Putnam
Voyager
Fund
ANNUAL REPORT ON PERFORMANCE AND OUTLOOK
7-31-00
[SCALE LOGO OMITTED]
FROM THE TRUSTEES
[GRAPHIC OMITTED: PHOTO OF JOHN A. HILL AND GEORGE PUTNAM, III]
Dear Shareholder:
It is a pleasure to greet you in our new roles as Chairman of the
Trustees and President of the Funds. As you know, both of us have been
members of the Board of Trustees for a number of years -- years during
which the global securities markets, the mutual fund industry, and
Putnam itself have experienced tremendous growth and change.
As we look to the future, we are certain that the changes that lie ahead
will be even more breathtaking in their scope. What will not change is
the Trustees' dedication to serving the best interests of our
shareholders.
We are pleased to announce the appointment of Kevin M. Divney and James
C. Wiess to your fund's management team. Kevin was with Franklin
Portfolio Associates and State Street Bank before joining Putnam in
1997. He has 12 years of investment experience. Jim joined Putnam
earlier this year from J.P. Morgan Investment Management. He has 16
years of investment experience.
Respectfully yours,
/S/ JOHN A. HILL /S/ GEORGE PUTNAM, III
John A. Hill George Putnam, III
Chairman of the Trustees President of the Funds
September 20, 2000
REPORT FROM FUND MANAGEMENT
Roland W. Gillis
Charles H. Swanberg
Robert R. Beck
Michael P. Stack
Paul E. Marrkand
Kevin M. Divney
James C. Wiess
The stock market took investors on a memorable journey during the 12
months that ended July 31, 2000, the fiscal year of Putnam Voyager Fund.
As you might recall from our previous management report this past
January, the fund participated in a powerful rally in growth stocks
during late 1999. This exuberance gave way in early 2000 as investors
assessed the risks posed by rising short-term interest rates. The prices
of many growth stocks peaked in February, corrected in March, April, and
May, and then recovered substantial ground in the final two months of
the period. In spite of this recent volatility, we are pleased to report
a strong gain for the full year.
Total return for 12 months ended 7/31/00
Class A Class B Class C Class M
NAV POP NAV CDSC NAV CDSC NAV POP
----------------------------------------------------------------------
37.76% 29.83% 36.69% 31.69% 36.79% 35.79% 37.13% 32.31%
----------------------------------------------------------------------
Past performance is not indicative of future results. Performance
information for longer periods and explanation of performance
calculation methods begin on page 6.
* RISING INTEREST RATES CAUSE MARKETS TO CHURN
Inflation became a greater concern as economic growth accelerated during
the past year, and the stock market's gyrations during the past several
months came, in part, as a reaction to the Federal Reserve Board's
efforts to prevent it. A whopping 7.3% growth in GDP during the final 3
months of 1999, more than twice the average growth rate of the past
couple of decades, combined with a tight labor market, prompted action
by the Fed. Although it had already raised rates three times in 1999,
the Fed continued this course by raising them three more times in the
first half of 2000.
[GRAPHIC OMITTED: horizontal bar chart TOP INDUSTRY SECTORS]
TOP INDUSTRY SECTORS*
Electronics 16.1%
Communications
equipment 9.0%
Software 6.6%
Retail 6.1%
Pharmaceuticals 6.0%
Footnote reads:
*Based on net assets as of 7/31/00. Holdings will vary over time.
Amid a series of rate increases such as we experienced during the
period, the market tends to anticipate greater risk, and stock prices
consequently decline. On one hand, investors worry that inflation might
get out of hand and businesses could face rising costs. On the other
hand, there is the possibility that the rate increases might throw the
economy into recession and cut into business profits. These forces
turned out to be especially damaging to the companies your fund owns
because the market had expected unusually high growth rates from them.
In our constant monitoring of the fund's holdings, including ongoing
discussions with senior company executives, we saw no reason to alter
the portfolio significantly in spite of the turmoil resulting from rate
increases. We believed economic growth would continue at an adequate
pace to sustain the profit growth in the companies we favored.
In fact, we took advantage of the opportunity to add to several
positions that in our view, the market had unfairly punished. Examples
include Sun Microsystems, EMC Software, and Intel. These companies are
thriving as spending on technology and telecommunications equipment and
services rapidly expands. In the June recovery for growth stocks, these
were among the fund's best performers, confirming the soundness of our
decision. While these stocks, as well as others mentioned in this
report, were viewed favorably at the end of the period, all are subject
to review in accordance with your fund's investment policy and may
change in the future.
* WORLD CONTINUES TO EMBRACE TECHNOLOGY AND TELECOMMUNICATIONS
Your fund is broadly diversified with an assortment of growth stocks
representing companies of many sizes from a variety of industries. What
these companies share is earnings growth that is faster than the average
for the whole economy. By investing in stocks with above-average growth
rates, we seek greater returns than the general stock market over time.
Within this diversified portfolio, however, many growth stocks are
thriving because of one trend, the construction of the world's computer
and telecommunications infrastructure. In many ways, the impact of this
trend is as powerful as that of the industrial revolution primarily
because of the new productivity it can unleash. Computers and
telecommunications networks allow businesses to manage themselves far
more efficiently, driving down costs, enhancing competition, and
creating new business opportunities. As growth-style investors, we long
ago understood this potential. Many of the fund's holdings that
performed magnificently in late 1999 were, in fact, bought as small
companies years ago and have grown into large companies.
Reflecting the fund's strong long-term performance, Morningstar, an
independent rating agency, has awarded Putnam Voyager Fund's class A
shares 5 out of 5 stars for overall performance as of July 31, 2000. Of
the 3,776 domestic equity funds rated, the top 10% received 5 stars.
Past performance is no guarantee of future results. Morningstar ratings
reflect risk-adjusted performance through 7/31/00 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 3-, 5-, and 10-year performance, the
fund received 4, 4 and 5 stars, and the number of funds rated was 3776,
2348, and 786, respectively. 10% of the funds in an investment category
receive 5 stars; the next 22.5% receive 4 stars. Performance of other
share classes will vary.
Because this trend is so broad, holdings that benefit from it can be
found in several different industries. Companies making semiconductor
chips for computers and cellular telephones include Linear Technology,
Xilinx, and PMC-Sierra. Fund holdings that make larger pieces of
computer and networking hardware are ADC Telecommunications, Comverse,
and wireless telephone giant Nokia of Finland. Finally the fund had
large positions in the leading telecommunications service carriers
including Sprint PCS and NEXTLINK Communications.
* PHARMACEUTICALS, MEDIA COMPANIES EXCEED EXPECTATIONS
Beyond technology, we have also found compelling growth companies in the
pharmaceutical and media sectors. Several of these stocks are less
understood by the market, in our opinion, which leads them to be
somewhat more attractively priced than the general universe of growth
stocks. This characteristic is an advantage for the fund because stocks
with attractive prices tend to feel less impact from general market
volatility. During recent volatility, many of these holdings helped
stabilize the fund's performance.
[GRAPHIC OMITTED: TOP 10 HOLDINGS]
TOP 10 HOLDINGS
Viacom, Inc. Class B
Entertainment
AT&T Corp. - Liberty Media Corp.
Cable television
Cisco Systems, Inc.
Communications equipment
Pfizer, Inc.
Pharmaceuticals
Intel Corp.
Electronics
General Electric Co.
Conglomerates
Linear Technology Corp.
Electronics
Oracle Corp.
Software
Maxim Integrated Products Inc.
Electronics
Citigroup, Inc.
Financial
Footnote reads:
These holdings represent 21.5% of the fund's net assets as of 7/31/00.
Portfolio holdings will vary over time.
In the pharmaceuticals industry, we have recently invested in
Schering-Plough and added to positions in companies such as Pharmacia
Corp. and Pfizer. Many of these stocks have been trading at slightly
depressed price multiples in the past year because of questions about
their future drugs in development and the political uncertainties raised
by the possibility of adding prescription drug benefits to Medicare.
Profits of these companies have been solid, however, and their stocks
were in demand when investors looked for more defensive fare during the
recent market correction.
In the media sector, the fund has benefited from the performance of
several advertising and radio stocks. Advertising companies have
flourished thanks to the buoyant economy and to the rapid pace of new
business development. New technology and telecommunications companies
must establish their brands in many markets around the world and they
rely on the expertise of companies such as fund holding Omnicom Group.
Advertisers also have attractive stock prices because many investors
still perceive the business as vulnerable to a cyclical downturn. Our
research, however, persuades us that well-managed advertisers can
maintain long-term growth and their stocks can have surprising
potential.
Among broadcasters, television companies, such as fund holdings Viacom,
AT&T-Liberty Media, and Univision Communications are profiting from
demand for advertising time. As more people commute long distances to
work and read less, radio companies are taking market share from local
newspapers. Several of the fund's radio holdings, such as AMFM and
Hispanic Broadcasting, are also growing by acquiring new stations in
different cities and achieving greater efficiencies.
