DREYFUS STRATEGIC GROWTH, L.P.
LETTER TO SHAREHOLDERS
Dear Shareholder:
The following letter to investors in Dreyfus Strategic Growth, L.P. (now
called Premier Strategic Growth Fund) is signed by Michael L. Schonberg, who
is now the Fund's Portfolio Manager.
It is a pleasure to introduce Mike Schonberg, who has been managing the
Fund since August, 1995, when he joined the Dreyfus investment management
team. Mike's previous experience includes managing growth-oriented portfolios
at DuPont Pension Fund and UBS Asset Management, New York, where he served as
chief investment officer and vice chairman of its Investment Policy
Committee. He has also held posts as portfolio manager for Cambridge Capital
Corporation and Alliance Capital Management Corp. Most recently he was
associated with Omega Advisors as a general partner. He is a graduate of the
Massachusetts Institute of Technology.
Sincerely,
[Stephen Canter signature logo]
Stephen Canter
Chief Investment Officer
The Dreyfus Corporation
January 12, 1996
New York, N.Y.
Dear Shareholder:
As of December 31, 1995, your Fund reorganized from a Delaware limited
partnership to a Massachusetts business trust. Effective January 1, 1996, the
Fund's name was changed from Dreyfus Strategic Growth, L.P. to Premier
Strategic Growth Fund. The investment objective and management policies of
the Fund remain unchanged. However, for the 1996 tax year, there will no
longer be the need to issue Schedule K-1s to Fund investors. Instead, Fund
income will be reported in a manner similar to most other funds - via Form
1099 - which will result in simpler filing procedures.
As we mentioned, the Fund's investment objective and management policies
have not changed. Last August, however, we introduced a new investment
approach. As shown later in this letter, in the section entitled "Portfolio
Focus," this transition required about two months' time. Hence this approach
had a minimal effect on the Fund's performance for the year ended December
31, 1995.
The Fund's approach bases stock selection on a forecast of future (12 to
18 months') relative earnings growth, by company. This stems from our belief
that relative stock performance is strongly correlated to relative earnings
performance. Final construction of the portfolio rests on analysis of the
fundamentals of companies that interest us. The top-down earnings forecasts
supplement the analysis of business fundamentals.
Our selection approach leads to a growth-style portfolio which holds a
core of companies that we believe have above-average long-term growth
potential. When appropriate, we supplement this with large cyclical positions
when we see signs of a strong recovery in cyclical earnings. The portfolio
normally will hold large, medium and small capitalization stocks. Small cap
selections will be included when sufficient trading liquidity exists.
We will sell stocks short in a bearish market environment or in
anticipation of a fundamental problem that could seriously affect earnings of
a particular company.
The Fund will use foreign stocks on occasion as an extension of a strong
domestic concept, as an opportunity to participate in a cyclical regional
earnings recovery, and as an alternative to U.S. stocks when American shares
are relatively unattractive compared to foreign markets. Index futures and
options are available to the Fund to hedge market risk. However, such
instruments will be used sparingly.
ECONOMIC ENVIRONMENT
Global economic growth appears to be slowing due to the long lagged
effect of the dynamic interest rate rise in 1994. U.S. economic growth is
weak, as the consumer sector is hampered by slow employment and income growth
while the industrial sector continues to make necessary inventory
adjustments. Current monetary and fiscal trends portend more below-average
growth in early 1996, with 1997 poised for a more sustained economic and
earnings growth phase if the liquidity background improves further. European
economic growth is slowing and Japan remains in need of a major economic
stimulus program to accelerate growth in 1996.
MARKET OVERVIEW
As we see it, the financial markets have a continued positive background
as increased monetary liquidity and lower interest rates develop in the
current slow growth, low inflation environment. However, the risk of selected
1996 earnings disappointments has increased. This requires very careful
selection of industry exposure and company focus.
The areas where we look for continued solid earnings growth are computer
networking, telecommunications, certain semiconductors, consumer growth
stocks, finance and industrial technology. Sectors that we favor because of
new products and technology include biotechnology, select electronic
technology breakthroughs and health care services.
PORTFOLIO FOCUS
When the transition between the Fund's portfolio managers took place last
summer the portfolio was mainly in cash, with less than 40% in equities.
