<PAGE> 1
SEMIANNUAL REPORT APRIL 30, 1998
OPPENHEIMER
Quest
Opportunity
Value Fund
[PHOTO]
[OPPENHEIMERFUND LOGO]
THE RIGHT WAY TO INVEST
<PAGE> 2
CONTENTS
3 President's Letter
4 Fund Performance
6 An Interview
with the Fund's
Manager
10 Statement of
Investments
14 Statement of
Assets and
Liabilities
16 Statement of
Operations
17 Statements of
Changes in
Net Assets
18 Financial Highlights
22 Notes to Financial
Statements
27 Officers and
Trustees
28 Information and
Services
REPORT HIGHLIGHTS
- --------------------------------------------------------------------------------
- - 4-star Morningstar ranking: The Fund's Class A shares were ranked 4 stars
overall by Morningstar for the combined 3- and 5-year periods ended March 31,
1998, among 2,437 (3-year) and 1,363 (5-year) domestic equity funds.(1)
- - The financial crisis in Asia affected some of the portfolio's stocks
negatively and others positively.
- - Our outlook is cautiously optimistic, but we're being careful to invest
prudently in established businesses at what we consider attractive prices.
CUMULATIVE TOTAL RETURNS
For the 6-Month Period
Ended 4/30/98
CLASS A
Without With
Sales Chg.(2) Sales Chg.(3)
13.82% 7.27%
CLASS B
Without With
Sales Chg.(2) Sales Chg.(3)
13.56% 8.56%
CLASS C
Without With
Sales Chg.(2) Sales Chg.(3)
13.56% 12.56%
CLASS Y
Without With
Sales Chg.(2) Sales Chg.(3)
14.10% 14.10%
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT PAST PERFORMANCE
DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST.
1. Source: Morningstar, Inc. 3/31/98. Morningstar, Inc. ranks mutual funds in
broad investment classes, based on risk-adjusted returns after considering sales
charges and expenses. Return and risk are measured as performance above and
below the 90-day U.S. Treasury bill returns, respectively. Overall star ranking
is subject to change monthly. Top 10% are ranked 5 stars, next 22.5% are 4
stars, middle 35% are 3 stars, next 22.5% are 2 stars and bottom 10% are 1 star.
The Fund's Class A shares were ranked 3 stars(3-year) and 4 stars (5-year),
weighted 40%/60%, respectively.
2. Includes changes in net asset value per share without deducting any sales
charges. This performance is not annualized.
3. Class A return includes the current maximum initial sales charge of 5.75%.
Class B return includes the applicable contingent deferred sales charge of 5%.
Class C return includes the contingent deferred sales charge of 1%. Class Y
shares were first publicly offered on 12/16/96 and are not available for sale to
individual shareholders. An explanation of the different performance
calculations is in the Fund's prospectus. Class B and C shares are subject to an
annual 0.75% asset-based sales charge and Class A shares are subject to an
annual 0.25% asset-based sales charge. This performance is not annualized.
OppenheimerFunds, Inc. became the Fund's advisor on 11/22/95. The Fund's
subadvisor is OpCap Advisors, which was the Fund's advisor prior to 11/22/95.
The portfolio manager is employed by the Fund's subadvisor.
2 Oppenheimer Quest Opportunity Value Fund
<PAGE> 3
[PHOTO]
BRIDGET A. MACASKILL
President
Oppenheimer
Quest Opportunity
Value Fund
DEAR SHAREHOLDER,
- --------------------------------------------------------------------------------
As we move further into 1998, we remain impressed by the remarkable resilience
of the financial markets. Recent efforts by the United States to help support
the Japanese Yen have inspired hope that the fallout of the Asian economic
crisis can be contained. In general, the U.S. and world markets have continued
to build wealth for investors at a virtually unprecedented pace.
At OppenheimerFunds, we are pleased to help our fund shareholders
participate in the potential rewards of today's markets, but we also recognize
that this rate of growth cannot last forever. Because no one can predict exactly
when the next correction or bear market might occur, we think it is prudent to
continually identify, evaluate and manage the risks that may affect our fund
shareholders.