* SOLID FUNDAMENTALS SUPPORT GROWTH COMPANIES
As we complete this report in late summer, the market continues its
struggle to find a comfortable level for stock prices, especially some
of the rapidly growing companies that your fund holds. Although growth
stocks rallied robustly in June as the market anticipated an end to the
Fed's rate increases, the economy continues to grow faster than its
long-term average rate.
Fortunately the economy is also feeling the benefits of increased
productivity made possible by technology: Worker productivity in the
second quarter grew at an annual rate of 5.3%, its biggest jump in
nearly two decades. We must emphasize, however, that while interest
rates have a major impact on performance, they are a short-term factor.
Their effects dissipate when rates stabilize or begin to cycle lower.
Our research and investment process is focused on fundamental business
issues, not macroeconomic factors. From this perspective, as we have
described above, there is little negative or discouraging news -- most
fund holdings are generating excellent profits and their outlook remains
bright. This gives us great confidence that the fund has the potential
to deliver solid returns as it has during its long history.
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 7/31/00, there is no guarantee the fund will
continue to hold these securities in the future. The fund invests all or
a portion of its assets in small to midsize companies. Such investments
increase the risk of greater price fluctuations.
PERFORMANCE SUMMARY
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
Voyager Fund is designed for investors seeking capital appreciation
mainly through common stocks.
<TABLE>
<CAPTION>
TOTAL RETURN FOR PERIODS ENDED 7/31/00
Class A Class B Class C Class M
(inception dates) (4/1/69) (4/27/92) (7/26/99) (12/1/94)
NAV POP NAV CDSC NAV CDSC NAV POP
-----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 year 37.76% 29.83% 36.69% 31.69% 36.79% 35.79% 37.13% 32.31%
-----------------------------------------------------------------------------------
5 years 200.82 183.52 189.73 187.73 189.82 189.82 193.66 183.40
Annual average 24.64 23.17 23.71 23.54 23.72 23.72 24.04 23.16
-----------------------------------------------------------------------------------
10 years 619.66 578.01 565.77 565.77 567.29 567.29 584.90 561.01
Annual average 21.82 21.09 20.87 20.87 20.90 20.90 21.22 20.79
-----------------------------------------------------------------------------------
Annual average
(life of fund) 15.19 14.97 14.12 14.12 14.32 14.32 14.42 14.29
-----------------------------------------------------------------------------------
</TABLE>
COMPARATIVE INDEX RETURNS FOR PERIODS ENDED 7/31/00
Russell 1000 Russell MidCap Consumer
Growth Index* Growth Index* price index
------------------------------------------------------------------------------
1 year 24.38% 43.76% 3.60%
------------------------------------------------------------------------------
5 years 224.55 183.94 13.10
Annual average 26.54 23.20 2.49
------------------------------------------------------------------------------
10 years 504.24 487.78 32.44
Annual average 19.70 19.37 2.85
------------------------------------------------------------------------------
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
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.
*The fund's performance benchmark has been changed from the Russell MidCap
Growth Index to the Russell 1000 Growth Index to reflect the fund's increased
emphasis on large-cap growth stocks.
+The Russell MidCap Growth Index and the Russell 1000 Growth Index did not
exist at the date of the fund's inception.
[GRAPHIC OMITTED: worm chart GROWTH OF A $10,000 INVESTMENT]
GROWTH OF A $10,000 INVESTMENT
Cumulative total return of a $10,000 investment since 7/31/90
Russell MidCap Russell 1000
Fund's class A Growth Growth Consumer price
Date shares at POP Index Index index
7/31/90 9,422 10,000 10,000 10,000
7/31/91 11,687 11,908 11,688 10,445
7/31/92 13,251 13,285 13,172 10,775
7/31/93 15,860 15,043 13,494 11,074
7/31/94 16,731 15,831 14,167 11,380
7/31/95 22,539 20,701 18,618 11,710
7/31/96 26,031 22,201 21,508 12,055
7/31/97 34,418 31,013 32,660 12,316
7/31/98 40,211 33,598 39,165 12,523
7/31/99 49,217 40,886 48,581 12,784
7/31/00 $67,801 $58,778 $60,424 $13,244
Footnote reads:
Past performance is no assurance of future results. At the end of the
same time period, a $10,000 investment in the fund's class B and class C
shares would have been valued at $66,577 and $66,729, respectively and
no contingent deferred sales charges would apply; a $10,000 investment
in the fund's class M shares would have been valued at $68,490 ($66,101
at public offering price).
PRICE AND DISTRIBUTION INFORMATION 12 MONTHS ENDED 7/31/00
Class A Class B Class C Class M
------------------------------------------------------------------------------
Distributions
(nimber) 1 1 1 1
------------------------------------------------------------------------------
Income -- -- -- --
------------------------------------------------------------------------------
Capital gains
Long-term $2.892 $2.892 $2.892 $2.892
------------------------------------------------------------------------------
Short-term 0.089 0.089 0.089 0.089
------------------------------------------------------------------------------
Total $2.981 $2.981 $2.981 $2.981
------------------------------------------------------------------------------
Share value: NAV POP NAV NAV NAV POP
------------------------------------------------------------------------------
7/31/99 $24.25 $25.73 $22.57 $24.25 $23.61 $24.47
------------------------------------------------------------------------------
7/31/00 30.22 32.06 27.68 30.00 29.20 30.26
------------------------------------------------------------------------------
TOTAL RETURN FOR PERIODS ENDED 6/30/00 (most recent calendar quarter)
Class A Class B Class C Class M
(inception dates) (4/1/69) (4/27/92) (7/26/99) (12/1/94)
NAV POP NAV CDSC NAV CDSC NAV POP
------------------------------------------------------------------------------
1 year 37.97% 30.02% 36.94% 31.94% 37.07% 36.07% 37.39% 32.61%
------------------------------------------------------------------------------
5 years 232.41 213.36 220.12 218.11 220.51 220.51 224.36 212.97
Annual average 27.16 25.66 26.20 26.04 26.23 26.23 26.53 25.63
------------------------------------------------------------------------------
10 years 622.22 580.81 568.34 568.34 569.96 569.96 587.74 563.69
Annual average 21.86 21.14 20.92 20.92 20.95 20.95 21.27 20.84
------------------------------------------------------------------------------
Annual average
(life of fund) 15.35 15.13 14.28 14.28 14.49 14.49 14.59 14.46
------------------------------------------------------------------------------
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.
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
Russell MidCap Growth Index measures the performance of those Russell
Midcap companies with higher price-to-book ratios and higher forecasted
growth values. The stocks are also members of the Russell 1000 Growth
Index.*
Russell 1000 Growth Index measures the performance of those Russell 1000
Index companies with higher price-to-book ratios and higher forecasted
growth values.*
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 into 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, preceded by the Report of independent
accountants, 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.
REPORT OF INDEPENDENT ACCOUNTANTS
For the fiscal year ended July 31, 2000
To the Trustees and Shareholders
of Putnam Voyager Fund
In our opinion, the accompanying statement of assets and liabilities,
including the fund's portfolio, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Putnam Voyager Fund (the "fund") at July 31, 2000, and the results of
its operations, the changes in its net assets and the financial
highlights for the periods indicated, in conformity with accounting
principles generally accepted in the United States. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the fund's management; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial
statements in accordance with auditing standards generally accepted in
the United States, which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included
confirmation of investments owned at July 31, 2000 by correspondence
with the custodian, provide a reasonable basis for the opinion
expressed above.
