<PAGE>
Annual Report
------------------------------------------------
Premier Strategic
------------------------------------------------
Investing
------------------------------------------------
October 31, 1995
[lion logo]
Letter to Shareholders
- --------------------------------------------------------------------------------
Dear Shareholder:
As your new portfolio manager, in this letter I describe my investment
strategy as well as report on the results for the latest fiscal year. To
place these changes in their proper setting, the general economic and market
events of recent months are also discussed.
ECONOMIC ENVIRONMENT
The much-desired soft landing for the U.S. economy that the Federal
Reserve Board has been striving to attain appears to have occurred. This is
the result of more than a year of moves by the Fed to tighten interest rates,
followed by a token loosening of the reins last summer.
Now that the economy is no longer overactive, the central bank must
concern itself with the possibility that the economy might slow down more
than would be desirable. However, the latest economic statistics do not
contain convincing evidence of that happening. The housing industry is doing
well. Industrial orders continue to expand and gross domestic product keeps
on growing, albeit at a reduced rate.
In the meantime, the rate of inflation appears to be under firm control.
Consumer prices have advanced only at a very moderate pace, and average wages
have barely inched ahead. Unemployment has not gotten out of hand, and
hovers near the so-called full employment level.
Retail spending has settled down, in part because consumers are carrying
large debit balances in mortgage and credit card debts. To what extent this
will affect holiday shopping remains to be seen. The industrial sector of
the economy, however, appears to be forging ahead.
MARKET ENVIRONMENT
As your Fund reached the end of its fiscal year, October 31, 1995, stocks
were not far below the record levels they had reached earlier in the fall.
Among the factors accounting for this market strength were good corporate
profits and low interest rates. Third quarter profit reports from leading
corporations, while not universally favorable, were better than earlier
quarters. The extensive lean and mean corporate reorganizations of the past
few years appear to be paying off. Even though the pricing environment for
most corporate products is extremely competitive, manufacturers and service
providers appear able to squeeze out improved profits.
How long that continuing improvement will last is an open question. Many
economists think that profit levels may flatten out over the coming months.
The recent record on that score, however, has been encouraging.
Interest rates also have buoyed stock prices and sustained the bond
market. As the cost of borrowing has steadily decreased, many corporations
have benefitted. This advantage has been particularly notable with public
utilities.
Another factor in market strength has been the relentless advance of
technology, which has virtually forced corporations -- and now individual
households as well -- to reequip in order to keep up with technical progress.
The obvious result has been seen in record prices commanded during
<PAGE>
the year by high technology stocks. While some disillusionment may set in,
the market appears to have taken a very optimistic view of the long-range
outlook for these companies.
In addition, equities have been favorably affected by the very large
inflow of investment money, on a regular basis, from 401(k) and other
retirement plans. To be sure, money managers could at some point turn off
the spigot, and divert this cash flow into bonds or money market instruments.
During the past year, however, equity purchases by pension funds and other
retirement investors have provided a supportive background for stock prices.
Of course, there are some concerns. Perhaps the biggest has been the
struggle between Congress and the White House over how to reduce Government
spending and cut the burden of the Government's perennial deficit.
Hopefully, this impasse will be settled soon. In the meantime, the
uncertainties in Washington have been a source of some concern to investors.
The fading value of the U.S. dollar has also been a question mark. Yet,
after hitting a low last spring, the dollar has gradually recovered some lost
ground. This dollar rebound reflects weakness in the economies of Western
Europe and Japan, but also the strengthening of economic activity here at
home.
INVESTMENT STRATEGY
A new investment style has been introduced for Premier Strategic
Investing, one which emphasizes finding unusual values in common stocks.
Value stock investors look for undervalued opportunities: They want to
buy growing companies but they don't want to pay much for them. The reasons
that value stocks tend to appreciate in value typically include higher
dividends; reliance on more known (as contrasted with projected) data for
evaluation; the tendency of low valuations to rise over time; and the concept
of contrarian investing: buying stocks that other investors do not like yet.
The fact that value stocks are selling at comparatively low prices relative
to specific measures should, we believe, lessen the downside risk in these
securities if bad news is encountered. Of course, there can be no guarantee
that any stock, regardless of how attractive its price may seem, will not
decline in value.
Our approach to the selection of value stocks starts with our analysts,
who are an integral part of our investment team. We work exclusively with
securities that our analysts know and follow closely.
Using the analysts' work as a starting point, we then screen stocks by
computer according to two principal methods. First, we screen for high
projected earnings (the inverse of the price-to-earnings ratio). Then we
apply our own proprietary screen which dynamically analyzes 21 fundamental
factors that have historically affected stock prices. These factors include
the growth outlook over various time horizons, several relative value
measures, company size, earnings revisions and surprises, cash flow,
financial and foreign leverage, price momentum and a qualitative evaluation
of the potential for positive change to occur at each company.
