PREMIER STRATEGIC INVESTING
LETTER TO SHAREHOLDERS
Dear Shareholder:
This letter accompanies the semi-annual report of Premier Strategic
Investing for the six-month period ended April 30, 1996. The Fund's Class A
shares achieved a total return during this period of 16.57%,* compared to
13.76% for the Standard & Poor's 500 Composite Stock Price Index for the same
period.** The total return for Class B shares was 16.15%, for Class C shares
was16.16%, and for Class R shares was 16.74%.*
While the Fund can use various techniques to achieve its stated
investment objective of capital growth, its primary instruments are common
stocks. With respect to equity investments made by the Fund, we employ a
disciplined value style of equity investing. This investment style seeks
undervalued securities with the opportunity for growth through a disciplined
approach. This approach is described in detail in the following section.
VALUE INVESTING
While there are other investment disciplines practiced at Dreyfus, I am a
passionate believer in value investing. Value investors are frugal. We want
to buy growing companies, but do not want to pay much for them.
Value investors believe that in the investment world, inexpensive is
better than expensive. By definition, securities with low valuations should
have more potential for an increase in this valuation than securities with
high valuations, provided, of course, that the business fundamentals are
sound. Investors tend to have low expectations for securities with low
valuations, and these low expectations tend to be more easily met than for
securities with high expectations. Furthermore, investors and analysts often
extrapolate or project past growth into the future which tends to result in
excessive pessimism about low valuation stocks. The opposite growth pattern
can occur relative to these expectations, and low valuation stocks can grow
more rapidly than expected. Finally, if a stock with a low valuation is
unfortunately greeted with bad news and its price corrects, it already may be
relatively inexpensive and possibly experience a smaller relative decline. Of
course, because value stocks are undervalued, their prospects for significant
growth are less certain.
Investing in value stocks is somewhat counter to human nature. A
successful value investor does not follow the herd of other investors, does
not blindly accept widely distributed recommendations from brokerage firms,
and does not buy just glamorous investment stories which many others already
know and own. A successful value investor is more proactive than reactive,
and takes advantage of other investors' overreaction to events. Among the
numerous reasons that value stocks may appreciate in value are lower
expectations, more thorough analysis of actual, reported data instead of
forecasts, typically higher dividends, often more stock repurchases by the
companies, and the potential for takeovers and asset restructuring. Because
of its focus on securities with low valuations, value investing is designed
to produce more steady, less volatile investment performance.
THE MARKETS
The U.S. equity market benefited from one of its most vigorous price
increases during the early months of this year. One of the underlying
reasons, in addition to economic growth, was a decision by
the Federal Reserve Board to take no action in February to change short-term
interest rates. As winter turned into spring, however, the market's own
forces brought about a tightening of long-term rates. Several times in March
and April, the prospect of higher borrowing costs jolted the stock averages.
Nonetheless, by the time your Fund's latest fiscal period ended on April 30,
1996, the major market indexes were all solidly ahead of last year's level.
As shown by the flood of money going into mutual funds, investors appear
to have a voracious appetite for owning stocks. Saving for retirement has
become a national preoccupation, as evidenced by the growth of 401(k) and
other retirement plans. Stock market valuations have, of course, benefited
from this trend. However, if interest rates rise high enough, the attraction
of equities could diminish. The coming months will tell whether this is a
likely possibility.
PORTFOLIO OVERVIEW
Particularly strong results during the semi-annual period were achieved
with, among other securities, Eastman Kodak, Jones Apparel Group, Fila
Holdings, Grand Casinos, Digital Equipment, Texaco, Finova Group, Warner
Lambert, Sandoz, Praxair, AlliedSignal, Westinghouse Electric and Intimate
Brands. Results were penalized by holdings such as Sensormatic Electronics,
American Greetings Cl.A, Teradyne, PMI Group, Humana, Caremark International,
Witco, James River, and the electric utility sector in general.
As this reporting period ended, our primary investment themes included:
* Depressed high growth securities
* Asset restructuring potential
* Neglected or misunderstood companies
* New, unappreciated growth opportunities
* Particularly undervalued situations
Thank you for the privilege of managing your assets.
