<PAGE>
Van Eck Global
- --------------------------------------------------------------------------------
Worldwide Insurance Trust
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[GRAPHIC]
ANNUAL REPORT
December 31, 1999
discipline
Worldwide Bond Fund
allocation
diversity
GLOBAL INVESTMENTS SINCE 1955
<PAGE>
Van Eck Worldwide Bond Fund
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Dear Shareholder:
A rebound in global economic growth, surging stock markets, and mounting
concern over potential inflationary pressures set the stage for a tumultuous
year for world bond markets in 1999. With the exception of Japan and emerging
market fixed income, most global bond markets were down on the year. In most
cases, the continued strength of the U.S. dollar caused further losses for
U.S.-based global bond investors. In this environment, the Van Eck Worldwide
Bond Fund lost 7.82% for the twelve months ended December 31, 1999, compared to
a loss of 4.27% for the Salomon Smith Barney World Government Bond Index (WGBI)
for the same time period.
Bond Market Review
Nineteen ninety-eight's fears of a global economic slowdown seemed a distant
memory as 1999 brought back surging stock returns and strong investor
sentiment. Even Year 2000 worries, which many feared would slow the global
economy, had little effect on economic growth or financial assets. In addition,
emerging market economies staged a dramatic rebound, which led their equity and
bond markets to outperform those of most developed markets. This euphoria in
the world's equity markets made the potential returns of global bond markets
less attractive on a relative basis. This preference for equities over bonds
helped to explain the weakness of global government bond markets throughout the
year.
The U.S. bond market had a particularly difficult year, falling 2.45%. U.S.
three-month Treasury bills began the year at a yield of 4.45% and closed the
year at 5.32%. Thirty-year Treasury bond yields rose 175 basis points from
their October 1998 lows to end this year at 6.48%, marking 1999 as one of the
worst years for Treasuries in 25 years. The U.S. economy continued to gain
momentum throughout 1999, even in the face of sharply rising bond yields and a
shift to a tightening of monetary policy by the Federal Reserve. The Fed raised
rates three times for a total increase of 75 basis points (0.75%). Throughout
the year, we held an overweight position in U.S. bonds on a duration-adjusted
basis relative to the Salomon Smith Barney WGBI. We reduced our U.S. bond
weighting during the first quarter (from approximately 45% at December 31, 1998
to roughly 36% at March 31, 1999) in order to add exposure to the Australian,
Canadian, South African, and Mexican bond markets. We did, however, maintain
our overweight exposure to the U.S. bond market through the end of the year as
we favored the higher yields available in the U.S. bond market relative to
other global bond markets. At December 31, 1999, the Fund had an approximate
30% weighting to the U.S. bond market.
The year ended with the Fund's European bond weighting at over 40% of total net
assets, with highest exposure to the German and UK bond markets. Overall,
Europe underperformed the U.S., with every fixed income market turning in
negative performance in both local and U.S. dollar terms. Spain, Portugal,
Ireland, France and Austria were among the worst performers, all down over 17%
in U.S. dollar terms. With the exception of Ireland (with a weighting of 2.4%
at year end), the portfolio was underweight all of these markets with respect
to the Index. The heavy losses to U.S. dollar investors in the European bond
markets were due to a combination of both rising yields and weakness in the
euro and other European currencies relative to the U.S. dollar.
There were few places to hide in the European bond markets this year. However,
we did find relative safety in the UK, whose market fell 4.3% in U.S. dollar
terms, outperforming all other European fixed income markets. The Fund was
overweight the UK throughout 1999 with an approximate 15% weighting at
December 31, down from approximately 21% a year earlier. During the second half
of 1999, we were heavily overweight the British pound versus the Index as we
uncovered our British Pound Sterling hedges late in the second quarter and were
able to take advantage of the strengthening currency in the second half of the
year. This helped relative performance as the pound outperformed the euro. We
were also overweight Sweden versus the Index throughout the year in terms of
both bond and currency exposure. This helped relative performance as well; the
Swedish bond market (-7.5%) also outperformed most
<PAGE>
Van Eck Worldwide Bond Fund
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European bond markets. At year end, Swedish bonds made up almost 5% of the
portfolio's net assets.