Combining this data with our analysts' knowledge of individual companies,
we then construct a core portfolio of 40 to 50 names that seeks to be
adequately diversified without overly diluting the potential impact of good
investment ideas.
Selling is also a major part of our discipline. Here again, we use
specific criteria for determining when selling out a position is required.
<PAGE>
Finally, we employ a strategic overlay investment process that seeks to
add value through more aggressive investment techniques and instruments.
These will include added industry and security concentration, small
capitalization holdings, short-selling selected securities, and the opportune
use of high-yield corporate debt securities.
PORTFOLIO OVERVIEW
In the beginning of the fiscal year the portfolio was in a very
defensive posture with a high percentage of its holdings in cash and short
sales. This position was changed in the late winter and during the following
months the portfolio's performance began to improve. When the present manager
took over in August, the value investing strategy was introduced; however, it
will take several months for the new strategy to become effective. Because of
the high cash position and inopportune short positions early on in the fiscal
year, the Fund's performance lagged the S&P 500 this fiscal year. The Fund's
latest fiscal year, which ended October 31, 1995, includes only a short
period that fully reflects the new management approach.
For the full 12 months, the Fund's total return was 12.43% for Class A
shares. For Class B shares, the return was 11.50%.* The Standard & Poor's
500 Composite Stock Price Index returned 26.41%** for the same period. The
Fund's Class C and Class R shares commenced operations on September 5, 1995.
For the periods from September 5, 1995 through October 31, 1995, the total
return was -0.23% for Class C shares and -.05% for Class R shares.
Since changing the Fund's investment style, we reduced its cash
equivalent reserves from about 25% to a negligible amount. Equity holdings
now comprise almost the entire portfolio.
As the fiscal year ended, our primary investment themes included:
Depressed high-growth securities: Sensormatic Electronics, Zilog,
Creative Technologies and McCormick.
Stocks with asset restructuring potential: General Motors, Amerada Hess,
Dean Witter Discover, Sandoz, Warner Lambert, Monsanto, James River,
Westinghouse, Masco, Allied Signal, FMC, TRINOVA, Dayton Hudson and General
Electric.
Neglected or misunderstood companies: Eastman Kodak, First Brands,
Philips Electronics, Sofamor/Danek Group, Witco, AT&T and Ameritech.
Companies with new, unappreciated growth opportunities: Grand Casinos,
Wendy's International, Texaco, Guidant, Baxter International, Praxair,
Citicorp and Columbia/HCA Healthcare.
In the strategic overlay portion of the portfolio, which runs about 20%
of total assets, we have placed special emphasis on certain industry sectors,
notably health care, producer manufacturing, process industries and consumer
nondurables; sold short shares of Caremark International; and taken positions
in a few small capitalization companies, namely Midwest Express, Tel-Save,
and Duff & Phelps Credit.
To make funds available for such purchases, we sold a number of issues
that had been in the portfolio prior to August. The largest of these sales
included part of the Citicorp position, Amoco, Occidental Petroleum, Placer
Dome, Corning and WMX Technologies.
<PAGE>
It is a pleasure to have been named to manage your assets in this
portfolio. I will endeavor to serve you to the best of my abilities.
Sincerely,
Timothy M. Ghriskey
Portfolio Manager
November 15, 1995
New York, N.Y.
* Total return includes reinvestment of dividends and any capital
gains paid, without taking into account the maximum initial sales charge
in the case of Class A shares, or the applicable contingent deferred
sales charge imposed on redemptions in the case of Class B and Class C
shares.
** Source: Lipper Analytical Services, Inc. -- Unlike the Fund, which
may employ a variety of investment techniques, Standard & Poor's 500
Composite Stock Price Index is a widely accepted unmanaged index of stock
market performance consisting solely of equity securities.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1 October 31, 1995
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER STRATEGIC
INVESTING CLASS A SHARES AND THE STANDARD & POOR'S 500
COMPOSITE STOCK PRICE INDEX
[chart]
*Source: Lipper Analytical Services, Inc.
Average Annual Total Returns
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
Class A Shares Class B Shares
- ------------------------------------------------------------ --------------------------------------------------------
% Return Reflecting
% Return Applicable Contingent
Reflecting % Return Deferred Sales
% Return Without Maximum Initial Assuming No Charge Upon
Period ended 10/31/95 Sales Charge Sales Charge (4.5%) Period ended 10/31/95 Redemption Redemption*
- ---------------------- ------------- ---------- ----------------- ---------- -----------
<S> <C> <C> <C> <C> <C>
1 Year 12.43% 7.40% 1 Year 11.50% 7.50%
5 Years 10.84 9.83 From Inception (1/15/93) 4.75 3.76
From Inception (10/16/86) 12.05 11.48
</TABLE>
Actual Aggregate Total Returns
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
Class C Shares Class R Shares
- ------------------------------------------------------------ -----------------------------------------------------
% Return Reflecting
Applicable Contingent
% Return Deferred Sales
Assuming No Charge Upon
Period ended 10/31/95 Redemption Redemption** Period ended 10/31/95
- ---------------------- ----------- ----------------- ----------------------
<S> <C> <C> <C>
From Inception (9/1/95) (0.23)% (1.23)% From Inception (9/1/95)(.05)%
</TABLE>
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in Class A shares of
Premier Strategic Investing on 10/16/86 (Inception Date) to a $10,000
investment made in the Standard & Poor's 500 Composite Stock Price Index on
that date. For comparative purposes, the value of the Index on 10/31/86 is
used as the beginning value on 10/16/86. All dividends and capital gain
distributions are reinvested. Performance for Class B shares, Class C shares
and Class R shares will vary from the performance of Class A shares shown
above due to differences in charges and expenses.