We believe that one of the leading risks facing investors today is that
stock valuations are at the high end of their historical range, while U.S.
corporate earnings growth is slowing. Given these facts, we believe it is
unlikely that stocks will sustain the growth rate of the past three years. Stock
prices could continue trading near current levels until earnings "catch up," or
there could be a market correction. However, we believe that either scenario
would be only a temporary pause on the way to potentially greater long-term
gains.
We are also examining the potential economic effects of the "millennium
problem" that may render many computer systems unable to recognize the year 2000
when it arrives. Solving this problem has required companies to divert
substantial human and financial resources from their core businesses, possibly
constraining global economic growth during 1999 and 2000.
For our part, we can report that OppenheimerFunds has made solid
progress toward ensuring that our shareholder accounting systems are fully "year
2000 compliant," and that all shareholder accounts will make a seamless
transition into the 21st century.
We encourage you to meet with your financial advisor to discuss how a
possible market correction or the millennium problem may affect your
investments. Together, you can prepare your investment portfolio for the
challenges and opportunities of the new century.
Sincerely,
/s/BRIDGET A. MACASKILL
Bridget A. Macaskill
May 21, 1998
3 Oppenheimer Quest Opportunity Value Fund
<PAGE> 4
AVG ANNUAL TOTAL RETURNS
For the Periods Ended 3/31/98(1)
<TABLE>
<CAPTION>
CLASS A
Since
1 year 5 year Inception
<S> <C> <C>
24.19% 19.10% 18.55%
</TABLE>
<TABLE>
<CAPTION>
CLASS B
Since
1 year 5 year Inception
<S> <C> <C>
26.09% N/A 20.27%
</TABLE>
<TABLE>
<CAPTION>
CLASS C
Since
1 year 5 year Inception
<S> <C> <C>
30.12% N/A 20.46%
</TABLE>
<TABLE>
<CAPTION>
CLASS Y
Since
1 year 5 year Inception
<S> <C> <C>
32.45% N/A 26.26%
</TABLE>
CUMULATIVE TOTAL RETURN
For the Period Ended 3/31/98(1)
<TABLE>
<CAPTION>
CLASS A
5 year
<S> <C>
139.61% $23,962(4)
</TABLE>
PERFORMANCE UPDATE
- --------------------------------------------------------------------------------
Oppenheimer Quest Opportunity Value Fund's Class A shares provided a cumulative
total return, without sales charges, of 13.82% for the six-month period ended
April 30, 1998(2) In addition, the Fund's Class A shares were ranked 4 stars
overall by Morningstar for the combined 3- and 5-year periods ended March 31,
1998, among 2,437 (3-year) and 1,363 (5-year) domestic equity funds.(3)
<TABLE>
<CAPTION>
GROWTH OF $10,000
Over five years
(without sales charges)(4)
<S> <C>
Oppenheimer Quest Opportunity S&P 500
Value Fund Class A shares Index
10,000 10,000
10,282.2 10,048.7
10,615.1 10,308.3
10,545.1 10,547.3
10,469.5 10,147.4
10,853.2 10,190.1
11,126.4 10,688.4
11,064 10,686.7
12,424.3 11,727.2
14,219.9 12,846.7
15,042.1 13,867.6
15,708.4 14,702.5
16,814.7 15,491.7
17,134.2 16,186.9
17,890.1 16,687.1
19,293.5 18,078.2
19,293.5 18,562.8
21,659.3 21,803.5
23,120.5 23,436.8
23,178.3 24,109.7
25,422.9 27,472.8
</TABLE>
1. Total returns include changes in share price and reinvestment of dividends
and capital gains distributions in a hypothetical investment for the periods
shown. Class A returns include the current maximum initial sales charge of
5.75%. Class A shares were first publicly offered on 1/3/89. The Fund's maximum
sales charge for Class A shares was lower prior to 11/24/95, so actual
performance may have been higher. Class B returns include the applicable
contingent deferred sales charge of 5% (1-year) and 2% (since inception on
9/1/93). Class C returns for the one-year result include the contingent deferred
sales charge of 1%. Class C shares have an inception date of 9/1/93. Class Y
shares were first publicly offered on 12/16/96 and are not available for sale to
individual shareholders. An explanation of the different performance
calculations is in the Fund's prospectus. Class B and C shares are subject to an
annual 0.75% asset-based sales charge and Class A shares are subject to an
annual 0.25% asset-based sales charge.
