<PAGE>
TO THE SHAREHOLDERS:
Pioneer Fund marked the midpoint of its 69th fiscal year on June 30, 1996.
Coming off the stock market's soaring performance of 1995, 1996 has proven to
be a difficult, and sometimes startling, year. The first quarter reintroduced
price swings to the broad stock market. The second quarter saw more frenetic
activity on Wall Street. Investors continued to adjust, or "correct,"
securities prices for the tremendous, marketwide upswing of last year. As we
write, market volatility has reached even higher peaks. Some days have seen
exceedingly intense buying and selling. The contrast is often striking
between our generally routine, day-to-day worklife and the fluctuation in the
value the stock market places on the companies for which many of us work.
What are we doing, we ask, that is so much better or so much worse than what
we did yesterday, or last week?
In large part, the answer has to do with the lag in investors' perception of
important changes that have taken place at companies. Investors are often
responding to an accumulation of news whose import they have suddenly
grasped, rather than to a recent event. Investors also will act on what they
see in a company's future, and that perception, too, may all at once gel in
their minds and induce them to buy aggressively, or rapidly sell, a stock.
The stock market is not actually "crazy," as much as it may seem so at times.
Rather it is a pricing mechanism fueled by bursts of information that may not
always be reliable and oiled by flows of money that are not always
predictable. Add the complexity of matching supply and demand for thousands
of different stocks, and Wall Street may be counted, in fact, among the
all-time economic wonders of the world.
How Your Fund Performed
We are glad to report positive results for Pioneer Fund for the six months
ended June 30, 1996.
(bullet) Net asset value was $26.18 per share at June 30, versus $24.36 on
December 31, 1995, and $25.54 on March 31, 1996.
(bullet) The Fund paid income dividends of $0.10 per share in June and March,
for a total of $0.20 during the first six months of 1996.
(bullet) The Fund produced a total return of 8.30% for the six months,
including 2.90% in the second quarter, based on net asset value and
assuming reinvestment of dividends. By comparison, the unmanaged
Standard & Poor's 500 Index returned 10.08% for the six months
through June 30 and 4.48% in the second quarter. For shareholders
paying the maximum 5.75% sales charge at the beginning of the
period, total return for the six months was 2.06%.
The accompanying table shows results for the Fund over longer time periods.
Average Annual Total Returns
(As of June 30, 1996)
Net Public
Asset Offering
Value Price*
------- -------------
Life of Fund (2/13/28) 12.90% 12.81%
20 Years 13.20 12.86
10 Years 11.55 10.89
5 Years 13.78 12.43
1 Year 19.31 12.46
How Pioneer Managed Your Investment
Activity during recent months reinforced some of the shifts in industry
weightings we started in the second half of last year. In particular, we
further bolstered holdings in financial services, pharmaceuticals and
technology. We sold securities we thought had reached their full price
potential or that we felt offered less attractive prospects than other
securities. The chart on the following page illustrates the Fund's
diversification as of June 30.
*Reflects deduction of the maximum 5.75% sales charge at the beginning of the
period and assumes reinvestment of all distributions at net asset value.
Past performance does not guarantee future results. Returns and share prices
fluctuate, and your shares, when redeemed, may be worth more or less than
their original cost.
<PAGE>
Sector Distribution
(Percentage of equity holdings as of June 30, 1996)
[typeset representation of pie chart]
Consumer Non-Durables 14%
Financial 17%
Services 17%
Transportation 1%
Energy 3%
Consumer Durables 6%
Capital Goods 6%
Basic Industries 9%
Utilities 13%
Technology 14%
[end pie chart]
Throughout the past year, we have continued to pare the number of holdings in
the portfolio. In the most recent quarter, we sold out of 15 companies while
starting positions in 11 new ones, for a net reduction of four. As we have
remarked before, it is our belief that the Fund's performance will benefit
from a closer focus on a shorter list of holdings we believe offer
above-average potential for long-term results.
Additions to the portfolio covered, as usual, a wide range of industries.
Eastman Kodak is the premier photographic film and equipment company in the
United States. New management is making impressive progress toward improving
earnings at this previously "lumbering giant." BankAmerica is the leading
consumer banking institution in California, where the economy at last appears
to be on the road to recovery. H.F. Ahmanson is an important savings and loan
serving that same market.
In the growing health maintenance organization (HMO) industry we added United
Healthcare and Foundation Health. Seagate Technology, prominent manufacturer
of computer information-storage devices, and DST Systems, transaction-service
provider to the mutual fund industry, were additions in the technology
sector. General Electric is prominent in many major industries, including
financial services, aircraft engines, capital goods, home appliances and
broadcasting.
