 4.50 02/15/06 7,401,680
------------
Catalog/Specialty Distribution (1.8%)
3,500 Amazon.com Inc. - 144A**............. 4.75 02/01/09 4,398,135
------------
Cellular Telephone (1.6%)
8,770 U.S. Cellular Corp. ................. 0.00 06/15/15 4,008,942
------------
Clothing/Shoe/Accessory Stores (1.7%)
3,200 Genesco Inc. ........................ 5.50 04/15/05 2,430,176
2,500 The Sports Authority, Inc. .......... 5.25 09/15/01 1,765,900
------------
4,196,076
------------
Computer Hardware (0.9%)
4,000 Hewlett-Packard Co. ................. 0.00 10/14/17 2,238,320
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE> 4
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Computer Software (1.1%)
$ 8,000 Citrix Systems, Inc. - 144A**........ 0.00% 03/22/19 $ 2,695,280
------------
Consumer/Business Services (1.0%)
2,000 Data Processing Resource............. 5.25 04/01/05 1,402,280
1,500 Interim Services Inc. ............... 4.50 06/01/05 1,161,360
------------
2,563,640
------------
Contract Drilling (0.9%)
9,000 Pride International, Inc. ........... 0.00 04/24/18 2,240,370
------------
E.D.P. Peripherals (0.5%)
1,500 Quantum Corp. ....................... 7.00 08/01/04 1,359,375
------------
E.D.P. Services (1.8%)
3,000 May & Speh, Inc. .................... 5.25 04/01/03 4,462,650
------------
Electronic Components (1.2%)
6,000 Solectron Corp. - 144A**............. 0.00 01/27/19 2,952,840
------------
Electronic Distributors (1.2%)
1,500 Cellstar Corp. ...................... 5.00 10/15/02 1,155,345
4,000 Reptron Electronics, Inc. ........... 6.75 08/01/04 1,790,000
------------
2,945,345
------------
Electronic Production Equipment
(1.7%)
3,000 Cymer Inc. .......................... 3.50+ 08/06/04 2,402,100
2,500 Integrated Process Equipment
Corp. .............................. 6.25 09/15/04 1,856,250
------------
4,258,350
------------
Engineering & Construction (1.4%)
4,000 Emcor Group, Inc. ................... 5.75 04/01/05 3,423,720
------------
Finance Companies (0.0%)
1,000 Cityscape Financial Corp. (a)........ 6.00 05/01/06 1,250
1,000 Cityscape Financial Corp. (Eurobond)
(a)................................. 6.00 05/01/06 1,250
2,500 Cityscape Financial Corp. - 144A**
(a)................................. 6.00 05/01/06 3,125
------------
5,625
------------
Food Chains (0.8%)
6,000 Whole Foods Market Inc. ............. 0.00 03/02/18 1,968,720
------------
Home Building (0.8%)
4,300 Lennar Corp. ........................ 0.00 07/29/18 1,891,441
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE> 5
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Hospital/Nursing Management (0.4%)
$ 2,500 ARV Assisted Living, Inc. ........... 6.75% 04/01/06 $ 950,000
------------
Hotels/Resorts (0.5%)
1,900 Sholodge, Inc. ...................... 7.50 05/01/04 1,146,175
------------
Internet Services (1.7%)
4,000 At Home Corp. - 144A**............... 0.525 12/28/18 4,180,000
------------
Major U.S. Telecommunications (3.2%)
2,500 Bell Atlantic Financial
Service - 144A** (exchangeable into
Cable & Wireless Communications
common stock)....................... 4.25 09/15/05 2,729,375
5,000 Bell Atlantic Financial
Service - 144A** (exchangeable into
Telecom Corporation of New Zealand
common stock)....................... 5.75 04/01/03 5,306,250
1,750 SA Telecommunications, Inc. - 144A**
(a)................................. 10.00 08/15/06 52,500
------------
8,088,125
------------
Managed Health Care (1.9%)
3,000 Concentra Managed Care, Inc. ........ 4.50 03/15/03 2,818,290
2,000 Greenery Rehabilitation Group,
Inc. ............................... 8.75 04/01/15 2,005,000
------------
4,823,290
------------
Medical Equipment & Supplies (0.7%)
2,635 ThermoTrex Corp. .................... 3.25 11/01/07 1,744,107
------------
Medical/Nursing Services (3.1%)
2,000 Continucare Corp. - 144A**........... 8.00 10/31/02 590,000
3,500 Healthsouth Corp. ................... 3.25 04/01/03 2,849,210
4,560 Quantum Health Resources, Inc. ...... 4.75 10/01/00 4,334,827
------------
7,774,037
------------
Movies/Entertainment (0.7%)