PricewaterhouseCoopers LLP
Boston, Massachusetts
September 6, 2000
<TABLE>
<CAPTION>
THE FUND'S PORTFOLIO
July 31, 2000
COMMON STOCKS (93.0%) (a)
NUMBER OF SHARES VALUE
<S> <C> <C>
Advertising and Marketing Services (0.5%)
-------------------------------------------------------------------------------------------------------------------
162,700 Interpublic Group Cos., Inc. $ 6,518,169
1,480,931 Lamar Advertising Co. (NON) 67,567,477
1,547,250 Omnicom Group, Inc. 131,516,250
----------------
205,601,896
Airlines (0.1%)
-------------------------------------------------------------------------------------------------------------------
1,200,000 Ryanair Holdings, PLC ADR (Ireland) (NON) 50,550,000
Banking (2.2%)
-------------------------------------------------------------------------------------------------------------------
2,277,500 Bank of America Corp. 107,896,563
1,955,300 Bank of New York Company, Inc. 91,532,481
200,000 Comerica, Inc. 10,200,000
9,072,326 Fifth Third Bancorp 374,800,427
12,847,017 Firstar Corp. 253,728,586
100,000 Mellon Financial Corp. 3,768,750
100,000 State Street Corp. 10,037,500
458,350 SunTrust Banks, Inc. 21,943,506
1,617,202 TCF Financial Corp. 47,606,384
349,900 Zions Bancorp 15,308,125
----------------
936,822,322
Beverage (0.3%)
-------------------------------------------------------------------------------------------------------------------
1,425,150 Coca-Cola Co. 87,379,509
221,900 Coca-Cola Enterprises, Inc. 4,257,706
266,000 Pepsi Bottling Group, Inc. (The) 8,129,625
393,000 PepsiCo, Inc. 18,004,313
----------------
117,771,153
Biotechnology (1.5%)
-------------------------------------------------------------------------------------------------------------------
3,122,400 Amgen, Inc. (NON) 202,760,850
65,350 Biogen, Inc. (NON) 3,463,550
1,525,650 Genentech, Inc. (NON) 232,089,506
94,700 Medimmune, Inc. (NON) 5,634,650
1,856,170 Sepracor, Inc. (NON) 196,289,978
----------------
640,238,534
Broadcasting (4.4%)
-------------------------------------------------------------------------------------------------------------------
5,465,600 AMFM, Inc. (NON) 390,448,800
5,949,308 Clear Channel Communications, Inc. (NON) 453,262,903
1,752,800 Echostar Communications Corp. Class A (NON) 69,126,050
1,147,300 Entercom Communications Corp. (NON) 44,529,581
2,028,162 Hispanic Broadcasting Corp. (NON) 77,196,916
16,398,898 Infinity Broadcating Corp. Class A (NON) 578,061,155
1,323,100 Univision Communications, Inc. Class A (NON) 164,395,175
3,789,000 Westwood One, Inc. (NON) 105,381,563
----------------
1,882,402,143
Cable Television (3.2%)
-------------------------------------------------------------------------------------------------------------------
1,838,700 Adelphia Communications Corp. (NON) 64,814,175
53,343,402 AT&T Corp.-Liberty Media Group Class A (NON) 1,186,890,695
446,750 Comcast Corp. Class A 15,196,480
3,810,600 USA Networks, Inc. (NON) 80,260,763
----------------
1,347,162,113
Chemicals (--%)
-------------------------------------------------------------------------------------------------------------------
59,300 Avery Dennison Corp. 3,217,025
Commercial and Consumer Services (1.3%)
-------------------------------------------------------------------------------------------------------------------
2,667,273 Capita Group PLC (United Kingdom) 64,422,810
8,371,300 Cendant Corp. (NON) 107,257,281
4,073,618 Cintas Corp. 171,855,759
21,604,200 Serco Group PLC (United Kingdom) 187,630,749
----------------
531,166,599
Communications Equipment (9.0%)
-------------------------------------------------------------------------------------------------------------------
10,700,600 ADC Telecommunications, Inc. (NON) 448,756,413
1,213,000 Advanced Fibre Communications (NON) 52,007,375
1,165,600 Brocade Communications Systems (NON) 208,205,300
16,724,250 Cisco Systems, Inc. (NON) 1,094,393,109
2,563,200 Comverse Technology, Inc. (NON) 224,920,800
958,900 Corning, Inc. 224,322,669
311,100 Extreme Networks, Inc. (NON) 43,442,198
848,800 Foundry Networks, Inc. (NON) 69,442,450
1,509,426 Juniper Networks, Inc. (NON) 214,998,866
1,226,000 Lucent Technologies, Inc. 53,637,500
11,583,600 Nokia Oyj AB Class A, (Finland) 513,051,359
2,698,300 Nokia Oyj ADR (Finland) 119,568,419
2,626,800 Nortel Networks Corp. (Canada) 195,368,250
3,014,700 QUALCOMM, Inc. (NON) 195,767,081
506,000 Redback Networks, Inc. (NON) 65,780,000
1,501,600 Tellabs, Inc. (NON) 97,604,000
----------------
3,821,265,789
Computers (4.3%)
-------------------------------------------------------------------------------------------------------------------
1,129,000 Apple Computer, Inc. (NON) 57,367,313
220,000 Ariba, Inc. (NON) 25,506,250
8,826,150 Dell Computer Corp. (NON) 387,798,966
4,151,100 EMC Corp. (NON) 353,362,388
1,923,400 Gateway, Inc. (NON) 106,147,638
213,200 Hewlett-Packard Co. 23,278,775
642,100 IBM Corp. 72,196,119
126,500 Inktomi Corp. (NON) 13,535,500
56,700 Lexmark International Group, Inc. Class A (NON) 2,555,044
8,690,564 Parametric Technology Corp. (NON) 86,905,640
1,098,800 RealNetworks, Inc. (NON) 46,630,325
3,089,000 Sun Microsystems, Inc. (NON) 325,696,438
1,981,100 VeriSign, Inc. (NON) 314,375,806
----------------
1,815,356,202
Conglomerates (3.3%)
-------------------------------------------------------------------------------------------------------------------
14,853,050 General Electric Co. 764,003,759
186,000 Honeywell International, Inc. 6,254,250
11,854,100 Tyco International, Ltd. 634,194,350
----------------
1,404,452,359
Consumer Cyclicals (1.1%)
-------------------------------------------------------------------------------------------------------------------
5,095,600 Sony Corp. (Japan) 468,395,180
Consumer Finance (0.9%)
-------------------------------------------------------------------------------------------------------------------
345,000 Capital One Financial Corp. 20,225,625
5,740,200 MBNA Corp. 191,579,175
1,753,500 Providian Financial Corp. 178,747,406
----------------
390,552,206
Consumer Goods (0.4%)
-------------------------------------------------------------------------------------------------------------------
452,000 Colgate-Palmolive Co. 25,170,750
146,800 Estee Lauder Cos. Class A 6,459,200
2,265,700 Kimberly-Clark Corp. 130,136,144
----------------
161,766,094
Consumer Services (0.2%)
-------------------------------------------------------------------------------------------------------------------
989,600 TMP Worldwide, Inc. (NON) 71,251,200
Electric Utilities (0.2%)
-------------------------------------------------------------------------------------------------------------------
664,400 Calpine Corp. (NON) 47,338,500
100,000 Duke Energy Corp. 6,168,750
967,300 FPL Group, Inc. 46,672,225
----------------
100,179,475
Electronics (16.1%)
-------------------------------------------------------------------------------------------------------------------
892,150 Agilent Technologies, Inc. (NON) 36,355,113
3,674,150 Altera Corp. (NON) 360,755,603
3,990,000 Analog Devices, Inc. (NON) 266,831,250
50,000 Applied Micro Circuits Corp. (NON) 7,462,500
582,400 Broadcom Corp. (NON) 130,603,200
3,337,600 Celestica, Inc. (Canada) (NON) 208,600,000
4,676,250 Flextronics International, Ltd. (NON) 331,063,887
13,385,400 Intel Corp. 893,475,450
3,415,400 Jabil Circuit, Inc. (NON) 170,983,463
4,730,360 JDS Uniphase Corp. (NON) 558,773,775
12,643,664 Linear Technology Corp. 698,562,436
8,135,400 LSI Logic Corp. (NON) 275,586,675
10,195,392 Maxim Integrated Products, Inc. (NON) 673,533,084
2,707,300 Micron Technology, Inc. (NON) 220,644,950
5,140,450 Motorola, Inc. 169,956,128
1,791,500 PMC - Sierra, Inc. (NON) 347,215,094
233,000 QLogic Corp. (NON) 17,358,500
838,400 RF Micro Devices, Inc. (NON) 63,194,400
599,450 Rohm Co., Ltd. (Japan) 157,318,005
2,667,708 Sanmina Corp. (NON) 247,763,381
159,000 SCI Systems, Inc. (NON) 7,294,125
1,029,400 SDL, Inc. (NON) 357,266,138
280,800 Solectron Corp. (NON) 11,319,750
2,526,100 STMicroelectronics N.V. ADR (France) 143,829,819