Other new purchases included Santa Fe Pacific Gold, one of the prime
participants in the rich Nevada goldmining industry, and Cummins Engine, an
impressively resilient manufacturer of diesel engines for large trucks and
other heavy equipment. Finally, SBC Communications has been one of the
fastest growing "Baby Bells." Its pending acquisition of Pacific Telesis will
give it a very attractive telecommunications market reach across the
southwestern and western United States.
Looking Ahead
At a special meeting this spring, shareholders of Pioneer Fund voted on a
number of proposals regarding the Fund's management contract, investment
policies and restrictions. The Fund's Trustees carefully considered
shareholders' interests before they recommended that the issues be put to you
for a vote. We are pleased to announce that shareholders approved all of the
proposals. All that being said, we do not expect there to be any significant
changes in the way the Fund is managed. For detailed voting results, please
turn to page 13.
On a final note, we are pleased to announce that we will be giving semiannual
and annual reports a facelift, including easy-to-find and use graphic
summaries. Your annual report dated December 31, 1996, will reflect these
enhancements. We also will be incorporating many of these improvements into
your Fund's quarterly reports, beginning with the report dated September 30,
1996. We wish to thank all of you who took the time to respond to our
questions about what you want to see in fund reports.
On the following pages, please find the audited Schedule of Investments and
financial statements as of June 30, 1996. If you wish to speak to someone
about your investment in Pioneer Fund, please contact your investment
representative, or call us directly at 1-800-225-6292. Thank you for your
continuing support.
Respectfully submitted,
/s/John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman and President,
Pioneer Fund
2
<PAGE>
PIONEER FUND
SCHEDULE OF INVESTMENTS--June 30, 1996
<TABLE>
<CAPTION>
Shares Value
- ---------- -------------
<S> <C> <C>
INVESTMENT IN SECURITIES--99.8%
PREFERRED STOCKS--2.3%
212,300 Delta Air Lines Inc. (Convertible, Series C) $ 13,374,900
1,200,000 Greif Bros. Corp. (Non-voting, Class A) 38,400,000
141,800 Rouse Co., 6.5% (Convertible, Series A) 8,632,075
-------------
TOTAL PREFERRED STOCKS (Cost $19,199,685) $ 60,406,975
-------------
COMMON STOCKS--97.5%
BASIC INDUSTRIES--7.2%
Chemicals--3.2%
268,600 Bush Boake Allen, Inc.* $ 5,842,050
479,000 E.I. du Pont de Nemours and Co. 37,900,875
659,451 Lilly Industrial, Inc. (Class A) 11,210,667
324,525 Quaker Chemical Corp. 4,137,694
1,005,158 A. Schulman, Inc. 24,626,371
-------------
$ 83,717,657
-------------
Forest Products--0.8%
204,000 Consolidated Papers Inc. $ 10,608,000
202,000 Mead Corp. 10,478,750
-------------
$ 21,086,750
-------------
Metals & Mining--2.2%
89,600 Aluminum Co. of America $ 5,140,800
387,500 Barrick Gold Corp. 10,510,937
586,900 Phelps Dodge Corp. 36,607,887
485,200 Santa Fe Pacific Gold Corp. 6,853,450
-------------
$ 59,113,074
-------------
Paper Products--1.0%
379,300 Union Camp Corp. $ 18,490,875
229,600 Westvaco Corp. 6,859,300
-------------
$ 25,350,175
-------------
TOTAL BASIC INDUSTRIES $189,267,656
-------------
CAPITAL GOODS--5.7%
Producer Goods--5.7%
276,500 AlliedSignal, Inc. $ 15,795,063
201,600 Caterpillar, Inc. 13,658,400
81,000 Cummins Engine Co., Inc. 3,270,375
138,500 Deere & Co. 5,540,000
60,000 Dover Corp. 2,767,500
143,128 Hubbell Inc. (Class B) 9,482,230
140,400 Illinois Tool Works 9,494,550
172,200 Ingersoll-Rand Co. 7,533,750
102,100 Johnson Controls, Inc. 7,095,950
261,200 Minnesota Mining and Manufacturing Co. 18,022,800
142,100 Timken Co. 5,506,375
2,860,000 Westinghouse Electric Corp. 53,625,000
-------------
TOTAL CAPITAL GOODS $151,791,993
