Putnam
Global
Growth Fund
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
4-30-00
[SCALE LOGO OMITTED]
FROM THE CHAIRMAN
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[COPYRIGHT] Karsh, Ottawa
Dear Shareholder:
This is the last letter to you and the other shareholders of Putnam
Global Growth Fund that I will be signing. After more than 30 years as
Chairman of the Trustees and President of the Putnam Funds, the time has
come for me to step aside. As of July 1, 2000, John Hill will become
Chairman. John is currently an independent Trustee and has served on the
board for the past 14 years. In addition, my son, George Putnam, III,
will take on the role of President. I am confident that the leadership
of the funds will be in exceptionally strong hands.
I will become Chairman Emeritus, remain a Putnam shareholder, and stay
in close touch with the funds. It has been my privilege to serve you.
In one final piece of news, I am pleased to announce the appointment of
Stephen P. Dexter to your fund's management team. Before joining Putnam
in 1999, Steve was with Scudder Kemper Investments, Kemper Financial
Services, and Sears Investment Management. He has 17 years of investment
experience.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
June 21, 2000
REPORT FROM THE FUND MANAGERS
Robert Swift
Lisa Svensson
Kelly A. Morgan
Stephen P. Dexter
Manuel Weiss
A global rally in growth stocks generated strong performance for Putnam
Global Growth Fund in the semiannual period that ended April 30, 2000.
In the final two months of 1999, in particular, stocks in the
telecommunications, media, and technology sectors surged, as investors
recognized the demand by businesses and consumers for new technologies
and services. Our research had identified these new technologies early
on and your fund was well positioned in many innovative companies. The
only surprise was that investors in so many different markets shared a
sudden and simultaneous recognition of these growth opportunities.
Total return for 6 months ended 4/30/00
Class A Class B Class C Class M
NAV POP NAV CDSC NAV CDSC NAV POP
-------------------------------------------------------------------------
26.29% 19.02% 25.75% 20.75% 25.81% 24.81% 25.96% 21.55%
-------------------------------------------------------------------------
Past performance is not indicative of future results. Performance
information for longer periods and explanation of performance
calculation methods begin on page 6.
* GLOBAL ECONOMIC GROWTH PROMPTS INFLATION WORRIES
The market environment was ripe for rewards as the six-month period
opened because of the combination of rising economic growth in the
United States and abroad. Recovery overseas has been steady despite
lagging behind the U.S. rate. The global recovery fueled consumer and
business spending in developed markets and has helped the cyclical
sectors in emerging markets. With global growth on the upswing, and
interest rates moderate, stocks in general looked attractive but growth
stocks especially so. Above all, spending on technology and
communications products -- computers, wireless telephones, networking
equipment, and software -- stoked investor interest in these sectors.
[GRAPHIC OMITTED: horizontal bar chart COUNTRY ALLOCATIONS]
COUNTRY ALLOCATIONS*
United States 49.6%
Japan 14.0%
United Kingdom 12.7%
France 3.9%
Finland 3.0%
Footnote reads:
*Based on net assets as of 4/30/00. Holdings will vary over time.
The companies we emphasize in this fund were in favor throughout the
world during the first several months of the period. These companies are
characterized by high rates of earnings growth, strong management,
dominant market positions, and unit growth, which means that their
businesses are expanding. As an example, consider the cellular telephone
market. In many major markets, including the United States, only about
25% of households own cell phones, a figure that could double or triple
in coming years.
While the outlook for these companies has not changed, financial markets
did not remain as optimistic through the end of the period. Unusually
strong growth and low unemployment in the United States caused the
Federal Reserve Board to express concern for price pressures. To head
off these pressures, the Fed raised short-term interest rates three
times in the semiannual period (and once more after it ended). Many
investors began to fear that the Fed's policy would bring about a
recession, which would undercut the business and consumer spending on
technology products. During the final two months of the period, growth
stocks worldwide declined, even as companies in these sectors continued
to achieve high earnings.
* TELECOMMUNICATIONS STOCKS THRIVE AROUND WORLD
The telecommunications industry is fertile with new products and
services and is offering great investment opportunities in many regions.
Even Japan, which has had many business woes in recent years, has its
share of leading telecom companies. It is worth noting in this regard
that Japan is gradually following in the footsteps of the United States;
its economy is shifting from an industrial manufacturing focus and now
favors services and high technology. Increasing numbers of corporations
are restructuring and shutting down industrial facilities. New jobs in
the service sector are being created at the fastest rate in Japan's
history. The only downside to this situation is that the capital
required to finance this transition is being provided by a mountain of
government debt, which is putting some pressure on world capital
markets.
One of the fund's top Japanese holdings and a top performer is NTT
DoCoMo. It is Japan's leading cellular phone service provider, spun off
from its parent company, Nippon Telegraph and Telephone, in 1999. NTT
DoCoMo controls a proprietary technology for wireless data transmission,
including the ability to send e-mail using a cellular telephone. It has
introduced this technology in Japan through its I-mode service.
Originally anticipated to attract 2 million subscribers in its first
year, I-mode is such a hit that sales could reach 10 million. While this
holding, along with others discussed in this report, was viewed
favorably at the end of the period, all are subject to review and
adjustment in accordance with the fund's investment strategy and may
vary in the future.
Morningstar awarded Putnam Global Growth Fund's class A shares 5 out of
5 stars for 10-year performance as of April 30, 2000. This rating put
the fund in the top 10% of the 131 international equity funds rated.
Past performance is not indicative of future results. Morningstar
ratings reflect risk-adjusted performance through 4/30/00 and are
subject to change every month. Morningstar ratings are calculated from a
fund's 3-, 5-, and 10-year returns (with fee adjustments) in excess of
90-day Treasury bill returns and a risk factor that reflects performance
below 90-day Treasury bill returns. For the 3- and 5-year periods the
fund received five stars. There were 1,138 and 687 funds rated,
respectively. Performance of other share classes will vary.
Your fund's global mandate is an advantage because of the global
movement of technology ideas. For example, NTT DoCoMo's proprietary
wireless technology is based upon the intellectual property of a U.S.
company, QUALCOMM, which designs interfaces for wireless communications.
QUALCOMM collects a 5% licensing fee on all the revenues of companies
that manufacture hardware based on its interface. QUALCOMM thus stands
to benefit tremendously as telecommunications shift from primarily
voice-based wireline transmission to data-based wireless transmission.
Vodafone Group seizes growth opportunity
During the past six months, your fund benefited from the largest corporate
merger in Europe's history, Vodafone Group's acquisition of Mannesmann. The
fund owned both stocks. Mannesmann, a German company, triggered the struggle
with a plan to buy Orange, Vodafone's smaller rival in the United Kingdom.
Vodafone fended off the threat by making a hostile bid to buy Mannesmann.
Capital markets saw the benefits of a combination, both stocks rallied, and
Mannesmann management was gradually persuaded to accept a sweetened bid.
Vodafone is now the dominant wireless company in Europe and has a strong
presence in the United States. It has 50 million mobile phone
subscribers and is growing in excess of 20% per year. This acquisition
demonstrates the benefits of our global approach to growth investing, in
which we compare companies and analyze industries on a global basis. It
also demonstrates the opportunities for European companies to expand,
thanks to growing market integration fostered by the introduction of the
euro in 1999.
* FINANCIAL SERVICES OFFER GROWTH IN MANY MARKETS
Although the fund had a large commitment in the technology and
telecommunication areas, it remains fully diversified with attractive
companies in all sectors. The expansion of financial services is a trend
that has benefited several holdings, especially in Europe. Bipop-Carire
has become Italy's largest bank through acquisitions and unit growth. It
is the result of a 1999 merger between Banco Populare di Brescia and
Carire. Bipop-Carire has become a leading distributor of mutual funds,
which are becoming more popular in Italy. This portion of its business
grew by 40% last year. In Germany, one of the fund's largest holdings is
Marschollek, Lautenschlaeger. This brokerage partnership has an
aggressive expansion strategy targeting young German professionals with
high incomes who are new to investing. It offers comprehensive financial
services and is making excellent use of the Web to keep transaction
costs down.