1,552,800 Texas Instruments, Inc. 91,129,950
1,357,600 Vitesse Semiconductor Corp. (NON) 80,946,900
4,022,300 Xilinx, Inc. (NON) 301,923,894
----------------
6,829,747,470
Energy (2.1%)
-------------------------------------------------------------------------------------------------------------------
1,531,400 Baker Hughes, Inc. 53,024,725
1,738,950 Cooper Cameron Corp. (NON) 112,379,644
2,373,600 Halliburton Co. 109,482,300
1,462,350 Nabors Industries, Inc. (NON) 60,870,319
6,081,100 Schlumberger, Ltd. 449,621,331
2,492,462 Transocean Sedco Forex, Inc. 123,376,869
----------------
908,755,188
Entertainment (3.4%)
-------------------------------------------------------------------------------------------------------------------
951,850 SFX Entertainment, Inc. Class A (NON) 43,785,100
21,216,241 Viacom, Inc. Class B (NON) 1,406,901,981
----------------
1,450,687,081
Financial (2.2%)
-------------------------------------------------------------------------------------------------------------------
3,188,900 American Express Co. 180,770,769
9,077,809 Citigroup, Inc. 640,552,898
1,083,000 Fannie Mae 54,014,625
1,068,850 Freddie Mac 42,152,772
----------------
917,491,064
Health Care Services (0.9%)
-------------------------------------------------------------------------------------------------------------------
180,000 Baxter International, Inc. 13,995,000
168,900 Cardinal Health, Inc. 12,414,150
4,929,200 HCA-The Healthcare Corp. 167,592,800
2,534,950 United Health Group Incorporated 207,390,597
----------------
401,392,547
Insurance (1.4%)
-------------------------------------------------------------------------------------------------------------------
3,189,850 AFLAC, Inc. 165,672,834
2,021,000 American General Corp. 134,775,438
3,536,343 American International Group, Inc. 310,093,077
----------------
610,541,349
Investment Banking/Brokerage (1.7%)
-------------------------------------------------------------------------------------------------------------------
1,725,100 Merrill Lynch & Co., Inc. 222,969,175
2,088,200 Morgan Stanley, Dean Witter, Discover and Co. 190,548,250
8,209,200 Schwab (Charles) Corp. 296,557,350
----------------
710,074,775
Manufacturing (0.1%)
-------------------------------------------------------------------------------------------------------------------
150,000 Danaher Corp. 7,640,625
98,400 Illinois Tool Works, Inc. 5,633,400
1,312,955 Thermo Electron Corp. (NON) 27,243,816
----------------
40,517,841
Media (--%)
-------------------------------------------------------------------------------------------------------------------
206,300 Time Warner, Inc. 15,820,631
Medical Technology (1.8%)
-------------------------------------------------------------------------------------------------------------------
180,200 Allergan, Inc. 12,062,138
119,200 Bausch & Lomb, Inc. 7,412,750
7,638,190 Medtronic, Inc. 390,025,077
401,400 PE Corp.-PE Biosystems Group 34,997,063
256,400 St. Jude Medical, Inc. (NON) 10,576,500
3,253,300 Stryker Corp. 139,688,569
2,615,832 Sybron International Corp. (NON) 54,442,004
1,544,125 Thermo Cardiosystems, Inc. (NON) 14,669,188
672,528 Waters Corp. (NON) 79,778,634
----------------
743,651,923
Natural Gas Utilities (0.4%)
-------------------------------------------------------------------------------------------------------------------
1,230,300 Coastal Corp. 71,049,825
1,449,700 Enron Corp. 106,734,163
----------------
177,783,988
Oil & Gas (1.4%)
-------------------------------------------------------------------------------------------------------------------
300,000 Anadarko Petroleum Corp. 14,343,750
2,865,700 BP Amoco PLC ADR (United Kingdom) 149,911,931
1,236,700 Conoco, Inc. 27,671,163
2,797,000 Conoco, Inc. Class B 64,505,813
400,000 ExxonMobil Corp. 32,000,000
2,748,000 Noble Drilling Corp. (NON) 119,709,750
1,019,600 Royal Dutch Petroleum Co. PLC ADR (Netherlands) 59,391,700
1,957,900 Total Fina ELF S.A. ADR (France) 144,028,019
----------------
611,562,126
Pharmaceuticals (6.0%)
-------------------------------------------------------------------------------------------------------------------
334,000 Abbott Laboratories 13,902,750
135,900 Alza Corp. (NON) 8,799,525
6,500,000 American Home Products Corp. 344,906,250
895,000 Bristol-Myers Squibb Co. 44,414,375
1,382,000 Johnson & Johnson 128,612,375
1,716,200 Lilly (Eli) & Co. 178,270,275
929,300 Merck & Co., Inc. 66,619,194
24,534,875 Pfizer, Inc. 1,058,066,484
10,050,608 Pharmacia Corp. 550,270,788
3,379,600 Schering-Plough Corp. 145,956,475
----------------
2,539,818,491
Restaurants (0.7%)
-------------------------------------------------------------------------------------------------------------------
9,274,110 J.D. Wetherspoon PLC (United Kingdom) 50,271,129
6,044,461 Starbucks Corp. (NON) 226,667,288
----------------
276,938,417
Retail (6.1%)
-------------------------------------------------------------------------------------------------------------------
4,184,050 Bed Bath & Beyond, Inc. (NON) 154,025,341
776,500 Best Buy Co., Inc. (NON) 56,490,375
1,641,900 Circuit City Stores, Inc. 37,661,081
4,999,700 Costco Wholesale Corp. (NON) 162,802,731
247,400 CVS Corp. 9,756,838
5,725,935 Dollar Tree Stores, Inc. (AFF) (NON) 243,710,108
286,600 Gap, Inc. (The) 10,263,863
7,236,550 Home Depot, Inc. (The) 374,491,463
8,783,996 Kohls Corp. (NON) 498,491,773
365,800 Lowe's Cos., Inc. 15,432,188
1,535,837 Michaels Stores, Inc. (NON) 66,520,940
5,031,715 RadioShack Corp. 283,662,933
232,000 Safeway, Inc. (NON) 10,454,500
4,023,000 Target Corp. 116,667,000
8,594,587 TJX Cos., Inc. (The) 143,959,332
7,035,800 Wal-Mart Stores, Inc. 386,529,263
----------------
2,570,919,729
Semiconductor (1.9%)
-------------------------------------------------------------------------------------------------------------------
4,961,500 Applied Materials, Inc. (NON) 376,453,813
2,632,200 ASM Lithography Holding NV (Netherlands) (NON) 104,629,950
2,934,960 KLA Tencor Corp. (NON) 156,286,620
2,152,600 LAM Research Corp. (NON) 62,963,550
1,913,320 Teradyne, Inc. (NON) 121,256,655
----------------
821,590,588
Software (6.6%)
-------------------------------------------------------------------------------------------------------------------
93,900 Adobe Systems, Inc. 10,751,550
2,660,900 Amdocs Ltd. (NON) 178,779,219
200,000 BEA Systems, Inc. (NON) 8,612,500
213,715 BMC Software, Inc. (NON) 4,033,871
258,700 Computer Associates International, Inc. 6,418,994
2,409,652 Electronic Arts, Inc.(NON) 213,103,599
3,137,587 Intuit, Inc. (NON) 106,677,958
1,437,500 I2 Technologies, Inc. (NON) 186,515,625
2,649,400 Lernout & Hauspie Speech Products NV (Belgium) (NON) 82,462,575
470,000 Macromedia, Inc. (NON) 35,955,000
8,217,400 Microsoft Corp. (NON) (SEG) 573,677,220
8,988,600 Oracle Corp. (NON) 675,830,363
1,753,200 Portal Software, Inc. (NON) 88,290,056
1,134,500 Rational Software Corp. (NON) 115,435,375
439,800 Siebel Systems, Inc. (NON) 63,771,000
3,749,250 VERITAS Software Corp. (NON) 382,189,172
2,400,000 Vignette Corp. (NON) 81,300,000
----------------
2,813,804,077
Technology Services (1.7%)
-------------------------------------------------------------------------------------------------------------------
1,294,700 America Online, Inc. (NON) 69,023,694
126,700 Automatic Data Processing, Inc. 6,279,569
570,200 CheckFree Holdings Corp. (NON) 34,639,650
3,112,000 Convergys Corp. (NON) 140,234,500
4,251,600 Electronic Data Systems Corp. 182,818,800
2,106,000 InfoSpace.com, Inc. (NON) 71,077,500
467,000 Sapient Corp. (NON) 53,121,250
1,136,150 Yahoo! Inc. (NON) 146,208,303
----------------
703,403,266
Telecommunications (5.4%)
-------------------------------------------------------------------------------------------------------------------
1,506,750 Allegiance Telecom, Inc. (NON) 83,718,797
202,100 ALLTEL Corp. 12,454,413
4,954,000 American Tower Corp. Class A (NON) 212,402,750
3,306,755 Covad Communications Group, Inc. 144A (NON) 54,561,458
217,400 Focal Communications Corp. (NON) 8,070,975
2,323,918 Global Crossing Ltd. (Bermuda) (NON) 56,500,256