2,000 Sportsline USA, Inc. - 144A**........ 5.00 04/01/06 1,837,500
------------
Other Pharmaceuticals (0.5%)
1,000 Sepracor Inc. - 144A**............... 7.00 12/15/05 1,160,390
------------
Precision Instruments (0.5%)
1,500 Thermo Instrument Systems, Inc. -
144A**.............................. 4.50 10/15/03 1,351,410
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE> 6
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Real Estate Investment Trusts (3.1%)
$ 2,290 Capstar Hotel Corp. ................. 4.75% 10/15/04 $ 1,719,103
2,650 Centertrust Retail Properties (Series
A).................................. 7.50 01/15/01 2,464,500
4,000 Macerich Company (Eurobond).......... 7.25 12/15/02 3,640,000
------------
7,823,603
------------
Rental/Leasing Companies (1.0%)
3,000 Financial Federal Corp. ............. 4.50 05/01/05 2,602,620
------------
Restaurants (0.7%)
1,700 Hometown Buffet, Inc. ............... 7.00 12/01/02 1,704,896
------------
Semiconductors (2.2%)
2,000 Cirrus Logic, Inc. .................. 6.00 12/15/03 1,356,080
1,000 Level One Communications, Inc. ...... 4.00 09/01/04 1,961,130
2,000 Micron Technology Inc. .............. 7.00 07/01/04 2,130,280
------------
5,447,490
------------
Shoe Manufacturing (2.7%)
7,075 Nine West Group, Inc. ............... 5.50 07/15/03 6,650,500
------------
Telecommunications (2.9%)
3,000 Global Telesystems Group, Inc. ...... 5.75 07/01/10 3,528,300
2,500 NTL Inc. - 144A**.................... 7.00 12/15/08 3,787,500
------------
7,315,800
------------
Telecommunications Equipment (0.3%)
500 Comverse Technology Inc. ............ 4.50 07/01/05 728,000
------------
TOTAL CONVERTIBLE BONDS
(Identified Cost $157,386,802)........................... 148,705,637
------------
NUMBER OF
SHARES
- --------
CONVERTIBLE PREFERRED STOCKS (34.4%)
Apparel (0.9%)
65,800 Warnaco Group, Inc. $3.00................................ 2,352,350
------------
Auto Parts: O.E.M. (0.4%)
120,000 BTI Capital Trust $3.25 - 144A**......................... 1,065,000
------------
Biotechnology (0.7%)
63,500 Gensia Sicor, Inc. $3.75................................. 1,643,062
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE> 7
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Broadcasting (2.6%)
97,000 Sinclair Broadcasting Group, Inc. $3.00.................. $ 3,958,813
242,000 Triathlon Broadcasting Co. $0.945........................ 2,541,000
------------
6,499,813
------------
Cable Television (4.5%)
36,000 Comcast Corp. $2.766
(exchangeable for cash based on value of AT&T Corp.
common stock)........................................... 2,863,125
32,400 EchoStar Communications Corp. (Series C) $3.375.......... 5,410,800
35,000 MediaOne Group, Inc. $3.633
(exchangeable into AirTouch Communications, Inc. common
stock).................................................. 2,896,250
------------
11,170,175
------------
Computer Software (2.0%)
51,000 Microsoft Corp. (Series A) $2.197........................ 5,017,125
------------
Electronic Distributors (0.7%)
50,000 Pioneer Standard Electronics, Inc. $3.375................ 1,800,000
------------
Home Building (1.2%)
50,000 Fleetwood Capital Trust $3.00............................ 2,148,450
100,000 Kaufman & Broad Home Corp. $0.825........................ 800,000
------------
2,948,450
------------
Home Furnishings (0.9%)
40,800 Newell Financial Trust I $2.625.......................... 2,307,974
------------
Integrated Oil Companies (0.9%)
40,000 Unocal Corp. $3.125...................................... 2,175,000
------------
International Banks (1.4%)
110,000 National Australia Bank, Ltd. $1.969 (Australia)
(Units) ++.............................................. 3,444,375
------------
Investment Bankers/Brokers/Services (3.4%)
50,000 Merrill Lynch & Co., Inc. $2.39
(exchangeable into IMC Global, Inc. common stock)....... 1,125,000
100,000 Merrill Lynch & Co., Inc. $4.087
(exchangeable into SunAmerica, Inc. common stock)....... 7,400,000
------------
8,525,000
------------
Major Chemicals (1.4%)
