FIDELITY
(registered trademark)
PURITAN
FUND
SEMIANNUAL REPORT
JANUARY 31, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on minimizing taxes.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 6 The manager's review of fund
performance, strategy, and outlook.
INVESTMENT CHANGES 9 A summary of major shifts in the
fund's investments over the last six
months.
INVESTMENTS 10 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 54 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 58 Footnotes to the financial
statements.
REPORT OF INDEPENDENT 63 The auditor's opinion.
ACCOUNTANTS
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
No one wants to pay more taxes than they have to. But a recent survey of
500 U.S. households, conducted by Fidelity and Yankelovich Partners, showed
that few people took steps to reduce their taxes under the new tax laws
that went into effect last year. In fact, many people were not completely
aware of the changes until they filed their 1993 tax returns.
Whether or not you're someone whose tax bill increased as a result of these
changes, it may make sense to consider ways to keep more of what you earn.
First, if your employer offers a 401(k) or 403(b) retirement savings plan,
consider enrolling. These plans are set up so you can make regular
contributions -
before taxes - to a retirement savings plan. They offer a disciplined
savings strategy, the ability to accumulate earnings tax-deferred, and
immediate tax savings. For example, if you earn $40,000 a year and
contribute 7% of your salary to your 401(k) plan, your annual contribution
is $2,800. That reduces your taxable income to $37,200 and, if you're in
the
28% tax bracket, saves you $784 in federal taxes. In addition, you pay no
taxes on any earnings until withdrawal.
It may be a good idea to contact your benefits office as soon as possible
to find out when you can enroll or increase your contribution. Most
employers allow employees to make changes only a few times each year.
Second, consider an IRA. Many people are eligible to make an IRA
contribution (up to $2,000) that is fully tax deductible. That includes
people who are not covered by company pension plans, or those within
certain income brackets. Even if you don't qualify for a fully deductible
contribution, any IRA earnings will grow tax-deferred until withdrawal.
Third, consider tax-free investments like municipal bonds and municipal
bond funds. Often these can provide higher after-tax yields than comparable
taxable investments. For example, if you're in the new 36% federal income
tax bracket and invest $10,000 in a taxable investment yielding 7%, you'll
pay $252 in federal taxes and receive $448 in income. That same $10,000
invested in a tax-free bond fund yielding 5.5% would allow you to keep $550
in income.
These are three investment strategies that could help lower your tax bill
in 1994. If you're interested in learning more, please call us at
1-800-544-8888 or visit a Fidelity Investor Center. We look forward to
talking with you.
Best regards,
Edward C. Johnson 3d, Chairman
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each
performance figure includes changes in a fund's share price, plus
reinvestment of any dividends (or income) and capital gains (the profits
the fund earns when it sells stocks that have grown in value). Puritan has
a 2% sales charge, which was in effect October 1, 1987 through December 31,
1992 then waived through 1995.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1994 PAST 6 PAST 1 PAST 5 PAST 10
MONTHS YEAR YEARS YEARS
Puritan 10.21% 23.33% 94.49% 306.64%
Puritan (including 2% sales 8.00% 20.86% 90.60% 298.51%
charge)
Lehman Brothers Aggregate Bond
Index 3.47% 9.14% 70.49% 204.42%
S&P 500(Registered trademark) 8.97% 12.88% 90.05% 318.37%
Average Equity Income Fund 8.14% 15.05% 74.57% 237.91%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years, or 10
years. For comparison, you can look at the performance of the Standard
& Poor's 500 Composite Stock Price Index - a common proxy for the U.S.
stock market - and the performance of the Lehman Brothers Aggregate Bond
Index, a broad measure of the bond market. You can also look at the average
equity income fund, which reflects the performance of 97 equity income
funds tracked by Lipper Analytical Services. These benchmarks include
reinvested dividends and capital gains, if any, and exclude the effects of
sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1994 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Puritan 23.33% 14.23% 15.06%
Puritan (including 2% sales charge) 20.86% 13.77% 14.83%
Lehman Brothers Aggregate Bond 9.14% 11.26% 11.78%
Index
S&P 500(Registered trademark) 12.88% 13.70% 15.39%
Average Equity Income Fund 15.04% 11.70% 12.61%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER TEN YEARS
Puritan (004) Lehman Aggreg. Bond S&P 500
01/31/84 9800.00 10000.00 10000.00
02/29/84 9444.51 9949.00 9648.00
03/31/84 9541.46 9837.57 9814.91
04/30/84 9517.23 9817.90 9908.15
05/31/84 9139.17 9512.56 9359.24
06/30/84 9287.11 9634.32 9562.34
07/31/84 9287.67 10067.86 9443.76
08/31/84 10019.72 10238.01 10487.30
09/30/84 10284.60 10480.65 10489.40
10/31/84 10518.44 10925.03 10530.30
11/30/84 10564.94 11120.59 10412.37
12/31/84 10760.24 11282.95 10687.25
01/31/85 11395.01 11540.20 11519.79
02/28/85 11480.18 11304.78 11661.48
03/31/85 11669.47 11535.40 11669.65
04/30/85 11803.68 11774.18 11659.14
05/31/85 12342.40 12389.97 12333.04
06/30/85 12621.37 12521.31 12526.67
07/31/85 12812.13 12477.48 12507.88
08/31/85 12782.45 12712.06 12401.56
09/30/85 12732.00 12788.33 12013.39
10/31/85 12997.29 13056.89 12568.41
11/30/85 13472.93 13370.25 13430.61
12/31/85 13849.02 13779.38 14080.65
01/31/86 14252.42 13856.54 14159.50
02/28/86 15016.75 14402.49 15218.63
03/31/86 15623.71 14848.97 16067.83
04/30/86 15624.04 14927.67 15886.26
05/31/86 15817.92 14642.55 16731.41
06/30/86 15943.37 15026.19 17014.17
07/31/86 15528.20 15159.92 16063.08
08/31/86 16368.83 15535.88 17254.96
09/30/86 16060.87 15382.08 15827.98
10/31/86 16522.61 15603.58 16741.25
11/30/86 16673.04 15822.03 17148.06
12/31/86 16723.18 15880.57 16710.79
01/31/87 17744.50 16104.49 18961.73
02/28/87 18087.94 16215.61 19710.72
03/31/87 18393.22 16142.64 20280.36
04/30/87 18279.29 15700.33 20099.86
05/31/87 18253.49 15639.10 20274.73
06/30/87 18730.79 15854.92 21298.60
07/31/87 19262.22 15842.24 22378.44
08/31/87 19655.05 15758.27 23213.16
09/30/87 19246.34 15422.62 22704.79
10/31/87 16403.09 15971.67 17814.18
11/30/87 15819.74 16099.44 16346.29
12/31/87 16423.72 16318.39 17590.24
01/31/88 17420.83 16892.80 18330.79
02/29/88 17947.87 17093.82 19185.01
03/31/88 17618.16 16933.14 18592.19
04/30/88 17864.26 16841.70 18798.56
05/31/88 18168.27 16728.86 18962.11
06/30/88 18826.91 17132.03 19832.47
07/31/88 18871.03 17041.23 19757.11
08/31/88 18679.82 17085.54 19085.37
09/30/88 19211.40 17473.38 19898.40
10/31/88 19525.12 17801.88 20451.58
11/30/88 19390.67 17584.69 20159.12
12/31/88 19525.84 17604.04 20511.91
01/31/89 20489.89 17857.54 22013.38
02/28/89 20306.26 17728.96 21465.25
03/31/89 20675.13 17805.20 21965.39
04/30/89 21374.14 18177.32 23105.39
05/31/89 22088.68 18655.39 24041.16
06/30/89 22243.14 19224.38 23904.12
07/31/89 23471.87 19633.86 26062.67
08/31/89 23629.40 19343.28 26573.49
09/30/89 23368.88 19441.93 26464.54
10/31/89 22670.09 19920.20 25850.57
11/30/89 23092.61 20109.44 26377.92
12/31/89 23352.62 20163.74 27010.99
01/31/90 22363.97 19923.79 25198.55
02/28/90 22602.61 19987.54 25523.61
03/31/90 22635.15 20001.53 26199.99
04/30/90 22081.38 19817.52 25544.99
05/31/90 23310.05 20404.12 28035.62
06/30/90 23185.29 20732.62 27844.98
07/31/90 22974.51 21018.74 27755.88
08/31/90 21586.91 20737.08 25246.75
09/30/90 20584.54 20909.20 24017.23
10/31/90 20227.48 21174.75 23913.96
11/30/90 21370.08 21630.01 25458.80
12/31/90 21869.67 21967.43 26169.10
01/31/91 22849.72 22239.83 27310.07
02/28/91 24174.60 22428.87 29262.74
03/31/91 24335.21 22583.63 29970.90
04/30/91 24537.85 22827.53 30042.83
05/31/91 25735.27 22959.93 31340.68
06/30/91 24842.36 22948.45 29905.28
07/31/91 25702.22 23267.43 31298.86
08/31/91 26150.84 23770.01 32040.64
09/30/91 26172.80 24252.54 31505.57
10/31/91 26552.12 24521.75 31927.74
11/30/91 25641.76 24747.35 30641.05
12/31/91 27218.20 25482.34 34146.39
01/31/92 27449.19 25135.78 33511.27
02/29/92 28219.15 25299.16 33946.91
03/31/92 28081.22 25157.49 33284.95
04/30/92 28998.40 25338.62 34263.52
05/31/92 29330.14 25817.52 34431.42
06/30/92 29172.14 26173.80 33918.39
07/31/92 30060.93 26707.75 35305.65
08/31/92 29764.67 26977.50 34581.88
09/30/92 30127.60 27298.53 34989.95
10/31/92 29900.14 26935.46 35112.42
11/30/92 30706.58 26940.85 36309.75
12/31/92 31417.26 27369.21 36756.36
01/31/93 32312.46 27894.70 37065.11
02/28/93 32973.21 28382.85 37569.20
03/31/93 34277.03 28502.06 38361.91
04/30/93 34923.77 28701.58 37433.55
05/31/93 35398.04 28738.89 38436.77
06/30/93 35637.56 29259.06 38548.24
07/31/93 36160.68 29425.84 38394.04
08/31/93 37206.92 29940.79 39849.18
09/30/93 36950.81 30021.63 39542.34
10/31/93 37911.49 30132.71 40360.86
11/30/93 37302.28 29876.58 39977.44
12/31/93 38155.34 30037.92 40461.16
01/31/94 39851.13 30442.00 41836.84
$10,000 OVER 10 YEARS: Let's say you invested $10,000 in Fidelity Puritan
Fund on January 31, 1984 and paid the 2% sales charge. As the chart shows,
by January 31, 1994, the value of your investment would have grown to
$39,851 - a 298.51% increase on your initial investment. For comparison,
look at how both the S&P 500 and Lehman Brothers Aggregate Bond Index
did over the same period. With dividends reinvested, the same $10,000
investment in the S&P 500 would have grown to $41,837 - a 318.37%
increase. If you'd put $10,000 in the bond index, it would have grown to
$30,442 - a 204.42% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. The stock market,
for example, has a history of
growth in the long run and
volatility in the short run. In
turn, the share price and
return of a fund that invests in
stocks or bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
FUND TALK: THE MANAGER'S OVERVIEW
Interview with Richard Fentin, Portfolio Manager of Fidelity Puritan Fund
Q. HOW DID THE FUND PERFORM, RICH?
A. Quite well. It was up 10.21% for the six months and 23.33% for the year
ended January 31, 1994. That beat the average equity income fund, which
rose 8.14% and 15.05% during the same two periods, according to Lipper
Analytical Services. It also outperformed the S&P 500, which was up
8.97% and 12.88% over those intervals.
Q. WHAT INVESTMENTS CONTRIBUTED TO THE FUND'S RECENT PERFORMANCE RESULTS?
A. Several groups come to mind. Cyclical stocks, for one. These are stocks
that tend to do well when the economy improves. This meant companies such
as W.R. Grace, a diversified chemical manufacturer that restructured, was
rewarded for its improving profitability. It was the fund's single biggest
investment for most of the last six months. And Caterpillar, a machine
manufacturer and the fund's second largest stock, gained over 30% from the
end of July to the end of January. I've owned Caterpillar for some time,
and I'm holding on to it because I think it still has some room to
appreciate. In my opinion, there's still a gap between the market's
perception of the impact of the company's ongoing cost-
cutting and its true potential for higher profits in an improving economy.
Q. WHAT ELSE?
A. Another boost to performance came from the fund's investment in foreign
bonds. As interest rates started to come down in Europe, the fund's
investment in both government and corporate bonds from France, Denmark,
Sweden, and the United Kingdom did well.
Q. IN FACT, OF THE FUND'S 36% STAKE IN BONDS, ABOUT 25% WERE FOREIGN, UP
FROM LAST JULY. WHY DID YOU SHIFT AWAY FROM THE U.S. BOND MARKET?
A. My strategy over the past six months has been to reduce the fund's
investment in U.S. bonds for two reasons. First, because I don't believe
that interest rates in the U.S. have much room to fall. If that's true,
then the big gains from bonds are probably behind us. Second, because I
have a value orientation, which means I'm looking for areas where rates
still have room to come down.
Q. SO WHERE ARE YOU FINDING OPPORTUNITIES?
A. Right now I'm finding them outside the United States - in Western
Europe, Japan, and Latin American countries such as Argentina. That said,
keep in mind that I still have about 13% of the fund's bond investments in
U.S. Treasuries. They've held their own during the period, and the income
they generate has added to the fund's performance.
Q. AT THE END OF JANUARY, YOU HAD ABOUT 50% OF THE FUND IN STOCKS. ONE OF
YOUR TOP CONCENTRATIONS WAS ENERGY, WHICH WAS NOT A GREAT PERFORMER DURING
THE PERIOD. WHY?
A. Despite the group's recent weak performance, I still believe it's just a
matter of time until energy prices rise to reflect the fact that there is
very little excess capacity. If energy prices go up, stock prices should
follow and companies such as British Petroleum and Schlumberger, with vast
international markets, should benefit. That's why I've held on. At the end
of January, I still had about 9% in the sector, British Petroleum and
Schlumberger were the fund's third and fourth largest stock investments.
Q. HAVE YOU MADE ANY MAJOR CHANGES TO THE FUND'S SECTOR EMPHASIS?
A. Surprisingly little. I cut back slightly on my investment in finance
from about 16.2% last July to about 15.1% at the end of January. Most of
this was on the stock side because I believed stocks in this sector were
fairly valued and unlikely to repeat their strong gains. As expected, most
of the fund's bank stocks were flat - at best - during the period. One
notable exception was Citicorp, which has had a good run and added to the
fund's performance.