2,885,466 Global Telesystems Group, Inc. (NON) 24,526,461
894,500 Level 3 Communication, Inc. (NON) 61,217,344
12,528,600 McLeodUSA, Inc. Class A (NON) 212,203,163
14,077,200 Metromedia Fiber Network, Inc. Class A (NON) 494,461,650
799,300 Nextel Communications, Inc. Class A (NON) 44,710,844
7,840,980 NEXTLINK Communications, Inc. Class A (NON) 259,242,401
1,741,613 NTL, Inc. (NON) 78,481,436
627,600 Pinnacle Holdings, Inc. (NON) 35,263,275
150,000 Qwest Communications International, Inc. (NON) 7,040,625
235,000 SBC Communications, Inc. 10,002,188
3,893,600 Sprint Corp. (PCS Group) (NON) 215,121,400
408,500 Sprint Corp. 14,552,813
354,000 TyCom, Ltd. (Bermuda) (NON) 12,058,125
4,969,550 Vodaphone Group PLC (United Kingdom) 214,311,844
855,000 VoiceStream Wireless Corp. (NON) 109,653,750
1,016,450 WinStar Communications, Inc. (NON) 30,747,613
819,500 Worldcom, Inc. (NON) 32,011,719
----------------
2,283,315,300
----------------
Total Common Stocks (cost $23,753,845,312) $ 39,375,966,141
COMMERCIAL PAPER (6.5%) (a)
PRINCIPAL AMOUNT VALUE
-------------------------------------------------------------------------------------------------------------------
$ 100,000,000 Asset Securitization Corp. effective yield of 6.50%,
August 2, 2000 $ 99,981,944
100,000,000 Associates First Capital effective yield of 6.52%,
August 2, 2000 99,619,667
100,000,000 Banc One Corp. effective yield of 6.57%,
August 16, 2000 99,726,250
93,000,000 Ciesco L.P. effective yield 6.50%, September 8, 2000 92,361,917
100,000,000 Commerzbank USA effective yield 6.50%, September 25, 2000 99,006,944
50,000,000 Corporate Asset FDG effective yield 6.51%, August 14, 2000 49,882,458
100,000,000 Corporate Receivables effective yield 6.51%, August 11, 2000 99,819,167
50,000,000 Credit Suisse First Boston effective yield 6.52%,
August 18. 2000 49,846,056
55,500,000 cxc Incorporated effective yield 6.53%, September 25, 2000 54,946,310
75,000,000 DaimlerChrysler effective yield 6.49%, August 4, 2000 74,959,438
100,000,000 Dresdner US Finance effective yield 6.50%, August 15, 2000 99,747,222
75,000,000 Eureka Securitization effective yield 6.52%, August 24, 2000 74,687,583
90,000,000 Falcon Asset Security Corp. effective yield 6.52%,
August 30, 2000 89,527,300
150,000,000 Federal Home Loan Mortgage effective yield 6.43%,
August 8, 2000 149,812,458
100,000,000 Federal Home Loan Mortgage effective yield 6.41%,
August 29, 2000 99,501,444
200,000,000 Federal Home Loan Mortgage effective yield 6.39%,
August 25, 2000 199,148,000
100,000,000 Fleet Financial Group effective yield 6.50%, August 23, 2000 99,602,778
100,000,000 General Electric Capital effective yield 6.50%, August 21, 2000 99,638,889
100,000,000 Goldman Sachs Group effective yield 6.54%, August 18, 2000 99,691,167
100,000,000 Goldman Sachs Group effective yield 6.51%, August 9, 2000 99,855,333
50,000,000 IBM Corp effective yield 6.49%, August 14, 2000 49,882,819
92,000,000 National Australia Funding Corp. effective yield 6.49%,
August 7, 2000 91,900,487
50,000,000 Nordbanken NA Inc. effective yield 6.50%, August 11, 2000 49,909,722
100,000,000 Salomon Smith Barney effective yield 6.54%, August 3, 2000 99,963,667
125,000,000 Salomon Smith Barney effective yield 6.52%, August 24, 2000 124,479,306
100,000,000 Sheffield Receivables Corp. effective yield 6.52%,
August 10, 2000 99,837,000
91,000,000 Sigma Finance effective yield 6.66%, August 15, 2000 90,765,860
100,000,000 Venture Business Trust effective yield 6.53%, August 17, 2000 99,709,778
100,000,000 Windmill Funding effective yield 6.53%, August 9, 2000 99,854,889
----------------
Total Commercial Paper (cost $2,737,665,853) $ 2,737,665,853
SHORT-TERM INVESTMENTS (0.8%) (a)
PRINCIPAL AMOUNT VALUE
-------------------------------------------------------------------------------------------------------------------
$76,761,000 Interest in $500,000,000 joint repurchase agreement dated
July 31, 2000 with Goldman Sachs & Co. due
August 1, 2000 with respect to various U.S. Treasury
obligations -- maturity value of $76,775,009 for an
effective yield of 6.57% $ 76,761,000
148,513,000 Interest in $600,000,000 joint repurchase agreement dated
July 31, 2000 with S.B.C. Warburg Inc. due August 1, 2000
with respect to various U.S. Treasury obligations --
maturity value of $148,540,186 for an effective yield
of 6.59% 148,513,000
127,924,000 Interest in $500,000,000 joint tri-party repurchase agreement
dated July 31, 2000 with Lehman Brothers Inc. due
August 1, 2000 with respect to various U.S. Treasury
obligations -- maturity value of $127,947,382 for an
effective yield of 6.58% 127,924,000
----------------
Total Short-Term Investments (cost $353,198,000) $ 353,198,000
-------------------------------------------------------------------------------------------------------------------
Total Investments (cost $26,844,709,165) (b) $ 42,466,829,994
-------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $42,323,966,152.
(b) The aggregate identified cost on a tax basis is $27,014,673,257
resulting in gross unrealized appreciation and depreciation of
$16,572,133,884 and $1,119,977,147 respectively, or net unrealized
appreciation of $15,452,156,737.
(NON) Non-income-producing security.
(AFF) Affiliated Companies (Note 5).
(SEG) A portion of this security was pledged and segregated with the
custodian to cover margin requirements for futures contracts at July 31,
2000.
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.
ADR after the name of a foreign holding stands for American
Depositary Receipts representing ownership of foreign securities on
deposit with a domestic custodian bank.
-----------------------------------------------------------------------------
Forward Currency Contracts to Sell at July 31, 2000
Market Aggregate Face Delivery Unrealized
Value Value Date Appreciation
-----------------------------------------------------------------------------
Japanese Yen $17,882,646 $18,547,881 9/20/2000 $665,235
-----------------------------------------------------------------------------
Futures Contracts Outstanding at July 31, 2000
Market Aggregate Face Expiration Unrealized
Value Value Date Depreciation
-----------------------------------------------------------------------------
S&P 500 Index
(Long) $2,217,344,900 $2,294,284,744 Sep-00 $(76,939,844)
-----------------------------------------------------------------------------
-------------------------------------------------------------------------
Swap Contracts Outstanding at July 31, 2000
Unrealized
Notional Termination Appreciation/
Amount Date (Depreciation)
-------------------------------------------------------------------------
Agreement with Lehman
Brothers, Inc. Dated
July 10, 2000 to
receive (pay) the
notional amount
multiplied by the
return of General
Electric, Co. and pay
the notional amount
multiplied by twelve
month LIBOR adjusted
by a specified
spread. $26,206,650 Jul-01 $(591,100)
Agreement with Lehman
Brothers, Inc. Dated
July 11, 2000 to
receive (pay) the
notional amount
multiplied by the
return of General
Electric, Co. and pay
the notional amount
multiplied by twelve
month LIBOR adjusted
by a specified
spread. 45,607,692 Jul-01 (1,541,808)
Agreement with Lehman
Brothers, Inc. Dated
July 10, 2000 to
receive (pay) the
notional amount
multiplied by the
return of Microsoft
and pay the notional
amount multiplied by
twelve month LIBOR
adjusted by a
specified
spread. 40,134,250 Jul-01 (5,386,000)
Agreement with Salomon
Brothers Holding Co.
Dated June 29, 2000 to
receive (pay) the
notional amount
multiplied by the
return of General
Electric, Co. and pay
the notional amount
multiplied by twelve
month LIBOR adjusted
by a specified
spread. 150,970,200 Jul-01 2,480,490
Agreement with Salomon
Brothers Holding Co.
Dated June 23, 2000 to
receive (pay) the
notional amount
multiplied by the
return of Microsoft
and pay the notional
amount multiplied by
twelve month LIBOR
adjusted by a
specified
spread. 233,062,500 Jun-01 (25,304,610)
Agreement with Salomon
Brothers Holding Co.