75,000 Monsanto Co. $2.60....................................... 3,487,500
------------
Medical/Dental Distributors (0.9%)
60,000 Owens & Minor Trust I (Series A) $2.688.................. 2,160,000
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE> 8
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Military/Gov't/Technical (1.3%)
73,400 Loral Space & Communications Ltd. (Series C) $3.00
(Bermuda)............................................... $ 3,312,175
------------
Movies/Entertainment (1.2%)
111,000 Metromedia International Group, Inc. $3.625.............. 2,969,250
------------
Newspapers (0.9%)
80,000 Tribune Co. $1.746 (exchangeable into The Learning
Company, Inc. common stock)............................. 2,200,000
------------
Oil/Gas Transmission (0.8%)
40,000 El Paso Energy Capital Trust I $2.375.................... 1,925,000
------------
Other Consumer Services (0.9%)
80,000 Cendant Corp. $3.75...................................... 2,305,000
------------
Other Telecommunications (1.9%)
30,000 NEXTLINK Communications, Inc. $3.25...................... 2,095,320
60,000 Winstar Communications, Inc. (Series D) $3.50............ 2,692,500
------------
4,787,820
------------
Railroads (1.4%)
10,000 Union Pacific Capital Trust $3.125....................... 507,660
60,000 Union Pacific Capital Trust $3.125 - 144A**.............. 3,045,960
------------
3,553,620
------------
Real Estate Investment Trusts (2.8%)
80,000 Equity Office Properties Trust (Series B)
$2.625 - 144A**......................................... 3,135,040
98,940 FelCor Lodging Trust, Inc. (Series A) $1.95.............. 2,090,108
85,000 Reckson Associates Reality Corp. (Series A) $1.906....... 1,731,875
------------
6,957,023
------------
Rental/Leasing Companies (1.3%)
70,000 United Rentals Trust I $3.25 - 144A**.................... 3,117,170
------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(Identified Cost $91,505,461)............................ 85,722,882
------------
COMMON STOCKS (2.0%)
Apparel (1.4%)
170,000 Tropical Sportswear International, Corp.*................ 3,400,000
------------
Casino/Gambling (0.2%)
144,285 Alliance Gaming Corp.*................................... 613,211
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
8
<PAGE> 9
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
PORTFOLIO OF INVESTMENTS March 31, 1999 (unaudited) continued
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Newspapers (0.4%)
70,000 Hollinger International, Inc. (Class A).................. $ 949,375
------------
TOTAL COMMON STOCKS
(Identified Cost $4,636,290)............................. 4,962,586
------------
PRINICIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE
- -------- ------ --------
SHORT-TERM INVESTMENTS (3.4%)
U.S. GOVERNMENT AGENCY (b) (0.8%)
$ 2,000 Federal Farm Credit Bank (Amortized
Cost $1,998,404).................... 4.79% 04/07/99 1,998,404
------------
REPURCHASE AGREEMENT (2.6%)
6,456 The Bank of New York (dated 03/31/99;
proceeds $6,457,215) (c) (Identified
Cost $6,456,340).................... 4.875 04/01/99 6,456,340
------------
TOTAL SHORT-TERM INVESTMENTS
(Identified Cost $8,454,744)............................. 8,454,744
------------
TOTAL INVESTMENTS
(Identified Cost $261,983,297) (d).............. 99.4% 247,845,849
OTHER ASSETS IN EXCESS OF LIABILITIES............. 0.6 1,547,118
----- ------------
NET ASSETS....................................... 100.0% $249,392,967
===== ============
</TABLE>
- ---------------------
<TABLE>
<C> <S>
* Non-income producing security.
** Resale is restricted to qualified institutional investors.
+ Variable rate security; rate shown is the rate in effect at
March 31, 1999.
++ Consists of more than one class of securities traded
together as a unit; stocks with attached warrants.
(a) Non-income producing security; bond in default.
(b) Security was purchased on a discount basis. The interest
rate shown has been adjusted to reflect a money market
equivalent yield.
(c) Collateralized by $5,129,023 U.S. Treasury Bond 8.00% due
11/15/21 valued at $6,585,467.