Q. IN TERMS OF STOCKS, YOUR BIGGEST OVERSEAS CONCENTRATION WAS IN JAPAN.
HAVE YOU HELD ON THROUGH THE RECENT TURMOIL IN THE JAPANESE MARKET?
A. Yes, and although my Japanese investments lost ground as the market
plummeted midway through the period, I actually added to my investments
there because I think Japan has taken some important, positive steps toward
ending its economic problems. In general, my Japanese investments are in
solid companies such as Matsushita, Sony, Hitachi, and Toyota. I bought
them when they were inexpensive, and they should benefit from any
improvement in the economy.
Q. WITH ABOUT ONE-THIRD OF THE FUND INVESTED OVERSEAS, HOW HAVE YOU MANAGED
THE RISK OF CURRENCY FLUCTUATIONS?
A. I've hedged the yen and the deutschemark, because I think both
currencies are overpriced relative to the dollar. To do this, I've bought
foreign currency contracts, which would gain in value if either currency
falls. As a result, the returns on my investments wouldn't be hurt when
they are converted back into U.S. dollars. For example, the yen is very
expensive, and that's having a negative effect on Japan's export business.
The Japanese government seems to recognize the need to relieve the
situation. If they take action to bring the value of the yen down, the fund
should be able to absorb the change.
Q. AT THE END OF JULY, YOU ADDED A SMALL INVESTMENT IN GOLD STOCKS. HOW DID
IT PERFORM, AND DO YOU STILL OWN THEM?
A. My investment in gold did well, and I still believe that demand will
outstrip supply. However, the stocks got way ahead of the metal. They were
up nearly 100% in 1993, and I sold them because I believed they were fairly
priced.
Q. WHERE ARE YOU LOOKING FOR OPPORTUNITY IN THE MONTHS AHEAD?
A. As a value investor, I go wherever I find the opportunity to buy stocks
and bonds that are cheap. Lately, that's led me more and more into foreign
markets. The U.S. stock market is expensive and the U.S. bond market has
probably topped out. The situation has changed slowly, but it is changing
and so is the portfolio.
FUND FACTS
GOAL: to provide as much
income as possible
consistent with preservation
of capital by investing in
stocks and bonds
START DATE: April 16, 1947
SIZE: as of January 31,
1993 over $9 billion
MANAGER: Richard Fentin,
since April 1987; manager,
Fidelity Growth Company
Fund, January 1983-April
1987
(checkmark)
RICH FENTIN ON THE U.S. STOCK
MARKET:
"Since my strategy in
managing Puritan is to look
for value, an overvalued stock
market - one where prices
are expensive relative to other
measures like earnings -
makes my job a real
challenge. Put it this way: if
the Dow Jones Industrial
Average were a stock, I
wouldn't own it. It's very
expensive, and I try to buy
cheap stocks. History tells us
that when the U.S. stock
market gets this expensive, it
usually goes down until prices
come back in line. It's a little
bit like living on a fault in
California. You know it's going
to happen. You just don't
know exactly when or where
or how much damage it's
going to do. But you don't up
and move, because on
balance, California, like the
U.S. stock exchange, is a
great place to be."
(bullet) At the end of January, the
fund had about 50% in stocks,
36% in bonds, 4% in
convertible securities, and
10% in short-term and other
investments. If the stock
market goes down, in all
likelihood Puritan Fund will go
down too. A market decline,
however, could help the fund
as more opportunities
became available to buy good
stocks at cheap prices.
(bullet) The fund has about
one-third of its investments
overseas: in developed
markets - such as Japan -
and in some emerging foreign
markets, such as Argentina.
INVESTMENT CHANGES
TOP FIVE STOCKS AS OF JANUARY 31, 1994
% OF FUND'S
% OF FUND'S INVESTMENTS IN
INVESTMENTS THESE STOCKS 6
MONTHS AGO
Grace (W.R.) & Co. 1.6 1.5
Caterpillar, Inc. 1.5 1.4
British Petroleum PLC ADR 1.4 0.5
Schlumberger Ltd. 1.3 0.1
Loews Corp. 1.1 1.0
TOP FIVE BONDS AS OF JANUARY 31, 1994
% OF FUND'S
% OF FUND'S INVESTMENTS IN
INVESTMENTS THESE BONDS 6
MONTHS AGO
United States Government (various issues) 11.2 10.7
Argentina Republic (various issues) 2.1 1.6
Danish Government (various issues) 1.7 0.7
French Government (various issues) 1.0 0.6
Mexican Government (various issues) 0.7 0.5
TOP FIVE INDUSTRIES AS OF JANUARY 31, 1994
% OF FUND'S
INVESTMENTS IN
% OF FUND'S THESE INDUSTRIES
INVESTMENTS 6 MONTHS AGO
Finance 15.1 16.2
Energy 9.2 9.6
Basic Industries 8.5 10.1
Durables 5.4 5.2
Retail & Wholesale 4.9 3.4
ASSET ALLOCATION
AS OF JANUARY 31, 1994* AS OF JULY 31, 1993**
Row: 1, Col: 1, Value: 10.1
Row: 1, Col: 2, Value: 4.2
Row: 1, Col: 3, Value: 35.9
Row: 1, Col: 4, Value: 49.7
Row: 1, Col: 1, Value: 7.5
Row: 1, Col: 2, Value: 5.8
Row: 1, Col: 3, Value: 34.0
Row: 1, Col: 4, Value: 52.7
Stocks 49.7%
Bonds 35.9%
Convertible
securities 4.2%
Short-term and other
investments 10.2%
FOREIGN
INVESTMENTS 33.7%
Stocks 52.7%
Bonds 34.0%
Convertible
securities 5.8%
Short-term and other
investments 7.5%
FOREIGN
INVESTMENTS 29.8%
*
*
*
INVESTMENTS JANUARY 31, 1994
Showing Percentage of Total Value of Investments
COMMON STOCKS - 47.2%
SHARES VALUE (NOTE 1)
(000S)
AEROSPACE & DEFENSE - 0.3%
AEROSPACE & DEFENSE - 0.3%
Boeing Co. 10,000 $ 433
Flightsafety International, Inc. 669,400 23,261
Sundstrand Corp. 13,600 604
24,298
DEFENSE ELECTRONICS - 0.0%
Raytheon Co. 10,000 677
TOTAL AEROSPACE & DEFENSE 24,975
BASIC INDUSTRIES - 6.9%
CHEMICALS & PLASTICS - 3.3%
Akzo NV Ord. 374,400 40,564
Betz Laboratories, Inc. 232,100 11,692
CGIP 8,100 1,876
Cabot Corp. 10,000 525
Cominco Fertilizer Ltd. (b) 368,600 7,211
Dow Chemical Co. 34,600 2,197
du Pont (E.I.) de Nemours & Co. 35,000 1,960
Eastman Chemical Co. 2,500 109
GEON 170,000 4,590
Georgia Gulf Corp. (b) 29,100 706
Goodrich (B.F.) Company 71,500 2,985
Grace (W.R.) & Co. 3,482,864 158,906
Imperial Chemical Industries PLC:
ADR 80,200 3,910
Ord. 1,759,200 21,034
Lubrizol Corp. 10,000 344
Lyondell Petrochemical Co. 1,293,900 29,436
Monsanto Co. 12,400 956
PPG Industries, Inc. 10,000 789
Sommers-Allibert SA 26,450 11,276
Union Carbide Corp. 732,000 18,666
Wellman, Inc. 8,600 152
319,884
IRON & STEEL - 0.1%
Avest Sheffield AB Ord. free shares (b) 873,300 5,987
British Steel PLC ADR 10,000 215
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
BASIC INDUSTRIES - CONTINUED
IRON & STEEL - CONTINUED
Geneva Steel Co. (b) 70,750 $ 849
Inland Steel Industries, Inc. (b) 40,600 1,426
Oregon Steel Mills, Inc. 89,900 2,405
Quanex Corp. 10,000 198
11,080
METALS & MINING - 1.7%
Alcan Aluminum Ltd. 2,696,000 65,672
Alumax, Inc. 1,000,100 26,753
De Beers Consolidated Mines Ltd. ADR 1,873,600 42,859
Noranda, Inc. 845,100 16,930
Outokumpu Oy Class A (b) 493,800 7,783
Preussag AG 20,000 5,345
Reynolds Metals Co. 71,600 3,822
169,164
PACKAGING & CONTAINERS - 0.2%
Ball Corp. 18,784 495
Carnaudmetalbox SA (b) 285,000 10,166
Owens-Illinois, Inc. (b) 505,300 5,874
16,535
PAPER & FOREST PRODUCTS - 1.6%
Abitibi Price, Inc. installment receipts (i) 163,600 769
Albany International Corp. Class A 154,000 2,907
Cartiere (Burgo) Ord. (b) 2,262,000 14,732
Champion International Corp. 499,500 16,671
Chesapeake Corp. 644,900 16,445
Georgia-Pacific Corp. 91,400 6,878
International Paper Co. 318,297 23,912
Longview Fibre Co. 508,500 10,996
Mead Corp. 10,000 474
Repola OY 2,111,100 44,418
Scott Paper Co. 19,900 930
Stone Container Corp. (b) 322,500 5,321
Union Camp Corp. 145,400 7,143
Westvaco Corp. 211,100 7,652
Weyerhaeuser Co. 10,000 489
159,737
TOTAL BASIC INDUSTRIES 676,400
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONGLOMERATES - 2.9%
Allied-Signal, Inc. 70,000 $ 5,504
Brierley Investments Ltd. 5,844,100 4,748
Canadian Pacific Ltd. Ord. 4,924,422 89,852
Coltec Industries, Inc. (b) 360,900 7,669
Crane Co. 101,100 2,704
Hanson Trust PLC:
sponsored ADR 908,600 19,648
Ord. 5,012,954 21,778
ITT Corp. 186,800 18,376
Litton Industries, Inc. (b) 79,541 5,449
Textron, Inc. 495,700 29,308
Tyco Laboratories, Inc. 10,000 540
United Technologies Corp. 1,112,200 74,934
280,510
CONSTRUCTION & REAL ESTATE - 1.2%
BUILDING MATERIALS - 0.0%
Adience, Inc. (b) 160,060 200
Southdown, Inc. (warrants) (b) 17,500 195
395
ENGINEERING - 0.4%
CBI Industries, Inc. 164,200 5,131
EG&G, Inc. 1,917,500 36,433
41,564
REAL ESTATE INVESTMENT TRUSTS - 0.8%
Associated Estates Realty Corp. 87,700 1,907
Carr Realty Corp. 100,000 2,350
Crown American Realty Trust (SBI) 735,200 10,477
Developers Diversified Realty 80,000 2,270
Excel Realty Trust, Inc. 61,800 1,151
Federal Realty Investment Trust 316,500 7,636
Kimco Realty Corporation 52,500 1,877
LTC Properties, Inc. 284,600 3,771
Nationwide Health Properties, Inc. 147,500 5,310
Property Trust of America (SBI) 223 4
Simon Properties Group, Inc. (b) 826,000 20,237
Taubman Centers, Inc. 175,300 2,016
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONSTRUCTION & REAL ESTATE - CONTINUED
REAL ESTATE INVESTMENT TRUSTS - CONTINUED
Urban Shopping Centers, Inc. (b) 160,000 $ 3,540
Vornado Realty Trust 157,200 5,502
Weingarten Realty Investors (SBI) 197,532 7,358
Western Investment Real Estate Trust (SBI) 257,300 3,280
78,686
TOTAL CONSTRUCTION & REAL ESTATE 120,645
DURABLES - 4.9%
AUTOS, TIRES, & ACCESSORIES - 2.7%
Cooper Tire & Rubber Co. 211,300 5,388
Honda Motor Co. Ltd. 2,577,000 41,251
Johnson Controls, Inc. 1,305,000 76,669
Lear Holdings Corp. (warrants) (b) 703 316
Nippon Cable Systems 119,000 1,171
Pacific Dunlop 4,485,575 18,709
Snap-on Tools Corp. 710,100 30,446
Toyota Motor Corporation 4,050,000 73,027
Volkswagen AG 55,000 14,027
261,004
CONSUMER ELECTRONICS - 1.6%
Aktiebolaget Electrolux 382,300 17,619
Black & Decker Corp. 10,000 211