During this period, significant short positions and foreign holdings were
liquidated. In August and September, new American equity positions were
identified and purchased. Currently, it is our intention to remain as fully
invested as possible; however, this may change based on market conditions.
The Fund completed its fiscal year December 31, 1995. For the 12-month
period, its total return was -4.57%, based upon net asset value per share,*
well below the return of 37.53% for the Standard & Poor's 500.** We attribute
the negative return to the fact that the Fund was basically uninvested during
the first seven months of the year when hedge positions were factored in. It
was in transition for the next two months, and became fully invested late in
the year when some key sectors such as health technology performed poorly.
Since the start of 1996, however, our selections by and large have performed
well.
Currently, the portfolio emphasizes health care stocks, select technology
issues and, to a lesser degree, financial stocks. As our analysis of the
economic outlook indicates, the portfolio is underweighted in industrial
cyclical issues and utilities as well as in consumer cyclicals.
As shown in the Statement of Investments, on a later page in this report,
we favor such biotechnology stocks as Oncor, Biogen and Teva Pharmaceutical.
On the basis of breakthroughs in technology, we have selected such issues as
Cree Research, Continental Circuits, Fuisz Technology and Chromatics Color
Science. In health care services we have taken positions in Complete
Management, OncorMed, HemaCare and ThermoLase.
Selections such as these may not be conventional. The capacity for growth
of these and other stocks in the portfolio will become clear as the newly
reorganized portfolio matures.
Your investment in the Fund is very much appreciated. We will continue
our best efforts to bring you rewarding returns.
Sincerely,
Michael L. Schonberg
Portfolio Manager
January 12, 1996
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid.
**SOURCE: LIPPER ANALYTICAL SERVICES, INC. - Reflects the reinvestment of
income dividends and when applicable, capital gain distributions. The
Standard & Poor's 500 Index is a widely accepted unmanaged index of U.S.
stock market performance.
DREYFUS STRATEGIC GROWTH, L.P. DECEMBER 31, 1995
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS STRATEGIC
GROWTH, L.P. AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
[Exhibit A
Dollars
$27,746
Standard & Poor's 500
Composite Stock
Price Index*
$23,915
Dreyfus
Strategic Growth
*Source: Lipper Analytical Services, Inc.]
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
% RETURN REFLECTING
% RETURN WITHOUT MAXIMUM INITIAL
PERIOD ENDED 12/31/95 SALES CHARGE SALES CHARGE (4.5%)**
_____________ ___________ _____________
<S> <C> <C>
1 Year (4.57)% (8.88)%
5 Years 6.60 5.63
From Inception (3/27/87) 11.04 10.46
</TABLE>
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in Dreyfus Strategic
Growth, L.P. on 3/27/87 (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 3/31/87 is used as the
beginning value on 3/27/87. All dividends and capital gain distributions are
reinvested.
The Fund's performance shown in the line graph takes into account the maximum
initial sales charge and all other applicable fees and expenses. Unlike the
Fund, the Standard and 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 Financial Highlights section of the
Prospectus and elsewhere in this report.
**Prior to 1/1/96 the Fund charged a maximum initial sales charge of 3.0%.
<TABLE>
<CAPTION>
DREYFUS STRATEGIC GROWTH, L.P.