(d) The aggregate cost for federal income tax purposes
approximates identified cost. The aggregate gross unrealized
appreciation is $23,432,306 and the aggregate gross
unrealized depreciation is $37,569,754, resulting in net
unrealized depreciation of $14,137,448.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
9
<PAGE> 10
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL STATEMENTS
<TABLE>
<S> <C>
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1999 (unaudited)
ASSETS:
Investments in securities, at value (identified cost
$261,983,297).............................................. $ 247,845,849
Receivable for:
Interest................................................ 2,249,276
Dividends............................................... 86,385
Shares of beneficial interest sold...................... 78,999
Prepaid expenses and other assets........................... 69,405
-------------
TOTAL ASSETS............................................ 250,329,914
-------------
LIABILITIES:
Payable for:
Shares of beneficial interest repurchased............... 352,886
Plan of distribution fee................................ 226,032
Investment management fee............................... 137,083
Dividends and distributions to shareholders............. 110,384
Accrued expenses and other payables......................... 110,562
-------------
TOTAL LIABILITIES....................................... 936,947
-------------
NET ASSETS.............................................. $ 249,392,967
=============
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................. $ 381,945,040
Net unrealized depreciation................................. (14,137,448)
Accumulated undistributed net investment income............. 6,403,089
Accumulated net realized loss............................... (124,817,714)
-------------
NET ASSETS.............................................. $ 249,392,967
=============
CLASS A SHARES:
Net Assets.................................................. $1,044,810
Shares Outstanding (unlimited authorized, $.01 par value)... 78,860
NET ASSET VALUE PER SHARE............................... $13.25
=============
MAXIMUM OFFERING PRICE PER SHARE,
(net asset value plus 5.54% of net asset value)......... $13.98
=============
CLASS B SHARES:
Net Assets.................................................. $ 245,595,235
Shares Outstanding (unlimited authorized, $.01 par value)... 18,531,028
NET ASSET VALUE PER SHARE............................... $13.25
=============
CLASS C SHARES:
Net Assets.................................................. $2,731,724
Shares Outstanding (unlimited authorized, $.01 par value)... 206,603
NET ASSET VALUE PER SHARE............................... $13.22
=============
CLASS D SHARES:
Net Assets.................................................. $21,198
Shares Outstanding (unlimited authorized, $.01 par value)... 1,600
NET ASSET VALUE PER SHARE............................... $13.25
=============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
10
<PAGE> 11
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL STATEMENTS, continued
<TABLE>
<S> <C>
STATEMENT OF OPERATIONS
For the six months ended March 31, 1999 (unaudited)
NET INVESTMENT INCOME:
INCOME
Interest.................................................... $ 5,622,507
Dividends................................................... 3,630,965
-----------
TOTAL INCOME............................................ 9,253,472
-----------
EXPENSES
Plan of distribution fee (Class A shares)................... 802
Plan of distribution fee (Class B shares)................... 1,287,963
Plan of distribution fee (Class C shares)................... 14,034
Investment management fee................................... 791,805
Transfer agent fees and expenses............................ 202,246
Shareholder reports and notices............................. 42,342
Registration fees........................................... 35,502
Professional fees........................................... 31,942
Custodian fees.............................................. 12,716
Trustees' fees and expenses................................. 9,565
Other....................................................... 5,575
-----------
TOTAL EXPENSES.......................................... 2,434,492
-----------
NET INVESTMENT INCOME................................... 6,818,980
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized loss........................................... (14,589,010)
Net change in unrealized depreciation....................... 32,363,028
-----------
NET GAIN................................................ 17,774,018
-----------
NET INCREASE................................................ $24,592,998
===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE> 12
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL STATEMENTS, continued
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX
MONTHS ENDED FOR THE YEAR
MARCH 31, ENDED
1999 SEPTEMBER 30, 1998
- ---------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income.............................. $ 6,818,980 $ 14,325,883
Net realized gain (loss)........................... (14,589,010) 7,466,716
Net change in unrealized appreciation/depreciation. 32,363,028 (67,299,872)
------------ ------------
NET INCREASE (DECREASE)........................ 24,592,998 (45,507,273)
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM NET INVESTMENT
INCOME:
Class A shares..................................... (35,563) (35,198)
Class B shares..................................... (7,637,289) (12,386,068)
Class C shares..................................... (85,756) (89,566)
Class D shares..................................... (64,137) (116,323)
------------ ------------
TOTAL DIVIDENDS................................ (7,822,745) (12,627,155)
------------ ------------
Net increase (decrease) from transactions in shares
of beneficial interest............................ (35,869,359) 9,302,728
------------ ------------
NET DECREASE................................... (19,099,106) (48,831,700)
NET ASSETS:
Beginning of period................................ 268,492,073 317,323,773
------------ ------------
END OF PERIOD
(Including undistributed net investment income
of $6,403,089 and $7,406,854, respectively).... $249,392,967 $268,492,073
============ ============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE> 13
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited)
1. ORGANIZATION AND ACCOUNTING POLICIES
Morgan Stanley Dean Witter Convertible Securities Trust (the "Fund") is
registered under the Investment Company Act of 1940, as amended (the "Act"), as
a diversified, open-end management investment company. The Fund's investment
objective is to seek a high level of total return on its assets through a
combination of current income and capital appreciation. The Fund was organized
as a Massachusetts business trust on May 21, 1985 and commenced operations on
October 31, 1985. On July 28, 1997, the Fund converted to a multiple class share
structure.