The Fund's performance shown in the line graph takes into account the maximum
initial sales charge on Class A shares and all other applicable fees and
expenses. The Standard & Poor's 500 Composite Stock Price Index is a widely
accepted, unmanaged index of overall stock market performance which does not
take into account charges, fees and other expenses. Further information
relating to Fund performance, including expense reimbursements, if
applicable, is contained in the Condensed Financial Information section of
the Prospectus and elsewhere in this report.
*Maximum contingent deferred sales charge for Class B shares is 4% and is
reduced to 0% after six years.
**Maximum contingent deferred sales charge for Class C shares is 1% within
one year of the date of purchase.
<PAGE>
Premier Strategic Investing
- --------------------------------------------------------------------------------
(formerly Dreyfus Strategic Investing)-See Note 1
Statement of Investments October 31, 1995
<TABLE>
<CAPTION>
Common Stocks-90.4% Shares Value
- ----------------------------------------------------------------------- ------------ ------------
<S> <C> <C> <C>
Commercial
Services-2.2% American Greetings, Cl. A........... 175,000 $ 5,512,500
------------
Consumer
Durables-4.0% Eastman Kodak....................... 85,000 5,323,125
General Motors...................... 110,000 4,812,500
------------
10,135,625
Consumer
Non-Durables-7.5% First Brands........................ 115,000 5,261,250
Jones Apparel Group................. 100,000(a) 3,425,000
McCormick & Co...................... 225,000 5,568,750
Warnaco Group, Cl. A................ 205,000 4,766,250
------------
19,021,250
------------
Consumer
Services-4.5% Grand Casinos....................... 150,000(a) 5,962,500
Wendy's International............... 270,000 5,366,250
------------
11,328,750
------------
Consumer
Staples-2.0% Philip Morris Cos................... 60,000 5,070,000
------------
Energy-6.0% Amerada Hess........................ 105,000 4,738,125
Texaco............................ 155,000 10,559,375
------------
15,297,500
------------
Finance-9.2% Citicorp............................ 80,780 5,240,603
Duff & Phelps....................... 117,900 1,842,188
FINOVA Group........................ 115,000 5,203,750
PMI Group........................... 110,000 5,280,000
Prudential Reinsurance Holdings..... 278,000 5,664,250
------------
23,230,791
------------
Health Care-15.3% Baxter International................ 75,000 2,896,875
Guidant............................. 350,000(a) 11,200,000
McKesson............................ 119,000 5,682,250
Rhone-Poulenc Rorer................. 105,000 4,948,125
Sandoz AG........................... 8,220 6,783,038
Sofamor/Danek Group................. 85,000(a) 2,082,500
Warner-Lambert...................... 60,000 5,107,500
------------
38,700,288
------------
</TABLE>
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Statement of Investments (continued) October 31, 1995
<TABLE>
<CAPTION>
Common Stocks-(continued) Shares Value
- ----------------------------------------------------------------------- ------------ ------------
<S> <C> <C> <C>
Process Industries-6.2% James River....................... 150,000 $4,818,750
Monsanto.......................... 55,000 5,761,250
Praxair........................... 195,000 5,265,000
------------
15,845,000
------------
Producer
Manufacturing-11.2% AlliedSignal...................... 114,000 4,845,000
General Electric.................. 90,000 5,692,500
Masco............................. 190,000 5,343,750
Philips Electronics, N.V. A.D.R... 115,000 4,441,875
TRINOVA........................... 100,000 2,812,500
Westinghouse Electric............. 370,000 5,226,250
------------
28,361,875
------------
Retail Trade-4.3% Dayton Hudson..................... 70,000 4,812,500
Intimate Brands................... 300,000(a) 5,025,000
Tandy............................. 22,500 1,110,937
------------
10,948,437
------------
Technology-9.0% Applied Materials................. 100,000(a) 5,012,500
Boeing............................ 75,000 4,921,875
Creative Technology............... 260,000(a) 3,022,500
Digital Equipment................. 95,000(a) 5,141,875
International Business Machines... 47,000 4,570,750
------------
22,669,500
------------
Transportation-2.0% Tidewater......................... 195,000 5,143,125
------------
Utilities-7.0% AT&T.............................. 100,000 6,400,000
Ameritech......................... 108,000 5,832,000
Entergy........................... 190,000 5,415,000
------------
17,647,000
------------
TOTAL COMMON STOCKS
(cost $216,545,699)............. $228,911,641
------------
------------
</TABLE>
<PAGE>
Premier Strategic Investing
- --------------------------------------------------------------------------------
(formerly Dreyfus Strategic Investing)-See Note 1
Statement of Investments (continued) October 31, 1995
<TABLE>
<CAPTION>
Principal
Short-Term Investments-2.5% Amount Value
- ----------------------------------------------------------------------- ------------ ------------
<S> <C> <C> <C>
U.S. Treasury Bills: 6.15%, 11/16/1995................. $ 125,000(b) $ 124,730
6.52%, 12/14/1995................. 4,000 3,975
5.42%, 12/21/1995................. 6,240,000(c) 6,194,947
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $6,323,033)............... $ 6,323,652
------------
------------
TOTAL INVESTMENTS (cost $222,868,732).................................. 92.9% $235,235,293
------- ------------
------- ------------
CASH AND RECEIVABLES (NET)............................................. 7.1% $ 17,917,782
------- ------------
------- ------------
NET ASSETS............................................................. 100.0% $253,153,075
------- ------------
------- ------------
<FN>
Notes to Statement of Investments:
- --------------------------------------------------------------------------------
(a)Non-income producing.