Charles Schwab in the United States has a somewhat similar story. This
company has astutely positioned itself to take advantage of the growing
number of individuals who like to trade stocks online. Schwab charges a
low trading commission and, through its mutual fund supermarket,
provides investors with access to a huge variety of different funds.
[GRAPHIC OMITTED: TOP 10 HOLDINGS]
TOP 10 HOLDINGS
Vodafone Group Plc.
United Kingdom
Communications services
Intel Corp.
United States
Technology
Cisco Systems, Inc.
United States
Technology
Nokia Oyj
Finland
Communications services
NTT Mobile Communications
Japan
Communications services
General Electric Co.
United States
Conglomerates
Yahoo! Inc.
United States
Technology
Nortel Networks Corp.
Canada
Technology
Sun Microsystems, Inc.
United States
Technology
Marschollek, Lautenschlaeger und Partner AG
Germany
Insurance and finance
Footnote reads:
These holdings represent 39.1% of the fund's net assets as of 4/30/00.
Portfolio holdings will vary over time.
* STOCKS REMAIN FUNDAMENTALLY SOLID
As we look ahead to the second half of the fund's 2000 fiscal year, we
remain pleased with the fundamental performance of companies in the
portfolio. Most of the fund's holdings reported excellent financial
results for the first quarter of 2000 and remain well positioned for
coming months. Unfortunately market psychology has become more
pessimistic since March because of concerns that efforts by central
banks to smother inflation will also choke off business and consumer
spending on new technology products and services. We are confident,
however, that demand can remain strong without igniting inflation and
that the global economy will continue showing positive growth. Once
markets adjust to these expectations, we believe they will once again
focus on the strong earnings of growth companies.
The views expressed here are exclusively those of Putnam Management.
They are not meant as investment advice. Although the described holdings
were viewed favorably as of 4/30/00, there is no guarantee the fund will
continue to hold these securities in the future. International investing
involves certain risks, including economic instability, political
developments, and currency fluctuations, not present with U.S.
investments.
PERFORMANCE SUMMARY
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
Global Growth Fund is designed for investors seeking capital
appreciation through a globally diversified equity portfolio.
<TABLE>
<CAPTION>
TOTAL RETURN FOR PERIODS ENDED 4/30/00
Class A Class B Class C Class M
(inception dates) (9/1/67) (4/27/92) (2/1/99) (3/1/95)
NAV POP NAV CDSC NAV CDSC NAV POP
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 months 26.29% 19.02% 25.75% 20.75% 25.81% 24.81% 25.96% 21.55%
----------------------------------------------------------------------------------------
1 year 46.73 38.31 45.63 40.63 45.53 44.53 45.94 40.79
----------------------------------------------------------------------------------------
5 years 195.37 178.36 184.18 182.18 184.23 184.23 187.50 177.39
Annual average 24.19 22.72 23.23 23.06 23.24 23.24 23.52 22.64
----------------------------------------------------------------------------------------
10 years 341.94 316.34 309.28 309.28 309.80 309.80 319.54 304.98
Annual average 16.02 15.33 15.13 15.13 15.15 15.15 15.42 15.01
----------------------------------------------------------------------------------------
Annual average
(life of fund) 12.10 11.89 11.05 11.05 11.25 11.25 11.34 11.21
----------------------------------------------------------------------------------------
</TABLE>
COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 4/30/00
MSCI All-
Country
World Free Consumer
Index* price index
-------------------------------------------------------------------------
6 months 7.93% 1.84%
-------------------------------------------------------------------------
1 year 13.00 3.01
-------------------------------------------------------------------------
5 years 116.58 12.71
Annual average 16.71 2.42
-------------------------------------------------------------------------
10 years 245.25 32.82
Annual average 13.19 2.88
-------------------------------------------------------------------------
Annual average
(life of fund) -- 5.12
-------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. Returns for class A and class M
shares reflect the current maximum initial sales charges of 5.75% and
3.50%, respectively. Class B share returns for the 1-, 5-, and 10-year
(where available) and life-of-fund periods reflect the applicable
contingent deferred sales charge (CDSC), which is 5% in the first year,
declines to 1% in the sixth year, and is eliminated thereafter. Returns
shown for class B and class M shares for periods prior to their
inception are derived from the historical performance of class A shares,
adjusted to reflect both the initial sales charge or CDSC, if any,
currently applicable to each class and in the case of class B and class
M shares the higher operating expenses applicable to such shares. For
class C shares, returns for periods prior to their inception are derived
from the historical performance of class A shares, adjusted to reflect
both the CDSC currently applicable to class C shares, which is 1% for
the first year and is eliminated thereafter, and the higher operating
expenses applicable to class C shares. All returns assume reinvestment
of distributions at NAV. Investment return and principal value will
fluctuate so that an investor's shares when redeemed may be worth more
or less than their original cost.
*Inception date of index was after the fund's inception.
PRICE AND DISTRIBUTION INFORMATION 6 MONTHS ENDED 4/30/00
Class A Class B Class C Class M
------------------------------------------------------------------------------
Distributions (number) 1 1 1 1
------------------------------------------------------------------------------
Income -- -- -- --
------------------------------------------------------------------------------
Capital gains
Long-term $1.059 $1.059 $1.059 $1.059
------------------------------------------------------------------------------
Short-term 0.747 0.747 0.747 0.747
------------------------------------------------------------------------------
Total $1.806 $1.806 $1.806 $1.806
------------------------------------------------------------------------------
Share value: NAV POP NAV NAV NAV POP
------------------------------------------------------------------------------
10/31/99 $15.07 $15.99 $14.43 $14.98 $14.90 $15.44
------------------------------------------------------------------------------
4/30/00 17.27 18.32 16.39 17.09 17.01 17.63
------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TOTAL RETURN FOR PERIODS ENDED 3/31/00 (most recent calendar quarter)
Class A Class B Class C Class M
(inception dates) (9/1/67) (4/27/92) (2/1/99) (3/1/95)
NAV POP NAV CDSC NAV CDSC NAV POP
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 months 54.40% 45.48% 53.93% 48.93% 53.77% 52.77% 54.14% 48.72%
----------------------------------------------------------------------------------------
1 year* 67.06 57.47 65.80 60.80 65.67 64.67 66.28 60.47
----------------------------------------------------------------------------------------
5 years 242.80 223.13 230.03 228.03 230.13 230.13 233.87 222.12
Annual average 27.94 26.44 26.97 26.82 26.98 26.98 27.27 26.36
----------------------------------------------------------------------------------------
10 years 394.30 365.81 357.70 357.70 358.14 358.14 369.67 353.45
Annual average 17.33 16.63 16.43 16.43 16.44 16.44 16.73 16.32
----------------------------------------------------------------------------------------
Annual average
(life of fund) 12.53 12.33 11.48 11.48 11.69 11.69 11.77 11.65
----------------------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. They do not take into account any
adjustment for taxes payable on reinvested distributions. Investment
returns and principal value will fluctuate so that an investor's shares
when sold may be worth more or less than their original cost. See first
page of performance section for performance calculation method.
*Returns were achieved during favorable market conditions that may not be sustained.
</TABLE>
TERMS AND DEFINITIONS
Total return shows how the value of the fund's shares changed over time,
assuming you held the shares through the entire period and reinvested
all distributions in the fund.
Class A shares are generally subject to an initial sales charge.
Class B shares may be subject to a sales charge upon redemption.
Class C shares are not subject to an initial sales charge and are
subject to a contingent deferred sales charge only if the shares are
redeemed during the first year.
Class M shares have a lower initial sales charge and a higher 12b-1 fee
than class A shares and no sales charge on redemption.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities, divided by the number of outstanding shares, not including
any initial or contingent deferred sales charge.
Public offering price (POP) is the price of a mutual fund share plus the
maximum sales charge levied at the time of purchase. POP performance
figures shown here assume the 5.75% maximum sales charge for class A
shares and 3.50% for class M shares.