The Fund offers Class A shares, Class B shares, Class C shares and Class D
shares. The four classes are substantially the same except that most Class A
shares are subject to a sales charge imposed at the time of purchase and some
Class A shares, and most Class B shares and Class C shares are subject to a
contingent deferred sales charge imposed on shares redeemed within one year, six
years and one year, respectively. Class D shares are not subject to a sales
charge. Additionally, Class A shares, Class B shares and Class C shares incur
distribution expenses.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ from
those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at its
latest sale price on that exchange prior to the time when assets are valued; if
there were no sales that day, the security is valued at the latest bid price (in
cases where a security is traded on more than one exchange, the security is
valued on the exchange designated as the primary market pursuant to procedures
adopted by the Trustees); (2) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (3) when market
quotations are not readily available, including circumstances under which it is
determined by Morgan Stanley Dean Witter Advisors Inc. (the "Investment
Manager") that sale and bid prices are not reflective of a security's market
value, portfolio securities are valued at their fair value as determined in good
faith under procedures established by and under the general supervision of the
Trustees (valuation of debt securities for which market quotations are not
readily available may be based upon current market prices of securities which
are comparable in coupon, rating and maturity or an appropriate matrix utilizing
similar factors); (4) certain portfolio securities may be valued by an outside
pricing service
13
<PAGE> 14
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited) continued
approved by the Trustees. The pricing service may utilize a matrix system
incorporating security quality, maturity and coupon as the evaluation model
parameters, and/or research and evaluations by its staff, including review of
broker-dealer market price quotations, if available, in determining what it
believes is the fair valuation of the portfolio securities valued by such
pricing service; and (5) short-term debt securities having a maturity date of
more than sixty days at time of purchase are valued on a mark-to-market basis
until sixty days prior to maturity and thereafter at amortized cost based on
their value on the 61st day. Short-term debt securities having a maturity date
of sixty days or less at the time of purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Dividend income and other distributions are recorded on the ex-dividend date.
Discounts are accreted over the life of the respective securities. Interest
income is accrued daily.
C. MULTIPLE CLASS ALLOCATIONS -- Investment income, expenses (other than
distribution fees), and realized and unrealized gains and losses are allocated
to each class of shares based upon the relative net asset value on the date such
items are recognized. Distribution fees are charged directly to the respective
class.
D. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
E. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions to its shareholders on the record date. The amount of dividends
and distributions from net investment income and net realized capital gains are
determined in accordance with federal income tax regulations which may differ
from generally accepted accounting principles. 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. Dividends and distributions which
exceed net investment income and net realized capital gains for financial
reporting purposes but not for tax purposes are reported as dividends in excess
of net investment income or distributions in excess of net realized capital
gains. To the extent they exceed net investment income and net realized capital
gains for tax purposes, they are reported as distributions of paid-in-capital.
14
<PAGE> 15
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited) continued
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement with the Investment Manager, the
Fund pays the Investment Manager a management fee, accrued daily and payable
monthly, by applying the following annual rates to the Fund's net assets
determined as of the close of each business day: 0.60% to the portion of the
daily net assets not exceeding $750 million; 0.55% to the portion of the daily
net assets exceeding $750 million but not exceeding $1 billion; 0.50% to the
portion of daily net assets exceeding $1 billion but not exceeding $1.5 billion;
0.475% to the portion of daily net assets exceeding $1.5 billion but not
exceeding $2 billion; 0.45% to the portion of daily net assets exceeding $2
billion but not exceeding $3 billion; and 0.425% to the portion of daily net
assets exceeding $3 billion.