Matsushita Electric Industrial Co. Ltd. 4,464,000 71,046
Sony Corp. 1,235,200 72,385
161,261
TEXTILES & APPAREL - 0.6%
Acme Boot Co. Unit Stock 1,000 1,001
Burlington Industries Equity, Inc. (b) 10,000 146
NIKE, Inc. Class B 335,700 16,785
Stride Rite Corp. 1,221,200 19,845
Unifi, Inc. 840,000 20,790
58,567
TOTAL DURABLES 480,832
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
ENERGY - 7.8%
COAL - 0.0%
Eastern Enterprises Co. 32,900 $ 855
ENERGY SERVICES - 2.4%
Baker Hughes, Inc. 1,439,800 28,976
Halliburton Co. 1,014,700 32,724
Helmerich & Payne, Inc. 969,600 26,785
Marine Drilling Cos., Inc. (b) 500,000 2,750
McDermott International, Inc. 750,900 17,740
Petrolane, Inc. Class B (b) 80,164 942
Schlumberger Ltd. 2,083,100 123,684
233,601
OIL & GAS - 5.4%
Amerada Hess Corp. 2,029,200 98,416
Anderson Exploration Ltd. (b) 122,000 3,052
British Borneo Petroleum 305,600 1,058
British Petroleum PLC:
ADR 1,956,100 133,505
Ord. 6,565,225 37,370
Cabot Oil & Gas Corp. Class A (f) 1,118,800 24,753
Kerr-McGee Corp. 525,800 24,187
Lasmo PLC 500,051 949
Louisiana Land & Exploration Co. 695,500 28,950
Mesa, Inc. (b) 95,993 672
Murphy Oil Corp. 539,100 22,305
Noble Affiliates, Inc. 59,900 1,640
Occidental Petroleum Corp. 2,299,500 41,391
Oryx Energy Co. 10,000 180
Pennzoil Co. 71,200 3,934
Petro-Canada 432,200 4,390
Renaissance Energy Ltd. (b) 12,000 271
Repsol SA sponsored ADR 10,000 341
Royal Dutch Petroleum Co. 322,200 35,442
San Juan Basin Royalty Trust (UBI) 1,469,600 13,961
Sun Company, Inc. 10,000 309
Tarragon Oil & Gas Ltd. (b) 42,600 521
Total Compagnie Francaise des Petroles Class B 751,024 41,560
Total SA sponsored ADR (b) 218,276 6,003
Union Texas Petroleum Holdings, Inc. 100,000 2,025
527,185
TOTAL ENERGY 761,641
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
FINANCE - 4.7%
BANKS - 0.6%
Bank of Boston Corp. 530,349 $ 13,590
BankAmerica Corp. 420,000 19,530
Chase Manhattan Corp. (warrants) (b) 50,221 427
Chemical Banking Corp. 512,300 20,236
Citicorp (b) 33,100 1,448
Continental Bank Corp. (b) 46,200 1,623
Grant Street National Bank (b) 1,047,299 360
57,214
CREDIT & OTHER FINANCE - 0.7%
American Express Co. 580,400 19,008
Argentaria Corp. Bancaria de Espana 821,000 39,027
GFC Financial Corp. 486,000 15,066
73,101
INSURANCE - 1.9%
ACE Ltd. 369,800 10,447
Allstate Corp. 335,100 9,550
Berkley (W.R.) Corp. 14,300 511
Heath (CE) 1,988,000 13,052
Loews Corp. 1,135,200 112,527
MBIA, Inc. 122,000 7,686
NAC Re Corp. 448,400 14,125
SAFECO Corp. 7,400 437
Travelers, Inc. (The) 319,648 13,465
181,800
SAVINGS & LOANS - 0.3%
Ahmanson (H.F.) & Co. 1,783,400 33,439
Great Western Financial Corp. 12,094 234
33,673
SECURITIES INDUSTRY - 1.2%
Daiwa Securities 864,000 14,227
ECM Corp. LP interest (b)(h) 6,318 632
Invesco Mim PLC (b) 1,601,400 5,908
Midland Walwyn, Inc. (b) 368,300 4,053
Nomura Securities Co. Ltd. 3,845,000 82,064
Paine Webber Group, Inc. 237,600 7,039
113,923
TOTAL FINANCE 459,711
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
HEALTH - 0.8%
DRUGS & PHARMACEUTICALS - 0.3%
Allergan, Inc. 978,800 $ 22,757
IMCERA Group, Inc. 10,000 379
Warner-Lambert Co. 28,500 1,856
24,992
MEDICAL EQUIPMENT & SUPPLIES - 0.1%
Bergen Brunswig Corp. Class A 224,300 4,178
Pall Corp. 270,000 5,096
9,274
MEDICAL FACILITIES MANAGEMENT - 0.4%
HCA - Hospital Corporation of America Class A (b) 1,156,300 44,951
TOTAL HEALTH 79,217
INDUSTRIAL MACHINERY & EQUIPMENT - 3.5%
ELECTRICAL EQUIPMENT - 0.5%
AMETEK, Inc. (f) 2,305,600 28,244
General Electric Co. 12,400 1,336
General Signal Corp. 20,000 728
Murata Manufacturing Co. 400,000 16,191
Westinghouse Electric Corp. 20,000 280
46,779
INDUSTRIAL MACHINERY & EQUIPMENT - 2.9%
Amtrol, Inc. 87,600 1,708
Caterpillar, Inc. 1,454,700 151,470
Deere & Co. 18,000 1,449
Goulds Pumps, Inc. 770,600 19,650
Harnischfeger Industries, Inc. 522,800 12,613
Mitsubishi Heavy Industry 5,758,000 37,663
Parker-Hannifin Corp. 1,553,400 59,417
TRINOVA Corp. 46,900 1,548
Terex Corp. (rights) (b) 5,610 11
Thermadyne Industries, Inc. (b)(f) 320,000 3
Thermadyne Industries, Inc. (warrants) (b) 1,091 55
Watts Industries, Inc. Class A 1,500 80
285,667
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
POLLUTION CONTROL - 0.1%
Safety Kleen Corp. 569,800 $ 9,687
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 342,133
MEDIA & LEISURE - 1.0%
ENTERTAINMENT - 0.0%
Live Entertainment, Inc. (warrants) (g):
$2.00 (b) 256,000 256
$2.72 244,705 154
410
LEISURE DURABLES & TOYS - 0.0%
Brunswick Corp. 10,000 195
LODGING & GAMING - 0.1%
Bally Gaming International, Inc. (g) 84,392 1,181
Bally Gaming International, Inc. (warrants) (b)(g) 135,000 1,013
Bally's Grand, Inc. (b) 238,531 2,922
Bally's Grand Inc. (warrants) (b) 12,878 61
Bally Manufacturing Corp. (b) 28,758 255
Trump Plaza Holding Associates (warrants) (b) 270 211
5,643
PUBLISHING - 0.9%
General Media, Inc. (warrants)(b) 1,110 17
MaClean Hunter Ltd. 1,847,200 19,632
Meredith Corp. 263,900 11,117
Times Mirror Co. Series A 1,568,200 56,847
87,613
TOTAL MEDIA & LEISURE 93,861
NONDURABLES - 3.3%
BEVERAGES - 0.6%
Seagram Co. Ltd. 1,780,500 54,424
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONDURABLES - CONTINUED
FOODS - 1.0%
Borden, Inc. 10,000 $ 154
ConAgra, Inc. 2,413,300 63,651
Dole Food, Inc. 898,900 26,180
House Food Industrial 208,000 4,784
94,769
HOUSEHOLD PRODUCTS - 0.7%
First Brands Corp. 10,000 361
London International Group 1,205,600 2,941
Orkla AS:
Class A Free shares 781,550 30,632
Class B (non-vtg.) 697,150 27,044
Stanhome, Inc. 200,100 6,503
67,481
TOBACCO - 1.0%
American Brands, Inc. 10,000 358
Philip Morris Companies, Inc. 1,541,900 92,900
RJR Nabisco Holdings Corp. (b) 1,336,100 10,021
103,279
TOTAL NONDURABLES 319,953
PRECIOUS METALS - 0.1%
Agnico Eagle Mines Ltd. 1,233,600 14,155
RETAIL & WHOLESALE - 4.3%
APPAREL STORES - 1.3%
Charming Shoppes, Inc. 2,974,400 34,206
Edison Brothers Stores, Inc. 1,009,800 30,420
Filene's Basement Corp. (b) 1,012,500 10,252
Limited, Inc. (The) 2,493,300 44,255
Petrie Stores Corp. 278,300 7,584
126,717
DRUG STORES - 0.1%
Rite Aid Corporation 671,600 12,509
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
RETAIL & WHOLESALE - CONTINUED
GENERAL MERCHANDISE STORES - 1.3%
Carter Hawley Hale Stores, Inc. (b) 339,000 $ 3,305
Dayton Hudson Corp. 1,419,000 93,299
Federated Department Stores, Inc. (b) 10,000 219
Hills Stores Co. (b) 33,579 726
Price/Costco, Inc. 1,481,000 26,288
123,837
GROCERY STORES - 1.3%
American Stores Co. 913,200 38,697
FF Holdings Corp. (b)(h) 39,600 89
Food 4 Less Holdings, Inc. (warrants) (b) 14,206 431
Giant Food, Inc. Class A 956,200 22,590
Grand Union Capital Corp. Class B (b)(f) 5,975 4,063
Grand Union Co. (warrants)(b) 2,130 1,491
Great Atlantic & Pacific Tea Co., Inc. 1,583,300 37,603
Supervalue, Inc. 748,500 29,192
134,156
RETAIL & WHOLESALE, MISCELLANEOUS - 0.3%
Barrys Jewelers, Inc. 227,883 313
Barrys Jewelers, Inc. (warrants)(b) 5,697 2
Duty Free International, Inc. 129,700 2,351
Fabri-Centers of America, Inc. (b) 246,400 4,312
Finlay Enterprises, Inc. 3,670 55
Handleman Co. (Del.) 400,000 5,500
Sotheby's Holdings, Inc. Class A 384,700 6,348
Uny Co. Ltd. 741,000 9,271
28,152
TOTAL RETAIL & WHOLESALE 425,371
SERVICES - 0.6%
LEASING & RENTAL - 0.1%
Orix Corp. 250,000 8,739
PHH Corp. 1,000 43
Ryder Systems, Inc. 37,600 1,011
9,793
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
SERVICES - CONTINUED
PRINTING - 0.3%
Deluxe Corp. 50,000 $ 1,744
Donnelley (R.R.) & Sons Co. 732,400 22,704
Harland (John H.) Co. 5,000 115
Nashua Corp. (f) 165,000 5,012
Standard Register Co. 70,000 1,558
31,133
SERVICES - 0.2%
Angelica Corp. 10,000 279
CPI Corp. 134,900 1,956
Jostens, Inc. 488,400 8,669
National Service Industries, Inc. 144,300 3,896
Town & Country Jewelry Manufacturing Corp. Class A (b) 534,507 1,570
16,370
TOTAL SERVICES 57,296
TECHNOLOGY - 3.7%
COMPUTERS & OFFICE EQUIPMENT - 1.9%
Canon, Inc. 3,233,000 49,075
Comdisco, Inc. 522,800 12,351
Digital Equipment Corp. (b) 276,300 8,358
Stratus Computer, Inc. (b) 564,500 17,217
Tandem Computers, Inc. (b) 1,403,800 18,951
Xerox Corp. 782,100 76,744
182,696
ELECTRONIC INSTRUMENTS - 0.2%
Measurex Corp. 231,200 4,624
Tektronix, Inc. 649,600 18,351
22,975
ELECTRONICS - 1.4%
AMP, Inc. 1,113,200 69,575
Anthem Electronics, Inc. (b) 103,100 3,377
Hitachi, Ltd. 7,980,000 66,439
Toshiba Corp. 218,000 1,460
140,851
COMMON STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
TECHNOLOGY - CONTINUED
PHOTOGRAPHIC EQUIPMENT - 0.2%
Eastman Kodak Co. 10,000 $ 441
Polaroid Corp. 622,700 20,938
21,379
TOTAL TECHNOLOGY 367,901
TRANSPORTATION - 0.2%
RAILROADS - 0.2%
Chicago & North Western Holdings Corp. (b) 152,900 4,090
Illinois Central Corp. Series A 491,400 18,427
22,517
TRUCKING & FREIGHT - 0.0%
Roadway Services, Inc. 6,300 441
TOTAL TRANSPORTATION 22,958
UTILITIES - 1.0%
ELECTRIC UTILITY - 0.2%
Centerior Energy Corp. 1,018,500 13,368
EUA Power Corp. (b) 1,300 1
Public Service Co. of New Mexico (b) 53,500 709
Texas Utilities Co. 8,132 314
14,392
GAS - 0.3%
Coastal Corp. (The) 1,050,400 32,431
Enron Corp. 10,000 329
UGI Corp. (warrants)(b) 13,633 17
32,777
TELEPHONE SERVICES - 0.5%
Telebras PN (Reg.) (k) 1,086,076 51,621
TOTAL UTILITIES 98,790
TOTAL COMMON STOCKS
(Cost $3,850,475) 4,626,349
PREFERRED STOCKS - 5.5%
SHARES VALUE (NOTE 1)
(000S)
CONVERTIBLE PREFERRED STOCKS - 3.0%
BASIC INDUSTRIES - 0.7%
IRON & STEEL - 0.3%
Bethlehem Steel Corp.:
$3.00 (b)(h) 280,000 $ 18,760
$5.00 34,900 1,928
Inland Steel Industries, Inc. Series G, $4.625 exchangeable 116,300
7,560
28,248
METALS & MINING - 0.3%
Alumax, Inc. Series A, $4.00 97,233 11,668
Reynolds Metals Co. $3.31 330,400 18,172
29,840
PAPER & FOREST PRODUCTS - 0.1%
Boise Cascade Corp. $1.58 243,100 6,138