-------------
CONSUMER DURABLES--6.1%
Motor Vehicles--6.1%
664,300 Chrysler Corp. $ 41,186,600
2,185,000 Ford Motor Co. 70,739,375
482,000 General Motors Corp. 25,244,750
263,000 Genuine Parts Co. 12,032,250
125,700 TRW Inc. 11,297,287
-------------
TOTAL CONSUMER DURABLES $160,500,262
-------------
NON-DURABLES--13.9%
Agriculture & Food--5.5%
213,800 CPC International, Inc. $ 15,393,600
309,900 General Mills, Inc. 16,889,550
855,150 H.J. Heinz & Co. 25,975,181
153,800 Hershey Foods Corp. 11,285,075
660,000 Pepsico, Inc. 23,347,500
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
PIONEER FUND
SCHEDULE OF INVESTMENTS (Continued)
Shares Value
- ---------- -------------
490,550 Quaker Oats Co. $ 16,740,019
888,100 Sara Lee Corp. 28,752,237
217,600 Sysco Corp. 7,452,800
-------------
$145,835,962
-------------
Home Products--0.2%
140,998 Lancaster Colony Corp. $ 5,269,800
-------------
Retail Food--1.3%
500,000 Albertson's, Inc. $ 20,687,500
386,700 Weis Markets, Inc. 12,616,087
-------------
$ 33,303,587
-------------
Retail Non-Food--6.9%
516,900 Circuit City Stores, Inc. $ 18,673,012
230,000 Dayton-Hudson Corp. 23,718,750
79,100 Eastman Kodak Co. 6,150,025
298,200 Kohl's Corp.* 10,921,575
560,800 The May Department Stores Co. 24,535,000
288,900 Mercantile Stores Co., Inc. 16,936,762
424,800 J.C. Penney Co., Inc. 22,302,000
294,400 Sears Roebuck & Co. 14,315,200
806,000 Wal-Mart Stores, Inc. 20,452,250
712,800 Walgreen Co. 23,878,800
-------------
$181,883,374
-------------
TOTAL NON-DURABLES $366,292,723
-------------
ENERGY--2.7%
Oil & Gas Extraction--2.2%
326,500 Amoco Corp. $ 23,630,438
480,500 Chevron Corp. 28,349,500
160,700 Union Pacific Resources Group, Inc. 4,298,725
-------------
$ 56,278,663
-------------
Oil Services--0.5%
169,000 Schlumberger, Ltd. $ 14,238,250
-------------
TOTAL ENERGY $ 70,516,913
-------------
FINANCIAL--16.4%
Commercial Bank--8.8%
327,100 AmSouth Bancorporation $ 11,816,488
110,000 BankAmerica Corp. 8,332,500
1,049,200 Bank of New York Co., Inc. 53,771,500
569,800 Boatmen's Bancshares, Inc. 22,863,225
700,000 CoreStates Financial Corp. 26,950,000
559,132 First Chicago NBD Corp. 21,876,040
190,000 First Tennessee National Corp. 5,818,750
948,178 Huntington Bancshares, Inc. 22,637,750
1,297,324 National City Corp. 45,568,506
252,900 State Street Boston Corp. 12,897,900
-------------
$232,532,659
-------------
Finance--Miscellaneous--0.6%
440,000 Federal National Mortgage Association $ 14,740,000
-------------
Insurance--General--4.0%
186,600 American International Group, Inc. $ 18,403,425
721,000 Chubb Corp. 35,959,875
930,400 SAFECO Corp. 32,912,900
356,600 St. Paul Companies, Inc. 19,078,100
-------------
$106,354,300
-------------
Investments--2.8%
950,100 Charles Schwab Corp. $ 23,277,450
318,000 Merrill Lynch & Co., Inc. 20,709,750
1,000,000 T. Rowe Price Associates, Inc. 30,750,000
-------------
$ 74,737,200
-------------
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
PIONEER FUND
SCHEDULE OF INVESTMENTS (Continued)
Shares Value
- ---------- -------------
Savings & Loan--0.2%
214,500 H.F. Ahmanson & Co. $ 5,791,500
-------------
TOTAL FINANCIAL $434,155,659
-------------
SERVICES--17.0%
Broadcasting & Media--1.8%
515,874 Cox Communications, Inc. (Class A)* $ 11,155,775
692,811 Gaylord Entertainment Co. (Class A) 19,571,911
930,928 US West Media Group* 16,989,436
-------------
$ 47,717,122
-------------
Health Services & Personal Care--1.7%
258,200 Becton Dickinson & Co. $ 20,720,550
95,100 Foundation Health Corp.* 3,411,713
425,000 United Healthcare Corp. 21,462,500
-------------
$ 45,594,763
-------------
Pharmaceuticals--9.8%
332,000 Bristol-Myers Squibb Co. $ 29,880,000
870,000 Ciba-Geigy Ltd. (A.D.R.) 53,000,313
800,000 Johnson & Johnson 39,600,000
335,000 Pfizer, Inc. 23,910,625
3,898 Roche Holdings AG-Genusschein 29,760,366