Sincerely,
[Timothy M. Ghriskey signature logo]
Timothy M. Ghriskey
Portfolio Manager
May 15, 1996
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. - Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of U.S. stock market performance.
<TABLE>
PREMIER STRATEGIC INVESTING
STATEMENT OF INVESTMENTS APRIL 30, 1996 (UNAUDITED)
COMMON STOCKS-94.6% SHARES VALUE
______ _______
<S> <C> <C> <C>
COMMERCIAL SERVICES-1.9% Sensormatic Electronics 255,000 $ 5,195,625
____________
CONSUMER DURABLES-2.4%.... Eastman Kodak 85,000 6,502,500
____________
CONSUMER NON-DURABLES-13.7% American Greetings, Cl. A 175,000 4,834,375
Fila Holdings A.D.S 106,000 7,234,500
First Brands 230,000 6,095,000
Jones Apparel Group 150,000 (a) 7,706,250
Kimberly-Clark 74,100 5,381,513
Philip Morris Cos 60,000 5,407,500
____________
36,659,138
____________
CONSUMER SERVICES-2.7%........... Grand Casinos225,000 (a) 7,284,375
____________
ELECTRONIC TECHNOLOGY-13.6%...... Boeing 75,000 6,159,375
Digital Equipment 95,000 (a) 5,676,250
Hewlett-Packard 60,000 6,352,500
Lucent Technologies 35,000 (a) 1,229,375
Omnipoint 18,000 (a) 540,000
Perkin-Elmer 115,000 6,310,625
Premiere Technologies. 13,500 (a) 509,625
Storage Technology 175,000 (a) 5,381,250
Teradyne 210,000 (a) 4,305,000
____________
36,464,000
____________
ENERGY MINERALS-4.3%....... Amerada Hess 105,000 5,945,625
Phillips Petroleum 135,000 5,602,500
____________
11,548,125
____________
FINANCE-8.6%...... Aetna Life & Casualty 75,000 5,343,750
CIGNA 50,000 5,668,750
ContiFinancial 34,400 (a) 1,096,500
FINOVA Group 115,000 6,382,500
PMI Group 110,000 4,675,000
____________
23,166,500
____________
HEALTH SERVICES-4.5%.............. Heartport 32,900 (a) 1,176,175
Humana 200,000 (a) 4,925,000
IMPATH 29,000 (a) 507,500
Value Health 185,000 (a) 5,388,125
____________
11,996,800
____________
PREMIER STRATEGIC INVESTING
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 (UNAUDITED)
COMMON STOCKS (CONTINUED) SHARES VALUE
______ _______
HEALTH TECHNOLOGY-10.5%........ Astra A 135,000 $ 5,982,758
Baxter International 125,000 5,531,250
Bristol-Myers Squibb 65,000 5,346,250
ChiRex 78,500 (a) 961,625
Sandoz AG 4,000 4,360,129
Warner-Lambert 53,000 5,922,750
____________
28,104,762
____________
PROCESS INDUSTRIES-5.3%..... James River 150,000 4,012,500
Praxair 135,000 5,214,375
Witco 150,000 5,118,750
____________
14,345,625
____________
PRODUCER MANUFACTURING-13.1% AlliedSignal 114,000 6,626,250
National Service Industries 145,000 5,365,000
Olin 65,000 5,752,500
Raychem 85,000 6,619,375
Tenneco 95,000 5,213,125
Westinghouse Electric 300,000 5,662,500
____________
35,238,750
____________
RETAIL TRADE-5.3%............ Cost Plus. 15,000 356,250
Eckerd 125,000 (a) 5,968,750
Intimate Brands, Cl. A 300,000 6,337,500
Thrifty Payless Holdings B 125,000 1,687,500
____________
14,350,000
____________
TECHNOLOGY SERVICES-.3%........... CSG Systems International 11,000 (a) 352,000
Segue Software 12,000 (a) 354,000
____________
706,000
____________
UTILITIES-8.4%.................... AT&T. 100,000 6,125,000
Ameritech 108,000 6,304,500
Entergy 190,000 5,035,000
GTE 120,000 5,205,000
____________
22,669,500
____________
TOTAL COMMON STOCKS
(cost $225,261,381) $254,231,700
============
CORPORATE BOND-2.0% INAMED, 11%, 3/31/1999
(cost $5,250,000) $ 5,250,000 (c) $ 5,250,000
============
SHORT-TERM INVESTMENTS-4.6%
U.S. TREASURY BILLS:.... 5.29%, 5/9/1996 $ 106,000 (b) 105,887
5.03%, 7/5/1996 12,090,000 (b) 11,981,432
5.38%, 7/25/1996 304,000 300,416
____________
TOTAL SHORT-TERM INVESTMENTS
(cost $12,389,603) $ 12,387,735
============
TOTAL INVESTMENTS (cost $242,900,984) ..................................... 101.2% $271,869,435
===== ============
LIABILITIES, LESS CASH AND RECEIVABLES (1.2%) $ (3,152,221)
===== ============
NET ASSETS................... ..................................... 100.0% $268,717,214
===== ============
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Partially held by brokers as collateral for open short positions.