TOTAL BASIC INDUSTRIES 64,226
ENERGY - 0.5%
ENERGY SERVICES - 0.1%
McDermott International, Inc. Series C, $2.875 (h) 300,000 13,500
OIL & GAS - 0.4%
Occidental Petroleum Corp. $3.875 (h) 179,500 9,289
Unocal Corp. $3.50 (b)(h) 424,400 25,358
34,647
TOTAL ENERGY 48,147
FINANCE - 0.8%
BANKS - 0.8%
Citicorp $5.375 (h) 405,900 50,230
Citicorp depositary shares representing 1/12
preferred, Series 15, $1.217 787,000 15,937
Wells Fargo Series C, 9% 293,050 8,059
74,226
PREFERRED STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONVERTIBLE PREFERRED STOCKS - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - 0.2%
Cooper Industries, Inc. $8.00 exchangeable (b) 10,000 $ 259
Tenneco, Inc. depositary shares representing 1/2 share
preferred, Series A 321,000 13,682
13,941
MEDIA & LEISURE - 0.0%
ENTERTAINMENT - 0.0%
Live Entertainment, Inc. Series B, pay-in-kind (b) 489,507 3,671
LODGING & GAMING - 0.0%
Bally Manufacturing Corp. Series D, $4.00 exchangeable (b) 13,300 559
TOTAL MEDIA & LEISURE 4,230
NONDURABLES - 0.3%
TOBACCO - 0.3%
RJR Nabisco Holdings Corp. depositary shares
representing 1/4 share, Series A 4,206,800 33,129
RETAIL & WHOLESALE - 0.0%
APPAREL STORES - 0.0%
Lamonts Apparel, Inc. Series A (b) 25,110 50
TRANSPORTATION - 0.5%
AIR TRANSPORTATION - 0.2%
AMR Corp. $3.00 (b)(h) 396,700 21,422
TRUCKING & FREIGHT - 0.3%
Consolidated Freightways, Inc. Series C, $1.54 947,000 21,544
TNT Ltd. 8% 5,112,000 9,428
30,972
TOTAL TRANSPORTATION 52,394
PREFERRED STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
CONVERTIBLE PREFERRED STOCKS - CONTINUED
UTILITIES - 0.0%
GAS - 0.0%
Transco Energy Co. $4.75 4,100 $ 211
TOTAL CONVERTIBLE PREFERRED STOCKS 290,554
NONCONVERTIBLE PREFERRED STOCKS - 2.5%
BASIC INDUSTRIES - 0.0%
IRON & STEEL - 0.0%
Stelco, Inc. Series B, 7.76% 22,425 413
PAPER & FOREST PRODUCTS - 0.0%
Stone Savannah River Pulp & Paper Corp. Series A,
exchangeable $15.375 14,840 1,113
TOTAL BASIC INDUSTRIES 1,526
CONSTRUCTION & REAL ESTATE - 0.0%
CONSTRUCTION - 0.0%
UDC Homes, Inc. prime exchangeable (b) 259,098 3,077
ENERGY - 0.1%
OIL & GAS - 0.1%
Gulf Canada Resources Ltd. (b)(g) 46,430 139
Gulf Canada Resources Ltd. Series 1, adj. rate 2,130,977 6,659
6,798
FINANCE - 1.2%
BANKS - 1.1%
Bank of New York, Inc. adj. rate 153,057 7,308
Chase Manhattan Corp.:
Series J, 9.08% 401,524 11,092
Master Trust Series H, 9.76% 85,050 2,509
Chemical Banking Corp.:
Series C, adj. rate (b) 255,000 3,060
Series 1 149,500 7,550
Series 2, adj. rate 200,200 5,480
PREFERRED STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONCONVERTIBLE PREFERRED STOCKS - CONTINUED
FINANCE - CONTINUED
BANKS - CONTINUED
First Chicago Corp.:
adj. rate 80,700 $ 4,065
Series C, adj. rate 60,714 5,973
Series D, 10% 3,500 93
First Fidelity Bancorporation Series D, adj. rate (b) 121,780 12,269
First Interstate Bancorp:
depositary shares representing 1/8 share, Series F 531,291 15,010
depositary shares representing 1/8 share, Series G, 9% 297,000 8,279
First Union Corp. Series 1990, adj. rate (b) 55,000 2,949
Fleet Financial Group, Inc.:
depositary shares representing 1/4
preferred Series III,10.12% 11,937 351
depositary shares representing 1/4 preferred Series IV 5,089 143
Marine Midland Banks, Inc. Series A, adj. rate (b) 106,676 5,120
Mellon Bank Corp. Series I, 9.6% 118,300 3,283
Riggs National Corp. 8,586 244
Shawmut National Corp. depositary shares representing 1/10
share, 9.3% 182,800 5,073
Summit Bancorporation adj. rate 215,069 4,973
UJB Financial Corp. Series B, adj. rate. 20,600 1,009
105,833
CREDIT & OTHER FINANCE - 0.0%
Household International, Inc. depositary shares representing
1/4 share, Series 89-A, 9 1/2% 40,000 1,090
SAVINGS & LOANS - 0.1%
Ahmanson (H.F.) & Co. depositary shares representing 1/2
share, Series B 9.6% 354,812 9,890
Dime Savings Bank of New York 150 160
Washington Mutual Series C, 9 1/8% 24,000 660
10,710
TOTAL FINANCE 117,633
INDUSTRIAL MACHINERY & EQUIPMENT - 0.0%
Thermadyne Industries, Inc. $4.31 (b) 223,110 335
PREFERRED STOCKS - CONTINUED
SHARES VALUE (NOTE 1)
(000S)
NONCONVERTIBLE PREFERRED STOCKS - CONTINUED
SERVICES - 0.0%
Town & Country Corp. exchangeable (b) 112,098 $ 869
TECHNOLOGY - 0.0%
ELECTRONICS - 0.0%
Berg Electronics Holding Corp. Series E, $3.47 136,801 3,523
UTILITIES - 1.2%
ELECTRIC UTILITY - 0.8%
Cleveland Electric Illuminating Co.:
Series L, adj. rate 25,000 2,338
Series M, adj. rate (b) 63,489 6,349
Series N, $9.125 19,997 2,020
Series R (b) 2,500 2,475
Georgia Power Co. Class A 1993 Series 160,000 4,140
Gulf State Utilities Co.:
$1.75 500,000 12,875
$8.52 (b) 89,993 9,292
$9.96 (b) 14,788 1,536
Series A, adj. rate (b) 44,407 4,485
Series B, adj. rate 88,403 4,464
Long Island Lighting Co. $7.95 570,100 15,179
Public Service Co. of New Hampshire, Series A 369,707 10,259
Texas Utilities Electric Co., Series B, adj. rate 10,700 1,062
76,474
GAS - 0.1%
ENSERCH Corp. Series D, adj. rate (b) 20,000 1,005
Transcontinental Gas Pipelines $6.65 38,665 3,828
4,833
TELEPHONE SERVICES - 0.3%
SIP (Societa Ital Per L'Eser) Spa Di Risp N/C Ord. 5,179,900 11,347
Stet Societa Finanziaria Telefonica Spa 8,976,000 20,354
31,701
TOTAL UTILITIES 113,008
TOTAL NONCONVERTIBLE PREFERRED STOCKS 246,769
TOTAL PREFERRED STOCKS
(Cost $463,279) 537,323
CORPORATE BONDS - 17.4%
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
CONVERTIBLE BONDS - 1.2%
AEROSPACE & DEFENSE - 0.0%
UNC, Inc. 7 1/2%, 3/31/06 B2 $ 3,569 $ 3,426
BASIC INDUSTRIES - 0.0%
IRON & STEEL - 0.0%
Stelco, Inc. 7 3/4%, 8/31/98 - CAD 3,500 2,370
CONGLOMERATES - 0.3%
Hanson PLC euro 9 1/2%, 1/31/06 - GBP 14,500 27,621
CONSTRUCTION & REAL ESTATE - 0.0%
REAL ESTATE - 0.0%
Mid-Atlantic Realty Trust 7 5/8%, 9/15/03 - 2,770 2,715
REAL ESTATE INVESTMENT TRUSTS - 0.0%
Centerpoint Properties 8.22%, 1/15/04 - 1,854 1,863
Sizeler Property Investors, Inc. 8%, 7/15/03 - 1,000 1,015
2,878
TOTAL CONSTRUCTION & REAL ESTATE 5,593
DURABLES - 0.2%
AUTOS, TIRES, & ACCESSORIES - 0.1%
Amoco CDA Petroleum Co. exchangeable,
7 3/8%, 9/19/13 Aa3 10,800 12,689
Volvo B 10%, 3/31/95 - SEK 5,388 1,218
13,907
CONSUMER ELECTRONICS - 0.1%
Whirlpool Corp. liquid yield option notes
0%, 5/14/11 Baa1 13,080 6,426
TOTAL DURABLES 20,333
ENERGY - 0.1%
ENERGY SERVICES - 0.1%
Lone Star Technologies, Inc. euro 8%, 8/27/02 - 5,150 4,480
OIL & GAS - 0.0%
USX-Marathon Group 7%, 6/15/17 BB- 4,490 4,288
TOTAL ENERGY 8,768
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
CONVERTIBLE BONDS - CONTINUED
FINANCE - 0.1%
BANKS - 0.1%
Bank of New York Co., Inc. 7 1/2%, 8/15/01 Baa1 $ 2,725 $ 4,156
Midlantic Banks Inc. 8 1/4%, 7/1/10 Ba2 1,750 1,785
5,941
INDUSTRIAL MACHINERY & EQUIPMENT - 0.1%
ELECTRICAL EQUIPMENT - 0.1%
Alcatel Alsthom 6 1/2%, 1/1/00 - FRF 74 10,938
MEDIA & LEISURE - 0.2%
BROADCASTING - 0.2%
Time Warner, Inc. 8 3/4%, 1/10/15 Ba3 20,000 21,100
PRECIOUS METALS - 0.1%
Agnico Eagle Mines Ltd. B1 7,715 6,539
TRANSPORTATION - 0.1%
AIR TRANSPORTATION - 0.1%
Alaska Air Group, Inc. liquid yield option notes
0%, 4/18/06 Ba3 17,500 7,088
TOTAL CONVERTIBLE BONDS 119,717
NONCONVERTIBLE BONDS - 16.2%
AEROSPACE & DEFENSE - 0.0%
Fairchild Corp.:
12%, 10/15/01 B3 1,050 1,034
12 1/4%, 3/15/06 B3 870 861
Fairchild Industries, Inc. 12 1/4%, 2/1/99 B2 535 554
2,449
BASIC INDUSTRIES - 0.9%
CHEMICALS & PLASTICS - 0.2%
Grace (W.R.) & Co. 7.4%, 2/1/00 BBB- 5,000 5,306
IMC Fertilizer Group, Inc.:
9 1/4, 10/1/00 B3 5,000 5,099
10 1/8, 6/15/01 B3 1,500 1,605
10 3/4, 6/15/03 B3 1,000 1,080
9.45%, 12/15/11 B3 3,700 3,765
Methanex Corp. 8 7/8% 11/15/01 Ba3 4,290 4,494
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
BASIC INDUSTRIES - CONTINUED
CHEMICALS & PLASTICS - CONTINUED
OSI Specialties, Inc. 9 1/4%, 10/1/02 B1 $ 1,120 $ 1,154
Trans Resources, Inc. 14 1/2%, 9/1/96 B2 515 572
23,075
IRON & STEEL - 0.3%
Acindar Industria Argentina De Aceros:
euro 9 1/2%, 10/23/95 - 500 490
10 1/2%, 12/10/94 (h) - 400 392
Inland Steel Industries, Inc. 12 3/4%, 12/15/02 Ba3 4,225 4,890
Republic Engineered Steels, Inc. 9 7/8%,
12/15/01 B2 8,600 8,987
Stelco 10.25%, 4/30/96 - CAD 4,670 3,479
WCI Steel, Inc. 10 1/2%, 3/1/02 B1 4,500 4,804
23,042
METALS & MINING - 0.0%
Renco Metals, Inc. 12%, 7/15/00 B3 1,300 1,297
PACKAGING & CONTAINERS - 0.1%
Crown Cork & Seal, Inc. 6 3/4%, 4/15/03 Baa1 4,900 5,011
PAPER & FOREST PRODUCTS - 0.3%
Alto Parana euro 12%, 3/4/95 - 4,000 3,920
Chesapeake Corp.:
10 3/8%, 10/1/00 Baa3 2,700 3,273
9 7/8%, 5/1/03 Baa3 10,000 12,081
Great Northern Nekoosa Corp. 9 1/8%, 2/1/98 Baa3 7,800 8,665
Indorayon Yankee 9 1/8%, 10/15/00 BB 3,500 3,518
31,457
TOTAL BASIC INDUSTRIES 83,882
CONGLOMERATES - 0.2%
Insilco Corp.:
9 1/2%, 7/1/97 Ca 2,290 2,290
9 1/2%, 7/1/97 (g) Ca 3,420 3,420
10 3/8%, 7/1/97 - 2,000 2,015
Jordan Inds., Inc. 11 3/4%, 8/1/05 Caa 4,720 3,020
Sequa Corp. 9 3/8%, 12/15/03 - 1,840 1,868
12,613
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
CONSTRUCTION & REAL ESTATE - 0.6%
BUILDING MATERIALS - 0.6%
Adience, Inc. 11%, 6/15/02 - $ 1,415 $ 1,146
Cemex SA notes 8 7/8%, 6/10/98 (h) Ba2 7,000 7,568
DAL Tile International, Inc. secured coupon, 0%,
7/15/98 Caa 12,500 7,891
Hillsborough/Jim Walter Corp. (c):
sinking fund 13 3/4%, 2/1/03 Ca 875 718
17%, 1/1/96 Ca 1,087 924
Monogram Industries, Inc., 11%, 4/30/04 Caa 200 200
Nortek, Inc. 13 1/2%, 6/15/97 Caa 810 826
PT Semen Cibinong 9%, 12/15/98 (h) - 8,000 8,130
Sunbelt (Cemex) Enterprises 8 1/2%,
5/4/95 (g) - 5,000 5,150
Tolmex SA de CV 8 3/8%, 11/1/03 Ba2 10,000 10,548
USG Corp.10 1/4%, 12/15/02 B2 7,790 8,028
Westinghouse Credit Corp.:
9.04%, 6/1/98 Ba1 2,250 2,461
9.3%, 6/7/99 Ba1 2,400 2,680
8.93%, 6/22/99 Ba1 1,200 1,317
57,587
CONSTRUCTION - 0.0%
UDC Homes 11 3/4%, 4/30/03 B2 340 371
US Home Corp. 9 3/4%, 6/15/03 Ba3 45 47