1,298,200 Schering-Plough Corp. 81,462,050
-------------
$257,613,354
-------------
Publishing--3.2%
320,300 Central Newspapers, Inc. (Class A) $ 12,011,250
555,200 Harcourt General, Inc. 27,760,000
478,000 McGraw-Hill Companies, Inc. 21,868,500
873,600 John Wiley & Sons, Inc. (Class A)+ 25,334,400
-------------
$ 86,974,150
-------------
Other Services--0.5%
393,600 R. R. Donnelley & Sons Co. $ 13,726,800
-------------
TOTAL SERVICES $451,626,189
-------------
TECHNOLOGY--14.4%
Business Machines--9.3%
808,000 Compaq Computer Corp.* $ 39,794,000
230,000 EMC Corp.* 4,283,750
450,000 Hewlett Packard Co. 44,831,250
640,000 Intel Corp. 47,000,000
526,000 IBM Corp. 52,074,000
187,500 Seagate Technology, Inc.* 8,437,500
464,800 Silicon Graphics, Inc.* 11,155,200
660,000 Sun Microsystems, Inc.* 38,857,500
-------------
$246,433,200
-------------
Computer Software--1.4%
411,000 Aspen Technology, Inc.* + $ 22,605,000
227,500 Autodesk, Inc. 6,796,563
220,000 DST Systems, Inc.* 7,040,000
-------------
$ 36,441,563
-------------
Electronics--3.7%
90,000 General Electric Co. $ 7,785,000
464,000 General Motors Corp. (Class H) 27,898,000
597,500 Motorola, Inc. 37,567,813
294,000 Teradyne, Inc.* 5,071,500
381,000 Texas Instruments, Inc. 19,002,375
-------------
$ 97,324,688
-------------
TOTAL TECHNOLOGY $380,199,451
-------------
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
PIONEER FUND
SCHEDULE OF INVESTMENTS (Continued)
Shares Value
- ---------- -------------
TRANSPORTATION--0.8%
Railroad & Bus--0.8%
237,900 Norfolk Southern Corp. $ 20,162,025
-------------
TOTAL TRANSPORTATION $ 20,162,025
-------------
UTILITIES--13.3%
Electric Utility--1.1%
975,200 Allegheny Power System, Inc. $ 30,109,300
-------------
Gas Utility--0.6%
574,650 Indiana Energy, Inc. $ 16,449,356
-------------
Telecommunications--11.2%
331,000 AirTouch Communications, Inc.* $ 9,350,750
476,300 AT&T Corp. 29,530,600
683,000 Ameritech Corp. 40,553,125
613,200 Bell Atlantic Corp. 39,091,500
1,129,800 BellSouth Corp. 47,875,275
383,200 GTE Corp. 17,148,200
754,400 Lincoln Telecommunications Co. 12,353,300
504,400 NYNEX Corp. 23,959,000
1,045,000 Pacific Telesis Group 35,268,750
300,000 SBC Communications, Inc. 14,775,000
789,351 US West Communications, Inc. 25,160,563
-------------
$ 295,066,063
-------------
Utility/Other--0.4%
276,300 American Water Works Co., Inc. $ 11,121,075
-------------
TOTAL UTILITIES $ 352,745,794
-------------
TOTAL COMMON STOCKS (Cost $1,714,806,238) $2,577,258,665
-------------
TOTAL INVESTMENT IN SECURITIES
(Cost $1,734,005,923) $2,637,665,640
-------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount
- -----------
<S> <C> <C>
TEMPORARY CASH INVESTMENT--0.2%
Commercial Paper--0.2%
$5,053,000 Ford Motor Credit Co., 5.50%, 7/1/96 $ 5,053,000
-------------
TOTAL TEMPORARY CASH INVESTMENT (COST $5,053,000) $ 5,053,000
-------------
TOTAL INVESTMENT IN SECURITIES AND TEMPORARY
CASH INVESTMENTS--100% (COST $1,739,058,923) (a) $2,642,718,640
=============
</TABLE>
* Non-income producing security.
+ Investment held by Fund representing 5% or more of the outstanding voting
stock of such company (see Note 6).
(a) At June 30, 1996, the net unrealized gain on investments based on cost
for federal income tax purposes of $1,739,058,923 was as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
Aggregate gross unrealized gain for all
investments in which there is an excess of value
over tax cost $924,595,287
Aggregate gross unrealized loss for all
investments in which there is an excess of tax
cost over value (20,935,570)
-----------
Net unrealized gain $903,659,717
===========
</TABLE>
Purchases and sales of securities (excluding temporary cash investments) for
the six months ended June 30, 1996 aggregated approximately $373,628,000 and
$369,352,000, respectively.