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities, equipment,
clerical, bookkeeping and certain legal services and pays the salaries of all
personnel, including officers of the Fund who are employees of the Investment
Manager. The Investment Manager also bears the cost of telephone services, heat,
light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Morgan Stanley Dean Witter Distributors
Inc. (the "Distributor"), an affiliate of the Investment Manager. The Fund has
adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the
Act. The Plan provides that the Fund will pay the Distributor a fee which is
accrued daily and paid monthly at the following annual rates: (i) Class A -- up
to 0.25% of the average daily net assets of Class A; (ii) Class B -- 1.0% of the
lesser of: (a) the average daily aggregate gross sales of the Class B shares
since the inception of the Fund (not including reinvestment of dividend or
capital gain distributions) less the average daily aggregate net asset value of
the Class B shares redeemed since the Fund's inception upon which a contingent
deferred sales charge has been imposed or waived; or (b) the average daily net
assets of Class B; and (iii) Class C -- up to 1.0% of the average daily net
assets of Class C. In the case of Class A shares, amounts paid under the Plan
are paid to the Distributor for services provided. In the case of Class B and
Class C shares, amounts paid under the Plan are paid to the Distributor for (1)
services provided and the expenses borne by it and others in the distribution of
the shares of these Classes, including the payment of commissions for sales of
these Classes and incentive compensation to, and expenses of, Morgan Stanley
Dean Witter Financial Advisors and others who engage in or support distribution
of the shares or who service
15
<PAGE> 16
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited) continued
shareholder accounts, including overhead and telephone expenses; (2) printing
and distribution of prospectuses and reports used in connection with the
offering of these shares to other than current shareholders; and (3)
preparation, printing and distribution of sales literature and advertising
materials. In addition, the Distributor may utilize fees paid pursuant to the
Plan, in the case of Class B shares, to compensate Dean Witter Reynolds Inc.
("DWR"), an affiliate of the Investment Manager and Distributor, and other
selected broker-dealers for their opportunity costs in advancing such amounts,
which compensation would be in the form of a carrying charge on any unreimbursed
expenses.
In the case of Class B shares, provided that the Plan continues in effect, any
cumulative expenses incurred by the Distributor but not yet recovered may be
recovered through the payment of future distribution fees from the Fund pursuant
to the Plan and contingent deferred sales charges paid by investors upon
redemption of Class B shares. Although there is no legal obligation for the Fund
to pay expenses incurred in excess of payments made to the Distributor under the
Plan and the proceeds of contingent deferred sales charges paid by investors
upon redemption of shares, if for any reason the Plan is terminated, the
Trustees will consider at that time the manner in which to treat such expenses.
The Distributor has advised the Fund that such excess amounts, including
carrying charges, totaled $81,956,908 at March 31, 1999.
In the case of Class A shares and Class C shares, expenses incurred pursuant to
the Plan in any calendar year in excess of 0.25% or 1.0% of the average daily
net assets of Class A or Class C, respectively, will not be reimbursed by the
Fund through payments in any subsequent year, except that expenses representing
a gross sales credit to Morgan Stanley Dean Witter Financial Advisors or other
selected broker-dealer representatives may be reimbursed in the subsequent
calendar year. For the six months ended March 31, 1999, the distribution fee was
accrued for Class A shares and Class C shares at the annual rate of 0.15% and
1.0%, respectively.
The Distributor has informed the Fund that for the six months ended March 31,
1999, it received contingent deferred sales charges from certain redemptions of
the Fund's Class A shares, Class B shares and Class C shares of $101, $174,975
and $602 respectively and received $5,096 in front-end sales charges from sales
of the Fund's Class A shares. The respective shareholders pay such charges which
are not an expense of the Fund.
16
<PAGE> 17
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited) continued
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities, excluding
short-term investments, for the six months ended March 31, 1999 aggregated
$88,162,031 and $111,819,121, respectively.
For the six months ended March 31, 1999, the Fund incurred brokerage commissions
of $3,807 with DWR for portfolio transactions executed on behalf of the Fund.
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At March 31, 1999, the Fund had
transfer agent fees and expenses payable of approximately $9,500.
The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Trustees of the Fund who will have served as independent
Trustees for at least five years at the time of retirement. Benefits under this
plan are based on years of service and compensation during the last five years
of service. Aggregate pension costs for the six months ended March 31, 1999
included in Trustees' fees and expenses in the Statement of Operations amounted
to $3,072. At March 31, 1999, the Fund had an accrued pension liability of
$52,131 which is included in accrued expenses in the Statement of Assets and
Liabilities.
5. FEDERAL INCOME TAX STATUS
At September 30, 1998, the Fund had a net capital loss carryover of
approximately $108,866,000 of which $46,135,000 will be available through
September 30, 1999 and $62,731,000 will be available through September 30, 2000
to offset future capital gains to the extent provided by regulations.