4 Oppenheimer Quest Opportunity Value Fund
<PAGE> 5
ASSET ALLOCATION(5)
<TABLE>
<S> <C>
Stocks 87.4%
Cash Equivalents 8.3
Bonds 4.3
</TABLE>
PORTFOLIO REVIEW
- --------------------------------------------------------------------------------
Oppenheimer Quest Opportunity Value Fund is for investors looking for growth of
capital from a flexible portfolio.
WHAT WE LOOK FOR
- - Well-managed, solid businesses.
- - Management motivated to work for shareholders.
- - Securities believed to be undervalued.
- - High return on capital vs. high growth.
<TABLE>
<CAPTION>
TOP 10 STOCK HOLDINGS(5)
...............................................
<S> <C>
Citicorp 5.8%
...............................................
Du Pont (E.I.) De Nemours & Co. 5.3
...............................................
McDonald's Corp. 5.2
...............................................
Freddie Mac. 5.0
...............................................
Time Warner, Inc. 4.6
...............................................
Boeing Co. 4.3
...............................................
Caterpillar, Inc. 3.9
...............................................
ACE Ltd. 3.4
...............................................
Wells Fargo & Co. 3.2
...............................................
BankBoston Corp 3.2
...............................................
</TABLE>
<TABLE>
<CAPTION>
TOP 5 SECTORS(5)
<S> <C>
................................................
Financial 26.7%
................................................
Consumer Cyclicals 15.1
................................................
Basic Materials 14.1
................................................
Technology 13.8
................................................
Industrial 10.7
................................................
</TABLE>
2. Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
3. Source: Morningstar, Inc. 3/31/98. The Fund's Class A shares were ranked 3
stars (3-year) and 4 stars (5-year), weighted 40%/60%, respectively.
4. Results of a hypothetical $10,000 investment in Class A shares on March 31,
1993. The S&P 500 Index is a broad-based unmanaged stock index including daily
reinvestment of dividends, and cannot be purchased directly by investors. Past
performance does not guarantee future results.
5. Portfolio is subject to change. Percentages are as of April 30, 1998, and are
based on total market value of investments.
5 Oppenheimer Quest Opportunity Value Fund
<PAGE> 6
"WE'RE PLEASED THAT WE'VE PARTICIPATED IN MUCH OF THE STOCK MARKET'S GAINS."
AN INTERVIEW WITH YOUR FUND'S MANAGER
- --------------------------------------------------------------------------------
HOW HAS THE FUND PERFORMED DURING THE PERIOD?
We are pleased with the Fund's performance during this somewhat volatile market.
More specifically, Oppenheimer Quest Opportunity Value Fund's Class A shares
provided a cumulative total return, without sales charges, of 13.82% for the
six-month period ended April 30, 1998(1)
HOW DID THE ASIAN FINANCIAL CRISIS,WHICH OCCURRED LAST OCTOBER, AFFECT THE FUND?
The events in Asia have weakened the Fund's performance over the period. That's
because a number of the companies we owned have exposure to Asian markets. Top
holdings such as Citicorp, Boeing, Wells Fargo and DuPont saw their stock prices
fall immediately after the Asian crisis.
On the other hand, we believe that the events in Asia have helped c
ool off U.S. economic growth. Slower economic growth has dampened inflation
fears and produced lower interest rates. As interest rates fell over the past
six months, Fund holdings such as Freddie Mac, the U.S. government sponsored
mortgage provider, experienced substantial gains. Consequently, while the
Asian crisis was initially negative for the Fund, the longer-term effects on
the Fund may be less significant.
HAS THE PORTFOLIO'S MIX OF STOCKS, BONDS AND CASH CHANGED SIGNIFICANTLY OVER THE
PAST SIX MONTHS?
As of April 30, the portfolio was composed of approximately 85% stocks, 5% bonds
and 10% cash equivalents. This is not appreciably different from the portfolio's
composition six months earlier. We continue to de-emphasize bonds because we
believe that the stock market's opportunities continue to be greater than its
risks.
1. Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
6 Oppenheimer Quest Opportunity Value Fund
<PAGE> 7
[PHOTO]
PORTFOLIO MANAGEMENT
TEAM (L TO R)
Richard Glasebrook II
(Portfolio Manager)
Pierre Daviron
We tend to use bonds as part of a defensive strategy when we expect weakness in
the stock market. Although we are watchful for signs of such weakness, they have
not yet become apparent to us.
WHICH STOCKS IN THE PORTFOLIO CONTRIBUTED MOST TO PERFORMANCE?
Fortunately, the Fund held quite a few winning stocks during the past six
months. One of the stand-outs was McDonald's, the fast-food restaurant chain.
McDonald's has been a relatively poor performing stock over the last couple of
years, but it was one of the portfolio's top performers in this period. That's
because it appears that management has finally begun to restructure the
company's domestic operations at the same time that the company's overseas
presence is growing.
We mentioned Freddie Mac earlier as an example of a company that
benefited from lower interest rates in the wake of the Asian crisis. Perhaps
more important than interest-rate influences, the United States is enjoying a
housing boom. The resale and refinancing of homes are at historical highs, and
home buyers require mortgages. Freddie Mac's marginal share of the mortgage
market is among the highest in the country, so they have benefited greatly from
rising demand for mortgages. In addition, the healthy U.S. economy has helped
constrain foreclosures. As a result, Freddie Mac is enjoying higher volumes,
lower credit costs and higher earnings.
7 Oppenheimer Quest Opportunity Value Fund
<PAGE> 8
"FUND HOLDINGS SUCH AS FREDDIE MAC EXPERIENCED SUBSTANTIAL GAINS OVER THE LAST
SIX MONTHS AS INTEREST RATES FELL."
AN INTERVIEW WITH YOUR FUND'S MANAGER
Another of the Fund's holdings, Time Warner, saw its stock rise for several
reasons over the past six months. First, as the second largest cable company in
the U.S., Time Warner is expected to benefit from the advent of digital cable,
which is being touted as the preferred delivery system for many different forms
of information. Second, the company has continued to focus on improving
shareholder value by spending capital more efficiently and reducing costs.
Third, Time Warner has indicated that it plans to buy back shares of its stock
later this year or early next year. When a company buys back its stock, the
company's market value is spread among fewer shares, making each individual
share more valuable.
DID ANY STOCKS DISAPPOINT YOU DURING THE PERIOD?
Boeing, the aircraft company, has been disappointing because of a series of
management mis-steps related to their attempts to reduce the time it takes to
produce each aircraft to fill customer orders. While we don't think the
intrinsic value of the company has been affected, it has taken time to work
through these issues and Boeing's stock has lagged the overall market as a
result. However, our long-term view of Boeing remains very positive. Boeing is
the world's largest producer of aircraft, a leadership position that was
recently reinforced by its acquisition of former rival McDonnell Douglas.
8 Oppenheimer Quest Opportunity Value Fund
<PAGE> 9
"WE CONTINUE TO FAVOR STOCKS OVER BONDS BECAUSE WE THINK THE OPPORTUNITIES IN
THE STOCK MARKET OUTWEIGH THE RISKS."
Wells Fargo also disappointed us. This regional bank appears unable to recapture
the market share it lost in the wake of its difficult 1996 merger with First
Interstate Corporation. In addition, Wells Fargo is no longer considered one of
the most efficient banks in the country because its costs have been higher than
management and analysts projected. For these reasons, we significantly reduced
our position in Wells Fargo during the period.
WHAT IS YOUR OUTLOOK AND STRATEGY FOR THE FORESEEABLE FUTURE?
While we remain cautiously optimistic regarding the U.S. stock market, it is
becoming increasingly difficult to find good companies at attractive prices. The
three-year-old market rally has driven stock valuations to the high end of their
range and, as value managers, our goal is not to overpay for an investment.
Consequently, our goal looking forward is to invest cash selectively
and carefully. We've attempted to structure the portfolio so that it can
participate in most of the gains in rising markets, while attempting to avoid
some of the volatility in declining markets. In our view, this prudent
approach to investing should serve our shareholders well in the months ahead.