Following the introduction of the euro on December 31, 1998, the new currency
sank approximately 14% against the dollar during 1999. Lagging European
economic growth, capital outflows from the euro zone, and an American economy
that continued to outperform expectations were all factors that contributed to
the weakness of the new European currency. The Fund began 1999 overweight the
euro versus the Index. This position was reduced in the first quarter and then
brought down even further by June, bringing the exposure to half that of the
Index. We increased the Fund's exposure to the euro during the second half of
the year as the European economies began to show signs of sustainable economic
growth. Also, we expected a narrowing of interest rate differentials between
European and U.S. bond markets to support the euro relative to the U.S. dollar
in the second half.
Japan started the year with continued questions about its ability to pull its
economy out of the slump that it had been mired in for the last few years. In
the first quarter, the Japanese economy started to show some signs of positive
momentum as a result of the continued fiscal pump-priming initiatives of the
Japanese government. These unparalled fiscal stimulus packages increased debt
issuance and inflated budget deficits, which will continue to be a burden on
Japan's fiscal profile. We felt the deteriorating fiscal situation and low
level of Japanese bond yields made Japanese bonds unattractive. We therefore
had no exposure to the Japanese bond market throughout the year. While Japanese
bond yields actually fell in the first half of the year (and prices rose), the
gains were offset by a weakening currency. The second half of 1999 was a
different story as Japanese bond market returns outpaced most other global bond
markets; this outperformance was a result of a dramatic appreciation of the
Japanese yen. A bout of corporate restructurings and improving economic numbers
ignited a surge of inflows into the Japanese equity market as institutional
investors who had been underweight their international equity benchmarks
scrambled to increase their Japanese equity weightings. Due to the Salomon
Smith Barney WGBI's substantial weighting to the Japanese fixed income market,
the absence of Japanese exposure in the Worldwide Bond Fund's portfolio drove
the underperformance of the Fund versus the Index.
Commodity-related currencies performed well in 1999 as strong global economic
growth led by the U.S., as well as the Asian market recovery, yielded an
increase in demand for commodities. We added currency positions in Canada,
Australia, New Zealand and South Africa in the first quarter and these
positions all resulted in gains for the Fund. In total, these markets made up
approximately 17% of the Fund's assets at year end.
The Fund benefited by adding exposure to the fixed income markets of Mexico and
South Africa in the first quarter and to Brazil in the second quarter. The
outperformance of these markets was driven primarily by improvements in
monetary and fiscal discipline and a more positive global economic environment.
At December 31, the Fund had a total allocation of approximately 10% of total
net assets to these emerging market countries.
The Outlook
We feel that the shift toward tightening monetary policy by central banks
around the globe should be supportive of the global bond markets, as it would
likely assure bond investors that the central bankers of the world remain
vigilant against inflation. We also feel that this tightening of credit should
diminish some of the excess liquidity built into the global financial system as
a precautionary measure for Y2K. This cycle of tightening may also temper the
dramatic returns that we have seen in the global equity markets and draw
investors' attention back to the potential returns available in the global bond
markets. We believe the emerging market countries such as South Africa, Mexico
and Brazil should continue to benefit from rising commodity prices, improved
fiscal situations, and attractive yield levels. We are also encouraged by
continued evidence of better economic growth throughout Europe. We feel that
the European bond markets have largely discounted improved economic growth in
2000, citing the dramatic rise in European yields during the
<PAGE>
Van Eck Worldwide Bond Fund
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second half of 1999. On the other hand, we do not believe this has been
discounted in the currency markets and look for the euro to strengthen versus
the U.S. dollar and the Japanese yen in 2000. In closing, we feel that we are
well positioned to take advantage of the opportunities presented to us at the
start of the new millennium.
We appreciate your participation in the Worldwide Bond Fund and look forward to
helping you meet your investment goals in the future.