(b)Partially held by custodian in a segregated account as collateral for open
futures positions.
(c)Partially held by brokers as collateral for open short positions.
</TABLE>
Statement of Financial Futures October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value Unrealized
Number of Covered Appreciation
Financial Futures Long; Contracts by Contracts Expiration at 10/31/95
--------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Standard & Poor's 500................... 11 $ 3,211,175 December '95 $46,475
-------------
-------------
Statement of Securities Sold Short October 31, 1995
- --------------------------------------------------------------------------------
Common Stocks Shares Value
---------- ----------
Caremark International.......................................................... 150,000 $3,093,750
Ventritex....................................................................... 10,000 196,250
----------
TOTAL SECURITIES SOLD SHORT (proceeds $3,256,943)............................... $3,290,000
----------
----------
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities, at value (cost $222,868,732)-see statement $235,235,293
Cash............................................................... 724,301
Receivable for investment securities sold.......................... 23,248,527
Receivable from brokers for proceeds on securities sold short...... 3,256,943
Dividends and interest receivable.................................. 189,734
Receivable for shares of Beneficial Interest subscribed............ 2,848
Prepaid expenses................................................... 36,266
------------
262,693,912
LIABILITIES:
Due to The Dreyfus Corporation..................................... $ 164,058
Due to Distributor................................................. 83,382
Payable for investment securities purchased........................ 5,469,967
Securities sold short, at value (proceeds $3,256,943)-see statement 3,290,000
Net unrealized depreciation on forward currency exchange
contracts-Note 4(a).............................................. 320,942
Payable for shares of Beneficial Interest redeemed................. 32,886
Accrued expenses................................................... 179,602 9,540,837
---------- ------------
NET ASSETS............................................................. $253,153,075
------------
------------
REPRESENTED BY:
Paid-in capital.................................................... $213,976,231
Accumulated undistributed investment income-net.................... 1,567,646
Accumulated undistributed net realized gain on investments......... 25,550,161
Accumulated net unrealized appreciation on investments and foreign
currency transactions (including $46,475 net unrealized appreciation
on financial futures)-Note 4(b).................................. 12,059,037
------------
NET ASSETS at value.................................................... $253,153,075
------------
------------
Shares of Beneficial Interest outstanding:
Class A Shares
(unlimited number of $.001 par value authorized)................. 9,669,214
------------
------------
Class B Shares
(unlimited number of $.001 par value authorized)................. 2,095,628
------------
------------
Class C Shares
(unlimited number of $.001 par value authorized)................. 47
------------
------------
Class R Shares
(unlimited number of $.001 par value authorized)................. 46
------------
------------
NET ASSET VALUE per share:
Class A Shares ($208,785,984 / 9,669,214 shares)................... $21.59
------------
------------
Class B Shares ($44,365,093 / 2,095,628 shares).................... $21.17
------------
------------
Class C Shares ($998 / 47.16 shares)............................... $21.16
------------
------------
Class R Shares ($1,000 / 46.30 shares)............................. $21.60
------------
------------
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Statement of Operations year ended October 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Interest........................................................... $ 4,049,252
Cash dividends (net of $10,496 foreign taxes withheld at source)... 3,173,473
-----------
Total Income..................................................... $ 7,222,725
Expenses:
Management fee-Note 3(a)........................................... 1,953,914
Shareholder servicing costs-Note 3(c).............................. 1,000,964
Distribution fees-Note 3(b)........................................ 315,492
Professional fees.................................................. 71,993
Dividends on securities sold short................................. 70,017
Loan commitment fees-Note 2........................................ 64,583
Custodian fees..................................................... 56,598
Registration fees.................................................. 39,831
Trustees' fees and expenses-Note 3(d).............................. 39,744
Shareholders' reports.............................................. 10,951
Miscellaneous...................................................... 8,308
-----------
Total Expenses................................................. 3,632,395
-----------