9 Oppenheimer Quest Opportunity Value Fund
<PAGE> 10
STATEMENT OF INVESTMENTS April 30, 1998 (Unaudited)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
===================================================================================================
<S> <C> <C>
COMMON STOCKS--87.0%
- ---------------------------------------------------------------------------------------------------
BASIC MATERIALS--14.1%
- ---------------------------------------------------------------------------------------------------
CHEMICALS--11.4%
Dow Chemical Co. 1,400,000 $135,362,500
- ---------------------------------------------------------------------------------------------------
Du Pont (E.I.) De Nemours & Co. 3,600,000 262,125,000
- ---------------------------------------------------------------------------------------------------
Hercules, Inc. 850,000 40,640,625
- ---------------------------------------------------------------------------------------------------
Monsanto Co. 2,000,000 105,750,000
- ---------------------------------------------------------------------------------------------------
Solutia, Inc. 600,000 17,025,000
------------
560,903,125
- ---------------------------------------------------------------------------------------------------
PAPER--2.7%
Champion International Corp. 2,443,800 131,506,987
- ---------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--15.0%
- ---------------------------------------------------------------------------------------------------
AUTOS & HOUSING--1.4%
Security Capital Group, Inc., Cl. A(1) 45,127 70,172,485
- ---------------------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT--12.2%
Mattel, Inc. 2,094,800 80,257,025
- ---------------------------------------------------------------------------------------------------
McDonald's Corp. 4,100,000 253,687,500
- ---------------------------------------------------------------------------------------------------
Time Warner, Inc. 2,850,000 223,725,000
- ---------------------------------------------------------------------------------------------------
UAL Corp.(1) 500,000 43,593,750
------------
601,263,275
- ---------------------------------------------------------------------------------------------------
MEDIA--0.3%
Reed International plc, Sponsored ADR 400,000 14,700,000
- ---------------------------------------------------------------------------------------------------
RETAIL: GENERAL--1.1%
Nordstrom, Inc. 850,000 55,621,875
- ---------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS--4.4%
- ---------------------------------------------------------------------------------------------------
FOOD--2.9%
Diageo plc, Sponsored ADR 3,000,000 144,187,500
- ---------------------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES--1.0%
Becton, Dickinson & Co. 677,700 47,184,862
- ---------------------------------------------------------------------------------------------------
TOBACCO--0.5%
Philip Morris Cos., Inc. 700,000 26,118,750
- ---------------------------------------------------------------------------------------------------
ENERGY--0.3%
- ---------------------------------------------------------------------------------------------------
OIL-INTEGRATED--0.3%
Triton Energy Ltd.(1) 350,000 14,043,750
- ---------------------------------------------------------------------------------------------------
FINANCIAL--26.6%
- ---------------------------------------------------------------------------------------------------
BANKS--13.5%
BankAmerica Corp. 50,000 4,250,000
- ---------------------------------------------------------------------------------------------------
BankBoston Corp. 1,470,000 158,668,125
- ---------------------------------------------------------------------------------------------------
Chase Manhattan Corp. (New) 400,000 55,425,000
</TABLE>
10 Oppenheimer Quest Opportunity Value Fund
<PAGE> 11
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
BANKS (CONTINUED)
Citicorp 1,900,000 $285,950,000
- ---------------------------------------------------------------------------------------------------
Wells Fargo & Co. 431,800 159,118,300
------------
663,411,425
- ---------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--8.2%
Countrywide Credit Industries, Inc. 1,127,000 54,518,625
- ---------------------------------------------------------------------------------------------------
Fannie Mae 700,000 41,912,500
- ---------------------------------------------------------------------------------------------------
First Empire State Corp. 110,000 56,100,000
- ---------------------------------------------------------------------------------------------------
Freddie Mac 5,300,000 245,456,250
- ---------------------------------------------------------------------------------------------------
Travelers Group, Inc. 100,000 6,118,750
------------
404,106,125
- ---------------------------------------------------------------------------------------------------
INSURANCE--4.9%
ACE Ltd. 4,350,000 164,756,250
- ---------------------------------------------------------------------------------------------------
AFLAC, Inc. 300,000 19,500,000
- ---------------------------------------------------------------------------------------------------
EXEL Ltd. 771,400 57,613,938
------------
241,870,188
- ---------------------------------------------------------------------------------------------------
INDUSTRIAL--10.7%
- ---------------------------------------------------------------------------------------------------
MANUFACTURING--10.1%
AlliedSignal, Inc. 200,000 8,762,500