Photo of Charles Cameron
/S/ CHARLES CAMERON
Charles T. Cameron
Co-Portfolio
Manager
Photo of Gregory Krenzer
/S/ GREGORY KRENZER
Gregory F. Krenzer
Co-Portfolio
Manager
January 10, 2000
[PIE CHART]
Geographical Weightings
as of December 31, 1999
Australia 4.3
Canada 5.4
France 4.7
Sweden 4.8
United Kingdom 14.5
Brazil 2.4
United States 29.8
Cash/equivalents 7.1
Germany 14.4
Ireland 2.4
Mexico 2.5
New Zealand 2.2
South Africa 5.5
<PAGE>
Van Eck Worldwide Bond Fund
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Van Eck Worldwide Bond Fund
vs. Salomon Smith Barney
World Gov't Bond Index
[LINE CHART]
Van Eck Worldwide Salomon Smith Barney
Bond Fund World Gov't Bond Index
3/89 9980 9620
6/89 10392 10090
9/89 10799 10440
12/89 11125 11197
3/91 11052 11064
6/91 11107 11102
9/91 12238 12011
12/91 13171 12968
3/92 12570 12532
6/92 13474 13373
9/92 13381 14209
12/92 12479 13685
3/93 12682 14416
6/93 12818 14836
9/93 13272 15508
12/93 13451 15501
3/94 12985 15502
6/94 12832 15605
9/94 13079 15788
12/94 13274 15865
3/95 14743 17599
6/95 15210 18538
9/95 15278 18343
12/95 15571 18885
3/96 15179 18531
6/96 15245 18606
9/96 15504 19114
12/96 15964 19569
3/97 15542 18759
6/97 15824 19328
9/97 16122 19574
12/97 16345 19614
3/98 16553 19768
6/98 16898 20161
9/98 18279 21840
12/98 18429 22616
3/99 17544 21743
6/99 17131 20994
9/99 17353 21945
12/99 16988 21651
12/00
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Average Annual
Total Return 12/31/99 1 Year 5 Years 10 Years
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Van Eck Worldwide Bond Fund -7.82% 5.06% 5.44%
- ---------------------------------------------------------------
Salomon Smith Barney
World Gov't Bond Index -4.27% 6.42% 8.27%
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This graph compares a hypothetical $10,000 investment in the Van Eck Worldwide
Bond Fund made ten years ago with a similar investment in the Salomon Smith
Barney World Government Bond Index.
Inception date for the Worldwide Bond Fund was 9/1/89.
The Salomon Smith Barney World Government Bond Index is an unmanaged index and
includes the reinvestment of all dividends, but does not reflect the payment of
transaction costs, advisory fees or expenses that are associated with an
investment in the Fund. The Index's performance is not illustrative of the
Fund's performance. Indices are not securities in which investments can be
made.
The Salomon Smith Barney World Government Bond Index is a market
capitalization-weighted benchmark that tracks the performance of 17 world
government bond markets. Each has a total market capitalization of eligible
issues of at least US$20 billion and Euro15 billion. The issues are fixed rate,
greater than one-year maturity and subject to a minimum amount outstanding that
varies by local currency. Bonds must be sovereign debt issued in the domestic
market in local currency.
Past performance is not indicative of future results. Performance data quoted
represents past performance; the investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than the original cost. These returns do not take variable
annuity/life fees and expenses into account.
The Fund is only available as an option under various insurance contracts
issued by life insurance and annuity companies. These contracts offer life and
tax benefits to the beneficial owners of the Fund. Your insurance or annuity
company charges fees and expenses for these benefits which are not reflected in
this report or in the Fund's performance, since they are not direct expenses of
the Fund. Had these fees been included, returns would have been lower. A review
of your particular life and/or annuity contract will provide you with much
greater detail regarding these costs and benefits.