STATEMENT OF INVESTMENTS DECEMBER 31, 1995
COMMON STOCKS-102.2% SHARES VALUE
_____________
<S> <C> <C>
COMMERCIAL SERVICES-8.6% Cinar Films, Cl. B (a) 90,000 $ 1,361,250
Learning Tree International............ 28,500 445,312
Metromedia International Group....... (a) 150,000 2,100,000
Quintel Entertainment........... 119,500 567,625
______
4,474,187
______
CONSUMER DURABLES-5.1% LoJack (a) 140,000 1,557,500
Spectrum HoloByte...................... 115,000 747,500
Sterling Vision...................... (a) 50,000 343,750
_________
2,648,750
_________
CONSUMER
NON-DURABLES-8.0% ThermoLase (a) 60,000 1,552,500
Vista 2000........................... (a) 265,000 2,616,875
______
4,169,375
______
ELECTRONIC
TECHNOLOGY-20.2% Advanced Photonix, Cl. A .(a) 430,000 1,182,500
Applied Materials.................... (a) 50,000 1,968,750
cisco Systems........................ (a) 25,000 1,865,625
Continental Circuits................. (a) 100,000 1,625,000
Cree Research........................ (a) 202,000 2,979,500
Storage Technology................... (a) 40,000 955,000
______
10,576,375
______
FINANCE-9.4% ACE 30,000 1,192,500
ASTA Funding........................... 196,000 833,000
National Auto Credit................. (a) 100,000 1,625,000
Reliance Group Holdings................ 100,000 862,500
Titan Holdings....................... (a) 30,000 431,250
______
4,944,250
______
HEALTH SERVICES-12.8% Complete Management 116,000 1,029,500
Core Industries...................... (a) 120,000 1,020,000
Northstar Health Services............ (a) 225,000 1,321,875
OncorMed............................. (a) 240,000 1,440,000
On-Gard Systems...................... (a) 125,000 906,250
Quantum Health Resources............. (a) 100,000 981,250
______
6,698,875
______
HEALTH TECHNOLOGY-22.2% Biogen (a) 20,000 1,230,000
Forest Laboratories.................. (a) 25,000 1,131,250
Fuisz Technologies..................... 117,000 1,784,250
Guidant.............................. (a) 12,906 545,279
HemaCare............................. (a) 300,000 1,125,000
Mentor................................. 60,000 1,380,000
Neuromedical Systems................... 26,000 523,250
DREYFUS STRATEGIC GROWTH, L.P.
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1995
COMMON STOCKS (CONTINUED) SHARES VALUE
_____________
HEALTH
TECHNOLOGY (CONTINUED) ONCOR (a) 400,000 $ 1,800,000
Teva Pharmaceutical Industries, A.D.R.. 45,000 2,086,875
______
11,605,904
______
PROCESS INDUSTRIES-1.8% Chromatics Color Science International (a) 220,000 962,500
______
PRODUCER
MANUFACTURING-6.7% Motorcar Parts & Accessories ..(a) 160,000 2,100,000
Raychem................................ 25,000 1,421,875
______
3,521,875
______
TECHNOLOGY SERVICES-2.2%. Elcom International 15,000 228,750
Mercury Interactive.................. (a) 50,000 912,500
______
1,141,250
______
UTILITIES-5.2% AMNEX (a) 600,000 2,700,000
______
TOTAL COMMON STOCKS
(cost $56,423,796)................ .... $53,443,341
======
PRINCIPAL
CONVERTIBLE SECURED NOTES-1.9% AMOUNT
_______
HEALTH SERVICES; Comprehensive Care,
12%, 6/1/1996
(cost $1,000,000).................. (b) $ 1,000,000 $ 1,000,000
======
TOTAL INVESTMENTS (cost $57,423,796) .............................. 104.1% $54,443,341
===== ======
LIABILITIES, LESS CASH AND RECEIVABLES (4.1%) $ (2,157,521)
===== ======
NET ASSETS.................................................................. 100.0% $52,285,820
===== ======
</TABLE>
<TABLE>
<CAPTION>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Security restricted as to public resale. Investment in restricted
security, with an aggregate value of $1,000,000, represents approximately
1.9% of net assets;
<S> <C> <C> <C> <C>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE NET ASSETS VALUATION*
___ ______ _____ ________ _______
Comprehensive Care....................... 11/30/95 $100 1.9% cost
*The valuation of this security has been determined in good faith under
the direction of the Managing General Partners.
</TABLE>
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS STRATEGIC GROWTH, L.P.
STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 1995
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $57,423,796)-see statement...................................... $54,443,341
Cash.................................................................... 1,386,528
Receivable for investment securities sold............................... 5,339,992
Dividends and interest receivable....................................... 28,339
Prepaid expenses........................................................ 5,428
______
61,203,628
LIABILITIES:
Due to The Dreyfus Corporation and subsidiaries......................... $ 44,868
Due to Distributor...................................................... 1,013
Bank loans payable-Note 2............................................... 7,020,000
Payable for investment securities purchased............................. 1,706,902
Loan commitment fees and interest payable............................... 42,909
Payable for shares of Partnership Interest redeemed..................... 4,409
Accrued expenses........................................................ 97,707 8,917,808
_____ ______
NET ASSETS ................................................................ $52,285,820
======
REPRESENTED BY:
Paid-in capital......................................................... $18,735,145
Accumulated undistributed investment income-net......................... 15,339,253
Accumulated undistributed net realized gain on investments
and foreign currency transactions..................................... 21,191,877
Accumulated net unrealized (depreciation) on investments-Note 4(b)...... (2,980,455)
______
NET ASSETS at value applicable to 1,391,605 outstanding shares of
Partnership Interest, equivalent to $37.57 per share
(unlimited number of Limited Partners).................................. $52,285,820
======
See notes to financial statements.