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
PIONEER FUND
BALANCE SHEET--June 30, 1996
(Dollars in Thousands
Except Per Share Amounts)
ASSETS:
Investment in securities, at value (including
temporary cash investment of $5,053) (cost
$1,739,059; see Schedule of Investments and
Notes 1 and 6) $2,642,719
Receivables--
Investment securities sold 14,909
Fund shares sold 1,572
Dividends and interest 4,535
Other 40
---------
Total assets $2,663,775
---------
Liabilities:
Payables--
Investment securities purchased $ 9,029
Fund shares repurchased 1,065
Due to affiliates (Notes 2, 3 and 4) 3,051
Accrued expenses 133
---------
Total liabilities $ 13,278
---------
NET ASSETS:
Paid-in capital (Note 1) $1,644,656
Distributions in excess of net investment
income (262)
Accumulated undistributed net realized gain on
investments 102,443
Net unrealized gain on investments 903,660
---------
Total net assets (equivalent to $26.18 per
share based on 101,243,492 shares
of beneficial interest outstanding--
unlimited number of shares authorized) $2,650,497
=========
PIONEER FUND
STATEMENT OF OPERATIONS--For The Six
Months Ended June 30, 1996
(Dollars in Thousands)
Investment Income (Note 1):
Dividends (net of foreign taxes withheld of
$237) $ 31,113
Interest 371
-------
Total investment income $ 31,484
-------
Expenses:
Management fees (Note 2)
Basic fee $ 6,494
Performance adjustment (104)
Distribution fees (Note 4) 2,567
Transfer agent fees (Note 3) 3,290
Registration fees 85
Professional fees 79
Accounting (Note 2) 44
Custodian fees 70
Printing 92
Fees and expenses of nonaffiliated trustees 14
Miscellaneous 75
-------
Total expenses $ 12,706
Less fees paid indirectly (Note 5) (184)
-------
Net expenses $ 12,522
-------
Net investment income $ 18,962
-------
Realized and Unrealized Gain on Investments:
Net realized gain on investments $102,443
Change in net unrealized gain on investments 83,022
-------
Net gain on investments $185,465
-------
Net increase in net assets resulting from
operations $204,427
=======
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
PIONEER FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the Six Months Ended June 30, 1996 and the Year Ended December 31, 1995
(Dollars in Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
Six Months Year Ended
Ended December31,
June 30, 1996 1995
-------------- -----------
<S> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment income $ 18,962 $ 45,841
Net realized gain on investments 102,443 194,768
Change in net unrealized gain on investments 83,022 287,048
------------- ---------
Net increase in net assets resulting from operations $ 204,427 $ 527,657
------------- ---------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income ($0.20 and $0.49 per share, respectively) $ (19,913) $ (45,343)
In excess of net investment income ($0.00 and $0.00 per share,
respectively) (262) --
From net realized gain on investments ($0.00 and $2.09 per share,
respectively) -- (194,671)
------------- ---------
Decrease in net assets resulting from distributions to shareholders $ (20,175) $ (240,014)
------------- ---------
FROM FUND SHARE TRANSACTIONS: Shares
-----------------------
Net proceeds from sale of shares 4,374,052 9,316,854 $ 112,005 $ 223,191
Net asset value of shares issued to
shareholders in reinvestment of dividend
distributions 698,581 9,060,518 18,072 217,987
Cost of shares repurchased (5,082,633) (11,449,340) (129,930) (273,774)
-------- --------- ------------- ---------
Net increase in net assets resulting from
fund share transactions (10,000) 6,928,032 $ 147 $ 167,404
======== ========= ------------- ---------
Net increase in net assets $ 184,399 $ 455,047
NET ASSETS:
Beginning of period 2,466,098 2,011,051
------------- ---------
End of period (including (distributions in excess of)/accumulated
undistributed net investment income of $(262) and $951, respectively) $2,650,497 $2,466,098
============= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
PIONEER FUND
FINANCIAL HIGHLIGHTS
Selected Data For a Share Outstanding For The Periods Presented
<TABLE>
<CAPTION>
Six Months For the Years Ended December 31,
Ended ------------------------------------------------------
June 30, 1996 1995 1994 1993 1992 1991
-------------- ------- ------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $24.36 $21.32 $23.25 $21.51 $20.24 $18.79
------------ ------ ------ ------ ------ -------
Increase (decrease) from
investment operations:
Net investment income $ 0.19 $ 0.49 $ 0.49 $ 0.47 $ 0.50 $ 0.61
Net realized and unrealized
gain (loss) on investments 1.83 5.13 (0.63) 2.57 2.22 3.49
------------ ------ ------ ------ ------ -------
Net increase (decrease) from
investment operations $ 2.02 $ 5.62 $(0.14) $ 3.04 $ 2.72 $ 4.10
Distribution to shareholders
from:
Net investment income (0.20) (0.49) (0.49) (0.47) (0.50) (0.61)
Net realized gain -- (2.09) (1.30) (0.83) (0.95) (2.04)
------------ ------ ------ ------ ------ -------