<PAGE>
Worldwide Bond Fund
Schedule of Portfolio Investments
December 31, 1999
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<TABLE>
<CAPTION>
Principal Value
Country Amount Bonds and Notes (Note 1)
- ------------------------------------------------------------------
<C> <C> <S> <C>
BONDS AND NOTES: 92.9%
AUSTRALIA: 4.3%
Australia Government Bond
AUD 5,000,000 8.75% due 8/15/08 $ 3,667,853
-----------
BRAZIL: 2.4%
Republic of Brazil Bond
USD 2,000,000 11.625% due 4/15/04 2,005,000
-----------
CANADA: 5.4%
Government of Canada Bond
CAD 6,500,000 7.00% due 9/01/01 4,583,512
-----------
FRANCE: 4.7%
French Government Bond
EUR 3,899,695 5.50% due 10/12/01 4,014,892
-----------
GERMANY: 14.4%
Bundesrepublik Deutschland Bonds
EUR 3,579,043 7.375% due 1/03/05 3,989,027
2,709,847 6.00% due 1/04/07 2,860,462
3,000,000 4.75% due 7/04/28 2,532,930
3,000,000 4.50% due 7/04/09 2,836,480
-----------
12,218,899
-----------
IRELAND: 2.4%
Irish Government Bond
EUR 1,714,146 8.00% due 8/18/06 2,001,963
-----------
MEXICO: 2.5%
United Mexican States Bond
USD 2,000,000 9.75% due 4/06/05 2,075,000
-----------
NEW ZEALAND: 2.2%
New Zealand Government Bond
NZD 3,350,000 10.00% due 3/15/02 1,872,774
-----------
SOUTH AFRICA: 5.5%
South African Government Bond
ZAR 30,000,000 13.00% due 8/31/10 4,698,691
-----------
SWEDEN: 4.8%
Swedish Government Bonds
SEK 5,000,000 10.25% due 5/05/03 675,000
28,000,000 6.00% due 2/09/05 3,368,855
-----------
4,043,855
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal Value
Country Amount Bonds and Notes (Note 1)
- ---------------------------------------------------------------
<C> <C> <S> <C>
UNITED KINGDOM: 14.5%
Great Britain Government Bonds
GBP 2,250,000 8.00% due 6/10/03 $ 3,828,779
4,800,000 7.50% due 12/07/06 8,456,889
-----------
12,285,668
-----------
UNITED STATES: 29.8%
U.S. Treasury Notes
USD 8,600,000 6.50% due 8/15/05* 8,602,695
2,000,000 5.875% due 9/30/02 1,979,376
5,000,000 5.50% due 5/15/09 4,659,375
U.S. Treasury Bonds
6,000,000 6.625% due 2/15/27* 5,943,750
5,000,000 5.25% due 2/15/29 4,137,500
-----------
25,322,696
-----------
</TABLE>
<TABLE>
<S> <C> <C> <C>
Total Bonds and Notes: 92.9%
(Cost: $83,173,626) 78,790,803
-----------
Short-Term
Obligation: Date of Value
3.2% Maturity Coupon (Note 1)
- ---------------------------------------------
Repurchase
Agreement
(Note 8):
Purchased on
12/31/99;
maturity value
USD2,747,801
(with State
Street Bank &
Trust Co.;
collateralized
by USD2,920,000
Federal National
Mortgage
Association -
Discount Note
due 8/31/00 with
a value of
USD2,803,200)
(Cost:
$2,747,000) 1/03/00 3.50% 2,747,000
-----------
Total
Investments:
96.1%
(Cost:
$85,920,626) 81,537,803
Other assets
less
liabilities:
3.9% 3,337,176
-----------
Net Assets: 100% $84,874,979
===========
</TABLE>
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* These securities are segregated as collateral for forward foreign currency
contracts.