INVESTMENT INCOME-NET.............................................. 3,590,330
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain (loss) on investments-Note 4(a):
Long transactions (including options and foreign currency transactions) $27,043,597
Short sale transactions............................................ (2,453,670)
Net realized (loss) on financial futures-Note 4(a)................. (406,925)
Net realized (loss) on forward currency exchange transactions...... (49,555)
-----------
Net Realized Gain.................................................. 24,133,447
Net unrealized appreciation on investments, securities sold short and
translation of assets and liabilities in foreign currencies
(including $758,100 net unrealized appreciation on financial futures) 1,574,520
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS.............. 25,707,967
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................... $29,298,297
-----------
-----------
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------------------
1994 1995
-------------- -------------
<S> <C> <C>
OPERATIONS:
Investment income (loss)-net....................................... $ (115,350) $ 3,590,330
Net realized gain on investments................................... 8,966,398 24,133,447
Net unrealized appreciation (depreciation) on investments for the year (30,980,097) 1,574,520
-------------- -------------
Net Increase (Decrease) In Net Assets
Resulting From Operations...................................... (22,129,049) 29,298,297
-------------- -------------
DIVIDENDS TO SHAREHOLDERS:
From investment income-net:
Class A shares................................................... - (595,707)
Class B shares................................................... - (52,362)
In excess of investment income-net:
Class A shares................................................... (1,425,741) -
Class B shares................................................... (116,253) -
From net realized gain on investments:
Class A shares................................................... (26,597,901) (6,469,383)
Class B shares................................................... (2,951,918) (1,137,286)
-------------- -------------
Total Dividends................................................ (31,091,813) (8,254,738)
-------------- -------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares................................................... 49,925,537 21,994,003
Class B shares................................................... 21,282,593 7,596,999
Class C shares................................................... - 1,000
Class R shares................................................... - 1,000
Dividends reinvested:
Class A shares................................................... 25,815,338 6,576,053
Class B shares................................................... 2,988,881 1,152,348
Cost of shares redeemed:
Class A shares................................................... (65,443,064) (76,782,353)
Class B shares................................................... (2,932,744) (8,700,597)
-------------- -------------
Increase (Decrease) In Net Assets
From Beneficial Interest Transactions........................ 31,636,541 (48,161,547)
-------------- -------------
Total (Decrease) In Net Assets............................... (21,584,321) (27,117,988)
NET ASSETS:
Beginning of year.................................................. 301,855,384 280,271,063
-------------- -------------
End of year [including distributions in excess of investment income-net;
($1,374,615) in 1994 and undistributed investment income-net;
$1,567,646 in 1995).............................................. $ 280,271,063 $ 253,153,075
-------------- -------------
-------------- -------------
</TABLE>
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets (continued)
<TABLE>
<CAPTION>
Shares
------------------------------------------------------------------------------------
Class A Class B Class C Class R
------------------------- ----------------------- ------------ ------------
Period Ended Period Ended
Year Ended October 31, Year Ended October 31, October 31, October 31,
-------------------------- ----------------------
1994 1995 1994 1995 1995* 1995*
--------- ---------- ---------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Shares sold............... 2,345,076 1,104,032 993,936 375,923 47 46
Shares issued for dividends
reinvested.............. 1,240,296 357,006 144,600 63,385 - -
Shares redeemed........... (3,127,724) (3,862,550) (144,563) (431,198) - -
---------- --------- -------- -------- ----------- ---------
Net Increase (Decrease)
In Shares Outstanding. 457,648 (2,401,512) 993,973 8,110 47 46
---------- --------- -------- -------- ----------- ---------
---------- --------- -------- -------- ----------- ---------
<FN>
- ----------------
* From September 1, 1995 (commencement of initial offering) to October 31,
1995.
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Financial Highlights
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment
return, ratios to average net assets and other supplemental data for each
year indicated. This information has been derived from the Fund's financial
statements.