(c) Securities restricted as to public resale. Investments in restricted
security with an aggregate value of $5,250,000,
represents approximately 2.0% of net assets;
<TABLE>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE NET ASSETS VALUATION*
______ ___ __ ____ ___
<S> <C> <C> <C> <C>
INAMED............................. 1/23/96 $ 100.00 2.0% cost
</TABLE>
* The valuation of this security has been determined in good faith under the
direction of the Board of Trustees.
<TABLE>
STATEMENT OF SECURITIES SOLD SHORT APRIL 30, 1996 (UNAUDITED)
SHARES VALUE
COMMON STOCK ________ _______
<S> <C> <C>
Caremark International
(proceeds $3,059,443)................................................... 150,000 $4,143,750
============
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
PREMIER STRATEGIC INVESTING
STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1996 (UNAUDITED)
<S> <C> <C>
ASSETS:
Investments in securities, at value (cost $242,900,984)_see statement.. $271,869,435
Receivable from brokers for proceeds on securities sold short........... 3,059,443
Dividends and interest receivable....................................... 262,036
Receivable for investment securities sold............................... 163,335
Net unrealized appreciation on forward
currency exchange contracts-Note 3(a)................................. 155,463
Receivable for shares of Beneficial Interest subscribed................. 7,672
Prepaid expenses......................................................... 37,846
_________
275,555,230
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 164,306
Due to Distributor...................................................... 83,630
Due to Custodian........................................................ 1,132,350
Securities sold short, at value
(proceeds $3,059,443)-see statement................................... 4,143,750
Payable for investment securities purchased............................. 1,008,626
Payable for shares of Beneficial Interest redeemed...................... 134,113
Accrued expenses........................................................ 171,241 6,838,016
__________ _____________
NET ASSETS.................................................................. $268,717,214
=============
REPRESENTED BY:
Paid-in capital......................................................... $216,716,016
Accumulated distributions in excess of investment income-net............ (558,995)
Accumulated undistributed net realized gain on investments.............. 24,520,764
Accumulated net unrealized appreciation on investments and
foreign currency transactions......................................... 28,039,429
_____________
NET ASSETS at value......................................................... $268,717,214
=============
Shares of Beneficial Interest outstanding:
Class A Shares
(unlimited number of $.001 par value authorized)....................... 9,814,625
=============
Class B Shares
(unlimited number of $.001 par value authorized)....................... 2,146,809
=============
Class C Shares
(unlimited number of $.001 par value authorized)....................... 52
=============
Class R Shares
(unlimited number of $.001 par value authorized)....................... 61
=============
NET ASSET VALUE per share:
Class A Shares ($221,213,083 / 9,814,625 shares)............................ $22.54
=======
Class B Shares ($47,501,615 / 2,146,809 shares)............................. $22.13
=======
Class C Shares ($1,142 / 52 shares)......................................... $21.97
=======
Class R Shares ($1,374 / 61 shares).................................... $22.52
=======
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
PREMIER STRATEGIC INVESTING
STATEMENT OF OPERATIONS SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED)
<S> <C> <C>
INVESTMENT INCOME:
INCOME:
Cash dividends (net of $7,276 foreign taxes withheld at source)....... $ 2,305,907
Interest.............................................................. 560,698
___
TOTAL INCOME...................................................... $ 2,866,605
EXPENSES:
Management fee-Note 2(a).............................................. 983,747
Shareholder servicing costs-Note 2(c)................................. 486,869
Distribution fees-Note 2(b)........................................... 170,668
Professional fees..................................................... 29,123
Trustees' fees and expenses-Note 2(d)................................. 24,933
Custodian fees........................................................ 21,092
Registration fees..................................................... 12,552
Dividends on securities sold short.................................... 6,000
Prospectus and shareholders' reports.................................. 2,550
Miscellaneous......................................................... 4,322
___
TOTAL EXPENSES.................................................... 1,741,856
___
INVESTMENT INCOME-NET............................................. 1,124,749
___
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain (loss) on investments and foreign
currency transactions-Note 3(a):
Long transactions................................................. $23,771,948
Short sale transactions........................................... (1,254,883)
Net realized gain on financial futures-Note 3(a)........................ 431,295
Net realized gain on forward currency exchange contracts................ 207,093