Dated June 26, 2000 to
receive (pay) the
notional amount
multiplied by the
return of Microsoft
and pay the notional
amount multiplied by
two month LIBOR
adjusted by a
specified
spread. 27,476,165 Aug-00 (3,379,781)
--------------------------------------------------------------------------
$(33,722,809)
--------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<S> <C>
Assets
-------------------------------------------------------------------------------------------
Investments in securities, at value
(identified cost $26,844,709,165) (Note 1) $42,466,829,994
-------------------------------------------------------------------------------------------
Cash 2,897,038
-------------------------------------------------------------------------------------------
Foreign currency (cost $6,366) 5,802
-------------------------------------------------------------------------------------------
Dividends, interest and other receivables 3,683,501
-------------------------------------------------------------------------------------------
Receivable for shares of the fund sold 72,163,326
-------------------------------------------------------------------------------------------
Receivable for securities sold 240,648,522
-------------------------------------------------------------------------------------------
Receivable for variation margin 10,799,627
-------------------------------------------------------------------------------------------
Receivable for open swap contracts (Note 1) 2,480,490
-------------------------------------------------------------------------------------------
Receivable for open forward currency contracts 665,235
-------------------------------------------------------------------------------------------
Total assets 42,800,173,535
Liabilities
-------------------------------------------------------------------------------------------
Payable for securities purchased 322,424,206
-------------------------------------------------------------------------------------------
Payable for shares of the fund repurchased 42,744,390
-------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 47,745,434
-------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 6,880,771
-------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 710,466
-------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 5,392
-------------------------------------------------------------------------------------------
Payable for distribution fees (Note 2) 16,641,651
-------------------------------------------------------------------------------------------
Payable for open swap contracts (Note 1) 36,203,299
-------------------------------------------------------------------------------------------
Other accrued expenses 2,851,774
-------------------------------------------------------------------------------------------
Total liabilities 476,207,383
-------------------------------------------------------------------------------------------
Net assets $42,323,966,152
Represented by
-------------------------------------------------------------------------------------------
Paid-in capital (Notes 1 and 4) $24,038,308,853
-------------------------------------------------------------------------------------------
Accumulated net investment loss (Note 1) (665,235)
-------------------------------------------------------------------------------------------
Accumulated net realized gain on investments
and foreign currency transactions (Note 1) 2,774,197,831
-------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and assets
and liabilities in foreign currencies 15,512,124,703
-------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $42,323,966,152
Computation of net asset value and offering price
-------------------------------------------------------------------------------------------
Net asset value and redemption price per class A share
($25,277,820,266 divided by 836,597,597 shares) $30.22
-------------------------------------------------------------------------------------------
Offering price per class A share (100/94.25 of $30.22)* $32.06
-------------------------------------------------------------------------------------------
Net asset value and offering price per class B share
($11,692,069,651 divided by 422,458,838 shares)** $27.68
-------------------------------------------------------------------------------------------
Net asset value and offering price per class C share
($219,658,395 divided by 7,321,511 shares)** $30.00
-------------------------------------------------------------------------------------------
Net asset value and redemption price per class M share
($674,783,735 divided by 23,107,041 shares) $29.20
-------------------------------------------------------------------------------------------
Offering price per class M share (100/96.50 of $29.20)* $30.26
-------------------------------------------------------------------------------------------
Net asset value, offering price and redemption price per class Y share
($4,459,634,105 divided by 144,368,571 shares) $30.89
-------------------------------------------------------------------------------------------
* 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
contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
Year ended July 31, 2000
<S> <C>
Investment income:
-------------------------------------------------------------------------------------------
Dividends (net of foreign tax of $1,779,006) $115,791,276
-------------------------------------------------------------------------------------------
Interest 61,622,064
-------------------------------------------------------------------------------------------
Total investment income 177,413,340
Expenses:
-------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 171,331,887
-------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 48,738,600
-------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 400,301
-------------------------------------------------------------------------------------------
Administrative services (Note 2) 66,212
-------------------------------------------------------------------------------------------
Distribution fees -- Class A (Note 2) 57,049,356
-------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 109,126,729
-------------------------------------------------------------------------------------------
Distribution fees -- Class C (Note 2) 895,892
-------------------------------------------------------------------------------------------
Distribution fees -- Class M (Note 2) 4,101,237
-------------------------------------------------------------------------------------------
Other 10,669,927
-------------------------------------------------------------------------------------------
Total expenses 402,380,141
-------------------------------------------------------------------------------------------
Expense reduction (Note 2) (7,266,819)
-------------------------------------------------------------------------------------------
Net expenses 395,113,322
-------------------------------------------------------------------------------------------
Net investment loss (217,699,982)
-------------------------------------------------------------------------------------------
Net realized gain on investments (Notes 1, 3 and 5) (including realized
gain of $6,936,391 on sales of investments in affiliated issuers) 3,806,246,789
-------------------------------------------------------------------------------------------
Net realized gain on futures contracts (Notes 1 and 3) 28,684,254
-------------------------------------------------------------------------------------------
Net realized loss on foreign currency transactions (Note 1) (1,516,135)
-------------------------------------------------------------------------------------------
Net unrealized appreciation of assets and liabilities in
foreign currencies during the year 1,987,799
-------------------------------------------------------------------------------------------
Net unrealized appreciation of investments,
swap contracts and futures during the year 6,945,419,830
-------------------------------------------------------------------------------------------
Net gain on investments 10,780,822,537
-------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $10,563,122,555
-------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS
Year ended July 31
---------------------------------
2000 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C>
Increase in net assets
--------------------------------------------------------------------------------------------------
Operations:
--------------------------------------------------------------------------------------------------
Net investment loss $ (217,699,982) $ (116,710,236)
--------------------------------------------------------------------------------------------------
Net realized gain on investments and foreign
currency transactions 3,833,414,908 3,128,249,015
--------------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and
assets and liabilities in foreign currencies 6,947,407,629 2,078,777,713
--------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 10,563,122,555 5,090,316,492
--------------------------------------------------------------------------------------------------
Distributions to shareholders:
--------------------------------------------------------------------------------------------------
From net realized gain on investments
Class A (2,110,408,905) (1,042,857,172)
--------------------------------------------------------------------------------------------------
Class B (1,110,093,903) (569,436,634)
--------------------------------------------------------------------------------------------------
Class C (3,378,753) --
--------------------------------------------------------------------------------------------------
Class M (49,685,399) (25,276,938)
--------------------------------------------------------------------------------------------------
Class Y (332,630,167) (106,713,548)
--------------------------------------------------------------------------------------------------
Increase from capital share transactions (Note 4) 6,955,406,877 2,148,949,675
--------------------------------------------------------------------------------------------------
Total increase in net assets 13,912,332,305 5,494,981,875
Net assets
--------------------------------------------------------------------------------------------------
Beginning of year 28,411,633,847 22,916,651,972
--------------------------------------------------------------------------------------------------
End of year (including accumulated net investment loss
and undistributed net investment income of $665,235
and $520,397, respectively) $42,323,966,152 $28,411,633,847
--------------------------------------------------------------------------------------------------
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
------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended July 31
------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $24.25 $21.36 $19.49 $15.73 $14.42
------------------------------------------------------------------------------------------------
Investment operations
------------------------------------------------------------------------------------------------
Net investment loss (c) (.11) (.05) (.04) -- (.02)
------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 9.06 4.53 3.12 4.85 2.19
------------------------------------------------------------------------------------------------
Total from
investment operations 8.95 4.48 3.08 4.85 2.17
------------------------------------------------------------------------------------------------
Less distributions:
------------------------------------------------------------------------------------------------
From net realized gain
on investments (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Total distributions (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Net asset value,
end of period $30.22 $24.25 $21.36 $19.49 $15.73
------------------------------------------------------------------------------------------------
Ratios and supplemental data
------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 37.76 22.40 16.83 32.22 15.49
------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $25,277,820 $17,180,288 $13,854,611 $11,158,273 $7,332,248
------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .86 .90 .96 1.02 1.03
------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.37) (.25) (.20) -- (.10)
------------------------------------------------------------------------------------------------
Portfolio turnover (%) 76.95 85.05 60.04 59.77 57.92
------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through brokerage services and expense
offset arrangements (Note 2).
(c) Per share net investment income (loss) has been determined on the
basis of weighted average number of shares outstanding during the
period.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS B
------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended July 31
------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $22.57 $20.14 $18.57 $15.15 $14.01
------------------------------------------------------------------------------------------------
Investment operations
------------------------------------------------------------------------------------------------
Net investment loss (c) (.31) (.21) (.18) (.12) (.13)
------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 8.40 4.23 2.96 4.63 2.13
------------------------------------------------------------------------------------------------
Total from
investment operations 8.09 4.02 2.78 4.51 2.00
------------------------------------------------------------------------------------------------
Less distributions:
------------------------------------------------------------------------------------------------
From net realized gain
on investments (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Total distributions (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Net asset value,
end of period $27.68 $22.57 $20.14 $18.57 $15.15
------------------------------------------------------------------------------------------------
Ratios and supplemental data
------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 36.69 21.43 16.02 31.17 14.70
------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $11,692,070 $8,433,131 $7,263,280 $5,664,375 $3,405,318
------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) 1.61 1.65 1.71 1.77 1.78
------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (1.12) (1.00) (.95) (.75) (.85)
------------------------------------------------------------------------------------------------
Portfolio turnover (%) 76.95 85.05 60.04 59.77 57.92
------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through brokerage services and expense
offset arrangements (Note 2).