See Notes to Financial Statements
<PAGE>
Worldwide Bond Fund Financial Statements
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Statement of Assets and Liabilities
December 31, 1999
<TABLE>
<S> <C> <C>
Assets:
Investments, at value (cost, $85,920,626) (Note 1)............... $ 81,537,803
Cash and foreign currency........................................ 438,161
Receivables:
Interest........................................................ 2,381,270
Capital shares sold............................................. 645,378
Unrealized appreciation on forward foreign currency contracts
(Note 4)....................................................... 17,126
------------
Total assets..................................................... 85,019,738
------------
Liabilities:
Payables:
Capital shares redeemed......................................... 5,047
Due to Advisor.................................................. 3,310
Accounts payable................................................ 52,501
Unrealized depreciation on forward foreign currency contracts
(Note 4)....................................................... 83,901
------------
Total liabilities................................................ 144,759
------------
Net assets....................................................... $ 84,874,979
============
Shares outstanding............................................... 7,936,486
============
Net asset value, redemption price and offering price per share... $ 10.69
============
Net assets consist of:
Aggregate paid in capital....................................... $ 86,746,666
Unrealized depreciation of investments, forward foreign
currency contracts and foreign currencies...................... (4,483,508)
Undistributed net investment income............................. 3,780,283
Accumulated realized loss....................................... (1,168,462)
------------
$ 84,874,979
============
Statement of Operations
Year Ended December 31,1999
Income (Note 1):
Interest income (Note 1) (net of foreign taxes withheld
of $24,835) .......................................... $ 6,130,817
Expenses:
Management (Note 2).................................... $ 998,553
Administration (Note 2)................................ 3,160
Custodian.............................................. 92,704
Trustees' fees and expenses............................ 38,173
Professional fees...................................... 36,834
Reports to shareholders................................ 34,385
Other.................................................. 18,662
---------
Total expenses......................................... 1,222,471
------------
Net investment income.................................. 4,908,346
------------
Realized and Unrealized Gain (Loss) on Investments
(Note 3):
Realized gain from security transactions............... 1,747,285
Realized loss from foreign currency transactions....... (3,708,838)
Change in unrealized depreciation of investments....... (11,326,799)
Change in unrealized depreciation of forward foreign
currency contracts and foreign currency transactions.. (316,520)
------------
Net loss on investments and foreign currency
transactions.......................................... (13,604,872)
------------
Net Decrease in Net Assets Resulting from Operations... $ (8,696,526)
============
</TABLE>
See Notes to Financial Statements
<PAGE>
Worldwide Bond Fund Financial Statements
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Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, December 31,
1999 1998
------------ ------------
<S> <C> <C>
Increase (decrease) in Net Assets:
Operations:
Net investment income............................ $ 4,908,346 $ 5,574,632
Realized gain from security transactions......... 1,747,285 1,940,736
Realized loss from foreign currency transactions. (3,708,838) (109,729)
Change in unrealized appreciation (depreciation)
of investments.................................. (11,326,799) 6,508,262
Change in unrealized appreciation (depreciation)
of forward foreign currency contracts and
foreign currency transactions................... (316,520) 452,900
------------ ------------
Net increase (decrease) in net assets resulting
from operations................................. (8,696,526) 14,366,801
------------ ------------
Dividends and Distributions to shareholders from:
Net investment income............................ (4,563,103) (1,020,300)
Net realized gains............................... (2,038,833) --
------------ ------------
Total dividends and distributions................ (6,601,936) (1,020,300)
------------ ------------
Capital share transactions*:
Net proceeds from sales of shares................ 65,420,051 83,615,224
Reinvestment of dividends and distributions...... 6,601,936 1,020,300
Cost of shares reacquired........................ (91,131,055) (91,160,172)
------------ ------------
Decrease in net assets resulting from capital
share transactions.............................. (19,109,068) (6,524,648)
------------ ------------
Total increase (decrease) in net assets.......... (34,407,530) 6,821,853
Net Assets:
Beginning of year................................ 119,282,509 112,460,656
------------ ------------
End of year (including undistributed net
investment income of $3,780,283 and $4,450,964,
respectively)................................... $ 84,874,979 $119,282,509
============ ============
*Shares of Beneficial Interest Issued and Redeemed
(Unlimited number of $.001 par value shares
authorized)
Shares sold...................................... 5,915,699 7,092,902
Reinvestment of dividends and distributions ..... 571,596 92,755
Shares reacquired................................ (8,265,435) (7,699,622)
------------ ------------
Net decrease..................................... (1,778,140) (513,965 )
============ ============
</TABLE>
See Notes to Financial Statements
<PAGE>
Worldwide Bond Fund
- -------------------------------------------------------------------------------
Financial Highlights
For a share outstanding throughout each period
<TABLE>
<CAPTION>
For the
Year Ended Eight Months
December 31, Ended Year Ended April 30,
---------------------------- December 31, ----------------------
1999 1998 1997 1996 1996 1995
------- -------- -------- ------------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period.... $ 12.28 $ 10.99 $ 11.10 $ 10.88 $ 11.46 $ 10.05
------- -------- -------- -------- ---------- ----------
Income From Investment
Operations:
Net Investment Income.. 0.61 0.57 0.48 0.36 0.58 0.68*
Net Gain (Loss) on
Investments (both
realized and
unrealized)........... (1.52) 0.82 (0.23) 0.17 (0.34) 0.77
------- -------- -------- -------- ---------- ----------
Total from Investment
Operations............. (0.91) 1.39 0.25 0.53 0.24 1.45
------- -------- -------- -------- ---------- ----------
Less Dividends and
Distributions:
Dividends from Net
Investment Income..... (0.47) (0.10) (0.36) (0.31) (0.82) (0.04)
Distributions from
Realized Capital
Gains................. (0.21) -- -- -- -- --
------- -------- -------- -------- ---------- ----------
Total Dividends and
Distributions.......... (0.68) (0.10) (0.36) (0.31) (0.82) (0.04)
------- -------- -------- -------- ---------- ----------
Net Asset Value, End of
Period................. $ 10.69 $ 12.28 $ 10.99 $ 11.10 $ 10.88 $ 11.46
======= ======== ======== ======== ========== ==========
Total Return (a)........ (7.82%) 12.75% 2.38% 4.98% 2.07% 14.51%
- ----------------------------------------------------------------------------------------------
Ratios/Supplementary
Data
Net Assets, End of
Period (000)........... $84,875 $119,283 $112,461 $118,676 $ 107,541 $ 113,466
Ratio of Gross Expenses
to Average Net Assets.. 1.22% 1.15% 1.12% 1.17%(b) 1.10% 0.99%
Ratio of Net Expenses to
Average Net Assets..... 1.22% 1.15% 1.12% 1.16%(b) 1.08% 0.98%
Ratio of Net Investment
Income to Average Net
Assets................. 4.92% 4.72% 4.31% 4.99%(b) 5.26% 6.24%
Portfolio Turnover Rate. 46.84% 30.59% 135.36% 73.95% 208.05% 265.87%
</TABLE>
- -------
(a) Total return is calculated assuming an initial investment made at the net
asset value at the beginning of the period, reinvestment of dividends and
distributions at net asset value during the period and a redemption on the
last day of the period. Total return for periods less than one year is not
annualized.
(b) Annualized.
* Based on average shares outstanding.
See Notes to Financial Statements
- -------------------------------------------------------------------------------
Notes To Financial Statements
Note 1--Significant Accounting Policies:
Van Eck Worldwide Insurance Trust (the "Trust"), organized as a Massachusetts
business trust on January 7, 1987, is registered under the Investment Company
Act of 1940. The following is a summary of significant accounting policies
consistently followed by the Worldwide Bond Fund (the "Fund"), a non-
diversified series of the Trust, in the preparation of its financial
statements. The policies are in conformity with accounting principles
generally accepted in the United States. The preparation of financial
statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts in the financial statements. Actual results could differ from those
estimates.
A. Security Valuation--Securities traded on national exchanges or on the
NASDAQ National Market System are valued at the last sales prices reported at
the close of business on the last business day of the year. Over-the-counter
securities not included in the NASDAQ National Market System and listed
securities for which no sale was reported are valued at the mean of the bid
and asked prices. Short-term obligations purchased with more than sixty days
remaining to maturity are valued at market. Short-term obligations purchased
with sixty days or less to maturity are valued at amortized cost, which with
accrued interest approximates value. Futures are valued using the closing
price reported at the close of the Chicago Board of Trade. Forward foreign
currency contracts are valued at the spot currency rate plus an amount
("points") which reflects the differences in interest rates between the U.S.
and the foreign markets. Securities for which quotations are not available are
stated at fair value as determined by the Board of Trustees.