___
NET REALIZED GAIN..................................................... 23,155,453
Net unrealized appreciation on investments, securities sold short
and foreign currency transactions [including $(46,475) net
unrealized depreciation on financial futures]......................... 15,980,392
___
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 39,135,845
___
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 40,260,594
=============
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
PREMIER STRATEGIC INVESTING
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
OCTOBER 31, APRIL 30, 1996
1995 (UNAUDITED)
_____________ _______________
<S> <C> <C>
OPERATIONS:
Investment income-net................................................ $ 3,590,330 $ 1,124,749
Net realized gain on investments..................................... 24,133,447 23,155,453
Net unrealized appreciation on investments for the period............ 1,574,520 15,980,392
______________ ______________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... 29,298,297 40,260,594
______________ ______________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net:
Class A Shares..................................................... (595,707) (2,945,685)
Class B Shares..................................................... (52,362) (305,675)
Class C Shares..................................................... - (13)
Class R Shares..................................................... - (17)
Net realized gain on investments:
Class A Shares..................................................... (6,469,383) (19,971,560)
Class B Shares..................................................... (1,137,286) (4,213,094)
Class C Shares..................................................... - (99)
Class R Shares..................................................... - (97)
______________ ______________
TOTAL DIVIDENDS.................................................. (8,254,738) (27,436,240)
______________ ______________
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A Shares..................................................... 21,994,003 14,442,719
Class B Shares..................................................... 7,596,999 2,175,350
Class C Shares..................................................... 1,000 -
Class R Shares..................................................... 1,000 200
Dividends reinvested:
Class A Shares..................................................... 6,576,053 21,775,972
Class B Shares..................................................... 1,152,348 4,346,452
Class C Shares..................................................... - 112
Class R Shares..................................................... - 114
Cost of shares redeemed:
Class A Shares..................................................... (76,782,353) (34,278,686)
Class B Shares........................................................... (8,700,597) (5,722,448)
______________ ______________
INCREASE (DECREASE) IN NET ASSETS FROM BENEFICIAL
INTEREST TRANSACTIONS.......................................... (48,161,547) 2,739,785
______________ ______________
TOTAL INCREASE (DECREASE) IN NET ASSETS........................ (27,117,988) 15,564,139
NET ASSETS:
Beginning of period.................................................. 280,271,063 253,153,075
______________ ______________
End of period [including undistributed investment income-net
of $1,567,646 in 1995 and distributions in excess of investment
income-net of ($558,995) in 1996].................................. $253,153,075 $268,717,214
============== ==============
</TABLE>
<TABLE>
PREMIER STRATEGIC INVESTING
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
SHARES
______________________________________________________________________
CLASS A CLASS B
__________________________________ _____________________________
SIX MONTHS SIX MONTHS
YEAR ENDED ENDED YEAR ENDED ENDED
OCTOBER 31, APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996
1995 (UNAUDITED) 1995 (UNAUDITED)
___________ _____________ ______________ _______________
<S> <C> <C> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Shares sold......................... 1,104,032 676,672 375,923 101,337
Shares issued for dividends reinvested 357,006 1,060,690 63,385 214,958
Shares redeemed..................... (3,862,550) (1,591,951) (431,198) (265,114)
___________ __________ ___________ ___________
NET INCREASE (DECREASE)
IN SHARES OUTSTANDING........... (2,401,512) 145,411 8,110 51,181
___________ __________ ___________ ___________
___________ __________ ___________ ___________
</TABLE>
<TABLE>
SHARES
_________________________________________________________________________
CLASS C CLASS R
__________________________________ _________________________________
SIX MONTHS SIX MONTHS
PERIOD ENDED ENDED PERIOD ENDED ENDED
OCTOBER 31, APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996
1995* (UNAUDITED) 1995* (UNAUDITED)
___________ _____________ ______________ ______________
<S> <C> <C> <C> <C>
CAPITAL SHARE TRANSACTIONS (continued):
Shares sold......................... 47 - 46 9
Shares issued for dividends reinvested - 5 - 6
___________ _____________ ______________ ______________
NET INCREASE
IN SHARES OUTSTANDING........... 47 5 46 15
=========== ============= ============== ==============
_______________
* From September 1, 1995 (commencement of initial offering) to October 31, 1995.