Capital losses incurred after October 31 ("post-October" losses) within the
taxable year are deemed to arise on the first business day of the Fund's next
taxable year. The Fund incurred and will elect to defer net capital losses of
approximately $1,307,000 during fiscal 1998.
As of September 30, 1998, the Fund had temporary book/tax differences primarily
attributable to post-October losses.
17
<PAGE> 18
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1999 (unaudited) continued
6. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
MARCH 31, 1999 SEPTEMBER 30, 1998
------------------------- -------------------------
(unaudited)
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
CLASS A SHARES
Sold........................................................ 143,138 $ 1,886,665 92,001 $ 1,349,947
Reinvestment of dividends................................... 2,182 28,132 2,116 29,640
Redeemed.................................................... (143,816) (1,907,474) (20,090) (277,904)
---------- ------------ ---------- ------------
Net increase - Class A...................................... 1,504 7,323 74,027 1,101,683
---------- ------------ ---------- ------------
CLASS B SHARES
Sold........................................................ 935,029 12,165,842 4,637,313 68,850,146
Reinvestment of dividends................................... 472,642 6,095,724 701,336 9,971,800
Redeemed.................................................... (4,029,795) (52,490,181) (5,189,588) (75,033,986)
---------- ------------ ---------- ------------
Net increase (decrease) - Class B........................... (2,622,124) (34,228,615) 149,061 3,787,960
---------- ------------ ---------- ------------
CLASS C SHARES
Sold........................................................ 69,240 879,830 213,545 3,143,678
Reinvestment of dividends................................... 5,074 65,283 4,574 64,248
Redeemed.................................................... (60,032) (773,144) (66,982) (917,694)
---------- ------------ ---------- ------------
Net increase - Class C...................................... 14,282 171,969 151,137 2,290,232
---------- ------------ ---------- ------------
CLASS D SHARES
Sold........................................................ 88,216 1,145,065 201,768 2,963,943
Reinvestment of dividends................................... 56 730 103 1,480
Redeemed.................................................... (222,993) (2,965,831) (66,930) (842,570)
---------- ------------ ---------- ------------
Net increase (decrease) - Class D........................... (134,721) (1,820,036) 134,941 2,122,853
---------- ------------ ---------- ------------
Net increase (decrease) in Fund............................. (2,741,059) $(35,869,359) 509,166 $ 9,302,728
========== ============ ========== ============
</TABLE>
18
<PAGE> 19
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR ENDED SEPTEMBER 30,
MONTHS ENDED --------------------------------------------------------
MARCH 31, 1999++ 1998++ 1997*++ 1996 1995 1994
- ---------------------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
SELECTED PER SHARE DATA:
Net asset value, beginning of period........... $12.45 $15.07 $12.72 $11.67 $10.75 $10.62
------ ------ ------ ------ ------ ------
Income (loss) from investment operations:
Net investment income......................... 0.33 0.65 0.60 0.55 0.60 0.42
Net realized and unrealized gain (loss)....... 0.86 (2.70) 2.31 1.12 0.82 0.11
------ ------ ------ ------ ------ ------
Total income (loss) from investment
operations.................................... 1.19 (2.05) 2.91 1.67 1.42 0.53
------ ------ ------ ------ ------ ------
Less dividends from net investment income...... (0.39) (0.57) (0.56) (0.62) (0.50) (0.40)
------ ------ ------ ------ ------ ------
Net asset value, end of period................. $13.25 $12.45 $15.07 $12.72 $11.67 $10.75
====== ====== ====== ====== ====== ======
TOTAL RETURN+.................................. 9.68%(1) (14.01)% 23.38% 14.70% 13.68% 5.02%
RATIOS TO AVERAGE NET ASSETS:
Expenses....................................... 1.86%(2)(3) 1.81%(3) 1.84% 1.89% 1.96% 1.93%
Net investment income.......................... 5.15%(2)(3) 4.40%(3) 4.45% 4.78% 5.24% 3.68%
SUPPLEMENTAL DATA:
Net assets, end of period, in millions......... $246 $263 $317 $234 $185 $190
Portfolio turnover rate........................ 36%(1) 95% 182% 171% 138% 184%
</TABLE>
- ---------------------
* Prior to July 28, 1997, the Fund issued one class of shares. All shares of
the Fund held prior to that date have been designated Class B shares.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
19
<PAGE> 20
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL HIGHLIGHTS, continued
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE SIX FOR THE YEAR JULY 28, 1997*
MONTHS ENDED ENDED THROUGH
MARCH 31, 1999 SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
- ------------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C>
CLASS A SHARES++
SELECTED PER SHARE DATA:
Net asset value, beginning of period........................ $12.45 $15.07 $14.31