DREYFUS STRATEGIC GROWTH, L.P.
STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1995
INVESTMENT INCOME:
INCOME:
Interest.............................................................. $ 2,258,333
Cash dividends (net of $2,980 foreign taxes withheld at source)....... 273,562
_____-
TOTAL INCOME...................................................... $ 2,531,895
EXPENSES:
Management fee-Note 3(a).............................................. 565,274
Investor servicing costs-Note 3(b).................................... 343,150
Interest expense-Note 2............................................... 158,454
Legal fees............................................................ 88,458
Auditing fees......................................................... 56,998
Registration fees..................................................... 42,398
Managing General Partners' fees and expenses-Note 3(c)................ 38,574
Loan commitment fees-Note 2........................................... 31,684
Custodian fees........................................................ 28,969
Prospectus and investors' reports-Note 3(b)........................... 18,281
Dividends on securities sold short.................................... 13,600
Miscellaneous......................................................... 2,600
_____-
TOTAL EXPENSES.................................................... 1,388,440
_____-
INVESTMENT INCOME-NET............................................. 1,143,455
_____-
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments-Note 4(a):
Long transactions (including options transactions
and foreign currency transactions)................................ $ 6,923,776
Short sale transactions............................................... (1,414,083)
Net realized (loss) on forward currency exchange contracts-Note 4(a);
Short transactions.................................................... (88,843)
Net realized gain (loss) on financial futures-Note 4(a):
Long transactions..................................................... 73,099
Short transactions.................................................... (8,025,060)
__________
NET REALIZED (LOSS)............................................... (2,531,111)
Net unrealized (depreciation) on investments (including options
transactions), foreign currency transactions and securities sold
short [including ($86,591) net unrealized (depreciation)
on financial futures]................................................. (1,774,747)
__________
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS................. (4,305,858)
__________
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $(3,162,403)
======
See notes to financial statements.
DREYFUS STRATEGIC GROWTH, L.P.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED DECEMBER 31,
________________________________
1994 1995
______ ______
OPERATIONS:
Investment income-net................................................... $ 1,612,811 $ 1,143,455
Net realized gain (loss) on investments................................. 1,612,943 (2,531,111)
Net unrealized (depreciation) on investments for the year............... (3,309,863) (1,774,747)
______ ______
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS................ (84,109) (3,162,403)
______ ______
PARTNERSHIP INTEREST TRANSACTIONS:
Net proceeds from shares sold........................................... 72,386,547 4,051,009
Cost of shares redeemed................................................. (18,806,148) (47,496,495)
______ ______
INCREASE (DECREASE) IN NET ASSETS FROM
PARTNERSHIP INTEREST TRANSACTIONS................................. 53,580,399 (43,445,486)
______ ______
TOTAL INCREASE (DECREASE) IN NET ASSETS........................... 53,496,290 (46,607,889)
NET ASSETS:
Beginning of year....................................................... 45,397,419 98,893,709
______ ______
End of year (including undistributed investment income-net:
$14,195,798 in 1994 and $15,339,253 in 1995).......................... $ 98,893,709 $ 52,285,820
====== ======
SHARES SHARES
______ ______
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 1,799,462 104,015
Shares redeemed......................................................... (475,280) (1,224,539)
______ ______
NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... 1,324,182 (1,120,524)
====== ======
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS STRATEGIC GROWTH, L.P.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Partnership 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.