418
TOTAL CONSTRUCTION & REAL ESTATE 58,005
DURABLES - 0.3%
AUTOS, TIRES, & ACCESSORIES - 0.1%
Clevite Industries Inc. sinking fund 12 3/8%,
6/30/01 - 3,600 1,800
Grupo Dina (Consorcio G) 10 1/2%,
11/18/97 (h) - 5,000 5,538
7,338
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
DURABLES - CONTINUED
TEXTILES & APPAREL - 0.2%
Acme Boot Co. 11 1/2%, 12/15/00 B2 $ 3,000 $ 3,015
Alpargatas:
SAIC 9%, 11/26/96 (h) - 5,000 5,000
SA euro 9%, 3/15/98 - 3,000 2,820
Fortsmann & Co., Inc. 14 3/4%, 4/15/99 (j) Caa 700 833
Leslie Fay Companies, Inc. (g):
9.53%, 1/15/00 - 1,130 861
10.54%, 1/15/02 - 1,021 674
Westpoint Stevens 9 3/8%, 12/15/05 B3 6,500 6,727
19,930
TOTAL DURABLES 27,268
ENERGY - 0.7%
ENERGY SERVICES - 0.3%
McDermott International, Inc. 10 1/4%, 6/1/95 Baa3 6,975 7,423
Petroliam Nasional Berhad yankee 6 7/8%,
7/1/03 (h) A2 12,000 12,357
TransTexas Gas Corp. 10 1/2%, 9/1/00 B1 8,050 8,593
28,373
OIL & GAS - 0.4%
Brid Sapic euro 11 3/4%, 2/24/97 - 3,000 3,150
Mesa Capital Corp. secured 0%,
6/30/98 (e) - 8,916 8,080
PDV America, Inc.:
7 1/4%, 8/1/98 Baa3 4,000 4,100
7 3/4%, 8/1/00 Baa3 6,700 6,951
Pemex:
euro 17 3/4%, 6/1/94 Ba2 1,020 1,061
11.43%, 12/13/95 (h) Ba2 4,000 4,265
Petro Canada, Inc.:
9 3/8%, 6/24/97 - CAD 2,000 1,664
yankee 8.60%, 10/15/01 Baa1 5,000 5,644
Petrolera Argentina San Jorge SA, secured
negotiable obligation 11%, 2/9/98 (h) - 5,000 5,225
Societe Nationale Elf Aquitaine 7 3/4%, 5/1/99 Aa3 2,850 3,132
43,272
TOTAL ENERGY 71,645
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
FINANCE - 8.3%
ASSET BACKED SECURITIES - 0.8%
Capital Auto Receivables Asset Trust, 5.85%,
1/15/98 Aaa $ 8,419 $ 8,553
Discover Card Trust, 6 1/8%, 5/15/98 A2 3,700 3,774
Ford Credit Auto Loan Master Trust 7 3/8%,
4/15/99 A2 10,000 10,723
MBNA Master Credit Card Trust 7 3/4%,
10/15/98 Aaa 750 806
Premier Auto Trust 4.95%, 2/2/99 A3 5,000 5,008
Standard Credit Card:
Master Trust, 5 7/8%, 7/7/96 Aaa 37,550 38,332
Master Trust I, participation certificate,
5 1/2%, 9/7/98 A2 5,600 5,647
Master Trust I, 6 1/4%, 9/7/98 A2 2,650 2,726
75,569
BANKS - 5.1%
Banco Nacional de Mexico SA:
euro 9 1/8%, 4/6/00 Ba2 2,500 2,750
9 1/8%, 4/6/00 (h) - 2,500 2,750
Bancomer SA (h):
9%, 6/1/00 - 8,000 8,720
euro 8%, 7/7/98 Ba2 6,000 6,285
Bancomer SNC 2/2/04 Ba2 25,000 24,844
Bank of Boston Corp.:
9 1/2%, 8/15/97 Baa2 5,298 6,000
10.3%, 9/1/00 Baa2 11,703 12,727
6%, 9/12/00 (j) Baa1 5,350 5,344
5%, 02/28/01 (j) Baa2 4,750 4,756
6 7/8%, 7/15/03 Baa2 2,000 2,057
6 5/8%, 2/1/04 Baa2 5,000 5,053
Bank of New York Co., Inc.:
7 5/8%, 7/15/02 Baa1 10,000 10,879
7 7/8%, 11/15/02 Baa1 5,000 5,524
Banobras euro 10 3/4%, 8/16/96 Ba2 5,000 5,531
Central Fidelity Banks, Inc. 8.15%, 11/15/02 Baa2 13,000 14,508
Chase Manhattan Corp. euro 5%, 5/31/00 (j) Baa2 2,000 2,005
Chemical Banking Corp. 8 5/8%, 5/1/02 Baa1 3,000 3,453
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
FINANCE - CONTINUED
BANKS - CONTINUED
Citicorp:
euro 5%, 10/25/05 (j) Baa2 $ 11,500 $ 11,500
8 1/2%, 2/11/97 Baa2 10,000 10,932
8.4%, 2/12/97 Baa2 5,000 5,463
8.42%, 2/12/97 Baa2 5,000 5,455
8%, 2/01/03 Baa2 3,000 3,335
Continental Bank Corp.:
4 1/2%, 5/18/00 (j) Baa3 9,500 9,488
9 3/4%, 3/15/95 Baa3 8,950 9,475
7 7/8%, 2/1/03 Baa3 4,350 4,778
Corporacion Andina De Fomento yankee bonds
7 1/4%, 4/30/98 (h) - 5,900 6,003
Credit Local de France 8 1/2%, 6/26/97 Aaa FRF 107,000 19,912
First of America Bank Corp. 8 1/2%, 2/1/04 Baa1 2,645 3,039
First Bank System, Inc. euro, 4 1/2%, 11/30/10 (j) Baa1 2,000 2,000
First Fidelity Bancorporation:
9 3/4%, 5/25/95 A3 1,000 1,068
8 1/2%, 4/1/98 A3 6,200 6,900
9 5/8%, 8/15/99 A3 6,000 7,111
First Hawaiian Bank secured 6.93%,
12/1/03 (h) A1 10,000 10,226
First Interstate Bancorp:
9 3/8%, 1/23/02 Baa3 3,350 4,001
9 1/8%, 2/1/04 Baa1 5,750 6,894
First Maryland Bancorp:
10 3/8%, 8/1/99 Baa1 7,450 9,046
8 3/8%, 5/15/02 Baa1 6,030 6,814
First National Bank of Boston 8 3/8%,
12/15/02 Baa1 4,450 5,047
First Union Corp. 6 3/4%, 1/15/98 A2 3,000 3,139
First USA Bank Wilmington DE:
5 3/4%, 1/15/99 Baa3 6,000 6,001
7.65%, 8/1/03 Baa1 18,000 19,015
Fleet Financial Group, Inc. 8 1/8%, 7/01/04 Baa1 3,370 3,793
HSBC Finance Nederland BV 7.40%,
4/15/03 (h) Baa1 4,000 4,262
Hartford National Corp. 9.85%, 6/1/99 Baa2 9,399 11,033
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
FINANCE - CONTINUED
BANKS - CONTINUED
Huntington Bancshares, Inc. 7 7/8%, 11/15/02 Baa1 $ 8,000 $ 8,839
Integra Financial Corp. 8 1/2%, 5/15/02 Baa2 2,500 2,810
Keycorp:
8.96%, 5/30/96 A2 5,000 5,448
7.97%, 1/22/99 A2 6,000 6,570
Manufacturers Hanover Corp.:
euro 5 1/4%, 7/15/97 (j) Baa2 500 503
8 1/2%, 2/15/99 Baa1 8,365 9,371
Marine Midland Banks, Inc.:
5.25%, 12/20/00 (j) Baa2 16,550 16,550
8 5/8%, 3/1/97 Baa2 14,818 16,173
Mellon Financial Co. 6 1/8%, 11/15/95 A3 3,130 3,221
Mercantile Bancorporation, Inc. 7 5/8%,
10/15/02 Baa1 10,050 10,923
Merchants National Corp. 9 7/8%, 10/1/99 A2 6,850 8,163
Midland American Capital Corp. gtd. 12 3/4%,
11/15/03 A2 1,550 1,988
Midland International Financial Services BV euro
5%, 3/6/99 (j) - 5,000 5,005
Midlantic Corp.:
9 7/8%, 12/1/99 Ba2 16,610 19,678
9.2%, 8/1/01 Ba2 11,245 13,132
Provident Bank 7 1/8%, 3/15/03 Baa3 4,500 4,691
Shawmut Corp.:
8 7/8%, 4/1/96 Baa1 6,840 7,409
8 1/8%, 2/1/97 Baa1 9,125 9,877
Signet Banking Corp. 9 5/8%, 6/01/99 Baa2 7,250 8,467
UJB Financial Corp. 8 5/8%, 12/10/02 Baa3 17,450 19,976
497,710
CREDIT & OTHER FINANCE - 1.3%
American General Financial Corporation
12 3/4%, 12/1/94 A2 2,870 3,073
Beatrice Finance NV gtd. euro 10 1/2%,
9/15/94 Baa3 5,000 5,300
Chrysler Financial Corp. 9 1/2%, 12/15/99 Baa2 8,000 9,397
Fleet Mortgage Group, Inc. 6 1/8%, 8/15/97 A3 9,800 10,092
Ford Motor Credit Co. 7 1/2%, 1/15/03 A2 4,500 4,865
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
FINANCE - CONTINUED
CREDIT & OTHER FINANCE - CONTINUED
GPA Delaware, Inc.:
gtd. notes 8 3/4%, 12/15/98 Caa $ 630 $ 534
8 1/2%, 3/3/97 - 4,200 3,696
8 5/8%, 1/15/99 - 2,900 2,407
General Motors Acceptance Corp.:
7%, 3/6/95 Baa1 6,000 6,173
7 3/4%, 1/28/97 Baa1 4,250 4,540
Greyhound Financial Corp. 6.95%, 1/28/98 Baa2 2,000 2,103
Household Finance Corp.:
9 3/8%, 2/15/96 A2 4,425 4,834
10 1/8%, 6/15/96 A3 7,175 8,035
Industrial Finance Corp. Thailand 7 1/2%,
12/2/98 - THB 100,000 3,941
LaSalle National Trust NA Trust No. 118501
mortgage note 2,000 2,000
Margaretten Financial Corp. 6 3/4%, 6/15/00 Baa3 10,000 10,267
Nacional Financiera SNC euro:
yankee 9 3/8%, 4/23/99 (h) Ba2 5,000 5,513
5 7/8%, 2/17/98 - 5,000 4,906
10 5/8%, 11/22/01 - 9,000 10,654
9 3/8%, 7/15/02 Ba2 5,000 5,631
Railcar Trust, 7 3/4%, 6/1/04 Aaa 10,335 11,406
Tenneco Credit Corp. 8 3/8%, 2/1/97 Baa2 1,250 1,250
U.S. Leasing 8 3/4%, 3/22/96 A2 2,000 2,178
Westinghouse Electric Corp. 9.15%, 1/20/98 Ba1 950 1,041
123,836
INSURANCE - 0.4%
American Annuity Group, Inc. 11 1/8%,
2/01/03 B2 2,090 2,236
Metropolitan Life Insurance Co. 6.3%,
11/1/03 (h) Aa3 9,000 9,017
New York Life Insurance Co. 6.4%,
12/15/03 (h) Aa3 12,000 12,128
Reliance Group 9%, 11/15/00 Ba3 15,000 15,450
38,831
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
FINANCE - CONTINUED
SAVINGS & LOANS - 0.7%
Ahmanson (H.F.) & Co. 9 7/8%, 11/15/99 Baa3 $ 6,000 $ 7,138
Anchor Bancorp, Inc. 8 7/8%,7/9/03 Ba3 10,000 10,500
Golden West Finance Corp. 8 3/8%, 4/15/02 A3 6,800 7,738
Home Savings of America:
10 1/2%, 6/12/97 Baa1 3,670 4,063
6%, 11/1/00 Baa1 5,000 4,959
Household Bank 8.45%, 12/10/02 A3 7,600 8,722
Household Bank Newport Beach Calif.
6 1/2%, 7/15/03 A3 5,000 5,056
USAT Holdings, Inc. 8.05%, 5/15/98 (h) Ba2 19,550 19,625
World Savings & Loan Association 9.9%, 7/1/00 A2 2,400 2,851
70,652
SECURITIES INDUSTRY - 0.0%
ECM Corp. extendible 14%, 6/1/02 (h) - 2,095 2,350
TOTAL FINANCE 808,948
HEALTH - 0.1%
DRUGS & PHARMACEUTICALS - 0.1%
Scherer (R.P.) International Corp. 6 3/4%, 2/1/04 Ba1 5,000 4,992
MEDICAL FACILITIES MANAGEMENT - 0.0%
Hallmark Healthcare Corp. 10 5/8%, 11/15/03 B3 3,850 4,014
TOTAL HEALTH 9,006
INDUSTRIAL MACHINERY & EQUIPMENT - 0.2%
ELECTRICAL EQUIPMENT - 0.1%
Ampex, Inc.:
Unit 0%, 1/15/98 (e)(g) - 3,800 2,356
20%, 3/15/94 - 557 557
Specialty Equipment Cos., Inc. 11 3/8%, 12/1/03 B3 6,000 6,420
9,333
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - CONTINUED
INDUSTRIAL MACHINERY & EQUIPMENT - 0.1%
Joy Technologies, Inc. 10 1/4%, 9/1/03 B1 $ 3,590 $ 3,778
Rexnord Holdings, Inc. 11 7/8%, 3/1/99 B2 2,090 2,153
Thermadyne Industries, Inc. (j):
15%, 5/1/99 Ca 4,803 5,231
10 1/2%, 11/1/99 Ca 1,117 833
11,995
TOTAL INDUSTRIAL MACHINERY & EQUIPMENT 21,328
MEDIA & LEISURE - 1.4%
BROADCASTING - 0.4%
Grupo Televisa SA:
euro 10%, 11/9/97 Ba2 4,000 4,470
6.75%, 4/7/96 (j) Ba2 6,120 6,258
Robin Media Group, Inc. 11 1/8%, 4/1/97 - 3,410 3,504
SCI Television, Inc. secured 11%, 6/30/05 - 7,560 7,938
SPI Holding, Inc. reset, 11 1/2%, 12/01/02
pay-in-kind B- 4,135 4,238
Telecommunications, Inc.:
7.13%, 2/02/98 Baa3 5,000 5,291
6.58%, 2/15/05 Baa3 6,000 6,316
Time Warner, Inc. 6.05%, 7/1/95 (h) Baa3 5,000 5,087
43,102
ENTERTAINMENT - 0.2%
Bally's Health & Tennis Corp. 13%, 1/15/03 B3 240 243
Kloster Cruise, Ltd. 13%, 5/1/03 B2 1,800 2,009
Live Entertainment, Inc.:
12%, 9/15/94 (g) - 8,000 8,000
10%, 9/1/98 - 2,325 2,128
Westwood Group, Inc. 14 1/4%, 8/15/97 (c) Caa 1,500 600
12,980
LODGING & GAMING - 0.4%
Bally Gaming International, Inc. 10 3/8%,
7/29/98 - 4,500 4,500
Ballys Grand, Inc. 10 3/8%, 12/15/03 (h) B2 7,000 7,175
Boyd Gaming Corp. 10 3/4%, 9/1/03 (h) - 8,000 8,480
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
MEDIA & LEISURE - CONTINUED
LODGING & GAMING - CONTINUED
Host Marriott Corp.:
9 1/8%, 12/1/00 B1 $ 1,500 $ 1,526
10 1/2, 5/1/06 B1 1,000 1,025