------ ------ ------
Income (loss) from investment operations:
Net investment income...................................... 0.39 0.75 0.13
Net realized and unrealized gain (loss).................... 0.86 (2.68) 0.78
------ ------ ------
Total income (loss) from investment operations.............. 1.25 (1.93) 0.91
------ ------ ------
Less dividends from net investment income................... (0.45) (0.69) (0.15)
------ ------ ------
Net asset value, end of period.............................. $13.25 $12.45 $15.07
====== ====== ======
TOTAL RETURN+............................................... 10.25%(1) (13.38)% 6.40%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.................................................... 1.01%(2)(3) 1.05%(3) 1.15%(2)
Net investment income....................................... 6.00%(2)(3) 5.16%(3) 5.03%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands..................... $1,045 $963 $50
Portfolio turnover rate..................................... 36%(1) 95% 182%
CLASS C SHARES++
SELECTED PER SHARE DATA:
Net asset value, beginning of period........................ $12.43 $15.06 $14.31
------ ------ ------
Income (loss) from investment operations:
Net investment income...................................... 0.33 0.64 0.12
Net realized and unrealized gain (loss).................... 0.85 (2.68) 0.77
------ ------ ------
Total income (loss) from investment operations.............. 1.18 (2.04) 0.89
------ ------ ------
Less dividends from net investment income................... (0.39) (0.59) (0.14)
------ ------ ------
Net asset value, end of period.............................. $13.22 $12.43 $15.06
====== ====== ======
TOTAL RETURN+............................................... 9.72%(1) (14.07)% 6.26%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.................................................... 1.86%(2)(3) 1.81%(3) 1.92%(2)
Net investment income....................................... 5.15%(2)(3) 4.40%(3) 4.52%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands..................... $2,732 $2,390 $620
Portfolio turnover rate..................................... 36%(1) 95% 182%
</TABLE>
- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charge. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
20
<PAGE> 21
MORGAN STANLEY DEAN WITTER CONVERTIBLE SECURITIES TRUST
FINANCIAL HIGHLIGHTS, continued
<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE SIX FOR THE YEAR JULY 28, 1997*
MONTHS ENDED ENDED THROUGH
MARCH 31, 1999 SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
- ------------------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C>
CLASS D SHARES ++
SELECTED PER SHARE DATA:
Net asset value, beginning of period........................ $12.44 $15.08 $14.31
------ ------ ------
Income (loss) from investment operations:
Net investment income...................................... 0.40 0.79 0.13
Net realized and unrealized gain (loss).................... 0.87 (2.71) 0.80
------ ------ ------
Total income (loss) from investment operations.............. 1.27 (1.92) 0.93
------ ------ ------
Less dividends from net investment income................... (0.46) (0.72) (0.16)
------ ------ ------
Net asset value, end of period.............................. $13.25 $12.44 $15.08
====== ====== ======
TOTAL RETURN+............................................... 10.33%(1) (13.19)% 6.42%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses.................................................... 0.86%(2)(3) 0.81%(3) 0.89%(2)
Net investment income....................................... 6.15%(2)(3) 5.40%(3) 4.94%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands..................... $21 $1,696 $21
Portfolio turnover rate..................................... 36%(1) 95% 182%
</TABLE>
- ---------------------
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Not annualized.
(2) Annualized.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
SEE NOTES TO FINANCIAL STATEMENTS
21
<PAGE> 22
(This Page Intentionally Left Blank)
<PAGE> 23
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
Wayne E. Hedien
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Mitchell M. Merin
President
Barry Fink
Vice President, Secretary and General Counsel
Peter M. Avelar
Vice President
Ellen Gold
Assistant Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Morgan Stanley Dean Witter Trust FSB
Harborside Financial Center -- Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Morgan Stanley Dean Witter Advisors Inc.
Two World Trade Center
New York, New York 10048
The financial statements included herein have been taken from the records of the
Fund without examination by the independent accountants and accordingly they do
not express an opinion thereon.
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and trustees,
fees, expenses and other pertinent information, please see the prospectus of the
Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
MORGAN STANLEY
DEAN WITTER
CONVERTIBLE
SECURITIES TRUST
[MORGAN STANLEY/DEAN WITTER GRAPHIC]
SEMIANNUAL REPORT
MARCH 31, 1999