Net increase (decrease) in net
asset value $ 1.82 $ 3.04 $(1.93) $ 1.74 $ 1.27 $ 1.45
------------ ------ ------ ------ ------ -------
Net asset value, end of period $26.18 $24.36 $21.32 $23.25 $21.51 $20.24
============ ====== ====== ====== ====== =======
Total return * 8.30% 26.64% (0.57%) 14.23% 13.60% 22.76%
Ratio of net expenses to
average net assets 0.99%**+ 0.95%+ 0.94% 0.95% 0.98% 0.87%
Ratio of net investment income
to average net assets 1.46%**+ 2.01%+ 2.13% 2.04% 2.33% 2.87%
Portfolio turnover rate 29%** 31% 20% 12% 13% 22%
Average commission rate paid
per exchange listed
transaction $0.0618 -- -- -- -- --
Net assets, end of period (in
thousands) $2,650,497 $2,466,098 $2,011,051 $2,042,945 $1,786,031 $1,614,567
Ratios assuming reduction for
fees paid indirectly:
Net expenses 0.97%** 0.94% -- -- -- --
Net investment income 1.48%** 2.02% -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
For the Years Ended December 31,
------------------------------------------------------------------------
1990 1989 1988 1987 1986
--------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $23.28 $20.34 $18.48 $19.72 $23.13
--------- --------- --------- --------- -----------
Increase (decrease) from
investment operations:
Net investment income $0.67 $0.61 $0.63 $0.62 $0.56
Net realized and unrealized
gain (loss) on investments (3.10) 4.09 2.72 0.41 1.95
--------- --------- --------- --------- -----------
Net increase (decrease) from
investment operations $(2.43) $4.70 $3.35 $1.03 $2.51
Distribution to shareholders
from:
Net investment income (0.67) (0.68) (0.62) (0.61) (0.67)
Net realized gain (1.39) (1.08) (0.87) (1.66) (5.25)
--------- --------- --------- --------- -----------
Net increase (decrease) in net
asset value $(4.49) $2.94 $1.86 $(1.24) $(3.41)
--------- --------- --------- --------- -----------
Net asset value, end of period $18.79 $23.28 $20.34 $18.48 $19.72
========= ========= ========= ========= ===========
Total return * (10.52%) 23.39% 18.33% 5.44% 11.49%
Ratio of net expenses to
average net assets 0.78% 0.75% 0.76% 0.70% 0.70%
Ratio of net investment income
to average net assets 3.15% 2.60% 3.03% 2.75% 2.44%
Portfolio turnover rate 17% 6% 11% 14% 31%
Average commission rate paid
per exchange listed
transaction -- -- -- -- --
Net assets, end of period (in
thousands) $1,395,520 $1,618,320 $1,409,755 $1,272,118 $1,302,120
Ratios assuming reduction for
fees paid indirectly:
Net expenses -- -- -- -- --
Net investment income -- -- -- -- --
</TABLE>
+ Ratios assuming no reduction for fees paid indirectly.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS--June 30, 1996
1. Pioneer Fund (the Fund), originally a Massachusetts business trust, is
registered under the Investment Company Act of 1940 as a diversified,
open-end management investment company. The investment objectives of the Fund
are reasonable income and growth of capital. Effective May 1, 1996, the Fund
was reorganized as a Delaware business trust. The reorganization has no
effect on the Fund's operations. Effective July 1, 1996, the Board of
Trustees (the Trustees) has authorized the issuance of three share classes of
the Fund, designated as Class A, Class B and Class C shares.
The Fund's financial statements have been prepared in conformity with
generally accepted accounting principles that require the management of the
Fund to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities at the date of the financial statements, and the
reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates.
The following is a summary of significant accounting policies consistently
followed by the Fund, which are in conformity with those generally accepted
in the investment company industry:
A. Security Valuation--Security transactions are recorded on trade date.
Each day, securities are valued at the last sale price on the principal
exchange where they are traded. Securities that have not traded on the
date of valuation, or securities for which sale prices are not generally
reported, are valued at the mean between the last bid and asked prices.
Securities for which market quotations are not readily available are
valued at their fair values as determined by, or under the direction of,
the Trustees. Temporary cash investments are valued at amortized cost.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis.
Gains and losses on sales of investments are calculated on the
"identified cost" method for both financial reporting and federal income
tax purposes. It is the Fund's practice to first select for sale those
securities that have the highest cost and also qualify for long-term
capital gain or loss treatment for tax purposes.
B. Foreign Currency Translation--The books and records of the Fund are
maintained in U.S. dollars. Amounts denominated in foreign currencies are
translated into U.S. dollars using the current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between
the amount of income accrued and the U.S. dollar actually received.