- ---------------------------------------------------------------------------------------------------
Caterpillar, Inc. 3,400,000 193,587,500
- ---------------------------------------------------------------------------------------------------
ITT Industries, Inc. 2,450,000 89,271,875
- ---------------------------------------------------------------------------------------------------
Minnesota Mining & Manufacturing Co. 1,500,000 141,562,500
- ---------------------------------------------------------------------------------------------------
Tenneco, Inc. 1,500,000 64,593,750
------------
497,778,125
- ---------------------------------------------------------------------------------------------------
TRANSPORTATION--0.6%
Union Pacific Corp. 500,000 27,375,000
- ---------------------------------------------------------------------------------------------------
TECHNOLOGY--13.7%
- ---------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE--6.2%
Boeing Co. 4,200,000 210,262,500
- ---------------------------------------------------------------------------------------------------
Lockheed Martin Corp. 845,000 94,111,875
------------
304,374,375
- ---------------------------------------------------------------------------------------------------
COMPUTER HARDWARE--0.0%
Adaptec, Inc.(1) 100,000 2,368,750
- ---------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE/SERVICES--0.7%
Computer Associates International, Inc. 600,000 35,137,500
- ---------------------------------------------------------------------------------------------------
ELECTRONICS--4.8%
Intel Corp. 400,000 32,325,000
- ---------------------------------------------------------------------------------------------------
Loral Space & Communications Ltd.(1) 500,000 15,656,250
</TABLE>
11 Oppenheimer Quest Opportunity Value Fund
<PAGE> 12
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
ELECTRONICS (CONTINUED)
National Semiconductor Corp.(1) 4,400,000 $ 96,800,000
- ---------------------------------------------------------------------------------------------------
Unitrode Corp.(1)(2) 1,450,000 23,200,000
- ---------------------------------------------------------------------------------------------------
Varian Associates, Inc. 1,416,200 69,305,288
--------------
237,286,538
- ---------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-TECHNOLOGY--2.0%
Tele-Communications TCI Ventures Group, Cl. A(1) 6,000,000 97,875,000
- ---------------------------------------------------------------------------------------------------
UTILITIES--2.2%
- ---------------------------------------------------------------------------------------------------
TELEPHONE UTILITIES--2.2%
Sprint Corp. 1,600,000 109,300,000
--------------
Total Common Stocks (Cost $3,254,695,233) 4,286,585,635
<CAPTION>
FACE
AMOUNT
===================================================================================================
U.S. GOVERNMENT OBLIGATIONS--4.3%
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
U.S. Treasury Bonds:
6.25%, 8/15/23 $100,000,000 102,906,300
6.375%, 8/15/27 100,000,000 105,343,800
- ---------------------------------------------------------------------------------------------------
U.S. Treasury Nts.:
7.50%, 11/15/01-5/15/02 2,000,000 2,123,127
7.875%, 8/15/01 550,000 586,094
-------------
Total U.S. Government Obligations (Cost $204,015,562) 210,959,321
===================================================================================================
SHORT-TERM NOTES--8.2%(3)
- ---------------------------------------------------------------------------------------------------
American Express Credit Corp., 5.49%, 5/11/98 2,028,000 2,024,907
- ---------------------------------------------------------------------------------------------------
Associates Corp. of North America, 5.50%, 6/17/98 9,091,000 9,025,722
- ---------------------------------------------------------------------------------------------------
BMW US Capital Corp., 5.52%, 6/11/98 37,932,000 37,693,534
- ---------------------------------------------------------------------------------------------------
Ford Motor Credit Co.:
5.49%, 6/17/98 12,270,000 12,182,055
5.51%, 5/4/98 3,105,000 3,103,574
- ---------------------------------------------------------------------------------------------------
General Electric Capital Corp., 5.48%, 6/22/98 50,000,000 49,604,222
- ---------------------------------------------------------------------------------------------------
General Electric Capital Services, Inc., 5.51%, 5/13/98 38,590,000 38,519,252
- ---------------------------------------------------------------------------------------------------
General Motors Acceptance Corp.:
5.51%, 5/18/98 50,000,000 49,862,250
5.52% 5/4/98 20,886,000 20,873,190
- ---------------------------------------------------------------------------------------------------
Goldman Sachs Group LP, 5.52%, 5/11/98 16,970,000 16,944,074
- ---------------------------------------------------------------------------------------------------
IBM Credit Corp.:
5.49%, 5/13/98 47,754,000 47,666,610
5.50%, 5/6/98-6/3/98 76,161,000 75,895,007
</TABLE>
12 Oppenheimer Quest Opportunity Value Fund
<PAGE> 13
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
SHORT-TERM NOTES(CONTINUED)
Merrill Lynch & Co., Inc.:
5.50%, 6/15/98 $17,783,000 $ 17,660,742
5.52%, 5/14/98 5,133,000 5,122,768
5.53%, 6/25/98 21,939,000 21,753,646
-------------
Total Short-Term Notes (Cost $407,931,553) 407,931,553
- ---------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $3,866,642,348) 99.5% 4,905,476,509