<TABLE>
<CAPTION>
Class A Shares
-----------------------------------------------------------
Year Ended October 31,
-----------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA: 1991 1992 1993 1994 1995
------ ------ ------ ------ ------
Net asset value, beginning of year... $18.03 $22.12 $19.90 $23.77 $19.83
------ ------ ------ ------ ------
Investment Operations:
Investment Income (loss)-net......... .21 .06 .03 .01 .31
Net realized and unrealized gain (loss) on
investments........................ 5.77 (.46) 3.89 (1.54) 2.04
------ ------ ------ ------ ------
Total from Investment Operations... 5.98 (.40) 3.92 (1.53) 2.35
------ ------ ------ ------ ------
Distributions:
Dividends from investment income-net. (.34) (.14) (.05) - (.05)
Dividends in excess of investment
income-net......................... - - - (.12) -
Dividends from net realized gain on
investments........................ (1.55) (1.68) - (2.29) (.54)
------ ------ ------ ------ ------
Total Distributions................ (1.89) (1.82) (.05) (2.41) (.59)
------ ------ ------ ------ ------
Net asset value, end of year......... $22.12 $19.90 $23.77 $19.83 $21.59
------ ------ ------ ------ ------
------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN*................. 36.50% (2.04%) 19.71% (6.92%) 12.43%
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets................. 1.35% 1.30% 1.27% 1.29% 1.22%
Ratio of interest expense, loan commitment
fees and dividends on securities sold
short to average net assets........ .58% .38% .47% .25% .05%
Ratio of net investment income (loss)
to average net assets.............. 1.07% .22% .16% .04% 1.51%
Portfolio Turnover Rate.............. 207.10% 204.73% 237.14% 199.13% 244.82%
Net Assets, end of year (000's Omitted) $145,717 $243,148 $276,022 $239,407 $208,786
<FN>
- --------------
* Exclusive of sales load.
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Financial Highlights (continued)
Contained below is per share operating performance data for a share
of Beneficial Interest outstanding, total investment
return, ratios to average net assets and other supplemental data for each
year indicated. This information has been derived from the Fund's financial
statements.
<TABLE>
<CAPTION>
Class B Shares Class C Shares Class R Shares
--------------------------------- ------------- ------------
Period Ended Period Ended
Year Ended October 31, October 31, October 31,
--------------------------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA: 1993(1) 1994 1995 1995(2) 1995(2)
------ ------ ------ ------ ------
Net asset value, beginning of year... $21.38 $23.62 $19.58 $21.21 $21.61
------ ------ ------ ------ ------
Investment Operations:
Investment Income (loss)-net......... (.07) (.04) .14 (.04) -
Net realized and unrealized gain (loss) on
investments........................ 2.31 (1.62) 2.02 (.01) (.01)
------ ------ ------ ------ ------
Total from Investment Operations... 2.24 (1.66) 2.16 (.05) (.01)
------ ------ ------ ------ ------
Distributions:
Dividends from investment income-net. - - (.03) - -
Dividends in excess of investment
income-net......................... - (.09) - - -
Dividends from net realized gain on
investments........................ - (2.29) (.54) - -
------ ------ ------ ------ ------
Total Distributions................ - (2.38) (.57) - -
------ ------ ------ ------ ------
Net asset value, end of year......... $23.62 $19.58 $21.17 $21.16 $21.60
------ ------ ------ ------ ------
------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN(3)............... 10.48%(4) (7.58%) 11.50% (.24%)(4) (.05%)(4)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets................. 1.65%(4) 1.84% 1.97% .36%(4) .17%(4)
Ratio of interest expense, loan commitment
fees and dividends on securities sold
short to average net assets........ .44%(4) .24% .05% - -
Ratio of net investment income (loss)
to average net assets.............. (.69%)(4) (.61%) .71% (.18%)(4) -
Portfolio Turnover Rate.............. 237.14% 199.13% 244.82% 244.82% 244.82%
Net Assets, end of year (000's Omitted) $25,833 $40,864 $44,365 $1 $1
<FN>
- ----------
(1) From January 15, 1993 (commencement of initial offering) to October 31, 1993.
(2) From September 1, 1995 (commencement of initial offering) to October 31, 1995.
(3) Exclusive of sales load.
(4) Not annualized.
</TABLE>
See notes to financial statements.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Notes To Financial Statements
NOTE 1-Significant Accounting Policies:
The Fund is registered under the Investment Company Act of 1940
("Act") as a non-diversified open-end management investment company. Premier
Mutual Fund Services, Inc. (the "Distributor") acts as the distributor of the
Fund's shares. The Distributor, located at One Exchange Place, Boston,
Massachusetts 02109, is a wholly-owned subsidiary of FDI Distribution
Services, Inc., a provider of mutual fund administration services, which in
turn is a wholly-owned subsidiary of FDI Holdings, Inc., the parent company
of which is Boston Institutional Group, Inc. The Dreyfus Corporation
("Manager") serves as the Fund's investment adviser. The Manager is a direct
subsidiary of Mellon Bank, N.A.
Effective September 1, 1995, the Fund changed its name from Dreyfus
Strategic Investing to Premier Strategic Investing.
The Fund offers Class A, Class B, Class C and Class R shares. Class A
shares are subject to a sales charge imposed at the time of purchase, Class B
shares are subject to a contingent deferred sales charge imposed at the time
of redemption on redemptions made within six years of purchase, Class C
shares are subject to a contingent deferred sales charge imposed at the time
of redemption on redemptions made within one year of purchase and Class R
shares are sold at net asset value per share only to institutional investors.
Other differences between the four Classes include the services offered to
and the expenses borne by each Class and certain voting rights.