Contingent deferred sales charge (CDSC) is a charge applied at the time
of the redemption of class B or C shares and assumes redemption at the
end of the period. Your fund's class B CDSC declines from a 5% maximum
during the first year to 1% during the sixth year. After the sixth year,
the CDSC no longer applies. The CDSC for class C shares is 1% for one
year after purchase.
COMPARATIVE BENCHMARKS
Morgan Stanley Capital International (MSCI) All-Country World Free Index
is an unmanaged list of global equity securities available to
non-domestic investors, with all values expressed in U.S. dollars.
Consumer price index (CPI) is a commonly used measure of inflation; it
does not represent an investment return.
Securities indexes assume reinvestment of all distributions and interest
payments and do not take in account brokerage fees or taxes. Securities
in the fund do not match those in the indexes and performance of the
fund will differ. It is not possible to invest directly in an index.
A GUIDE TO THE FINANCIAL STATEMENTS
These sections of the report constitute the fund's financial statements.
The fund's portfolio lists all the fund's investments and their values
as of the last day of the reporting period. Holdings are organized by
asset type and industry sector, country, or state to show areas of
concentration and diversification.
Statement of assets and liabilities shows how the fund's net assets and
share price are determined. All investment and noninvestment assets are
added together. Any unpaid expenses and other liabilities are
subtracted from this total. The result is divided by the number of
shares to determine the net asset value per share, which is calculated
separately for each class of shares. (For funds with preferred shares,
the amount subtracted from total assets includes the net assets
allocated to remarketed preferred shares.)
Statement of operations shows the fund's net investment gain or loss
for the reporting period. This is determined by adding up all the fund's
earnings -- from dividends and interest income -- and subtracting its
operating expenses. This statement also lists any net gain or loss the
fund realized on the sales of its holdings and -- for holdings that
remain in the portfolio -- any change in unrealized gains or losses over
the period.
Statement of changes in net assets shows how the fund's net assets were
affected by distributions to shareholders and by changes in the number
of the fund's shares. It lists distributions and their sources (net
investment income or realized capital gains) over the current reporting
period and the most recent fiscal year-end. The distributions listed
here may not match the sources listed in the Statement of operations
because the distributions are determined on a tax basis and may be paid
in a different period from the one in which they were earned.
Financial highlights provide an overview of the fund's investment
results, per-share distributions, expense ratios, net investment income
ratios and portfolio turnover in one summary table, reflecting the five
most recent reporting periods. In a semiannual report, the highlight
table also includes the current reporting period. For open-end funds, a
separate table is provided for each share class.
<TABLE>
<CAPTION>
THE FUND'S PORTFOLIO
April 30, 2000 (Unaudited)
COMMON STOCKS (96.0%) (a)
NUMBER OF SHARES VALUE
<S> <C> <C>
Brazil (--%)
-------------------------------------------------------------------------------------------------------------------
4 Telesp Participacoes S.A. $ 104
Canada (2.8%)
-------------------------------------------------------------------------------------------------------------------
2,585,400 Bombardier, Inc. 69,493,429
1,599,333 Nortel Networks Corp. 180,812,011
----------------
250,305,440
Finland (3.0%)
-------------------------------------------------------------------------------------------------------------------
4,585,484 Oy Nokia AB Class A 263,042,667
France (3.9%)
-------------------------------------------------------------------------------------------------------------------
280,807 Altran Technologies SA 57,387,314
46,760 Havas Advertising SA 23,337,724
383,907 STMicroelectronics 73,257,168
216,386 Television Francaise I (TF1) 148,127,534
286,500 Total S.A. Class B 43,470,298
----------------
345,580,038
Germany (1.4%)
-------------------------------------------------------------------------------------------------------------------
295,275 Consors Discount Broker AG 33,017,444
636,850 Epcos AG (NON) 90,028,332
----------------
123,045,776
Hong Kong (1.4%)
-------------------------------------------------------------------------------------------------------------------
16,807,000 China Telecom Ltd. (NON) 121,375,498
Italy (2.7%)
-------------------------------------------------------------------------------------------------------------------
2,119,800 Banca Fideuram SpA 31,604,607
1,098,302 Bipop-Carire, SpA (REL) 99,846,635
4,821,865 Mediaset SPA 78,246,501
2,093,173 Mediolanum SPA 34,727,990
----------------
244,425,733
Japan (14.0%)
-------------------------------------------------------------------------------------------------------------------
2,096 Fuji Television Network, Inc. 34,868,762
444,000 Fujisawa Pharmaceutical Co. (NON) 16,619,224
67,100 Fujitsu Support and Services Inc. 144A 9,922,366
391,800 Itoen, Ltd. 38,745,471
520 KAO Corp. 15,811
129,360 Keyence Corp 42,860,961
267,000 Kyocera Corp. 44,590,481
707,000 Matsushita Communication Industrial Co., Ltd. 110,689,279
522,000 Murata Manufacturing Co. Ltd. 101,312,384
9,236,000 Nikko Securities Co. Ltd. 108,834,566
2,684,000 Nomura Securities Co. Ltd. 67,472,089
7,348 NTT DoCoMo. 245,159,704
196,000 Rohm Co. Ltd. 65,574,861
751,000 Seven-Eleven Japan Co., Ltd. 92,313,309
500 Sharp Corp. 9,635
587,600 Sony Corp. 67,394,787
1,571,000 Takeda Chemical Industries 103,232,994
254,600 Tokyo Electron Ltd. 41,437,209
115 Yahoo Japan Corp. 57,393,715
----------------
1,248,447,608
Netherlands (2.2%)
-------------------------------------------------------------------------------------------------------------------
1,833,395 ASM Lithography Holding N.V. (NON) 71,669,794
2,928,565 KPNQwest N.V. (NON) 121,669,781
----------------
193,339,575
South Korea (0.8%)
-------------------------------------------------------------------------------------------------------------------
259,200 Samsung Electronics Co. 70,085,624
Sweden (1.5%)
-------------------------------------------------------------------------------------------------------------------
3,283,914 Securitas AB Class B (NON) 85,338,506
1,091,981 Skandia Forsakrings AB 52,473,212
----------------
137,811,718
United Kingdom (12.7%)
-------------------------------------------------------------------------------------------------------------------
10,059,250 ARM Holdings PLC (NON) 102,258,312
4,539,200 Capita Group PLC 116,028,488
265,000 Capita Group PLC 144A 6,773,782
634,196 CMG PLC 40,926,038
3,015,973 Colt Telecom Group PLC (NON) 127,738,762
3,665,150 Logica PLC 110,068,853
312,528 Misys PLC 3,555,369
4,535,559 Sage Group (The) PLC 50,048,624
2,380,760 SEMA Group PLC 38,131,776
18,645,083 Telewest Communications PLC (NON) 112,927,301
77,233,492 Vodafone Group PLC 353,006,488
4,270,300 WPP Group PLC 68,528,408
----------------
1,129,992,201
United States (49.6%)
-------------------------------------------------------------------------------------------------------------------
1,136,100 AFLAC Inc. 55,455,881
618,300 Amdocs Ltd. (NON) 41,851,181
1,948,593 America Online, Inc. (NON) 116,550,219
785,200 American Express Co. 117,829,075
770,875 American International Group, Inc. 84,555,352
190,800 Amgen Inc. (NON) 10,684,800
1,070,925 Applied Materials, Inc. (NON) 109,033,552
1,850,384 AT&T Corp. (NON) 92,403,551
1,581,900 CBS Corp. (NON) 92,936,625
3,875,171 Cisco Systems, Inc. (NON) 268,658,339
1,266,150 Citigroup, Inc. 75,256,791
1,266,650 Clear Channel Communications, Inc. (NON) 91,198,800
827,900 Comcast Corp. Class A (NON) 33,167,744
195,100 Corning Inc. 38,532,250
260,900 eBay Inc. (NON) 41,532,019