Further, the effects of changes in foreign currency exchange rates on
investments are not segregated in the statement of operations from the
effects of changes in market price of those securities but are included
with the net realized and unrealized gain or loss on investments.
C. Federal Income Taxes--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 and net
realized capital gains, if any, to its shareholders. Therefore, no federal
income tax provisions are required.
The characterization of distributions to shareholders for financial
reporting purposes is determined in accordance with income tax rules.
Therefore, the source of the Fund's distributions may be shown in the
accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment transactions, or from
paid-in capital, depending on the type of book/tax differences that may
exist.
D. Fund Shares--The Fund records sales and repurchases of its fund shares
on trade date. Net losses, if any, as a result of cancellations are
absorbed by Pioneer Funds Distributor, Inc. (PFD), the principal
underwriter for the Fund and an indirect subsidiary of The Pioneer Group,
Inc. (PGI). PFD earned approximately $611,000 in underwriting commissions
on the sale of fund shares during the six months ended June 30, 1996.
Distributions to shareholders are recorded as of the ex-dividend date.
2. Pioneering Management Corporation (PMC), the Fund's investment adviser,
manages the Fund's portfolio and is a wholly owned subsidiary of PGI. PMC
receives a basic fee that is calculated at the annual rate of 0.60% of the
Fund's average daily net assets. The basic fee is subject to a performance
adjustment up to a maximum of +/- 0.10% based on the Fund's investment
performance as compared to the appropriate index. For the six months ended
June 30, 1996, management fees were reduced by approximately $104,000. Prior
to May 1, 1996, management fees were calculated daily at the annual rate of
0.50% of the Fund's average daily net assets up to $250 million, 0.48% of the
next $50 million and 0.45% of such assets in excess of $300 million. For the
six months ended June 30, 1996, the management fee was equivalent to an
annualized rate of 0.50% of average daily net assets.
10
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(Continued)
In addition, under the management agreement, certain other services and
costs, including accounting, regulatory reporting and insurance premiums, are
paid by the Fund. Included in due to affiliates is approximately $1,311,000
and $10,000 in management fees and accounting fees, respectively, payable to
PMC at June 30, 1996.
3. Pioneering Services Corporation (PSC), a wholly owned subsidiary of
PGI, provides substantially all transfer agent and shareholder services to
the Fund at negotiated rates. Included in due to affiliates is approximately
$482,000 in transfer agent fees payable to PSC at June 30, 1996.
4. The Fund adopted a Plan of Distribution (the Plan) that allows for the
Fund to reimburse Pioneer Funds Distributor, Inc. (PFD) for expenditures to
finance any activities primarily intended to result in the sale of fund
shares. The Plan provides for reimbursement of such expenditures in an amount
not to exceed 0.15% on qualifying investments in the Fund made prior to
August 19, 1991 and 0.25% on qualifying investments made on or subsequent to
that date. Included in due to affiliates is approximately $1,248,000 in
distribution fees payable to PFD at June 30, 1996.
5. The Fund has entered into certain expense offset arrangements resulting
in a reduction in the Fund's total expenses. For the six months ended June
30, 1996, the Fund's expenses were reduced by approximately $184,000 under
such arrangements.
6. The Fund's investment in certain companies may exceed 5% of the
outstanding voting stock. Such companies are deemed affiliates of the Fund
for financial reporting purposes. The following summarizes transactions with
affiliates of the Fund as of June 30, 1996:
<TABLE>
<CAPTION>
Dividend
Affiliates Purchases Sales Income Value
- ------------------------------------- -------- ---- ---------- ------------
<S> <C> <C> <C> <C>
Aspen Technology, Inc. $-- $-- $ -- $22,605,000
John Wiley & Sons, Inc. (Class A) -- -- 76,440 25,334,400
------ -- -------- ----------
$-- $-- $76,440 $47,939,400
====== == ======== ==========
</TABLE>
11
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE SHAREHOLDERS AND THE BOARD OF TRUSTEES OF PIONEER FUND:
We have audited the accompanying balance sheet of Pioneer Fund, including
the schedule of investments, as of June 30, 1996, and the related statement
of operations, statements of changes in net assets and financial highlights
for the periods presented. These financial statements and financial
highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of June 30,1996 by correspondence with the custodian. 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
Pioneer Fund as of June 30, 1996, the results of its operations, the changes
in its net assets and financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
August 1, 1996
12
<PAGE>
Results of April 23, 1996, Shareholder Meeting
On April 23, 1996, Pioneer Fund held a special meeting of shareholders. All
Proposals were passed by shareholder vote. Following are the detailed results
of the vote for each Proposal presented.
Proposal 1 -- Elect eight Trustees to serve on the Board of the Trustees.