- ---------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 0.5 23,055,325
----------- -------------
NET ASSETS 100.0% $4,928,531,834
=========== ==============
</TABLE>
1. Non-income producing security.
2. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended April 30, 1998.
The aggregate fair value of securities of all affiliated companies held by the
Fund as of April 30, 1998 amounts to $23,200,000. Transactions during the period
in which the issuer was an affiliate are as follows:
<TABLE>
<CAPTION>
SHARES GROSS GROSS SHARES
OCTOBER 31, 1997 ADDITIONS REDUCTIONS APRIL 30, 1998
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Unitrode Corp. 400,000 1,130,000 80,000 1,450,000
</TABLE>
3. Short-term notes are generally traded on a discount basis; the interest rate
is the discount rate received by the Fund at the time of purchase.
See accompanying Notes to Financial Statements.
13 Oppenheimer Quest Opportunity Value Fund
<PAGE> 14
STATEMENT OF ASSETS AND LIABILITIES April 30, 1998 (Unaudited)
<TABLE>
=========================================================================================================
<S> <C>
ASSETS
Investments, at value--see accompanying statement:
Unaffiliated companies (cost $3,841,496,489) $4,882,276,509
Affiliated companies (cost $25,145,859) 23,200,000
- --------------------------------------------------------------------------------------------------------
Cash 757,544
- --------------------------------------------------------------------------------------------------------
Receivables:
Investments sold 22,409,169
Shares of beneficial interest sold 12,197,464
Interest and dividends 9,038,224
- --------------------------------------------------------------------------------------------------------
Other 108,889
--------------
Total assets 4,949,987,799
========================================================================================================
LIABILITIES
Payables and other liabilities:
Shares of beneficial interest redeemed 11,319,392
Investments purchased 8,661,684
Distribution and service plan fees 1,012,348
Transfer agent and accounting services fees 259,109
Other 203,432
--------------
Total liabilities 21,455,965
========================================================================================================
NET ASSETS $4,928,531,834
==============
========================================================================================================
COMPOSITION OF NET ASSETS
Par value of shares of beneficial interest $ 1,268,086
- --------------------------------------------------------------------------------------------------------
Additional paid-in capital 3,671,576,915
- --------------------------------------------------------------------------------------------------------
Undistributed net investment income 6,815,462
- --------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 210,037,210
- --------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 1,038,834,161
--------------
Net assets $4,928,531,834
==============
</TABLE>
14 Oppenheimer Quest Opportunity Value Fund
<PAGE> 15
<TABLE>
========================================================================================================
<S> <C>
NET ASSET VALUE PER SHARE
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$2,239,178,129 and 57,130,748 shares of beneficial interest outstanding) $39.19
Maximum offering price per share (net asset value plus sales charge of
5.75% of offering price) $41.58
- --------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share (based on net assets of
$2,141,644,559 and 55,483,997 shares of beneficial interest outstanding) $38.60
- --------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share (based on net assets of $525,808,648
and 13,636,669 shares of beneficial interest outstanding) $38.56
- --------------------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $21,900,498 and 557,207 shares of beneficial interest outstanding) $39.30
</TABLE>
See accompanying Notes to Financial Statements.