927,124 EMC Corp. (NON) 128,812,291
700,700 Enron Corp. 48,830,031
891,225 Genentech, Inc. (NON) 104,273,325
1,349,953 General Electric Co. 212,280,109
927,050 Goldman Sachs Group, Inc. (The) 86,447,413
1,757,000 Home Depot, Inc. (The) 98,501,813
513,400 I2 Technologies, Inc. (NON) 66,356,950
3,100 IDEC Pharmaceuticals Corp. (NON) 198,400
2,164,650 Intel Corp. 274,504,678
1,350,500 Interpublic Group Cos. Inc. 55,370,500
1,037,000 JDS Uniphase Corp. (NON) 107,523,938
306,550 Juniper Networks, Inc. (NON) 65,199,353
219,900 Lexmark International Group, Inc. Class A (NON) 25,948,200
694,976 Linear Technology Corp. 39,700,504
2,188,828 Microsoft Corp. (NON) 152,670,753
780,600 Omnicom Group, Inc. 71,083,388
873,150 Oracle Corp. (NON) 69,797,428
829,875 PE Corp.-PE Biosystems Group 49,792,500
1,216,700 Pharmacia Corp. 60,758,956
1,065,100 QUALCOMM, Inc. (NON) 115,496,781
729,400 Schering-Plough Corp. 29,403,938
2,443,750 Schwab (Charles) Corp. 108,746,875
259,400 SMC Corp. 51,544,362
2,515,500 Sprint PCS (NON) 138,352,500
1,854,700 Sun Microsystems, Inc. (NON) 170,516,481
595,450 Teradyne, Inc. (NON) 65,499,500
734,600 Texas Instruments, Inc. 119,647,975
474,100 Time Warner, Inc. 42,639,369
684,000 United Parcel Service-class B 45,486,000
306,600 VeriSign, Inc. 42,732,374
768,700 VERITAS Software Corp. (NON) 82,455,085
1,046,900 Viacom, Inc. Class B (NON) 56,925,187
2,039,300 Wal-Mart Stores, Inc. 112,926,237
485,600 Warner-Lambert Co. 55,267,350
1,413,150 Yahoo! Inc. 184,062,787
----------------
4,409,399,510
----------------
Total Common Stocks (cost $5,877,090,096) $ 8,536,851,492
PREFERRED STOCKS (1.9%) (a) (cost $100,212,782)
NUMBER OF SHARES VALUE
-------------------------------------------------------------------------------------------------------------------
313,684 Marschollek, Lautenschlaeger und Partner AG
$3.05 pfd. (Germany) $ 165,969,012
SHORT-TERM INVESTMENTS (2.2%) (a)
PRINCIPAL AMOUNT VALUE
-------------------------------------------------------------------------------------------------------------------
$38,643,000 Asset Securitization ASCC, effective yield of 6.02%,
May 3, 2000 $ 38,623,614
50,000,000 Associates First Capital ASCC, effective yield of 6.04%,
May 1, 2000 49,991,611
50,000,000 Household Finance Corp., effective yield of 6.03%,
May 1, 2000 49,991,625
59,391,000 Interest in $500,000,000 joint tri-party repurchase agreement
dated April 28, 2000 with Merrill Lynch, Pierce, Fenner &
Smith, due May 1, 2000 with respect to various
U.S. Treasury obligations -- maturity value of $59,419,211
for an effective yield of 5.70%. 59,391,000
----------------
Total Short-Term Investments (cost $197,951,398) $ 197,997,850
-------------------------------------------------------------------------------------------------------------------
Total Investments (cost $6,175,254,276) (b) $ 8,900,818,354
-------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $8,890,551,890.
(b) The aggregate identified cost on a tax basis is $6,223,921,895,
resulting in gross unrealized appreciation and depreciation of
$2,956,904,629 and $280,008,170, respectively, or net unrealized
appreciation of $2,676,896,459.
(NON) Non-income-producing security.
(REL) Bipop-Carire, SpA is involved in a joint venture with Putnam Investments.
144A after the name of a security represents those 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.
The fund had the following industry group concentrations greater
than 10% at April 30, 2000 (as a percentage of net assets):
Technology 45.6%
Communication services 12.4
Financial 10.8
----------------------------------------------------------------------------
Forward Currency Contracts to Sell at April 30, 2000 (Unaudited)
Aggregate Face Delivery Unrealized
Market Value Value Date Appreciation
----------------------------------------------------------------------------
Japanese Yen $269,335,602 $269,610,079 5/9/00 $274,477
----------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
April 30, 2000 (Unaudited)
<S> <C>
Assets
-------------------------------------------------------------------------------------------
Investments in securities, at value
(identified cost $6,175,254,276) (Note 1) $8,900,818,354
-------------------------------------------------------------------------------------------
Cash 10,226,410
-------------------------------------------------------------------------------------------
Dividends and interest receivable 3,590,303
-------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 34,260,290
-------------------------------------------------------------------------------------------
Receivable for securities sold 226,066,133
-------------------------------------------------------------------------------------------
Receivable for open forward currency contracts 274,477
-------------------------------------------------------------------------------------------
Total assets 9,175,235,967
Liabilities
-------------------------------------------------------------------------------------------
Payable for securities purchased 243,439,858
-------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 20,483,697
-------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 14,303,815
-------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 2,502,889
-------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 26,902
-------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 2,935
-------------------------------------------------------------------------------------------
Payable for distribution fees (Note 2) 3,300,068
-------------------------------------------------------------------------------------------
Other accrued expenses 623,913
-------------------------------------------------------------------------------------------
Total liabilities 284,684,077
-------------------------------------------------------------------------------------------
Net assets $8,890,551,890
Represented by
-------------------------------------------------------------------------------------------
Paid-in capital (Notes 1 and 4) $5,411,209,072
-------------------------------------------------------------------------------------------
Accumulated net investment loss (Note 1) (77,028,201)
-------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and
foreign currency transactions (Note 1) 830,078,823
-------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and
assets and liabilities in foreign currencies 2,726,292,196
-------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $8,890,551,890
Computation of net asset value and offering price
-------------------------------------------------------------------------------------------
Net asset value and redemption price per class A share
($6,168,343,871 divided by 357,190,648 shares) $17.27
-------------------------------------------------------------------------------------------
Offering price per class A share (100/94.25 of $17.27)* $18.32
-------------------------------------------------------------------------------------------
Net asset value and offering price per class B share
($2,287,510,441 divided by 139,563,998 shares)** $16.39
-------------------------------------------------------------------------------------------
Net asset value and offering price per class C share
($63,568,746 divided by 3,719,552 shares)** $17.09
-------------------------------------------------------------------------------------------
Net asset value and redemption price per class M share
($101,453,642 divided by 5,964,219 shares) $17.01
-------------------------------------------------------------------------------------------
Offering price per class M share (100/96.50 of $17.01)* $17.63
-------------------------------------------------------------------------------------------
Net asset value, offering price and redemption price per class Y share
($269,675,190 divided by 15,312,230 shares) $17.61
-------------------------------------------------------------------------------------------
* On single retail sales of less than $50,000. On sales of $50,000
or more and on group sales, the offering price is reduced.
** Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
Six months ended April 30, 2000 (Unaudited)
<S> <C>
Investment income:
-------------------------------------------------------------------------------------------
Dividends (net of foreign tax of $817,054) $ 10,086,937
-------------------------------------------------------------------------------------------
Interest 1,922,079
-------------------------------------------------------------------------------------------
Total investment income 12,009,016
Expenses:
-------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 26,763,213
-------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 7,611,235
-------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 43,296
-------------------------------------------------------------------------------------------
Administrative services (Note 2) 17,492
-------------------------------------------------------------------------------------------
Distribution fees -- Class A (Note 2) 7,236,520
-------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 12,291,616
-------------------------------------------------------------------------------------------
Distribution fees -- Class C (Note 2) 205,790
-------------------------------------------------------------------------------------------
Distribution fees -- Class M (Note 2) 375,338
-------------------------------------------------------------------------------------------
Reports to shareholders 128,556
-------------------------------------------------------------------------------------------
Registration fees 341,382
-------------------------------------------------------------------------------------------
Auditing 55,158
-------------------------------------------------------------------------------------------
Legal 25,628
-------------------------------------------------------------------------------------------
Postage 315,291
-------------------------------------------------------------------------------------------
Other 550,668
-------------------------------------------------------------------------------------------
Total expenses 55,961,183
-------------------------------------------------------------------------------------------
Expense reduction (Note 2) (1,147,609)
-------------------------------------------------------------------------------------------
Net expenses 54,813,574
-------------------------------------------------------------------------------------------
Net investment loss (42,804,558)
-------------------------------------------------------------------------------------------
Net realized gain on investments (Notes 1 and 3) 840,853,834
-------------------------------------------------------------------------------------------
Net realized gain on futures contracts (Note 1) 1,093,001
-------------------------------------------------------------------------------------------
Net unrealized appreciation of assets and liabilities in
foreign currencies during the period 2,018,241
-------------------------------------------------------------------------------------------
Net unrealized appreciation of investments during the period 924,322,322
-------------------------------------------------------------------------------------------
Net gain on investments 1,768,287,398
-------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $1,725,482,840
-------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
Six months ended Year ended
April 30 October 31
2000* 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase in net assets
--------------------------------------------------------------------------------------------------
Operations:
--------------------------------------------------------------------------------------------------
Net investment loss $ (42,804,558) $ (37,197,669)
--------------------------------------------------------------------------------------------------
Net realized gain on investments 841,946,835 832,462,063
--------------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and
assets and liabilities in foreign currencies 926,340,563 1,127,783,290
--------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 1,725,482,840 1,923,047,684
--------------------------------------------------------------------------------------------------
Distributions to shareholders:
--------------------------------------------------------------------------------------------------
From net investment income
Class A -- (12,641,971)
--------------------------------------------------------------------------------------------------
Class Y -- (427,765)
--------------------------------------------------------------------------------------------------
From net realized gain on investments
Class A (520,018,235) (85,069,926)
--------------------------------------------------------------------------------------------------
Class B (255,061,000) (52,122,170)
--------------------------------------------------------------------------------------------------
Class C (2,755,244) --
--------------------------------------------------------------------------------------------------
Class M (9,367,009) (1,534,321)
--------------------------------------------------------------------------------------------------
Class Y (25,352,554) (1,818,004)
--------------------------------------------------------------------------------------------------
Increase from capital share transactions (Note 4) 1,309,063,377 170,921,093
--------------------------------------------------------------------------------------------------
Total increase in net assets 2,221,992,175 1,940,354,620
Net assets
--------------------------------------------------------------------------------------------------
Beginning of period 6,668,559,715 4,728,205,095
--------------------------------------------------------------------------------------------------
End of period (including accumulated net investment
loss and distribution in excess of net investment
income of $77,028,201 and $34,223,643, respectively) $8,890,551,890 $6,668,559,715
--------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS A
-------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share April 30
operating performance (Unaudited) Year ended October 31
-------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996 1995
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $15.07 $11.01 $12.00 $11.10 $10.13 $9.92
-------------------------------------------------------------------------------------------------------------
Investment operations
-------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.07)(b) (.05)(b) --(b) .04(b) .09(b) .09
-------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 4.08 4.48 1.23 1.68 1.47 .43
-------------------------------------------------------------------------------------------------------------
Total from
investment operations 4.01 4.43 1.23 1.72 1.56 .52
-------------------------------------------------------------------------------------------------------------
Less distributions:
-------------------------------------------------------------------------------------------------------------
From net
investment income -- (.05) (.26) (.27) (.18) (.01)
-------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (1.81) (.32) (1.96) (.55) (.41) (.30)
-------------------------------------------------------------------------------------------------------------
Total distributions (1.81) (.37) (2.22) (.82) (.59) (.31)
-------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $17.27 $15.07 $11.01 $12.00 $11.10 $10.13
-------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
-------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 26.29* 41.04 13.02 16.40 16.10 5.64
-------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $6,168,344 $4,254,993 $2,882,999 $2,628,933 $2,186,426 $1,689,656
-------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .54* 1.10 1.18 1.24 1.27 1.28
-------------------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.39)* (.39) (.01) .31 .84 1.05
-------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 72.50* 165.64 162.35 154.98 72.88 63.31
-------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the
basis of the weighted average number of shares outstanding during the
period.
(c) Includes amounts paid through brokerage service and expense offset
arrangements. (Note 2)
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS B
-------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share April 30
operating performance (Unaudited) Year ended October 31
-------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996 1995
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $14.43 $10.59 $11.62 $10.78 $9.86 $9.74
-------------------------------------------------------------------------------------------------------------
Investment operations
-------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.13)(b) (.14)(b) (.08)(b) (.05)(b) .01(b) .03
-------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 3.90 4.30 1.18 1.64 1.43 .40
-------------------------------------------------------------------------------------------------------------
Total from
investment operations 3.77 4.16 1.10 1.59 1.44 .43
-------------------------------------------------------------------------------------------------------------
Less distributions:
-------------------------------------------------------------------------------------------------------------
From net
investment income -- -- (.17) (.20) (.11) (.01)
-------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (1.81) (.32) (1.96) (.55) (.41) (.30)
-------------------------------------------------------------------------------------------------------------
Total distributions (1.81) (.32) (2.13) (.75) (.52) (.31)
-------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $16.39 $14.43 $10.59 $11.62 $10.78 $9.86
-------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
-------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 25.75* 40.00 12.13 15.54 15.25 4.80
-------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $2,287,510 $2,072,050 $1,732,139 $1,664,215 $1,327,246 $975,794
-------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .91* 1.85 1.93 1.99 2.02 2.04
-------------------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.76)* (1.14) (.75) (.45) .09 .29
-------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 72.50* 165.64 162.35 154.98 72.88 63.31
-------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the
basis of the weighted average number of shares outstanding during the
period.
(c) Includes amounts paid through brokerage service and expense offset
arrangements. (Note 2)
</TABLE>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS C
---------------------------------------------------------------------------
Six months
ended For the period
Per-share April 30 Feb. 1, 1999+
operating performance (Unaudited) to Oct. 31
---------------------------------------------------------------------------
2000 1999
---------------------------------------------------------------------------
Net asset value,
beginning of period $14.98 $12.97
---------------------------------------------------------------------------
Investment operations
---------------------------------------------------------------------------
Net investment income (loss)(b) (.13) (.10)
---------------------------------------------------------------------------
Net realized and unrealized
gain on investments 4.05 2.11
---------------------------------------------------------------------------
Total from
investment operations 3.92 2.01
---------------------------------------------------------------------------
Less distributions:
---------------------------------------------------------------------------
From net
investment income -- --
---------------------------------------------------------------------------
From net realized gain
on investments (1.81) --
---------------------------------------------------------------------------
Total distributions (1.81) --
---------------------------------------------------------------------------
Net asset value,
end of period $17.09 $14.98
---------------------------------------------------------------------------
Ratios and supplemental data
---------------------------------------------------------------------------
Total return at
net asset value (%)(a) 25.81* 15.50*
---------------------------------------------------------------------------
Net assets, end of period
(in thousands) $63,569 $19,269
---------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .91* 1.38*
---------------------------------------------------------------------------
Ratio of net investment loss
to average net assets (%) (.76)* (.83)*
---------------------------------------------------------------------------
Portfolio turnover (%) 72.50* 165.64
---------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the
basis of the weighted average number of shares outstanding during the
period.