</TABLE>
See independent accountants' review report and notes to financial statements.
PREMIER STRATEGIC INVESTING
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 period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
CLASS A SHARES
_____________________________________________________________________
YEAR ENDED OCTOBER 31, SIX MONTHS ENDED
______________________________________________________ APRIL 30, 1996
PER SHARE DATA: 1991 1992 1993 1994 1995 (UNAUDITED)
___ ___ ___ __ __ ____
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $18.03 $22.12 $19.90 $23.77 $19.83 $21.59
______ ______ ______ ______ ______ ______
INVESTMENT OPERATIONS:
Investment income-net......... .21 .06 .03 .01 .31 .12
Net realized and unrealized
gain (loss) on investments.... 5.77 (.46) 3.89 (1.54) 2.04 3.23
______ ______ ______ ______ ______ ______
TOTAL FROM INVESTMENT
OPERATIONS.............. 5.98 (.40) 3.92 (1.53) 2.35 3.35
______ ______ ______ ______ ______ ______
DISTRIBUTIONS:
Dividends from investment
income-net.................. (.34) (.14) (.05) - (.05) (.31)
Dividends in excess of investment
income-net.................. - - - (.12) - -
Dividends from net realized gain
on investments.............. (1.55) (1.68) - (2.29) (.54) (2.09)
______ ______ ______ ______ ______ ______
TOTAL DISTRIBUTIONS......... (1.89) (1.82) (.05) (2.41) (.59) (2.40)
______ ______ ______ ______ ______ ______
Net asset value, end of period $22.12 $19.90 $23.77 $19.83 $21.59 $22.54
====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN(1)........ 36.50% (2.04%) 19.71% (6.92%) 12.43% 16.57%(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets.......... 1.35% 1.30% 1.27% 1.29% 1.22% .59%(2)
Ratio of interest expense, loan
commitment fees and dividends
on securities sold short to
average net assets.......... .58% .38% .47% .25% .05% .01%(2)
Ratio of net investment income
to average net assets....... 1.07% .22% .16% .04% 1.51% .49%(2)
Portfolio Turnover Rate....... 207.10% 204.73% 237.14% 199.13% 244.82% 64.46%(2)
Average commission rate paid(3) $.1181
Net Assets, end of period
(000's Omitted)............. $145,717 $243,148 $276,022 $239,407 $208,786 $221,213
_____________
(1) Exclusive of sales load.
(2) Not annualized.
(3) For fiscal years beginning on or after November 1, 1995, the Fund is required to disclose its average commission rate paid
per share for purchases and sales of investment securities.
</TABLE>
See independent accountants' review report and notes to financial statements.