(a) Portfolio valuation: Investments in securities (including options
and financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Securities for which there are no such valuations are valued at fair value as
determined in good faith under the direction of the Board of Trustees.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange. Investments in forward currency exchange
contracts are valued at the offsetting rates.
(b) Foreign currency transactions: The Fund does not isolate that
portion of the results of operations resulting from changes in foreign
exchange rates on investments from the fluctuations arising from changes in
market prices of securities held. Such fluctuations are included with the net
realized and unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions, the difference between
the amounts of dividends, interest and foreign withholding taxes recorded on
the Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise from
changes in the value of assets and liabilities other than investments in
securities, resulting from changes in exchange rates. Such gains and losses
are included with net realized and unrealized gain or loss on investments.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Notes To Financial Statements (continued)
(c) Securities transactions and investment income: Securities
transactions are recorded on a trade date basis. Realized
gain and loss from securities transactions are recorded on the identified
cost basis. Dividend income is recognized on the ex-dividend date and
interest income, including, where applicable, amortization of discount on
investments, is recognized on the accrual basis.
(d) Dividends to shareholders: Dividends are recorded on the
ex-dividend date. Dividends from investment income-net and dividends from net
realized capital gain are normally declared and paid annually, but the Fund
may make distributions on a more frequent basis to comply with the distributio
n requirements of the Internal Revenue Code. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the
policy of the Fund not to distribute such gain.
(e) Federal income taxes: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2-Bank Line of Credit:
In accordance with an agreement with a bank, the Fund could borrow up
to $60 million from November 1, 1994 through September 6, 1995 under a
short-term unsecured line of credit. In connection therewith, the Fund had
agreed to pay commitment fees at an annual rate of .125 of 1% on the total
line of credit. Interest on borrowings was charged at rates which are related
to the Federal Funds rate in effect from time to time.
During the year ended October 31, 1995, there were no borrowings
under the line of credit.
NOTE 3-Management Fee and Other Transactions With Affiliates:
(a) Pursuant to a management agreement ("Agreement") with the
Manager, the management fee is computed at the annual rate of .75 of 1% of
the average daily value of the Fund's net assets and is payable monthly. The
Agreement provides for an expense reimbursement from the Manager should the
Fund's aggregate expenses, exclusive of taxes, interest on borrowings (which,
in the view of Stroock & Stroock & Lavan, counsel to the Fund, also
contemplates loan commitment fees and dividends on securities sold short), bro
kerage and extraordinary expenses, exceed the expense limitation of any state
having jurisdiction over the Fund. The most stringent state expense
limitation applicable to the Fund presently requires reimbursement of
expenses in any full fiscal year that such expenses (excluding distribution
expenses and certain expenses as described above) exceed 2 1/2% of the first
$30 million, 2% of the next $70 million and 1 1/2% of the excess over $100
million of the average value of the Fund's net assets in accordance with
California "blue sky" regulations. There was no expense reimbursement for the
year ended October 31, 1995.
Dreyfus Service Corporation, a wholly-owned subsidiary of the
Manager, retained $21,025 during the year ended October 31, 1995 from
commissions earned on sales of the Fund's shares.
(b) Under a Distribution Plan (the "Plan") adopted pursuant to Rule
12b1 under the Act, the Fund pays the Distributor for distributing the Fund's
Class B and Class C shares at an annual rate of .75 of 1%
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Notes To Financial Statements (continued)
of the value of the average daily net assets of Class B and Class C shares,
respectively. During the year ended October 31, 1995, $315,491 and $1 were
charged to the Class B and Class C shares, respectively, by the Distributor
pursuant to the Plan.
(c) Under the Shareholder Services Plan, the Fund pays the
Distributor at an annual rate of .25 of 1% of the value of the average daily
net assets of Class A, Class B and Class C shares for provision of certain
services. The services provided may include personal services relating to
shareholder accounts, such as answering shareholder inquiries regarding the
Fund and providing reports and other information, and services related to the
maintenance of shareholder accounts. The Distributor may make payments to
Service Agents (a securities dealer, financial institution or other industry
professional) in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. For the year ended October 31, 1995,
$546,140, $105,163 and $1 were charged to the Class A, Class B and Class C
shares, respectively, by the Distributor pursuant to the Shareholder Services
Plan.
(d) Each trustee who is not an "affiliated person" as defined in the
Act, receives from the Fund an annual fee of $2,500 and an attendance fee of
$500 per meeting. The Chairman of the Board receives an additional 25% of
such compensation.