B. Federal Income Taxes--It is the Fund's policy to comply with the provisions
of the Internal Revenue Code applicable to regulated investment companies and
to distribute all of its taxable income to its shareholders. Therefore, no
federal income tax provision is required.
C. Currency Translation--Assets and liabilities denominated in foreign
currencies and commitments under forward foreign currency contracts are
translated into U.S. dollars at the mean of the quoted bid and asked prices of
such currencies on the last business day of the year. Purchases and sales of
investments are translated at the exchange rates prevailing when such
investments were acquired or sold. Income and expenses are translated at the
exchange rates prevailing when accrued. The portion of realized and unrealized
gains and losses on investments that results from fluctuations in foreign
currency exchange rates is not separately disclosed. Recognized gains or
losses attributable to foreign currency fluctuations on foreign currency
denominated assets, other than investments and liabilities are recorded as net
realized gains and losses from foreign currency transactions.
D. Dividend and Distributions--Dividend income and distributions
to shareholders are recorded on the ex-dividend date. Dividends on
<PAGE>
Worldwide Bond Fund
- -------------------------------------------------------------------------------
Notes to Financial Statements (continued)
foreign securities are recorded when the Fund is informed of such dividends.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from such amounts
reported in accordance with generally accepted accounting principles.
To reflect reclassifications, arising from permanent "book/tax" differences
for the year ended December 31, 1999, undistributed net investment income was
decreased by $1,015,924, accumulated net realized loss was decreased by
$1,859,591 and capital stock decreased by $843,667.
E. Other--Security transactions are accounted for on the date the securities
are purchased or sold. Interest income is accrued as earned.
Note 2--Management Agreement--Van Eck Associates Corporation (the "Adviser")
earned fees for investment management and advisory services provided to the
Fund. The fee is based on an annual rate of 1% on the first $500 million of
average daily net assets, .90 of 1% on the next $250 million and .70 of 1% on
the excess over $750 million. Certain of the officers and trustees of the
Trust are officers, directors or stockholders of the Adviser and Van Eck
Securities Corporation. In accordance with the advisory agreement, the Fund
paid the Adviser for costs incurred in connection with certain administrative
functions.
Note 3--Investments--Purchases and proceeds from sales of securities, other
than short-term obligations, aggregated $45,190,592 and $69,954,565
respectively, for the year ended December 31, 1999. For federal income tax
purposes, the identified cost of investments owned at December 31, 1999 was
$85,979,181. At December 31, 1999, net unrealized depreciation for federal
income tax purposes aggregated $4,441,378, of which $1,189,389 related to
appreciated securities and $5,630,767 related to depreciated securities.
As of December 31, 1999, the Fund had a capital loss carryforward of
$1,176,682 available, expiring December 31, 2007.
Note 4--Forward Foreign Currency Contracts--The Fund may buy and sell forward
foreign currency contracts to settle purchases and sales of foreign
denominated securities. In addition, the Fund may enter into forward foreign
currency contracts to hedge foreign denominated assets. Realized gains and
losses from forward foreign currency contracts are included in realized gain
(loss) from foreign currency transactions. At December 31, 1999, the Fund had
the following outstanding forward foreign currency contracts:
<TABLE>
<CAPTION>
Value At Unrealized
Settlement Current Appreciation
Contracts Date Value (Depreciation)
- --------- ---------- ---------- -------------
<S> <C> <C> <C>
Forward Foreign Currency Buy Contracts:
CAD 1,100,000
expiring 3/15/00 $ 745,763 $ 762,889 $ 17,126
EUR 8,800,000
expiring 3/15/00 8,984,426 8,916,556 (67,870)
GBP 2,250,000
expiring 3/15/00 3,656,925 3,640,894 (16,031)
--------
$(66,775)
========
</TABLE>
The Fund may incur additional risk from investments in forward foreign
currency contracts if the counterparty is unable to fulfill its obligation or
there are unanticipated movements of the foreign currency relative to the U.S.
dollar.