YEAR ENDED DECEMBER 31,
____________________________________________________________
PER SHARE DATA: 1991 1992 1993 1994 1995
____ ____ ____ ____ ____
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $27.27 $36.19 $30.63 $38.22 $39.37
___ ___ ___ ___ ___
INVESTMENT OPERATIONS:
Investment income-net........................ 2.07 1.38 2.21 .87(1) 5.37
Net realized and unrealized gain (loss)
on investments............................. 6.85 (6.94) 5.38 .28 (7.17)
___ ___ ___ ___ ___
TOTAL FROM INVESTMENT OPERATIONS........... 8.92 (5.56) 7.59 1.15 (1.80)
___ ___ ___ ___ ___
Net asset value, end of year................. $36.19 $30.63 $38.22 $39.37 $37.57
=== === === === ===
TOTAL INVESTMENT RETURN (2)...................... 32.71% (15.36%) 24.78% 3.01% (4.57%)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to average net assets 1.50%(3) 1.50%(3) 1.59%(3) 1.46% 1.57%
Ratio of interest expense, loan commitment fees
and dividends on securities sold short to average
net assets................................. .08% .22% .03% .16% .27%
Ratio of net investment income to average
net assets................................. 1.48% .83% .79% 2.17% 1.52%
Decrease reflected in above expense ratios due to
undertaking by the Manager................. - - .06% - -
Portfolio Turnover Rate...................... 95.49% 209.38% 301.07% 269.41% 298.93%
Net Assets, end of year (000's Omitted)...... $61,063 $44,765 $45,397 $98,894 $52,286
_________________________
(1) Based on an average of shares outstanding at each month end.
(2) Exclusive of sales load.
(3) Net of expenses reimbursed.
See notes to financial statements.
</TABLE>
DREYFUS STRATEGIC GROWTH, L.P.
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. The Dreyfus
Corporation ("Manager") serves as the Fund's investment adviser. Premier
Mutual Fund Services, Inc. (the "Distributor") acts as the Fund's
distributor. 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. As of December 31, 1995, Dreyfus
Partnership Management Inc., a wholly-owned subsidiary of the Manager, held
18,788 shares. The Manager is a direct subsidiary of Mellon Bank, N.A.
Effective on January 1, 1996, the Fund was reorganized as a Massachusetts
business trust under the name Premier Strategic Growth Fund. Effective
January 2, 1996 the Fund will offer four classes of shares-Class A, Class B,
Class C and Class R. The currently existing class of shares will be
designated as Class A. 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 Managing General
Partners. 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.
DREYFUS STRATEGIC GROWTH, L.P.
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) DISTRIBUTIONS TO INVESTORS: Distributions from investment income-net
and distributions from net realized capital gains may be allocated and paid
annually after the end of the year in which earned.
(E) INCOME TAXES: As a partnership, the Fund itself will not be subject
to Federal, State and City income taxes. Instead, each investor will be
allocated, and subject to tax on, his distributive share of the Fund's
income. Therefore, no income tax provision is required.
NOTE 2-BANK LINE OF CREDIT:
In accordance with an agreement with a bank, the Fund may borrow up to
$25 million under a short-term unsecured line of credit. In connection
therewith, the Fund has agreed to pay commitment fees at an annual rate of
.125 of 1% on the total line of credit. Interest on borrowings is charged at
rates which are related to Federal Funds rates in effect from time to time.
Outstanding borrowings on December 31, 1995 under the line of credit,
amounted to $7.02 million, at an annualized interest rate of 6.53%.
The average daily amount of short-term debt outstanding during the year
ended December 31, 1995 was approximately $2,313,000, with a related weighted
average annualized interest rate of 6.85%. The maximum amount borrowed at any
time during the year ended December 31, 1995 was $13.5 million.
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, brokerage, interest on borrowings
(which, in the view of Stroock & Stroock & Lavan, counsel to the Fund, also
contemplates loan commitment fees and dividends and interest accrued on
securities sold short), and extraordinary expenses, exceed the expense
limitation of any state having jurisdiction over the Fund, the Fund may
deduct from payments to be made to the Manager, or the Manager will bear the
amount of such excess to the extent required by state law. The most stringent
state expense limitation applicable to the Fund presently requires
reimbursement of expenses in any full 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 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
for the year ended December 31, 1995.
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 $4,944 for the period from
December 1, 1995 through December 31, 1995.
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager,
retained $14,322 during the year ended December 31, 1995 from commissions
earned on sales of Fund shares.