(c) Includes amounts paid through brokerage service and expense offset
arrangements. (Note 2)
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS M
-----------------------------------------------------------------------------------------------------------------
Six months
ended For the period
Per-share April 30 March 1, 1995+
operating performance (Unaudited) Year ended October 31 to October 31
-----------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996 1995
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $14.90 $10.90 $11.90 $11.05 $10.09 $8.86
-----------------------------------------------------------------------------------------------------------------
Investment operations
-----------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.11)(b) (.11)(b) (.06)(b) (.02)(b) .03(b) .01
-----------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 4.03 4.43 1.22 1.66 1.47 1.22
-----------------------------------------------------------------------------------------------------------------
Total from
investment operations 3.92 4.32 1.16 1.64 1.50 1.23
-----------------------------------------------------------------------------------------------------------------
Less distributions:
-----------------------------------------------------------------------------------------------------------------
From net
investment income -- -- (.20) (.24) (.13) --
-----------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (1.81) (.32) (1.96) (.55) (.41) --
-----------------------------------------------------------------------------------------------------------------
Total distributions (1.81) (.32) (2.16) (.79) (.54) --
-----------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $17.01 $14.90 $10.90 $11.90 $11.05 $10.09
-----------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
-----------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 25.96* 40.34 12.48 15.72 15.54 13.88*
-----------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $101,454 $76,537 $50,700 $43,662 $24,179 $5,853
-----------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .79* 1.60 1.68 1.74 1.80 1.23*
-----------------------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.64)* (.89) (.50) (.21) .32 .17*
-----------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 72.50* 165.64 162.35 154.98 72.88 63.31
-----------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the
basis of the weighted average number of shares outstanding during the
period.
(c) Includes amounts paid through brokerage service and expense offset
arrangements. (Note 2)
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS Y
-------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share April 30
operating performance (Unaudited) Year ended October 31
-------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996 1995
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $15.32 $11.20 $12.17 $11.24 $10.25 $10.00
-------------------------------------------------------------------------------------------------------------
Investment operations
-------------------------------------------------------------------------------------------------------------
Net investment income (loss) (.05)(b) (.02)(b) .03(b) .08(b) .12(b) .09
-------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 4.15 4.54 1.25 1.70 1.48 .47
-------------------------------------------------------------------------------------------------------------
Total from
investment operations 4.10 4.52 1.28 1.78 1.60 .56
-------------------------------------------------------------------------------------------------------------
Less distributions:
-------------------------------------------------------------------------------------------------------------
From net
investment income -- (.08) (.29) (.30) (.20) (.01)
-------------------------------------------------------------------------------------------------------------
From net realized gain
on investments (1.81) (.32) (1.96) (.55) (.41) (.30)
-------------------------------------------------------------------------------------------------------------
Total distributions (1.81) (.40) (2.25) (.85) (.61) (.31)
-------------------------------------------------------------------------------------------------------------
Net asset value,
end of period $17.61 $15.32 $11.20 $12.17 $11.24 $10.25
-------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
-------------------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 26.45* 41.19 13.35 16.75 16.39 6.00
-------------------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $269,675 $245,711 $62,367 $47,000 $66,708 $42,582
-------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(c) .41* .85 .93 .99 1.02 1.06
-------------------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.26)* (.13) .24 .69 1.09 1.20
-------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 72.50* 165.64 162.35 154.98 72.88 63.31
-------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Per share net investment income (loss) has been determined on the
basis of the weighted average number of shares outstanding during the
period.
(c) Includes amounts paid through brokerage service and expense offset
arrangements. (Note 2)
</TABLE>
NOTES TO FINANCIAL STATEMENTS
April 30, 2000 (Unaudited)
Note 1
Significant accounting policies
Putnam Global Growth Fund (the "fund") is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. The fund seeks capital appreciation by
investing primarily in common stocks traded in securities markets
located in a number of foreign countries and in the United States.
The fund offers class A, class B, class C, class M and class Y shares.
Class A shares are sold with a maximum front-end sales charge of 5.75%.
Class B shares, which convert to class A shares after approximately
eight years, do not pay a front-end sales charge but pay a higher
ongoing distribution fee than class A shares, and are subject to a
contingent deferred sales charge, if those shares are redeemed within
six years of purchase. Class C shares are subject to the same fees and
expenses as class B shares, except that class C shares have a one-year
1.00% contingent deferred sales charge and do not convert to class A
shares. Class M shares are sold with a maximum front end sales charge of
3.50% and pay an ongoing distribution fee that is higher than class A
shares but lower than class B shares. Class Y shares, which are sold at
net asset value, are generally subject to the same expenses as class A,
class B, class C and class M shares, but do not bear a distribution fee.
Class Y shares are sold to defined contribution plans that invest at
least $150 million in a combination of Putnam funds and other accounts
managed by affiliates of Putnam Investment Management, Inc., ("Putnam
Management"), the fund's manager, a wholly-owned subsidiary of Putnam
Investments, Inc.
Expenses of the fund are borne pro-rata by the holders of each class of
shares, except that each class bears expenses unique to that class
(including the distribution fees applicable to such class). Each class
votes as a class only with respect to its own distribution plan or other
matters on which a class vote is required by law or determined by the
Trustees. Shares of each class would receive their pro-rata share of the
net assets of the fund, if the fund were liquidated. In addition, the
Trustees declare separate dividends on each class of shares.
The following is a summary of significant accounting policies
consistently followed by the fund in the preparation of its financial
statements. The preparation of financial statements is in conformity
with generally accepted accounting principles and requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities of the financial statements and the reported
amounts of increases and decreases in net assets from operations during
the reporting period. Actual results could differ from those estimates.
A) Security valuation Investments for which market quotations are
readily available are stated at market value, which is determined using
the last reported sale price, or, if no sales are reported -- as in the
case of some securities traded over-the-counter -- the last reported bid
price. Securities quoted in foreign currencies are translated into U.S.
dollars at the current exchange rate. Short-term investments having
remaining maturities of 60 days or less are stated at amortized cost
which approximates market, and other investments are stated at fair
value following procedures approved by the Trustees.
B) Joint trading account Pursuant to an exemptive order issued by the
Securities and Exchange Commission, the fund may transfer uninvested
cash balances into a joint trading account along with the cash of other
registered investment companies and certain other accounts managed by
Putnam Investment Management Inc. These balances may be invested in one
or more repurchase agreements and/or short-term money market
instruments.
C) Repurchase agreements The fund, or any joint trading account, through
its custodian, receives delivery of the underlying securities, the
market value of which at the time of purchase is required to be in an
amount at least equal to the resale price, including accrued interest.
Collateral for certain tri-party repurchase agreements is held at the
counterparty's custodian in a segregated account for the benefit of the
fund and the counterparty. Putnam Management is responsible for
determining that the value of these underlying securities is at all
times at least equal to the resale price, including accrued interest.
D) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy
or sell is executed). Gains or losses on securities sold are determined
on the identified cost basis. Interest income is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date except that
certain dividends from foreign securities are recorded as soon as the
fund is informed of the ex-dividend date.
E) Foreign currency translation The accounting records of the fund are
maintained in U.S. dollars. The market value of foreign securities,
currency holdings, and other assets and liabilities are recorded in the
books and records of the fund after translation to U.S. dollars based on
the exchange rates on that day. The cost of each security is determined
using historical exchange rates. Income and withholding taxes are
translated at prevailing exchange rates when accrued or incurred. The
fund does not isolate that portion of realized or unrealized gains or
losses resulting from changes in the foreign exchange rate on
investments from fluctuations arising from changes in the market prices
of the securities. Such gains and losses are included with the net
realized and unrealized gain or loss on investments. Net realized gains
and losses on foreign currency transactions represent net realized
exchange gains or losses on closed forward currency contracts,
disposition of foreign currencies and the difference between the amount
of investment income and foreign withholding taxes recorded on the
fund's books and the U.S. dollar equivalent amounts actually received or
paid. Net unrealized appreciation and depreciation of assets and
liabilities in foreign currencies arise from changes in the value of
open forward currency contracts and assets and liabilities other than
investments at the period end, resulting from changes in the exchange
rate.
Investments in foreign securities involve certain risks, including those
related to economic instability, unfavorable political developments, and
currency fluctuations, not present with domestic investments.
F) Forward currency contracts The fund may engage in forward currency
contracts, which are agreements between two parties to buy and sell
currencies at a set price on a future date, to protect against a decline
in value relative to the U.S. dollar of the currencies in which its
portfolio securities are denominated or quoted (or an increase in the
value of a currency in which securities a fund intends to buy are
denominated, when a fund holds cash reserves and short-term
investments). The U.S. dollar value of forward currency contracts is
determined using current forward currency exchange rates supplied by a
quotation service. The market value of the contract will fluctuate with
changes in currency exchange rates. The contract is "marked to market"
daily and the change in market value is recorded as an unrealized gain
or loss. When the contract is closed, the fund records a realized gain
or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed. The fund
could be exposed to risk if the value of the currency changes
unfavorably, if the counterparties to the contracts are unable to meet
the terms of their contracts or if the fund is unable to enter into a
closing position.