(c) Per share net investment income (loss) has been determined on the
basis of weighted average number of shares outstanding during the
period.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS C
----------------------------------------------------------------
For the period
Per-share Year ended July 26, 1999+
operating performance July 31 to July 31
----------------------------------------------------------------
2000 1999
----------------------------------------------------------------
<S> <C> <C>
Net asset value,
beginning of period $24.25 $24.64
----------------------------------------------------------------
Investment operations
----------------------------------------------------------------
Net investment loss (c) (.33) --
----------------------------------------------------------------
Net realized and unrealized
gain (loss) on investments 9.06 (.39)
----------------------------------------------------------------
Total from
investment operations 8.73 (.39)
----------------------------------------------------------------
Less distributions:
----------------------------------------------------------------
From net realized gain
on investments (2.98) --
----------------------------------------------------------------
Total distributions (2.98) --
----------------------------------------------------------------
Net asset value,
end of period $30.00 $24.25
----------------------------------------------------------------
Ratios and supplemental data
----------------------------------------------------------------
Total return at
net asset value (%)(a) 36.79 (1.58)*
----------------------------------------------------------------
Net assets, end of period
(in thousands) $219,658 $822
----------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) 1.61 .03*
----------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (1.09) (.02)*
----------------------------------------------------------------
Portfolio turnover (%) 76.95 85.05
----------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through brokerage services and expense
offset arrangements (Note 2).
(c) Per share net investment income (loss) has been determined on the
basis of weighted average number of shares outstanding during the
period.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS M
------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended July 31
------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $23.61 $20.93 $19.22 $15.60 $14.37
------------------------------------------------------------------------------------------------
Investment operations
------------------------------------------------------------------------------------------------
Net investment loss (c) (.25) (.16) (.14) (.08) (.09)
------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 8.82 4.43 3.06 4.79 2.18
------------------------------------------------------------------------------------------------
Total from
investment operations 8.57 4.27 2.92 4.71 2.09
------------------------------------------------------------------------------------------------
Less distributions:
------------------------------------------------------------------------------------------------
From net realized gain
on investments (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Total distributions (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Net asset value,
end of period $29.20 $23.61 $20.93 $19.22 $15.60
------------------------------------------------------------------------------------------------
Ratios and supplemental data
------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 37.13 21.83 16.21 31.57 14.97
------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $674,784 $390,975 $322,277 $208,656 $87,782
------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) 1.36 1.40 1.46 1.52 1.50
------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.87) (.75) (.69) (.50) (.57)
------------------------------------------------------------------------------------------------
Portfolio turnover (%) 76.95 85.05 60.04 59.77 57.92
------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through brokerage services and expense
offset arrangements (Note 2).
(c) Per share net investment income (loss) has been determined on the
basis of weighted average number of shares outstanding during the
period.
</TABLE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period)
CLASS Y
------------------------------------------------------------------------------------------------
Per-share
operating performance Year ended July 31
------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $24.69 $21.66 $19.70 $15.85 $14.48
------------------------------------------------------------------------------------------------
Investment operations
------------------------------------------------------------------------------------------------
Net investment income (loss)(c) (.04) -- .01 .04 .02
------------------------------------------------------------------------------------------------
Net realized and unrealized
gain on investments 9.22 4.62 3.16 4.90 2.21
------------------------------------------------------------------------------------------------
Total from
investment operations 9.18 4.62 3.17 4.94 2.23
------------------------------------------------------------------------------------------------
Less distributions:
------------------------------------------------------------------------------------------------
From net realized gain
on investments (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Total distributions (2.98) (1.59) (1.21) (1.09) (.86)
------------------------------------------------------------------------------------------------
Net asset value,
end of period $30.89 $24.69 $21.66 $19.70 $15.85
------------------------------------------------------------------------------------------------
Ratios and supplemental data
------------------------------------------------------------------------------------------------
Total return at
net asset value (%)(a) 38.04 22.75 17.12 32.56 15.85
------------------------------------------------------------------------------------------------
Net assets, end of period
(in thousands) $4,459,634 $2,406,418 $1,476,485 $1,061,087 $709,595
------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b) .61 .65 .71 .77 .77
------------------------------------------------------------------------------------------------
Ratio of net investment income
(loss) to average net assets (%) (.12) -- .06 .25 .15
------------------------------------------------------------------------------------------------
Portfolio turnover (%) 76.95 85.05 60.04 59.77 57.92
------------------------------------------------------------------------------------------------
+ Commencement of operations.
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Includes amounts paid through brokerage services and expense
offset arrangements (Note 2).
(c) Per share net investment income (loss) has been determined on the
basis of weighted average number of shares outstanding during the
period.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
July 31, 2000
Note 1
Significant accounting policies
Putnam Voyager Fund (the "fund") is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The fund invests primarily in common stocks of
companies that Putnam Investment Management, Inc. ("Putnam Management"),
the fund's manager, a wholly-owned subsidiary of Putnam Investments,
Inc., believes have potential for capital appreciation significantly
greater than that of the market averages.
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 and class C 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 Management.
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 that 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 sales price on its principal exchange, or if no sales
are reported -- as in the case of some securities traded
over-the-counter -- the last reported bid price. Short-term investments
having remaining maturities of 60 days or less are stated at amortized
cost, which approximates market value. Other investments, including
restricted securities, are stated at fair value following procedures
approved by the Trustees. Market quotations are not considered to be
readily available for certain debt obligations; such investments are
stated at fair value on the basis of valuations furnished by a pricing
service or dealers, approved by the Trustees, which determine valuations
for normal institutional-size trading units of such securities using
methods based on market transactions for comparable securities and
variable relationships between securities that are generally recognized
by institutional traders.
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 Management. 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). 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. Non-cash dividends, if any, are
recorded at the fair market value of the securities received.
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) Equity swap contracts The fund may engage in swap agreements, which
are agreements to exchange the return generated by one instrument for
the return generated by another instrument. To manage its exposure in
equity markets, the fund may enter into equity swap agreements, which
involve a commitment by one party to pay interest in exchange for a
market-linked return based on a notional amount. To the extent that the
total return of the security or index underlying the transaction exceeds
or falls short of the offsetting interest rate obligation, the fund will
receive a payment from or make a payment to the counterparty,
respectively. Equity swaps are marked to market daily based upon
quotations from market makers and the change, if any, is recorded as
unrealized gain or loss. Payments received or made at the end of the
measurement period are recorded as realized gains or losses. The fund
could be exposed to credit or market risk due to unfavorable changes in
the fluctuation of interest rates or in the price of the underlying
security or index, the possibility that there is no liquid market for
these agreements or that the counterparty may default on its obligation
to perform.
H) Futures and options contracts The fund may use futures and options
contracts to hedge against changes in the values of securities the fund
owns or expects to purchase. The fund may also write options on
securities it owns or in which it may invest to increase its current
returns. The potential risk to the fund is that the change in value of
futures and options contracts may not correspond to the change in value
of the hedged instruments. In addition, losses may arise from changes in
the value of the underlying instruments, if there is an illiquid
secondary market for the contracts, or if the counterparty to the
contract is unable to perform. 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. Realized gains and losses on purchased options are
included in realized gains and losses on investment securities. Futures
contracts are valued at the quoted daily settlement prices established
by the exchange on which they trade. Exchange traded options are valued
at the last sale price, or if no sales are reported, the last bid price
for purchased options and the last ask price for written options.
Options traded over-the-counter are valued using prices supplied by
dealers.
I) 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 year ended
July 31, 2000, the fund had no borrowings against the line of credit.
J) 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.
K) 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. These differences
include temporary and permanent differences of losses on wash sale
transactions, foreign currency gains and losses, unrealized gains and
losses on certain futures contracts, net operating loss and book
amortization. For the year ended July 31, 2000, the fund reclassified
$216,514,350 to decrease accumulated net investment loss and $471 to
increase paid-in-capital, with a decrease to accumulated net realized
gains of $216,514,821. The calculation of net investment income per
share in the financial highlights table excludes these adjustments.
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 for the quarter. Such fee is based on the following annual
rates: 0.70% of the first $500 million of average net assets, 0.60% of
the next $500 million, 0.55% of the next $500 million, and 0.50% of the
next $5 billion, 0.475% of the next $5 billion, 0.455% of the next $5
billion, 0.44% of the next $5 billion, 0.43% of the next $5 billion,
0.42% of the next $5 billion, 0.41% of the next $5 billion, 0.40% of the
next $5 billion, 0.39% of the next $5 billion, 0.38% of the next $8.5
billion, and 0.37% above $55 billion.