DREYFUS STRATEGIC GROWTH, L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(B) Effective August 1, 1995, the Fund adopted a Shareholder Services Plan,
pursuant to which it pays the Distributor for the
provision of certain services to Fund shareholders a fee at the annual rate
of .25 of 1% of the value of the Fund's average daily net assets. 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 in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. During the period August 1, 1995
through December 31, 1995, the Fund was charged $63,227 pursuant to the
Shareholder Services Plan.
Prior to August 1, 1995, the Service Plan (the "Plan") pursuant to Rule
12b-1 under the Act, provided for the Fund to (a) reimburse the Distributor
for payments to third parties for distributing the Fund's shares and
servicing shareholder accounts ("Servicing") and (b) pay the Manager, Dreyfus
Service Corporation or any affiliate (collectively "Dreyfus") for advertising
and marketing relating to the Fund and Servicing, at an annual rate of .25 of
1% of the value of the Fund's average daily net assets. Each of the
Distributor and Dreyfus may have paid Service Agents (a securities dealer,
financial institution or other industry professional) a fee in respect of the
Fund's shares owned by shareholders with whom the Service Agent had a
Servicing relationship or for whom the Servicing Agent was the dealer or
holder of record. Each of the Distributor and Dreyfus determined the amounts,
if any, to be paid to Service Agents under the Plan and the basis on which
such payments are made. The Plan also separately provided for the Fund to
bear the costs of preparing, printing and distributing certain of the Fund's
prospectuses and statements of additional information and costs associated
with implementing and operating the Plan, not to exceed the greater of $100,00
0 or .005 of 1% of the Fund's average daily net assets for any full year.
During the period January 1, 1995 through July 31, 1995, the Fund was charged
$130,779 pursuant to the Plan.
(C) Each Managing General Partner 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 $250 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, forward currency exchange contracts and options transactions,
during the year ended December 31, 1995:
<TABLE>
<CAPTION>
PURCHASES SALES
________ ________
<S> <C> <C>
Long transactions................................................ $143,998,640 $115,921,817
Short sale transactions.......................................... 20,597,804 6,436,494
________ ________
TOTAL........................................................... $164,596,144 $122,358,311
======== ========
</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
DREYFUS STRATEGIC GROWTH, L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
and custodian, of cash and/or U.S. Government securities sufficient to cover
its short position. At December 31, 1995, there were no securities sold short
outstanding.
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 is engaged in trading financial futures contracts. 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 December 31, 1995, there were no financial futures contracts
outstanding.
(B) At December 31, 1995, accumulated net unrealized depreciation on
investments was $2,980,455, consisting of $5,039,618 gross unrealized
appreciation and $8,020,073 gross unrealized depreciation.
At December 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).
DREYFUS STRATEGIC GROWTH, L.P.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
INVESTORS AND MANAGING GENERAL PARTNERS
DREYFUS STRATEGIC GROWTH, L.P.
We have audited the accompanying statement of assets and liabilities of
Dreyfus Strategic Growth, L.P., including the statement of investments, as of
December 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 December 31, 1995 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our 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 Dreyfus Strategic Growth, L.P. at December 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 and Young LLP signature logo]
New York, New York
February 12, 1996
[Dreyfus lion "d" logo]
DREYFUS STRATEGIC GROWTH, L.P.
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
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. 038AR9512
[Dreyfus logo]
Strategic
Growth, L.P.
Annual Report
December 31, 1995
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN DREYFUS STRATEGIC GROWTH, L.P. AND THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE
INDEX
EXHIBIT A:
______________________________________________
| | STANDARD | |
| | & POOR'S 500 | DREYFUS |
| PERIOD |COMPOSITE STOCK | STRATEGIC |
| | PRICE INDEX * | GROWTH |
|---------|----------------|------------------|
| 3/27/87 | 10,000 | 9,548 |
|12/31/87 | 8,673 | 15,570 |
|12/31/88 | 10,109 | 16,365 |
|12/31/89 | 13,307 | 18,695 |
|12/31/90 | 12,893 | 17,358 |
|12/31/91 | 16,812 | 23,036 |
|12/31/92 | 18,092 | 19,497 |
|12/31/93 | 19,912 | 24,328 |
|12/31/94 | 20,174 | 25,060 |
|12/31/95 | 27,746 | 23,915 |
|----------------------------------------------
*Source: Lipper Analytical Services, Inc.