11%, 5/1/06 B1 2,551 2,618
Host Marriott Hospitality, Inc. 10 3/8%, 6/15/11 B1 2,500 2,550
Marriott Corp. Series G,
8 3/8%, 2/1/94 B2 4,450 4,467
Resorts International, Inc. secured pay-in-kind:
10%, 4/15/94 (j) Ca 6,026 4,086
15%, 4/15/94 Ca 3,448 2,323
Trump Plaza Funding, Inc. gtd. mtg. 10 7/8%,
6/15/01 B3 2,300 2,300
41,050
PUBLISHING - 0.3%
General Media, Inc. 10 5/8%, 12/31/00 - 1,110 1,141
News America Holdings, Inc.:
gtd. 9 1/8%, 10/15/99 Ba1 7,000 7,845
8 5/8%, 2/1/03 Ba1 9,250 10,214
Time Warner Entertainment Co. 9 5/8%,
5/1/02 Baa3 10,000 11,915
31,115
RESTAURANTS - 0.1%
American Restaurant Group Inc.12%, 9/15/98 B2 3,020 3,104
Cafeteria Operated 11%, 6/30/98 (g) - 7,577 6,061
9,165
TOTAL MEDIA & LEISURE 137,412
NONDURABLES - 0.4%
BEVERAGES - 0.1%
Canandaigua Wine, Inc. 8 3/4%, 12/15/03 B1 5,300 5,353
Fomento Ecunomico Mexicano SA 9 1/2%,
7/22/97 (h) - 4,000 4,360
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
NONDURABLES - CONTINUED
BEVERAGES - CONTINUED
Grupo Embotellador de Mexico SA de CV:
euro 10 3/4%, 11/19/97 Ba2 $ 3,560 $ 4,023
10 3/4%, 11/19/97 (h) Ba2 1,000 1,130
14,866
HOUSEHOLD PRODUCTS - 0.1%
Mary Kay Corp. 10 1/4%, 12/31/00 (h) B+ 2,080 2,148
Revlon Consumer Products Corp. 9 3/8%,
4/1/01 B 1,030 1,004
Revlon Worldwide secured 0%, 3/15/98 B3 7,820 4,047
7,199
TOBACCO - 0.2%
Empresas La Moderna SA 10 1/4%,
11/12/97 (h) - 6,000 6,615
RJR Nabisco, Inc. 10 1/2%, 4/15/98 Baa3 10,000 11,337
17,952
TOTAL NONDURABLES 40,017
PRECIOUS METALS - 0.0%
Teck Corp. 8.7%, 5/1/02 Baa2 2,000 2,259
RETAIL & WHOLESALE - 0.6%
APPAREL STORES - 0.1%
Apparel Retailers, Inc. 12 3/4%, 8/15/05 Caa 3,710 2,300
Lamonts Apparel 10 1/4%, 11/1/99 - 2,893 2,799
Limited, Inc. (The) 7 1/2%, 3/15/23 A1 2,000 2,020
7,119
GENERAL MERCHANDISE STORES - 0.2%
Controladora Comercial Mexicana SA de CV:
euro 8 3/4%, 4/21/98 - 3,570 3,780
8 3/4%, 4/21/98 (h) - 1,650 1,747
Dayton Hudson Corp. 9.18%, 2/27/98 A3 5,000 5,690
El Puerto de Liverpool SA de CV
7 1/4%, 10/19/96 (h) - 6,500 6,605
May Department Stores Co. 9 7/8%, 12/1/02 A2 2,850 3,521
21,343
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
RETAIL & WHOLESALE - CONTINUED
GROCERY STORES - 0.2%
American Stores Co. 9 1/8%, 4/1/02 Baa3 $ 5,000 $ 5,855
Farm Fresh Holdings Corp. 14 1/4%,
10/1/02 (h) - 4,609 4,978
Food 4 Less Holdings, Inc. 0%, 12/15/94 (e) Caa 5,338 3,737
Great Atlantic & Pacific Tea, Inc. 9 1/8%,
1/15/98 Baa3 1,250 1,372
Harvest Foods, Inc. 9%, 11/1/03 - 2,010 1,206
17,148
RETAIL & WHOLESALE, MISCELLANEOUS - 0.1%
Barrys Jewelers, Inc. 11%, 12/31/00 (g) - 1,595 1,515
Color Tile, Inc. 10 3/4%, 12/15/01 B2 7,750 8,119
Wickes Lumber Co., 11 5/8%, 12/15/03 B3 2,670 2,870
12,504
TOTAL RETAIL & WHOLESALE 58,114
SERVICES - 0.3%
LEASING & RENTAL - 0.2%
Acme Holdings, Inc. 11 3/4%, 6/1/00 B3 2,950 2,714
Ryder System, Inc. 9.2%, 3/15/98 Baa1 750 793
U.S. Leasing International, Inc. 8 3/4%, 5/1/96 A2 18,830 20,372
23,879
SERVICES - 0.1%
Comdata Network, Inc. 13 1/4%, 12/15/02 B3 4,300 4,870
Town & Country Corp.:
11 1/2%, 9/15/97 B 2,653 2,600
13%, 5/31/98 CCC+ 2,366 2,414
9,884
TOTAL SERVICES 33,763
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
TECHNOLOGY - 0.3%
COMPUTERS & OFFICE EQUIPMENT - 0.2%
Comdisco, Inc.:
9 3/4%, 1/15/97 Baa2 $ 4,850 $ 5,372
9.28%, 6/5/00 Baa2 2,000 2,301
9.3%, 6/27/00 Baa2 2,000 2,300
9 1/4%, 7/6/00 Baa2 7,625 8,731
9 1/2%, 1/28/02 Baa2 2,580 3,039
21,743
ELECTRONICS - 0.0%
Berg Electronics 11 3/8%, 5/1/03 (h) B3 2,050 2,173
Grupo Condumex SA de CV 6 1/4%,
7/27/96 (h) - 2,500 2,494
4,667
PHOTOGRAPHIC EQUIPMENT - 0.0%
Eastman Kodak Co. 9 5/8%, 11/15/99 A3 4,250 4,430
TOTAL TECHNOLOGY 30,840
TRANSPORTATION - 0.1%
AIR TRANSPORTATION - 0.1%
AMR Corp. 9 1/2%, 7/15/98 Baa3 4,750 5,283
Continental Airlines Corp. (c):
0%, 9/2/96 (j) - 2,130 107
2nd priority secured equipment certificate
11%, 3/15/95 Caa 450 14
Southwest Airlines Co. secured 9.40%, 7/1/01 Baa1 4,000 4,748
10,152
TRUCKING & FREIGHT - 0.0%
Consolidated Freightways, Inc. 9 1/8%, 8/15/99 Baa3 2,000 2,219
TOTAL TRANSPORTATION 12,371
UTILITIES - 1.8%
CELLULAR - 0.1%
Cencall Communications Corp. 0%, 1/15/04 Caa 1,970 1,221
Horizon Cellular Telephone Corp. 0%,
10/1/00 (h) Caa 3,100 2,263
Pagemart, Inc. 0%, 11/1/00 (h) - 43 2,593
6,077
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
UTILITIES - CONTINUED
ELECTRIC UTILITY - 1.3%
CMS Energy Corp. 9 7/8%, 10/1/99 Ba3 $ 9,170 $ 8,528
Comision Federal De Electricidad euro 8%,
8/4/97 - 10,000 10,500
Commonwealth Edison Co. 7 5/8%, 2/15/03 Baa3 1,000 1,026
El Paso Funding Corp. lease oblig. 10 3/4%,
4/1/13 (c) Ca 870 740
EUA Power Corp. secured, pay-in-kind (c):
17 1/2%,11/15/92 (h) - 719 101
17 1/2%, 5/15/93 - 4,080 571
Hydro-Quebec euro 4.75%, 7/31/02 (j) A+ 3,000 3,000
Long Island Lighting Co.:
10 1/4%, 6/15/94 Baa3 10,600 10,821
11 3/4%, 11/15/94 Baa3 391 413
8 3/4%, 5/1/96 Baa3 2,000 2,156
10 7/8%, 6/15/99 Baa3 2,500 2,685
7.3%, 7/15/99 Baa3 13,500 14,060
N.A.E.C. 9.05%, 6/1/02 Ba1 9,000 9,000
Public Service Co. of New Hampshire:
contingent 15.23%, 7/1/00 Ba2 8,657 10,994
1st mtg., Series B, 9.17%, 5/15/98 Baa3 5,000 5,469
Systems Energy Resources, Inc. 1st mtg.:
14%, 11/15/94 Baa3 10,000 10,754
10 1/2%, 9/1/96 Baa3 1,000 1,107
Toledo Edison Co.:
secured 9.3%, 4/1/98 Baa3 8,500 9,104
8.7%, 9/1/02 Ba3 8,500 8,489
United Illuminating Co.:
7 3/8%, 1/15/98 Baa3 4,000 4,200
9.76%, 1/2/06 Baa3 13,135 14,498
128,216
GAS - 0.4%
Columbia Gas Systems, Inc. (c):
7 1/2%, 10/1/97 Caa 2,000 2,242
9.07%, 1/12/00 - 250 289
10 1/4%, 8/1/11 Caa 360 448
10.15%, 11/1/13 Caa 290 352
9.43%, 10/12/19 Caa 1,250 1,522
Enron Corp. 9.65%, 5/15/01 Baa2 2,000 2,398
CORPORATE BONDS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
NONCONVERTIBLE BONDS - CONTINUED
GAS - CONTINUED
Southwest Gas Corp.:
9 3/4%, 6/15/02 Ba1 $ 15,150 $ 17,493
9 3/8%, 2/1/17 Ba1 4,250 4,489
Transcontinental Gas Pipe Line Corp.:
9%, 11/15/96 Ba2 6,050 6,426
extendible 6.21%, 5/15/00 Ba2 5,000 4,997
40,656
TELEPHONE SERVICES - 0.0%
MFS Communications 0%, 1/15/04 B3 3,850 2,492
TOTAL UTILITIES 177,441
TOTAL NONCONVERTIBLE BONDS 1,587,361
TOTAL CORPORATE BONDS
(Cost $1,625,943) 1,707,078
U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS - 7.5%
U.S. TREASURY OBLIGATIONS - 5.2%
8 7/8%, 11/15/97 Aaa 7,500 8,570
7 7/8%, 8/15/01 Aaa 9,150 10,531
6 3/8%, 8/15/02 Aaa 1,700 1,793
10 3/4%, 8/15/05 Aaa 91,260 129,361
9 7/8%, 11/15/15 Aaa 71,300 100,822
8 7/8%, 8/15/17 Aaa 7,700 10,016
8 1/8%, 8/15/19 Aaa 19,200 23,319
8%, 11/15/21 Aaa 99,150 119,770
12%, 8/15/23 Aaa 63,745 100,289
504,471
U.S. GOVERNMENT AGENCY OBLIGATIONS - 2.3%
Agency for International Development (guaran-
teed by U.S. government):
4 7/8%, 9/15/98 Aaa 7,100 7,051
5 3/4%, 3/15/00 Aaa 3,375 3,434
5 1/4%, 9/15/00 Aaa 25,405 25,087
Federal Agricultural Mortgage Corp.
7.48%, 11/27/00 Aaa 2,500 2,737
Federal Home Loan 7 1/8%, 11/18/02 Aaa 7,150 7,778
U.S. GOVERNMENT AND GOVERNMENT AGENCY OBLIGATIONS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
U.S. GOVERNMENT AGENCY OBLIGATIONS - CONTINUED
Financing Corporation:
9.40%, 2/8/18 Aaa $ 26,085 $ 34,514
9.80%, 4/6/18 Aaa 18,155 24,884
9.65%, 11/2/18 Aaa 9,160 12,426
9.70%, 4/5/19 Aaa 5,525 7,536
8.60%, 9/26/19 Aaa 25,250 31,121
Government Trust Certificates:
current coupon certificate, Class 1-C
9 1/4%, 11/15/01 Aaa 25,720 30,237
current coupon certificate, Class G-2
8%, 5/15/98 Aaa 11,164 11,992
9.4%, 5/15/02 Aaa 16,000 18,937
Private Export Funding Corporation secured
notes Series CC, 9 1/2%, 3/31/99 Aaa 4,000 4,761
Tennessee Valley Authority:
8 1/4%, 11/15/96 Aaa 2,000 2,187
6 7/8%, 12/15/43 Aaa 5,000 4,879
229,561
TOTAL U.S. GOVERNMENT AND GOVERNMENT
AGENCY OBLIGATIONS
(Cost $691,170) 734,032
U.S. GOVERNMENT AGENCY - MORTGAGED-BACKED SECURITIES - 3.7%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 0.2%
6 1/2%, 1/1/09 Aaa 9,900 10,138
8%, 10/1/16 to 4/1/20 Aaa 6,228 6,496
16,634
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 1.8%
6%, 10/1/23 to 12/1/23 Aaa 10,124 9,849
6 1/2%, 9/1/08 to 1/1/24 Aaa 64,421 65,154
7%, 7/1/22 to 12/1/23 Aaa 24,487 25,106
7 1/2%, 12/1/06 to 2/1/23 Aaa 55,446 57,802
8 1/2%, 1/1/09 to 9/1/23 Aaa 3,905 4,141
9%, 11/1/01 to 8/1/07 Aaa 12,120 12,889
10%, 8/1/17 Aaa 286 316
175,257
U.S. GOVERNMENT AGENCY - MORTGAGED-BACKED SECURITIES - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 1.7%
6 1/2%, 12/15/23 Aaa $ 9,887 $ 9,924
7%, 10/15/17 to 11/15/23 Aaa 44,912 46,177
7 1/2%, 4/15/17 to 12/15/23 Aaa 46,624 42,536
8%, 8/15/16 to 10/15/23 Aaa 19,014 20,108
8 1/2%, 11/15/05 to 11/15/22 Aaa 16,609 17,655
9%, 3/15/16 to 10/15/22 Aaa 26,497 28,458
10%, 10/15/10 to 7/15/19 Aaa 2,291 2,531
11%, 12/15/09 to 9/15/15 Aaa 3,315 3,779
11 1/2%, 12/15/10 Aaa 260 300
171,468
TOTAL U.S. GOVERNMENT AGENCY -
MORTGAGE-BACKED SECURITIES
(Cost $360,071) 363,359
COLLATERALIZED MORTGAGE OBLIGATIONS - 0.1%
MBNA Trust Class A, Series 1990-1, 9 1/2%,
10/25/20 - 1,265 1,282
Mutual Benefit Overseas (c):
9 3/8%, 2/1/96 - 2,476 842
9 3/8%, 2/1/96 - 6,787 2,308
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $1,984) 4,432
FOREIGN GOVERNMENT OBLIGATIONS - 7.8%
Alberta Province 9 1/4%, 4/1/00 Aa2 5,500 6,524
Argentina Republic:
euro 4.1875%, 3/31/05 (j) BB- 11,000 9,694
4.1875%, 3/31/05 (j) - 250 220
BOCON:
0.40%, 4/1/01 (j) - ARP 17,284 14,008
3 1/4%, 4/1/01 (j) B1 74,014 64,048
3.9775%, 9/1/02 (j) ARP 10,500 7,968
3.9775%, 4/1/07 (j) ARP 3,038 2,200
BOTE:
2.03%, 5/31/96 (j) - 65,300 36,669
3.12%, 4/3/00 (j) - 8,533 7,513
FOREIGN GOVERNMENT OBLIGATIONS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
Argentina Republic - continued
Brady:
euro 4%, 3/31/23 B1 $ 35,000 $ 24,544
4%, 3/31/23 (h) - 43,500 30,504