Nominee Affirmative Withheld
- -------------------------- ----------- --------------
John F. Cogan, Jr. 58,377,390.986 1,794,058.327
Richard H. Egdahl, M.D. 58,117,533.262 2,053,916.051
Margaret B.W. Graham 58,201,586.565 1,969,862.748
John W. Kendrick 58,354,675.437 1,816,773.876
Marguerite A. Piret 58,190,491.583 1,980,957.730
David D. Tripple 58,475,947.247 1,695,502.066
Stephen K. West 58,186,938.498 1,984,510.815
John Winthrop 58,463,981.162 1,707,468.151
Proposal 2 -- Approve a new management contract with Pioneering Management
Corporation (PMC), including a performance-based management fee.
Affirmative 48,206,236.842
Against 6,748,388.101
Abstain 3,362,933.370
Proposal 3 -- Allow the Fund to be reorganized as a Delaware business trust.
Affirmative 51,862,055.374
Against 3,260,386.118
Abstain 3,195,116.821
Proposal 4 -- Ratify the selection of Arthur Andersen LLP as the Fund's
independent public accountants for the fiscal year ending December 31, 1996.
Affirmative 56,871,229.170
Against 758,720.590
Abstain 2,541,499.553
Proposal 5a -- Eliminate the Fund's fundamental investment restriction
regarding repurchase agreements.
Affirmative 50,871,739.085
Against 3,077,013.041
Abstain 4,368,806.187
Proposal 5b -- Amend the Fund's fundamental investment restriction regarding
underwriting.
Affirmative 50,754,897.706
Against 3,047,064.943
Abstain 4,515,595.664
Proposal 5c -- Amend the Fund's fundamental investment restriction regarding
commodities.
Affirmative 49,492,781.284
Against 4,464,460.988
Abstain 4,360,316.041
Proposal 5d -- Eliminate the Fund's fundamental investment restriction
regarding restricted securities.
Affirmative 49,641,199.815
Against 4,186,554.808
Abstain 4,489,803.690
Proposal 5e -- Eliminate the Fund's fundamental investment restriction
regarding "unseasoned" issuers.
Affirmative 49,509,946.861
Against 4,293,287.550
Abstain 4,514,323.902
Proposal 5f -- Eliminate the Fund's fundamental investment restriction
regarding affiliates of affiliates of the Fund.
Affirmative 49,538,051.205
Against 4,238,041.181
Abstain 4,541,465.927
Proposal 5g -- Amend the Fund's fundamental investment restriction regarding
loans.
Affirmative 50,109,525.743
Against 3,796,693.866
Abstain 4,411,338.704
Proposal 5h -- Amend the Fund's fundamental investment restriction regarding
borrowing.
Affirmative 49,972,059.091
Against 3,935,789.304
Abstain 4,409,709.918
Proposal 5i -- Add a new fundamental investment restriction regarding "senior
securities."
Affirmative 50,724,979.859
Against 3,017,327.244
Abstain 4,575,251.210
13
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE>
PIONEER FUND
60 State Street
Boston, Massachusetts 02109
OFFICERS
JOHN F. COGAN, JR., Chairman and President
DAVID D. TRIPPLE, Executive Vice President
JOHN A. CAREY, Vice President
WILLIAM H. KEOUGH, Treasurer
JOSEPH P. BARRI, Secretary
TRUSTEES
JOHN F. COGAN, JR.
RICHARD H. EGDAHL, M.D.
MARGARET B.W. GRAHAM
JOHN W. KENDRICK
MARGUERITE A. PIRET
DAVID D. TRIPPLE
STEPHEN K. WEST
JOHN WINTHROP
INVESTMENT ADVISER
PIONEERING MANAGEMENT CORPORATION
PRINCIPAL UNDERWRITER
PIONEER FUNDS DISTRIBUTOR, INC.
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
INDEPENDENT PUBLIC ACCOUNTANTS
ARTHUR ANDERSEN LLP
LEGAL COUNSEL
HALE AND DORR
SERVICES AND SHAREHOLDER TRANSFER AGENT
PIONEERING SERVICES CORPORATION
60 State Street
Boston, Massachusetts 02109
Please call Pioneer for information on:
Existing accounts, new accounts,
prospectuses, applications and
service forms ................................................. 1-800-225-6292
Fund yields and prices ........................................ 1-800-225-4321
Toll-free fax ................................................. 1-800-225-4240
Retirement plans .............................................. 1-800-622-0176
Telecommunications Device for the Deaf (TDD) .................. 1-800-225-1997
When distributed to persons who are not shareholders of the Fund, this report
must be accompanied by a current prospectus, which discusses the objectives,
policies, sales charges and other information about the Fund.
0896-3593
(c)Pioneer Funds Distributor, Inc.
[Pioneer logo]
Pioneer
Fund
SEMIANNUAL REPORT
JUNE 30, 1996