PREMIER STRATEGIC INVESTING
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 period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
CLASS B SHARES
___________________________________________________
YEAR ENDED OCTOBER 31, SIX MONTHS ENDED
__________________________________ APRIL 30, 1996
PER SHARE DATA: 1993(1) 1994 1995 (UNAUDITED)
___ __ __ ____
<S> <C> <C> <C> <C>
Net asset value, beginning of period...... $21.38 $23.62 $19.58 $21.17
______ ______ ______ ______
INVESTMENT OPERATIONS:
Investment income (loss)-net.............. (.07) (.04) .14 .04
Net realized and unrealized
gain (loss) on investments.............. 2.31 (1.62) 2.02 3.17
______ ______ ______ ______
TOTAL FROM INVESTMENT
OPERATIONS.......................... 2.24 (1.66) 2.16 3.21
______ ______ ______ ______
DISTRIBUTIONS:
Dividends from investment
income-net.............................. - - (.03) (.16)
Dividends in excess of investment
income-net.............................. - (.09) - -
Dividends from net realized gain
on investments.......................... - (2.29) (.54) (2.09)
______ ______ ______ ______
TOTAL DISTRIBUTIONS..................... - (2.38) (.57) (2.25)
______ ______ ______ ______
Net asset value, end of period............. $23.62 $19.58 $21.17 $22.13
====== ====== ====== ======
TOTAL INVESTMENT RETURN(2).................... 10.48%(3) (7.58%) 11.50% 16.15%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets...................... 1.65%(3) 1.84% 1.97% .97%(3)
Ratio of interest expense, loan
commitment fees and dividends
on securities sold short to
average net assets...................... .44%(3) .24% .05% -
Ratio of net investment income
(loss) to average net assets............ (.69%)(3) (.61%) .71% .12%(3)
Portfolio Turnover Rate.................... 237.14% 199.13% 244.82% 64.46%(3)
Average commission rate paid(4)........... $.1181
Net Assets, end of period
(000's Omitted)......................... $ 25,833 $ 40,864 $ 44,365 $ 47,502
_____________
(1) From January 15, 1993 (commencement of initial offering) to October 31, 1993.
(2) Exclusive of sales load.
(3) Not annualized.
(4) For fiscal years beginning on or after November 1, 1995, the Fund is required to disclose its average commission rate paid
per share for purchases and sales of investment securities.
</TABLE>
See independent accountants' review report and notes to financial statements.
PREMIER STRATEGIC INVESTING
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 period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
CLASS C SHARES CLASS R SHARES
____________________________________ ____________________________________
PERIOD ENDED SIX MONTHS ENDED PERIOD ENDED SIX MONTHS ENDED
OCTOBER 31, APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996
PER SHARE DATA: 1995(1) (UNAUDITED) 1995(1) (UNAUDITED)
____ _____ ____ _____
<S> <C> <C> <C> <C>
Net asset value, beginning of period... $21.21 $21.16 $21.61 $21.60
______ ______ ______ ______
INVESTMENT OPERATIONS:
Investment income (loss)-net........... (.04) .05 - .19
Net realized and unrealized
gain (loss) on investments........... (.01) 3.13 (.01) 3.18
______ ______ ______ ______
TOTAL FROM INVESTMENT
OPERATIONS....................... (.05) 3.18 (.01) 3.37
______ ______ ______ ______
DISTRIBUTIONS:
Dividends from investment
income-net........................... - (.28) - (.36)
Dividends from net realized gain
on investments....................... - (2.09) - (2.09)
______ ______ ______ ______
TOTAL DISTRIBUTIONS.................. - (2.37) - (2.45)
______ ______ ______ ______
Net asset value, end of period......... $21.16 $21.97 $21.60 $22.52
====== ====== ====== ======
TOTAL INVESTMENT RETURN(2)................. (.24%)(3) 16.16%(3) (.05%)(3) 16.74%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets................... .36%(3) 1.02%(3) .17%(3) .49%(3)
Ratio of interest expense, loan committment
fees and dividends on securities sold short
to average net assets................ - - - -
Ratio of net investment income (loss)
to average net assets................ (.18%)(3) .05%(3) - .58%(3)
Portfolio Turnover Rate................ 244.82% 64.46%(3) 244.82% 64.46%(3)
Average commission rate paid(4)........ $.1181 $.1181
Net Assets, end of period
(000's Omitted)...................... $1 $1 $1 $1
_____________
(1) From September 1, 1995 (commencement of initial offering) to October 31,
1995.
(2) Exclusive of sales load.
(3) Not annualized.
(4) For fiscal years beginning on or after November 1, 1995, the Fund is
required to disclose its average commission rate paid per share for purchases
and sales of investment securities.
</TABLE>
See independent accountants' review report and notes to financial statements.