NOTE 4-Securities Transactions:
(a) The following summarizes the aggregate amount of purchases and
sales of investment securities and securities sold short, excluding
short-term securities, financial futures, forward currency exchange contracts
and options transactions during the year ended October 31, 1995:
<TABLE>
<CAPTION>
Purchases Sales
------------ ------------
<S> <C> <C>
Long transactions................................... $517,800,727 $508,567,026
Short sale transactions............................. 63,368,304 28,252,372
------------ ------------
Total........................................... $581,169,031 $536,819,398
------------ ------------
------------ ------------
</TABLE>
The Fund is engaged in short-selling which obligates the Fund to
replace the security borrowed by purchasing the security at current market
value. The Fund would incur a loss if the price of the security increases
between the date of the short sale and the date on which the Fund replaces
the borrowed security. The Fund would realize a gain if the price of the
security declines between those dates. Until the Fund replaces the borrowed
security, the Fund will maintain daily, a segregated account with a broker
and custodian, of cash and/or U.S. Government securities sufficient to cover
its short position. Securities sold short at October 31, 1995, and their
related market values and proceeds are set forth in the Statement of
Securities Sold Short.
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Notes To Financial Statements (continued)
The following summarizes open forward currency exchange contracts at
October 31, 1995:
<TABLE>
<CAPTION>
U.S. Dollar Unrealized
Forward Currency Contracts: Proceeds Value (Depreciation)
---------- ---------- --------------
<S> <C> <C> <C>
Sales:
Swiss Francs, expiring 12/18/95........ $4,900,000 $5,220,942 $(320,942)
---------
---------
</TABLE>
The Fund enters into forward currency exchange contracts in order to
hedge its exposure to changes in foreign currency exchange rates on its
foreign portfolio holdings. When executing forward currency exchange
contracts, the Fund is obligated to buy or sell a foreign currency at a
specified rate on a certain date in the future. With respect to sales of
forward currency exchange contracts, the Fund would incur a loss if the value
of the contract increases between the date the forward contract is opened and
the date the forward contract is closed. The Fund realizes a gain if the
value of the contract decreases between those dates. With respect to
purchases of forward currency exchange contracts, the Fund would incur a loss
if the value of the contract decreases between the date the forward contract
is opened and the date the forward contract is closed. The Fund realizes a
gain if the value of the contract increases between those dates. The Fund is
also exposed to credit risk associated with counter party nonperformance on
these forward currency exchange contracts which is typically limited to the
unrealized gains on such contracts that are recognized in the statement of
assets and liabilities.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments (see the Statement of Financial Futures). Investments in
financial futures require the Fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contract at the close of
each day's trading. Accordingly, variation margin payments are made or
received to reflect daily unrealized gains or losses. When the contracts are
closed, the Fund recognizes a realized gain or loss. These investments
require initial margin deposits with a custodian, which consist of cash or
cash equivalents, up to approximately 10% of the contract amount. The amount
of these deposits is determined by the exchange or Board of Trade on which
the contract is traded and is subject to change. Contracts open at October
31, 1995 and their related unrealized market appreciation are set forth in
the Statement of Financial Futures.
(b) At October 31, 1995, accumulated net unrealized appreciation on
investments was $12,059,037, consisting of $17,036,696 gross unrealized
appreciation and $4,977,659 gross unrealized depreciation.
At October 31, 1995, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
<PAGE>
Premier Strategic Investing
(formerly Dreyfus Strategic Investing)-See Note 1
- --------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
Shareholders and Board of Trustees
Premier Strategic Investing
We have audited the accompanying statement of assets and liabilities
of Premier Strategic Investing, including the statements of investments,
financial futures and securities sold short, as of October 31, 1995, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended, and
financial highlights for each of the years indicated therein. 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 October 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 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 Premier Strategic Investing at October 31, 1995, the results of
its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the financial highlights
for each of the indicated years, in conformity with generally accepted
accounting principles.
Ernst & Young LLP
New York, New York
December 5, 1995
Important Tax Information (Unaudited)
- --------------------------------------------------------------------------------
For Federal tax purposes the Fund hereby designates $.543 per share
as a long-term capital gain distribution paid on December 14, 1994.
<PAGE>
Premier Strategic Investing
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
First Data Investor Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 037/632AR9510
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN PREMIER STRATEGIC INVESTING CLASS A SHARES AND THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
EXHIBIT A:
_______________________________________________
| | STANDARD | PREMIER |
| | & POOR'S 500 | STRATEGIC |
| PERIOD | COMPOSITE STOCK | INVESTING |
| | PRICE INDEX * |(CLASS A SHARES)|
|-----------|-----------------|----------------|
| 10/16/86 | 10,000 | 9,550 |
| 10/31/86 | 10,000 | 9,580 |
| 10/31/87 | 10,640 | 12,092 |
| 10/31/88 | 12,210 | 12,440 |
| 10/31/89 | 15,428 | 15,997 |
| 10/31/90 | 14,274 | 15,948 |
| 10/31/91 | 19,044 | 21,769 |
| 10/31/92 | 20,939 | 21,324 |
| 10/31/93 | 24,061 | 25,527 |
| 10/31/94 | 24,988 | 23,759 |
| 10/31/95 | 31,587 | 26,713 |
|----------------------------------------------|
*Source: Lipper Analytical Services, Inc.