Note 5--Concentration of Risk--The Fund invests in foreign securities.
Investments in foreign securities may involve a greater degree of risk than
investments in domestic securities due to political, economic or social
instability. Foreign investments may also be subject to foreign taxes and
settlement delays. Since the Fund may have significant investments in foreign
debt securities it may be subject to greater credit and interest risks and
greater currency fluctuations than portfolios with significant investments in
domestic debt securities.
Note 6--Trustee Deferred Compensation Plan--The Trust established a Deferred
Compensation Plan (the "Plan") for Trustees. Commencing January 1, 1996, the
Trustees can elect to defer receipt of their Trustee fees until retirement,
disability or termination from the board. The Fund's contributions to the Plan
are limited to the amount of fees earned by the participating Trustees. The
fees otherwise payable to the participating Trustees are invested in shares of
the Van Eck Funds as directed by the Trustees. The Plan has been approved by
the Internal Revenue Service.
The Fund has elected to show the deferred liability net of the asset for
financial statement purposes.
As of December 31,1999, the total value of the assets and corresponding
liability of the Fund's portion of the Plan is $51,615.
Note 7--Bank Line of Credit--The Trust may participate with other funds
managed by Van Eck in a $15 million committed credit facility ("Facility") to
be utilized for temporary financing until the settlement of sales or purchases
of portfolio securities, the repurchase or redemption of shares of the Series,
including the Fund, at the request of the shareholders and other temporary or
emergency purposes. In connection therewith, the Series has agreed to pay
commitment fees, pro rata, based on usage. Interest is charged to the Series
at rates based on prevailing market rates in effect at the time of borrowings.
For the year ended December 31, 1999, the Fund did not borrow under the
Facility.
Note 8--Repurchase Agreements--Collateral for repurchase agreements, the value
of which must be at least 102% of the underlying debt obligation, is held by
the Fund's custodian. In the remote chance the counterparty should fail to
complete the repurchase agreement, realization and retention of the collateral
may be subject to legal proceedings and the Fund would become exposed to
market fluctuations on the collateral.
Note 9--Subsequent Events--An income dividend of $0.50 a share, was paid on
January 31, 2000 to shareholders of record date January 27, 2000 with a
reinvestment date of January 31, 2000.
<PAGE>
Worldwide Bond Fund
- --------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
To the Board of Trustees and Shareholders
Worldwide Bond Fund
We have audited the accompanying statement of assets and liabilities of
Worldwide Bond Fund (one of the Funds comprising Van Eck Worldwide Insurance
Trust) (the "Fund"), including the schedule of portfolio investments, as of
December 31, 1999, and the related statement of operations, statement of
changes in net assets, and the financial highlights for the year then ended.
These financial statements and the financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audit. The
statement of changes in net assets for the year ended December 31, 1998 and the
financial highlights for each of the five periods in the period then ended,
were audited by other auditors whose report, dated February 12, 1999, expressed
an unqualified opinion on those statements.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 and financial highlights. Our procedures include
confirmation of securities owned as of December 31, 1999, 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
audit provides a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above, and audited by us, present fairly, in all material respects, the
financial position of Worldwide Bond Fund at December 31, 1999, the results of
its operations, the changes in its net assets, and the financial highlights for
the year then ended, in conformity with accounting principles generally
accepted in the United States.
/s/ Ernst & Young LLP
New York, New York
January 27, 2000
<PAGE>
Van Eck Global [LOGO] [GRAPHIC]
Retire on Your Terms/TM/
Variable Annuities
Investment Adviser: Van Eck Associates Corporation
Distributor: Van Eck Securities Corporation
99 Park Avenue, New York, NY 10016
www.vaneck.com
This report must be accompanied or preceded by a prospectus, which includes more
complete information, such as charges and expenses and the risks associated with
international investing, including currency fluctuation or controls,
expropriation, nationalization and confiscatory taxation. Please read the
prospectus carefully before investing.