Province of Cordoba, Argentina 10%, 1/28/95 - 8,250 8,291
Bank Negara Malaysia treasury bill:
0%, 4/1/94 - MYR 4,000 1,432
0%, 5/11/94 - MYR 10,000 3,573
0%, 5/25/94 - MYR 30,000 10,609
0%, 6/8/94 - MYR 28,300 9,983
Canadian Government:
7 1/2%, 7/1/97 Aaa CAD 7,000 5,676
11 3/4%, 2/1/03 Aaa CAD 25,800 26,508
7 1/2%, 12/1/03 Aaa CAD 25,000 20,370
Danish Government:
9%, 11/15/00 Aa1 DKK 210,300 36,829
8%, 5/15/03 Aa1 DKK 403,000 68,132
7%, 12/15/04 Aa1 DKK 401,500 64,297
French Government OAT:
8 1/2%, 11/25/02 Aaa FRF 82,000 16,672
8 1/2%, 4/25/03 Aaa FRF 384,800 78,287
Government of New Zealand 8%, 4/15/04 Aa3 NZD 35,000 23,505
Kingdom of Sweden 10 3/4%, 1/23/97 Aa2 SEK 250,000 35,530
Manitoba Province:
6%, 10/15/97 A1 5,000 5,145
6 3/4%, 3/1/03 A1 5,000 5,226
Mexican Government:
Adjustabanos:
7 1/4%, 2/17/94 AA- MXN 4,231 1,915
4.8%, 9/1/94 AA- MXN 9,000 3,794
Brady:
4.1875%, 12/31/19 (j) Ba3 20,550 19,137
4.3125%, 12/31/19 (j) Ba3 7,600 7,078
6 1/4%, 12/31/19 Ba3 8,000 6,610
6 1/4%, 12/31/19 Ba3 12,500 10,328
8.35%, 12/31/19 (j) Ba3 4,950 4,610
Cetes 0%, 4/7/94 - MXN 36,700 11,593
Morocco Trust 4 1/2%, 1/3/09 (h)(j) - 16,250 13,548
Nigeria Brady 5 1/2%, 11/15/2020 - 12,500 7,453
Quebec Province 8.93%, 9/1/02 Aa3 2,000 2,330
Republic of Uruguay 8 1/4%, 6/8/95 (h) - 2,500 2,569
FOREIGN GOVERNMENT OBLIGATIONS - CONTINUED
MOODY'S RATINGS (D) PRINCIPAL VALUE (NOTE 1)
(UNAUDITED) AMOUNT (A) (000S) (000S)
United Kingdom Treasury:
12%, 11/20/98 Aaa GBP 16,200 $ 30,509
9 3/4%, 8/27/02 Aaa GBP 6,200 11,422
Victorian Public Authorities Finance Agency:
8.45%, 10/1/01 A1 4,700 5,414
8 1/4%, 1/15/02 A1 4,000 4,575
TOTAL FOREIGN GOVERNMENT OBLIGATIONS
(Cost $707,330) 766,842
SUPRANATIONAL OBLIGATIONS - 0.6%
African Development Bank:
9 1/2%, 12/15/95 Aa1 3,520 3,837
6 3/4%, 7/30/99 Aa1 10,000 10,575
9.3%, 7/01/00 Aa1 15,000 17,851
Export-Import Bank Korea 7.85%, 11/1/96 A1 13,200 14,133
Korea Development Bank:
9.6%, 12/1/00 A1 6,000 7,067
9 1/2%, 3/30/01 A1 7,000 8,357
TOTAL SUPRANATIONAL OBLIGATIONS
(Cost $56,806) 61,820
OTHER SECURITIES - 2.2%
COLLATERALIZED NOTES - 0.9%
Wilton Investments Ltd. sr. notes
(collateralized by Mexican govt. and
U.S. govt. securities) (g):
Series B, 0%, 3/4/94 36,330 36,170
Series C, 0%, 6/3/94 49,390 48,505
84,675
OTHER SECURITIES - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT (A) (000S) (000S)
INDEXED SECURITIES - 0.4%
AIG Matched Funding Corp. note 4.4655%,
9/14/94 (coupon inversely indexed
to HELIBOR and principal indexed
to value of 2-year Finnish securities, both
multiplied by 6) (j) $ 8,000 $ 9,072
AIG Matched Funding Corp. note 3.5862%,
9/16/94 (coupon inversely indexed
to HELIBOR and principal indexed to value
of 3-year Finnish securities, both multiplied
by 4) (j) 2,500 2,745
Bankers Trust New York Corp. note 13.84%,
8/7/95 (inversely indexed to 1-month gold
lease rate) (j) 4,000 4,270
Bankers Trust Company note 4.2075%, 8/31/94
(coupon inversely indexed to HELIBOR
and principal indexed to value of 2-year Finnish
securities, both multiplied by 6) (j) 2,300 2,614
Bankers Trust Company note 4.2175%, 9/2/94
(coupon inversely indexed to HELIBOR
and principal indexed to value of 3-year Finnish
securities, both multiplied by 4) (j) 2,500 2,778
Bankers Trust Company note 14.4375%, 7/15/94
(indexed to CSK denom. CEZ a.s. bond
16 1/2%, 6/25/98) 1,700 1,742
Citibank Nassau 0%, 7/6/94 (coupon
inversely indexed to CAD Banker's Acceptance
rate and principal indexed to value of 1-year
Canadian securities, both multiplied by 10) (j) 1,900 2,071
ITT Corp. 3.66%, 6/27/94 (inversely indexed to
1-year SEK swap rate, multiplied by 10) 14,000 14,853
Morgan Guaranty Trust Co. cert. of dep. 0%,
6/6/94 (indexed to $482 par of Westport
Investments Ltd. sr. notes, collateralized by
Mexican govt. securities, per $100 par) 1,615 1,561
Morgan Guaranty Trust Co. cert. of dep. 0%,
8/22/94 (indexed to $481 par of Westport
Investments Ltd. sr. notes, collateralized by
Mexican govt. securities, per $100 par) 268 261
41,967
OTHER SECURITIES - CONTINUED
PRINCIPAL VALUE (NOTE 1)
AMOUNT (A) (000S) (000S)
PURCHASED BANK DEBT - 0.9%
Belmont L.V. Land 8.61%, 7/16/97 (j) 8,182 $ 6,392
Indonesia SBI:
4/28/94 IDR 12,000 5,543
5/13/94 IDR 6,000 2,773
5/19/94 IDR 10,900 5,008
1/13/95 IDR 10,000 4,327
Leslie Fay Cos., Inc.:
1/15/96 134 109
revolving loan, 1/15/96 1,164 825
term loan, 1/15/96 1,299 1,058
Macy (R.H.) & Co.:
5/27/96 5,352 4,977
aquisition letter of credit:
5/27/94 3,682 3,424
7/10/94 6,065 5,640
7/10/94 1,149 1,045
facility letter of credit 7/10/94 29 27
letter of credit:
5/27/94 1,234 1,123
5/27/95 1,724 1,603
mortgage loan participation 5/27/94 20,000 18,200
revolving loan variable rate:
5/27/94 1,596 1,476
7/10/94 2,057 1,915
5/27/95 550 511
term loan:
5/27/95 4,637 4,234
5/27/96 3,781 3,517
term loan variable rate:
5/27/94 2,079 1,923
7/10/94 2,708 2,519
12/21/94 5,000 4,650
Special Real Estate Cap. 0%, 9/30/95 2,480 2,306
85,125
TOTAL OTHER SECURITIES
(Cost $177,045) 211,767
CERTIFICATES OF DEPOSIT - 0.3%
PRINCIPAL VALUE (NOTE 1)
AMOUNT (A) (000S) (000S)
Bank of America Malaysia 4.3%, 4/13/94 MYR 20,000 $ 7,224
1st. Bank of St. Paul 11.42%, 8/15/95 2,000 2,216
Siam Commercial Bank:
7%, 11/29/95 THB 300,000 11,800
7 1/4%, 11/29/96 THB 100,000 3,938
Thai Military Bank, Ltd. 8%, 10/28/96 THB 150,000 5,972
TOTAL CERTIFICATES OF DEPOSIT
(Cost $46,620) 31,150
COMMERCIAL PAPER - 2.9%
Banca Serfin SA 0%, 7/7/94 to 7/28/94 MXN 192,024 58,618
Banco Nacional De Mexico SA 0%, 12/8/94 MXN 31,080 9,111
Bank Negara Malaysia, 9/7/94 MYR 33,000 11,502
Bridas Energy Corp. 0%, 6/14/94 9,175 8,936
Citibank Mexico 0%, 5/12/94 MXN 17,498 5,456
Grupo Embotellador de Mexico SA de CV
0%, 4/20/94 (h) 10,000 9,872
Malayan Banking BHD 5.53%, 4/7/94 MYR 70,000 25,330
Nacional Financiera SNC 0%:
4/14/94 to 6/2/94 MXN 378,140 117,807
7/23/96 MXN 81,082 20,330
Public Bank BHD 0%, 4/13/94 MYR 50,000 17,932
TOTAL COMMERCIAL PAPER
(Cost $287,436) 284,894
REPURCHASE AGREEMENTS - 4.8%
MATURITY
AMOUNT
(000S)
Investments in repurchase agreements
(U.S. Treasury obligations), in a
joint trading account at 3.19%
dated 1/31/94 due 2/1/94 $ 473,437 473,395
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $8,741,554) $ 9,802,441
FORWARD FOREIGN CURRENCY CONTRACTS
SETTLEMENT UNREALIZED
AMOUNTS IN THOUSANDS DATE(S) VALUE GAIN/(LOSS)
CONTRACTS TO BUY
18,917 JPY 2/28/94 $ 174 $ (1)
(Payable amount $175)
THE VALUE OF CONTRACTS TO BUY AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 0%
CONTRACTS TO SELL
759,301 BEF 2/3/94 $ 21,260 $ (636)
53,758 CAD 3/7/94 40,429 (253)
23,933 CHF 4/19/94 16,404 (267)
6,282 DEM 2/28/94 to 7/18/94 3,597 (19)
978,064 DKK 2/7/94 to 4/28/94 145,678 (914)
4,843,329 ESP 4/21/94 to 4/27/94 34,144 (594)
232,660 FIM 4/11/94 42,064 (2,064)
1,136,810 FRF 4/14/94 to 4/28/94 191,806 (1,479)
51,889 GBP 4/11/94 to 4/26/94 77,768 (671)
36,875,992 JPY 2/28/94 to 4/27/94 339,600 (2,509)
129,573 NLG 4/26/94 66,369 (507)
182,282 NOK 4/26/94 24,363 (221)
408,734 SEK 4/11/94 to 4/19/94 51,444 (2,015)
TOTAL CONTRACTS TO SELL
(Receivable amount $1,042,777) $ 1,054,926 $ (12,149)
THE VALUE OF CONTRACTS TO SELL AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 10.8%
CURRENCY ABBREVIATIONS
ARP - Argentinean peso
BEF - Belgian franc
GBP - British pound
CAD - Canadian dollar
DKK - Danish krone
NLG - Dutch guilder
FIM - Finnish markka
FRF - French franc
DEM - German Deutsche mark
IDR - Indonesian rupiah
JPY - Japanese yen
MYR - Malaysian ringgit
MXN - Mexican peso
NZD - New Zealand dollar
NOK - Norwegian krone
ESP - Spanish peseta
SEK - Swedish krona
CHF - Swiss franc
THB - Thai baht
LEGEND
1. Principal amount is stated in United States dollars unless otherwise
noted.
2. Non-income producing
3. Non-income producing - issuer filed for protection under the Federal
Bankruptcy Code or is in default of interest payment.
4. Standard & Poor's Corporation credit ratings are used in the absence
of a rating by Moody's Investors Service, Inc.
5. Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
6. Affiliated company (see Note 6 of Notes to Financial Statements).
7. Restricted securities - investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION
ACQUISITION COST
SECURITY DATE (000S)
Ampex, Inc. Unit 0%,
1/15/98 7/22/92 $ 2,837
Bally Gaming
International, Inc. 9/29/93 1,230
Bally Gaming
International, Inc.
(warrants) 6/29/93 0
Barrys Jewelers, Inc.
11%, 12/31/00 12/22/93 1,436
Cafeteria Operated
11%, 6/30/98 6/24/93 6,063
Gulf Canada
Resources Ltd. 10/15/93 117
Insilco Corp. 9 1/2%,
7/1/97 7/14/93 3,424
Leslie Fay Companies, Inc.:
9.53%, 1/15/00 7/19/93 856
10.54%, 1/15/02 7/19/93 675
Live Entertainment, Inc.:
$2.00 (warrants) 3/23/93 230
$2.72 (warrants) 3/23/93 241
12%, 9/15/94 3/23/93 7,529
ACQUISITION
ACQUISITION COST
SECURITY DATE (000S)
Sunbelt (Cemex)
Enterprises 8 1/2%
5/4/95 2/12/93 $ 4,853
Wilton Investments
Ltd. sr. notes:
Series B, 0%,
3/4/94 3/3/93 36,308
Series C, 0%,
6/3/94 3/3/93 48,422
8. Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $389,076,000 or 4.0% of net
assets.
9. Market value reflects the payment of the first installment. Additional
equal payments of CAD 818,000 are payable in January and October of 1995.
10. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
11. Share amount in thousands.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 19.6% AAA, AA, A 20.1%
Baa 6.0% BBB 5.4%
Ba 4.0% BB 2.6%
B 2.5% B 2.1%
Caa 0.3% CCC 0.2%
Ca, C 0.2% CC, C 0.0%
D 0.1%
For some foreign government obligations, FMR has assigned the ratings of
the sovereign credit of the issuing government. The percentage not rated by
either S&P or Moody's amounted to 4.9% including long-term debt
categorized as other securities.