PREMIER STRATEGIC INVESTING
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Premier Strategic Investing (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company. The Fund's investment objective is capital
growth. The Dreyfus Corporation ("Manager") serves as the Fund's investment
adviser. The Manager is a direct subsidiary of Mellon Bank, N.A. ("Mellon").
Premier Mutual Fund Services, Inc. (the "Distributor") acts as the
distributor of the Fund's shares. 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. Forward currency exchange contracts are
valued at the forward rate.
(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.
(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
PREMIER STRATEGIC INVESTING
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution 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-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 value
of the Fund's average daily 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, brokerage, interest on borrowings
(which, in the view of Stroock & Stroock & Lavan, counsel to the Fund, also
contemplates dividends on securities sold short), 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 21/2% of the first $30 million, 2% of the next $70 million and 11/2%
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 during the six months ended April 30, 1996.
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager,
retained $59,079 during the six months ended April 30, 1996 from commissions
earned on sales of the Fund's shares.
(B) Under a Distribution Plan (the "Plan") adopted pursuant to Rule 12b-1
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% of the value of the
average daily net assets of Class B and Class C shares, respectively. During
the six months ended April 30, 1996, $170,664 and $4 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. During the six months ended April 30,
1996, $271,025, $56,888 and $1 were charged to the Class A, Class B and Class
C shares, respectively, by the Distributor pursuant to the Shareholder
Services Plan.
Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc.,
a wholly-owned subsidiary of the Manager, under a transfer agency agreement
for providing personnel and facilities to perform transfer agency services
for the Fund. Such compensation amounted to $76,227 for the period from
December 1, 1995 through April 30, 1996.
PREMIER STRATEGIC INVESTING
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Effective May 10, 1996, the Fund entered into a Custody Agreement with
Mellon to provide custodial services for the Fund.
(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 3-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 and forward currency exchange contracts during
the six months ended April 30, 1996:
<TABLE>
PURCHASES SALES
_________ _________
<S> <C> <C>
Long transactions......................... $162,335,526 $172,127,550
Short sale transactions................... 11,207,107 9,754,724
_________ _________
TOTAL................................... $173,542,633 $181,882,274
========= =========
</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 April 30, 1996, and their related market
values and proceeds are set forth in the Statement of Securities Sold Short.
The following summarizes open forward currency contracts at April 30,
1996:
<TABLE>
FOREIGN
CURRENCY U.S. DOLLAR UNREALIZED
FORWARD CURRENCY SALES CONTRACTS: AMOUNT PROCEEDS VALUE APPRECIATION
_______ ___ ___ ___ ___
<S> <C> <C> <C> <C>
Swiss Francs, expiring 6/18/96............ 3,500,000 $2,975,938 $2,826,684 $149,254
Swedish Krona, expiring 6/18/96........... 32,000,000 4,701,734 4,695,525 6,209
___
$155,463
===
</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
PREMIER STRATEGIC INVESTING
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
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. 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 received or made 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.
At April 30, 1996, there were no financial futures contracts outstanding.
(B) At April 30, 1996, accumulated net unrealized appreciation on
investments and forward currency exchange contracts was $28,039,607,
consisting of $33,512,459 gross unrealized appreciation and $5,472,852 gross
unrealized depreciation.
At April 30, 1996, 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).
PREMIER STRATEGIC INVESTING
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS STRATEGIC INVESTING
We have reviewed the accompanying statement of assets and liabilities of
Premier Strategic Investing, including the statements of investments and
securities sold short, as of April 30, 1996, and the related statements of
operations and changes in net assets and financial highlights for the six
month period ended April 30, 1996. These financial statements and financial
highlights are the responsibility of the Fund's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the interim financial statements and financial highlights
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
October 31, 1995 and financial highlights for each of the five years in the
period ended October 31, 1995 and in our report dated December 5, 1995, we
expressed an unqualified opinion on such statement of changes in net assets
and financial highlights.
[Ernst and Young LLP signature logo]
New York, New York
June 6, 1996
[Dreyfus lion "d" logo]
PREMIER STRATEGIC INVESTING
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
Mellon Bank, N.A.
One Mellon Bank Plaza
Pittsburgh, PA 15258
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, RI 02903
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 037/632SA964
[Dreyfus logo]
Semi-Annual Report
Premier Strategic
Investing
April 30, 1996