G) Line of credit The fund has entered into a committed line of credit
with certain banks. This line of credit agreement includes restrictions
that the fund maintain an asset coverage ratio of at least 300% and
borrowings must not exceed prospectus limitations. For the six months
ended April 30, 2000, the fund had no borrowings against the line of
credit.
H) Federal taxes It is the policy of the fund to distribute all of its
taxable income within the prescribed time and otherwise comply with the
provisions of the Internal Revenue Code applicable to regulated
investment companies. It is also the intention of the fund to distribute
an amount sufficient to avoid imposition of any excise tax under Section
4982 of the Internal Revenue Code of 1986, as amended. Therefore, no
provision has been made for federal taxes on income, capital gains or
unrealized appreciation on securities held nor for excise tax on income
and capital gains.
I) Distributions to shareholders Distributions to shareholders from net
investment income are recorded by the fund on the ex-dividend date.
Capital gain distributions, if any, are recorded on the ex-dividend date
and paid at least annually. The amount and character of income and gains
to be distributed are determined in accordance with income tax
regulations which may differ from generally accepted accounting
principles. Reclassifications are made to the fund's capital accounts to
reflect income and gains available for distribution (or available
capital loss carryovers) under income tax regulations.
Note 2
Management fee, administrative
services, and other transactions
Compensation of Putnam Management, for management and investment
advisory services is paid quarterly based on the average net assets of
the fund. Such fee is based on the following annual rates: 0.80% of the
first $500 million of average net assets, 0.70% of the next $500
million, 0.65% of the next $500 million, 0.60% of the next $5 billion,
0.575% of the next $5 billion, 0.555% of the next $5 billion, 0.54% of
the next $5 billion and 0.53% thereafter.
The fund reimburses Putnam Management an allocated amount for the
compensation and related expenses of certain officers of the fund and
their staff who provide administrative services to the fund. The
aggregate amount of all such reimbursements is determined annually by
the Trustees.
Custodial functions for the fund's assets are provided by Putnam
Fiduciary Trust Company (PFTC), a subsidiary of Putnam Investments, Inc.
Investor servicing agent functions are provided by Putnam Investor
Services, a division of PFTC.
For the six months ended April 30, 2000, fund expenses were reduced by
$1,147,609 under expense offset arrangements with PFTC and brokerage
service arrangements. Investor servicing and custodian fees reported in
the Statement of operations exclude these credits. The fund could have
invested a portion of the assets utilized in connection with the expense
offset arrangements in an income producing asset if it had not entered
into such arrangements.
Each Trustee of the fund receives an annual Trustee fee, of which $4,017
has been allocated to the fund, and an additional fee for each Trustee's
meeting attended. Trustees receive additional fees for attendance at
certain committee meetings.
The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan")
which allows the Trustees to defer the receipt of all or a portion of
Trustees Fees payable on or after July 1, 1995. The deferred fees remain
invested in certain Putnam funds until distribution in accordance with
the Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension
plan (the "Pension Plan") covering all Trustees of the fund who have
served as a Trustee for at least five years. Benefits under the Pension
Plan are equal to 50% of the Trustee's average total retainer and
meeting fees for the three years preceding retirement. Pension expense
for the fund is included in Compensation of Trustees in the Statement of
operations. Accrued pension liability is included in Payable for
compensation of Trustees in the Statement of assets and liabilities.
The fund has adopted distribution plans (the "Plans") with respect to
its class A, class B, class C and class M shares pursuant to Rule 12b-1
under the Investment Company Act of 1940. The purpose of the Plans is to
compensate Putnam Mutual Funds Corp., a wholly-owned subsidiary of
Putnam Investments Inc., for services provided and expenses incurred by
it in distributing shares of the fund. The Plans provide for payments by
the fund to Putnam Mutual Funds Corp. at an annual rate up to 0.35%,
1.00%, 1.00% and 1.00% of the average net assets attributable to class
A, class B, class C and class M shares, respectively. The Trustees have
approved payment by the fund at an annual rate of 0.25%, 1.00%, 1.00%
and 0.75% of the average net assets attributable to class A, class B,
class C and class M shares, respectively.
For the six months ended April 30, 2000, Putnam Mutual Funds Corp.,
acting as underwriter received net commissions of $885,664 and $23,646
from the sale of class A and class M shares, respectively and received
$849,651 and $8,694 in contingent deferred sales charges from
redemptions of class B and class C shares. A deferred sales charge of up
to 1% is assessed on certain redemptions of class A shares. For the six
months ended April 30, 2000, Putnam Mutual Funds Corp., acting as
underwriter received $20,940 on class A redemptions.
Note 3
Purchases and sales of securities
During the six months ended April 30, 2000, cost of purchases and
proceeds from sales of investment securities other than short-term
investments aggregated $6,562,285,323 and $6,136,088,095, respectively.
There were no purchases and sales of U.S. government obligations.
Note 4
Capital shares
At April 30, 2000, there was an unlimited number of shares of beneficial
interest authorized. Transactions in capital shares were as follows:
Six months ended April 30, 2000
---------------------------------------------------------------------------
Class A Shares Amount
---------------------------------------------------------------------------
Shares sold 91,210,161 $1,643,678,752
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 27,923,799 494,530,560
---------------------------------------------------------------------------
119,133,960 2,138,209,312
Shares
repurchased (44,245,858) (797,459,830)
---------------------------------------------------------------------------
Net increase 74,888,102 $1,340,749,482
---------------------------------------------------------------------------
Year ended October 31, 1999
---------------------------------------------------------------------------
Class A Shares Amount
---------------------------------------------------------------------------
Shares sold 93,924,759 $1,228,849,004
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 7,629,169 93,152,893
---------------------------------------------------------------------------
101,553,928 1,322,001,897
Shares
repurchased (81,005,561) (1,056,235,434)
---------------------------------------------------------------------------
Net increase 20,548,367 $ 265,766,463
---------------------------------------------------------------------------
Six months ended April 30, 2000
---------------------------------------------------------------------------
Class B Shares Amount
---------------------------------------------------------------------------
Shares sold 21,863,461 $374,891,387
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 14,163,064 238,789,259
---------------------------------------------------------------------------
36,026,525 613,680,646
Shares
repurchased (40,086,105) (687,364,585)
---------------------------------------------------------------------------
Net decrease (4,059,580) $(73,683,939)
---------------------------------------------------------------------------
Year ended October 31, 1999
---------------------------------------------------------------------------
Class B Shares Amount
---------------------------------------------------------------------------
Shares sold 32,374,239 $ 400,904,692
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 4,156,972 48,885,999
---------------------------------------------------------------------------
36,531,211 449,790,691
Shares
repurchased (56,458,220) (706,424,289)
---------------------------------------------------------------------------
Net decrease (19,927,009) $(256,633,598)
---------------------------------------------------------------------------
Six months ended April 30, 2000
---------------------------------------------------------------------------
Class C Shares Amount
---------------------------------------------------------------------------
Shares sold 2,652,154 $47,632,044
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 140,663 2,472,859
---------------------------------------------------------------------------
2,792,817 50,104,903
Shares
repurchased (359,314) (6,401,977)
---------------------------------------------------------------------------
Net increase 2,433,503 $43,702,926
---------------------------------------------------------------------------
For the period February 1, 1999
(commencement of operations) to
October 31, 1999
---------------------------------------------------------------------------
Class C Shares Amount
---------------------------------------------------------------------------
Shares sold 1,355,459 $17,881,229
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions -- --
---------------------------------------------------------------------------
1,355,459 17,881,229
Shares
repurchased (69,410) (924,256)
---------------------------------------------------------------------------
Net increase 1,286,049 $16,956,973
---------------------------------------------------------------------------
Six months ended April 30, 2000
---------------------------------------------------------------------------
Class M Shares Amount
---------------------------------------------------------------------------
Shares sold 1,539,553 $27,122,463
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 514,510 9,001,226
---------------------------------------------------------------------------
2,054,063 36,123,689
Shares
repurchased (1,225,537) (21,629,091)
---------------------------------------------------------------------------
Net increase 828,526 $14,494,598
---------------------------------------------------------------------------
Year ended October 31, 1999
---------------------------------------------------------------------------
Class M Shares Amount
---------------------------------------------------------------------------
Shares sold 3,899,037 $49,882,997
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 121,972 1,478,302
---------------------------------------------------------------------------
4,021,009 51,361,299
Shares
repurchased (3,535,004) (45,298,074)
---------------------------------------------------------------------------
Net increase 486,005 $ 6,063,225
---------------------------------------------------------------------------
Six months ended April 30, 2000
---------------------------------------------------------------------------
Class Y Shares Amount
---------------------------------------------------------------------------
Shares sold 4,419,230 $ 81,366,192
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 1,405,170 25,352,554
---------------------------------------------------------------------------
5,824,400 106,718,746
Shares
repurchased (6,545,758) (122,918,436)
---------------------------------------------------------------------------
Net decrease (721,358) $(16,199,690)
---------------------------------------------------------------------------
Year ended October 31, 1999
---------------------------------------------------------------------------
Class Y Shares Amount
---------------------------------------------------------------------------
Shares sold 13,118,267 $174,297,460
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 181,284 2,245,769
---------------------------------------------------------------------------
13,299,551 176,543,229
Shares
repurchased (2,836,139) (37,775,199)
---------------------------------------------------------------------------
Net increase 10,463,412 $138,768,030
---------------------------------------------------------------------------
THE PUTNAM FAMILY OF FUNDS
The following is a complete list of Putnam's open-end mutual funds.