Prior to June 30, 2000, the rates were 0.70% of the first $500 million
of average net assets, 0.60% of the next $500 million, 0.55% of the next
$500 million, and 0.50% of the next $5 billion, 0.475% of the next $5
billion, 0.455% of the next $5 billion, 0.44% of the next $5 billion,
and 0.43% of the next $5 billion, 0.42% of the next $5 billion, 0.41% of
the next $5 billion, 0.40% of the next $5 billion, and 0.39% 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 year ended July 31, 2000, fund expenses were reduced by
$7,266,819 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
$10,610 has been allocated to the fund, and an additional fee for each
Trustees 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 Retail Management, Inc., 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 Retail Management, Inc. at an annual rate up to
0.35%, 1.00% and 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 to an annual rate of 0.25%,
1.00% and 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 year ended July 31, 2000, Putnam Retail Management, Inc., acting
as underwriter received net commissions of $9,381,291 and $162,016 from
the sale of class A and class M shares, respectively and received
$9,000,726 and $27,373 in contingent deferred sales charges from
redemptions of class B and class C shares, respectively. A deferred
sales charge of up to 1% is assessed on certain redemptions of class A
shares. For the year ended July 31, 2000, Putnam Retail Management,
Inc., acting as underwriter received $106,966 on class A redemptions.
Note 3
Purchases and sales of securities
During the year ended July 31, 2000, purchases and sales of investment
securities other than short-term investments aggregated $29,027,419,652
and $28,038,256,754, respectively. There were no purchases and sales of
U.S. government obligations
Note 4
Capital shares
At July 31, 2000, there was an unlimited number of shares of beneficial
interest authorized. Transactions in capital shares were as follows:
Year ended July 31, 2000
---------------------------------------------------------------------------
Class A Shares Amount
---------------------------------------------------------------------------
Shares sold 248,033,305 $7,440,618,115
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 71,664,686 2,025,948,055
---------------------------------------------------------------------------
319,697,991 9,466,566,170
Shares
repurchased (191,478,983) (5,586,310,436)
---------------------------------------------------------------------------
Net increase 128,219,008 $3,880,255,734
---------------------------------------------------------------------------
Year ended July 31, 1999
---------------------------------------------------------------------------
Class A Shares Amount
---------------------------------------------------------------------------
Shares sold 200,358,574 $4,408,201,255
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 49,587,295 1,006,126,012
---------------------------------------------------------------------------
249,945,869 5,414,327,267
Shares
repurchased (190,131,808) (4,190,827,089)
---------------------------------------------------------------------------
Net increase 59,814,061 $1,223,500,178
---------------------------------------------------------------------------
Year ended July 31, 2000
---------------------------------------------------------------------------
Class B Shares Amount
---------------------------------------------------------------------------
Shares sold 109,322,903 $3,012,379,326
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 39,672,559 1,032,278,080
---------------------------------------------------------------------------
148,995,462 4,044,657,406
Shares
repurchased (100,107,288) (2,742,467,589)
---------------------------------------------------------------------------
Net increase 48,888,174 $1,302,189,817
---------------------------------------------------------------------------
Year ended July 31, 1999
---------------------------------------------------------------------------
Class B Shares Amount
---------------------------------------------------------------------------
Shares sold 80,109,234 $1,644,300,567
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 27,943,081 530,078,393
---------------------------------------------------------------------------
108,052,315 2,174,378,960
Shares
repurchased (95,145,441) (1,953,712,771)
---------------------------------------------------------------------------
Net increase 12,906,874 $ 220,666,189
---------------------------------------------------------------------------
Year ended July 31, 2000
---------------------------------------------------------------------------
Class C Shares Amount
---------------------------------------------------------------------------
Shares sold 7,519,564 $229,794,867
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 105,862 2,985,314
---------------------------------------------------------------------------
7,625,426 232,780,181
Shares
repurchased (337,806) (10,431,125)
---------------------------------------------------------------------------
Net increase 7,287,620 $222,349,056
---------------------------------------------------------------------------
For the period July 26, 1999
(commencement of operations) to
July 31, 1999
---------------------------------------------------------------------------
Class C Shares Amount
---------------------------------------------------------------------------
Shares sold 33,891 $829,273
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions -- --
---------------------------------------------------------------------------
33,891 829,273
Shares
repurchased -- --
---------------------------------------------------------------------------
Net increase 33,891 $829,273
---------------------------------------------------------------------------
Year ended July 31, 2000
---------------------------------------------------------------------------
Class M Shares Amount
---------------------------------------------------------------------------
Shares sold 10,859,007 $319,707,808
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 1,758,814 48,191,294
---------------------------------------------------------------------------
12,617,821 367,899,102
Shares
repurchased (6,070,033) (173,020,079)
---------------------------------------------------------------------------
Net increase 6,547,788 $194,879,023
---------------------------------------------------------------------------
Year ended July 31, 1999
---------------------------------------------------------------------------
Class M Shares Amount
---------------------------------------------------------------------------
Shares sold 6,906,639 $148,886,198
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 1,234,352 24,453,377
---------------------------------------------------------------------------
8,140,991 173,339,575
Shares
repurchased (6,976,351) (150,450,227)
---------------------------------------------------------------------------
Net increase 1,164,640 $ 22,889,348
---------------------------------------------------------------------------
Year ended July 31, 2000
---------------------------------------------------------------------------
Class Y Shares Amount
---------------------------------------------------------------------------
Shares sold 66,259,792 $1,960,179,612
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 11,532,419 332,630,167
---------------------------------------------------------------------------
77,792,211 2,292,809,779
Shares
repurchased (30,904,803) (937,076,532)
---------------------------------------------------------------------------
Net increase 46,887,408 $1,355,733,247
---------------------------------------------------------------------------
Year ended July 31, 1999
---------------------------------------------------------------------------
Class Y Shares Amount
---------------------------------------------------------------------------
Shares sold 45,348,130 $1,048,260,384
---------------------------------------------------------------------------
Shares issued in
connection with
reinvestment of
distributions 5,176,001 106,713,548
---------------------------------------------------------------------------
50,524,131 1,154,973,932
Shares
repurchased (21,197,444) (473,909,245)
---------------------------------------------------------------------------
Net increase 29,326,687 $ 681,064,687
---------------------------------------------------------------------------
Note 5
Transactions with Affiliated Issuers
Transactions during the year with companies in which the fund owned at
least 5% of the voting securities were as follows:
<TABLE>
<CAPTION>
Purchase Sales Dividend Market
Affiliates cost cost Income Value
------------------------------------------------------------------------------------------------------------------
Name of affiliate
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dollar Tree Stores $ -- $ 11,498,616 $ -- $243,710,108
Electronic Arts -- 27,602,381 -- --
Intuit, Inc. 42,999,688 47,464,830 -- --
Michaels Stores, Inc -- 14,476,455 -- --
Serco Group PLC -- 1,294,604 -- --
Thermo CardioSystems, Inc. -- 16,150,084 -- --
WestWood One, Inc. -- 2,048,500 -- --
------------------------------------------------------------------------------------------------------------------
Totals $42,999,688 $120,535,470 $ -- $243,710,108
------------------------------------------------------------------------------------------------------------------
</TABLE>
FEDERAL TAX INFORMATION
(Unaudited)
Pursuant to Section 852 of the Internal Revenue Code, as amended, the
Fund hereby designates $2,312,508,763 as a 20% capital gain, for its
taxable year ended July 31, 2000.
The Form 1099 you receive in January 2001 will show the tax status of
all distributions paid to your account in calendar 2000.
FUND INFORMATION
WEB SITE
www.putnaminvestments.com
INVESTMENT MANAGER
Putnam Investment Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Retail Management, Inc.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
TRUSTEES
John A. Hill, 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, III
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
Daniel Miller
Vice President
Roland Gillis
Vice President and Fund Manager
Charles Swanberg
Vice President and Fund Manager
Robert Beck
Vice President and Fund Manager
Michael P. Stack
Vice President and Fund Manager
Paul Marrkand
Vice President and Fund Manager
Kevin Divney
Vice President and Fund Manager
James Wiess
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 Voyager
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 and
Putnam Quarterly Ranking 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.putnaminvestments.com.
Not FDIC Insured, May Lose Value, No Bank Guarantee
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
---------------------
PRST STD
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
---------------------
For account balances, economic forecasts, and the latest on Putnam funds, visit
www.putnaminvestments.com
AN016 63662 007/883/530/516 9/00
PUTNAM INVESTMENTS [SCALE LOGO OMITTED]
---------------------------------------------------------------------------
Putnam Voyager Fund
Supplement to Annual Report dated 7/31/00
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, and M shares, which are discussed more extensively in the annual report.
ANNUAL RESULTS AT A GLANCE
---------------------------------------------------------------------------
Total return for periods ended 7/31/00 NAV
1 year 38.04%
5 years 204.76
Annual average 24.97
10 years 632.02
Annual average 22.03
Life of fund (since class A inception, 4/1/69) 15.25
(annual average)
Share value: NAV
7/31/99 $24.69
7/31/00 $30.89
---------------------------------------------------------------------------
Capital gains
Distributions: No. Income Short Long Total
1 -- $0.89000 $2.89200 $2.98100
---------------------------------------------------------------------------
Please note that past performance does not indicate 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.