Distribution of investments by country, as a percentage of total value of
investment in securities, is as follows:
United States 66.3%
Japan 5.6
Mexico 4.7
Canada 4.0
United Kingdom 3.4
Argentina 2.4
France 2.1
Netherlands 2.0
Denmark 1.7
Malaysia 1.0
Others (individually less than 1%) 6.8
TOTAL 100.0%
INCOME TAX INFORMATION
At January 31, 1994, the aggregate cost of investment securities for income
tax purposes was $8,742,613,000. Net unrealized appreciation aggregated
$1,059,828,000, of which $1,159,369,000 related to appreciated investment
securities and $99,541,000 related to depreciated investment securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS (EXCEPT PER-SHARE AMOUNTS) JANUARY 31, 1994
ASSETS
Investment in securities, at value (including repurchase $ 9,802,441
agreements of $473,395) (cost $8,741,554) (Notes 1
and 2) - See accompanying schedule
Long foreign currency contracts held, at value (cost 174
$175) (Note 2)
Short foreign currency contracts (Note 2) $ (1,054,926)
Contracts held, at value
Receivable for contracts held 1,042,777 (12,149)
Receivable for investments sold 122,999
Receivable for fund shares sold 56,148
Dividends receivable 8,793
Interest receivable 70,750
Other receivables 1,652
TOTAL ASSETS 10,050,808
LIABILITIES
Payable to custodian bank 1,546
Payable for foreign currency contracts held (Note 2) 175
Payable for investments purchased 265,254
Payable for fund shares redeemed 8,149
Accrued management fee 3,928
Other payables and accrued expenses 2,079
Collateral on securities loaned, at value (Note 5) 2,464
TOTAL LIABILITIES 283,595
NET ASSETS $ 9,767,213
Net Assets consist of (Note 1):
Paid in capital $ 8,464,624
Undistributed net investment income 10,289
Accumulated undistributed net realized gain (loss) on 243,563
investments
Net unrealized appreciation (depreciation) on:
Investment securities 1,060,887
Foreign currency contracts (12,150)
NET ASSETS, for 593,893 shares outstanding $ 9,767,213
NET ASSET VALUE, offering price and redemption price per $16.45
share ($9,767,213 (divided by) 593,893 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS ENDED JANUARY 31, 1994
INVESTMENT INCOME $ 63,890
Dividends (including $201 received from affiliated
issuers)
(Note 6)
Interest (including security lending fees of $32) (Note 5) 141,438
TOTAL INCOME 205,328
EXPENSES
Management fee (Note 4) $ 22,499
Transfer agent fees (Note 4) 9,765
Accounting and security lending fees (Note 4) 414
Non-interested trustees' compensation 26
Custodian fees and expenses 850
Registration fees 107
Audit 100
Legal 34
Miscellaneous 64
Total expenses before reductions 33,859
Expense reductions (Note 7) (215) 33,644
NET INVESTMENT INCOME 171,684
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1 AND 3)
Net realized gain (loss) on:
Investment securities (including realized gain (loss) of 440,777
$(293) on sales of investments in affiliated issuers)
Foreign currency contracts (6,307) 434,470
Change in net unrealized appreciation (depreciation) on:
Investment securities 265,186
Foreign currency contracts (15,085) 250,101
NET GAIN (LOSS) 684,571
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 856,255
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED JANUARY JULY 31, 1993
31, 1994
INCREASE (DECREASE) IN NET ASSETS
Operations $ 171,684 $ 308,787
Net investment income
Net realized gain (loss) on investments 434,470 604,934
Change in net unrealized appreciation (depreciation) 250,101 278,984
on
investments
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 856,255 1,192,705
FROM OPERATIONS
Distributions to shareholders (185,752) (324,490)
From net investment income
From net realized gain (680,892) (258,105)
TOTAL DISTRIBUTIONS (866,644) (582,595)
Share transactions 1,817,468 2,083,363
Net proceeds from sales of shares
Reinvestment of distributions from: 167,810 288,057
Net investment income
Net realized gain 638,634 238,621
Cost of shares redeemed (674,501) (969,803)
Net increase (decrease) in net assets resulting from 1,949,411 1,640,238
share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,939,022 2,250,348
NET ASSETS
Beginning of period 7,828,191 5,577,843
End of period (including undistributed net investment $ 9,767,213 $ 7,828,191
income of $10,289 and $53,154, respectively)
OTHER INFORMATION
Shares
Sold 112,779 132,921
Issued in reinvestment of distributions from: 10,660 18,907
Net investment income
Net realized gain 40,416 16,426
Redeemed (41,941) (62,745)
Net increase (decrease) 121,914 105,509
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED JULY 31,
ENDED
JANUARY 31,
1994 1993# 1992 1991 1990 1989
SELECTED PER-SHARE DATA
Net asset value, $ 16.59 $ 15.22 $ 13.75 $ 13.08 $ 14.90 $ 12.83
beginning of period
Income from Investment
Operations
Net investment .33 .72 .88(SUB SECTION) .75 .88 .99(double dagger)
income
Net realized and 1.25 2.14 1.37 .72 (1.17) 1.99
unrealized gain
(loss) on
investments
Total from 1.58 2.86 2.25 1.47 (.29) 2.98
investment
operations
Less Distributions
From net investment (.36) (.80) (.78) (.80) (.99) (.91)
income
From net realized (1.36) (.69) - - (.54) -
gain
Total distributions (1.72) (1.49) (.78) (.80) (1.53) (.91)
Net asset value, end $ 16.45 $ 16.59 $ 15.22 $ 13.75 $ 13.08 $ 14.90
of period
TOTAL RETURN (dagger)
(dagger)(dagger) 10.21% 20.29 16.96 11.87 (2.12) 24.38
% % % % %
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of $ 9,767 $ 7,828 $ 5,578 $ 4,942 $ 4,766 $ 4,947
period (in millions)
Ratio of expenses to .77%*(diamond) .74 .64 .66 .65% .64
average net assets % % % %
Ratio of expenses to .78%*(diamond) .74 .64 .66 .65% .64
average net assets % % % %
before expense
reductions
Ratio of net 3.95%* 4.89 6.23 5.94 6.30% 7.41
investment income % % % %
to average net
assets
Portfolio turnover rate 85%* 76 102 108 58% 77
% % % %
</TABLE>
* ANNUALIZED (dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIOD SHOWN. (dagger)(dagger) TOTAL
RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE AND FOR PERIODS OF LESS
THAN ONE YEAR ARE NOT ANNUALIZED. (diamond) SEE NOTE 7 OF NOTES TO
FINANCIAL STATEMENTS. # AS OF AUGUST 1, 1992 THE FUND DISCONTINUED THE USE
OF EQUALIZATION ACCOUNTING. (double dagger) INVESTMENT INCOME PER SHARE
REFLECTS A SPECIAL DIVIDEND WHICH AMOUNTED TO $.08 PER SHARE. (SUB
SECTION) INVESTMENT INCOME PER SHARE REFLECTS DIVIDENDS RECEIVED IN ARREARS
WHICH AMOUNTED TO $.14 PER SHARE.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1994
1. SIGNIFICANT ACCOUNTING
POLICIES.
Fidelity Puritan Fund (the fund) is a fund of Fidelity Puritan Trust (the
trust) and is authorized to issue an unlimited number of shares. The trust
is registered under the Investment Company Act of 1940, as amended (the
1940 Act), as an open-end management investment company organized as a
Massachusetts business trust. The following summarizes the significant
accounting policies of the fund:
SECURITY VALUATION. Securities for which exchange quotations are readily
available are valued at the last sale price, or if no sale price, at the
closing bid price. Securities (including restricted securities) for which
exchange quotations are not readily available (and in certain cases debt
securities which trade on an exchange), are valued primarily using
dealer-supplied valuations or at their fair value as determined in good
faith under consistently applied procedures under the general supervision
of the Board of Trustees. Short-term securities maturing within sixty days
are valued at amortized cost or original cost plus accrued interest, both
of which approximate current value.
FOREIGN CURRENCY TRANSLATION. The accounting records of the fund are
maintained in U.S. dollars. Investment securities and other assets and
liabilities denominated in a foreign currency are translated into U.S.
dollars at the current exchange rate. Purchases and sales of securities,
income receipts and expense payments are translated into U.S. dollars at
the exchange rate on the dates of the transactions.
It is not practical to identify the portion of each amount shown in the
fund's Statement of Operations under the caption "Realized and Unrealized
Gain (Loss) on Investments" that arises from changes in foreign currency
exchange rates. Investment income includes net realized and unrealized
currency gains and losses recognized between accrual and payment dates.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed, are recorded as soon as the fund is informed of the
ex-dividend date. Interest income, which includes accretion of original
issue discount, is accrued as earned. Investment income is recorded net of
foreign taxes where recovery of such taxes is not assured.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are recorded on the
ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
mortgage-backed securities, options transactions, foreign currency
transactions, market discount, partnerships, non-taxable dividends and
losses deferred due to wash sales and options. The fund also utilized
earnings and profits distributed to shareholders on redemption of shares as
a part of the dividends paid deduction for income tax purposes. Permanent
book and tax basis differences relating to shareholder distributions will
result in reclassifications to paid in capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective August 1,
1993, the fund adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the fund changed the classification of distributions to shareholders to
better
disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of July 31, 1993 have been reclassified to reflect
an increase in paid in capital of $27,398,000, a decrease in undistributed
net investment income of $28,797,000 and an increase in accumulated net
realized gain on investments of $1,399,000.
2. OPERATING POLICIES.
FORWARD FOREIGN CURRENCY CONTRACTS. The fund may enter into forward foreign
currency contracts. These contracts involve market risk in excess of the
amount reflected in the fund's Statement of Assets and Liabilities. The
face or contract amount in U.S. dollars reflects the total exposure the
fund has in that particular currency contract. The U.S. dollar value of
forward foreign currency contracts is determined using forward currency
exchange rates supplied by a quotation service. Losses may arise due to
changes in the value of the foreign currency or if the counterparty does
not perform under the contract.
Purchases and sales of forward foreign currency contracts having the same
settlement date and broker are offset and presented net on the Statement of
Assets and Liabilities. Gain (loss) on the purchase or sale of forward
foreign currency contracts having the same settlement date and broker is
recognized on the date of offset, otherwise gain (loss) is recognized on
settlement date.
2. OPERATING POLICIES -
CONTINUED
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible
for determining that the value of these underlying securities remains at
least equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other registered
investment companies having management contracts with FMR, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by
U.S. Treasury or Federal Agency obligations.
INDEXED SECURITIES. The fund may invest in indexed securities whose value
is linked either directly or inversely to changes in foreign currencies,
interest rates, commodities, indices, or other reference instruments.
Indexed securities may be more volatile than the reference instrument
itself, but any loss is limited to the amount of the original investment.
RESTRICTED SECURITIES. The fund is permitted to invest in privately placed
restricted securities. These securities may be resold in transactions
exempt from registration or to the public if the securities are registered.
Disposal of these securities may involve time-
consuming negotiations and expense, and prompt sale at an acceptable price
may be difficult. At the end of the period, restricted securities
(excluding 144A issues) amounted to $115,455,000 or 1.2% of net assets.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $4,274,070,000 and $3,541,764,000, respectively, of which U.S.
government and government agency obligations aggregated $1,101,841,000 and
$884,827,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a monthly
fee that is calculated on the basis of a group fee rate plus a fixed
individual fund fee rate applied to the average net assets of the fund. The
group fee rate is the weighted average of a series of rates ranging from
.30% to .52% and is based on the monthly average net assets of all the
mutual funds advised by FMR. The annual individual fund fee rate is .20%.
For the period, the management fee was equivalent to an annualized rate of
.52% of average net assets.
The Board of Trustees approved a new group fee rate schedule with rates
ranging from .2850% to .5200%. Effective November 1, 1993, FMR has
voluntarily
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
agreed to implement this new group fee rate schedule as it results in the
same or a lower management fee.
SALES LOAD. For the period January 1, 1993 through December 31, 1995,
Fidelity Distributors Corporation, an affiliate of FMR and the general
distributor of the fund, will voluntarily waive the sales charge (2% of the
offering price) on the sales of shares.
TRANSFER AGENT FEE. Fidelity Service Co. (FSC), an affiliate of FMR, is the
fund's transfer, dividend disbursing and shareholder servicing agent. FSC
receives fees based on the type, size, number of accounts and the number of
transactions made by shareholders. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements.
ACCOUNTING AND SECURITY LENDING FEES. FSC maintains the fund's accounting
records and administers the security lending program. The security lending
fee is based on the number and duration of lending transactions. The
accounting fee is based on the level of average net assets for the month
plus out-of-pocket expenses.
BROKERAGE COMMISSIONS. The fund placed a portion of its portfolio
transactions with brokerage firms which are affiliates of FMR. The
commissions paid to these affiliated firms were $1,285,000 for the period.
5. SECURITY LENDING.
The fund loaned securities to certain brokers who paid the fund negotiated
lenders' fees. These fees are included in interest income. The fund
receives U.S. Treasury obligations and/or cash as collateral against the
loaned securities, in an amount at least equal to 102% of the market value
of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 100% of the market value of the loaned
securities during the period of the loan. At period end, the value of the
securities loaned and the value of collateral amounted to $2,351,000 and
$2,464,000, respectively.
6. TRANSACTIONS WITH AFFILIATED COMPANIES.
An affiliated company is a company in which the fund has ownership of at
least 5% of the voting securities. Transactions with companies which are or
were affiliates are as follows:
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES
AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
AMETEK, Inc. $ 1,318 $ - $ 132 $ 28,244
Cabot Oil & Gas Corp. Class A 1,265 - - 24,753
Energen Corp. - 140 - -
SUMMARY OF TRANSACTIONS WITH AFFILIATED COMPANIES - CONTINUED
AMOUNTS IN THOUSANDS PURCHASES SALES DIVIDEND MARKET
AFFILIATES COST COST INCOME VALUE
Grand Union Capital Corp.
Class B* $ - $ - $ - $ 4,063
Nashua Corp. - 2,195 69 5,012
Thermadyne Industries, Inc. * - - - 3
TOTALS $ 2,583 $ 2,335 $ 201 $ 62,075
* NON-INCOME PRODUCING
7. EXPENSE REDUCTIONS.
FMR has directed certain portfolio trades to brokers who paid a portion of
the fund's expenses. For the period, the fund's expenses were reduced by
$215,000 under this arrangement.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Puritan Trust and the Shareholders of Fidelity
Puritan Fund:
We have audited the accompanying statement of assets and liabilities of
Fidelity Puritan Trust: Fidelity Puritan Fund, including the schedule of
portfolio investments, as of January 31, 1994, and the related statement
of operations for the six months then ended, the statement of changes in
net assets for the six months ended January 31, 1994 and for the year
ended July 31, 1993 and the financial highlights for the six months ended
January 31, 1994 and for each of the five years in the period ended July
31, 1993. 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 January 31, 1994, 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 Fidelity Puritan Trust: Fidelity Puritan Fund as of January 31, 1994,
the results of its operations for the six months then ended, the changes in
its net assets for the six months ended January 31, 1994 and for the year
ended July 31, 1993 and the financial highlights for the six months ended
January 31, 1994 and for each of the five years in the period ended July
31, 1993, in conformity with generally accepted accounting principles.
COOPERS & LYBRAND
Boston, Massachusetts
March 7, 1994
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Richard B. Fentin, Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
Robert H. Morrison, Manager,
Security Transactions
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
The Chase Manhattan Bank, N.A.
New York, NY
FIDELITY'S GROWTH AND INCOME FUNDS
Balanced Fund
Convertible Securities Fund
Equity-Income Fund
Equity-Income II Fund
Fidelity Fund
Global Balanced Fund
Growth & Income Portfolio
Market Index Fund
Puritan Fund
Real Estate Investment Portfolio
Utilities Income Fund
THE FIDELITY
TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