Please call your financial advisor or Putnam at 1-800-225-1581 to obtain
a prospectus for any Putnam fund. It contains more complete information,
including charges and expenses. Please read it carefully before you
invest or send money.
GROWTH FUNDS
Asia Pacific Growth Fund
Capital Appreciation Fund
Capital Opportunities Fund
Europe Growth Fund
Global Equity Fund
Global Growth Fund
Global Natural Resources Fund
Growth Opportunities Fund
Health Sciences Trust
International Growth Fund
International New Opportunities Fund
Investors Fund
New Century Growth Fund
New Opportunities Fund
OTC & Emerging Growth Fund
Research Fund
Tax Smart Equity Fund
Vista Fund
Voyager Fund
Voyager Fund II
GROWTH AND INCOME FUNDS
Balanced Retirement Fund
Convertible Income-Growth Trust
Equity Income Fund
The George Putnam Fund of Boston
Global Growth and Income Fund
The Putnam Fund for Growth and Income
Growth and Income Fund II
International Growth and Income Fund
New Value Fund
Small Cap Value Fund
Utilities Growth and Income Fund
INCOME FUNDS
American Government Income Fund
Diversified Income Trust
Global Governmental Income Trust
High Yield Advantage Fund [DBL. DAGGER]
High Yield Trust [DBL. DAGGER]
High Yield Trust II
Income Fund
Intermediate U.S. Government Income Fund
Money Market Fund **
Preferred Income Fund
Strategic Income Fund *
U.S. Government Income Trust
TAX-FREE INCOME FUNDS
Municipal Income Fund
Tax Exempt Income Fund
Tax Exempt Money Market Fund **
Tax-Free High Yield Fund
Tax-Free Insured Fund
State tax-free income funds [SECTION MARK]
Arizona, California, Florida, Massachusetts, Michigan, Minnesota, New
Jersey, New York, Ohio and Pennsylvania
State tax-free money market funds [SECTION MARK] **
California, New York
ASSET ALLOCATION FUNDS
Putnam Asset Allocation Funds--three investment portfolios that spread
your money across a variety of stocks, bonds, and money market
investments.
The three portfolios:
Asset Allocation: Balanced Portfolio
Asset Allocation: Conservative Portfolio
Asset Allocation: Growth Portfolio
* Formerly Putnam Diversified Income Trust II
[SECTION MARK] Not available in all states.
[DBL. DAGGER] Closed to new investors. Some exceptions may apply.
Contact Putnam for details.
** An investment in a money market fund is not insured or guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although the funds seek to preserve your investment at $1.00 per share, it
is possible to lose money by investing in the fund.
Check your account balances and current performance at www.putnaminv.com.
FUND INFORMATION
WEB SITE
www.putnaminv.com
INVESTMENT MANAGER
Putnam Investment Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
TRUSTEES
George Putnam, Chairman
William F. Pounds, Vice Chairman
John A. Hill, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
Lawrence J. Lasser
John H. Mullin III
Robert E. Patterson
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
John D. Hughes
Senior Vice President and Treasurer
Lawrence J. Lasser
Vice President
Gordon H. Silver
Vice President
Ian C. Ferguson
Vice President
Brett C. Browchuk
Vice President
Stephen Oristaglio
Vice President
Robert Swift
Vice President and Fund Manager
Lisa Svensson
Vice President and Fund Manager
Kelly A. Morgan
Vice President and Fund Manager
Stephen P. Dexter
Vice President and Fund Manager
Manuel Weiss
Vice President and Fund Manager
Richard A. Monaghan
Vice President
Richard G. Leibovitch
Vice President
John R. Verani
Vice President
This report is for the information of shareholders of Putnam Global
Growth Fund. It may also be used as sales literature when preceded or
accompanied by the current prospectus, which gives details of sales
charges, investment objectives, and operating policies of the fund, and
the most recent copy of Putnam's Quarterly Performance Summary. For more
information or to request a prospectus, call toll free: 1-800-225-1581.
You can also learn more at Putnam Investments' Web site: www.putnaminv.com.
Shares of mutual funds are not deposits or obligations of, or guaranteed
or endorsed by, any financial institution; are not insured by the
Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board,
or any other agency; and involve risk, including the possible loss of
the principal amount invested.
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
---------------------
BULK RATE
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
---------------------
For account balances, economic forecasts, and the latest on Putnam funds, visit
www.putnaminv.com
SA006-61430 005/882/907/513 6/00
PUTNAM INVESTMENTS [SCALE LOGO OMITTED]
---------------------------------------------------------------------------
Putnam Global Growth Fund
Supplement to Semiannual Report dated 4/30/00
The following information has been prepared to provide class Y shareholders
with a performance overview specific to their holdings. Class Y shares are
offered exclusively to defined contribution plans investing $150 million or
more in one or more of Putnam's funds or private accounts. Performance of
class Y shares, which incur neither a front-end load, distribution fee, nor
contingent deferred sales charge, will differ from performance of class A,
B, C, and M shares, which are discussed more extensively in the semiannual
report.
SEMIANNUAL RESULTS AT A GLANCE
---------------------------------------------------------------------------
Total return
for periods ended 4/30/00 NAV
6 months 26.45%
1 year 46.98%
5 years 198.88%
annual average 24.48%
10 years 351.81%
annual average 16.28%
Life of fund
(annual average, since class A inception, 9/1/67) 12.17%
Share value: NAV
10/31/99 $15.32
4/30/00 $17.61
---------------------------------------------------------------------------
Distributions: No. Income Capital gains Total
L/T S/T
1 $0.00 $1.059 $0.747 $1.806
---------------------------------------------------------------------------
Please note that past performance is no guarantee of future results.
Returns shown for class Y shares for periods prior to their inception are
derived from the historical performance of class A shares, adjusted to
reflect the initial sales charge currently applicable to class A shares.
These returns have not been adjusted to reflect differences in operating
expenses which, for class Y shares, are lower than the operating expenses
applicable to class A shares. All returns assume reinvestment of
distributions at net asset value. Investment return and principal value
will fluctuate so your shares, when redeemed, may be worth more or less
than their original cost. See full report for information on comparative
benchmarks. If you have questions, please consult your fund prospectus or
call Putnam toll free at 1-800-752-9894.