15 Oppenheimer Quest Opportunity Value Fund
<PAGE> 16
STATEMENT OF OPERATIONS For the Six Months Ended April 30, 1998 (Unaudited)
<TABLE>
========================================================================================================
<S> <C>
INVESTMENT INCOME
Dividends (net of foreign withholding taxes of $374,625) $ 23,826,586
- --------------------------------------------------------------------------------------------------------
Interest 22,072,970
------------
Total income 45,899,556
========================================================================================================
EXPENSES
Management fees--Note 4 19,000,638
- --------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 5,046,966
Class B 9,464,881
Class C 2,364,683
- --------------------------------------------------------------------------------------------------------
Transfer agent and accounting services fees--Note 4:
Class A 1,016,698
Class B 966,800
Class C 244,026
Class Y 11,846
- --------------------------------------------------------------------------------------------------------
Shareholder reports 450,369
- --------------------------------------------------------------------------------------------------------
Registration and filing fees 235,038
- --------------------------------------------------------------------------------------------------------
Custodian fees and expenses 86,845
- --------------------------------------------------------------------------------------------------------
Legal and auditing fees 34,238
- --------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 14,299
- --------------------------------------------------------------------------------------------------------
Other 133,653
------------
Total expenses 39,070,980
========================================================================================================
NET INVESTMENT INCOME 6,828,576
========================================================================================================
REALIZED AND UNREALIZED GAIN
Net realized gain on investments:
Unaffiliated companies 209,578,650
Affiliated companies 480,884
------------
Net realized gain 210,059,534
- --------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 358,413,511
------------
Net realized and unrealized gain 568,473,045
========================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $575,301,621
============
</TABLE>
See accompanying Notes to Financial Statements.
16 Oppenheimer Quest Opportunity Value Fund
<PAGE> 17
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 1998 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1997
<S> <C> <C>
============================================================================================================================
OPERATIONS
Net investment income $ 6,828,576 $ 12,106,567
- ----------------------------------------------------------------------------------------------------------------------------
Net realized gain 210,059,534 119,527,334
- ----------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 358,413,511 409,132,436
----------- -----------
Net increase in net assets resulting from operations 575,301,621 540,766,337
============================================================================================================================
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income:
Class A (9,231,281) (3,619,233)
Class B (2,214,587) (804,150)
Class C (509,037) (155,755)
Class Y (144,826) --
- ----------------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (54,377,134) (24,749,053)
Class B (51,629,864) (20,565,101)
Class C (13,038,847) (5,201,848)
Class Y (470,723) --
============================================================================================================================
BENEFICIAL INTEREST TRANSACTIONS
Net increase in net assets resulting from beneficial
interest transactions--Note 2:
Class A 196,710,769 709,459,770
Class B 244,183,559 786,575,074
Class C 44,384,644 201,535,805
Class Y 4,701,276 14,559,098
============================================================================================================================
NET ASSETS
Total increase 933,665,570 2,197,800,944
- ----------------------------------------------------------------------------------------------------------------------------
Beginning of period 3,994,866,264 1,797,065,320
============== =============
End of period (including undistributed net investment
income of $6,815,462 and $12,086,617, respectively) $4,928,531,834 $3,994,866,264
============== ==============
</TABLE>
See accompanying Notes to Financial Statements.
17 Oppenheimer Quest Opportunity Value Fund
<PAGE> 18
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30,
1998 YEAR ENDED OCTOBER 31,
(UNAUDITED) 1997 1996(3) 1995
=========================================================================================================
<S> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $35.62 $29.89 $24.59 $19.69
- ---------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .10 .16 .10 .23(4)
Net realized and unrealized gain (loss) 4.68 6.46 5.62 5.40
------ ------ ------ ------
Total income (loss) from investment
operations 4.78 6.62 5.72 5.63
- ---------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.18) (.11) (.13) (.12)
Distributions from net realized gain (1.03) (.78) (.29) (.61)
------ ------ ------ ------
Total dividends and distributions
to shareholders (1.21) (.89) (.42) (.73)
- ---------------------------------------------------------------------------------------------------------
Net asset value, end of period $39.19 $35.62 $29.89 $24.59
====== ====== ====== ======
=========================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(5) 13.82% 22.66% 23.56% 29.88%
=========================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of
period (in thousands) $2,239,178 $1,839,482 $897,493 $367,240
- ---------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $2,037,742 $1,399,186 $609,303 $251,626
- ---------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 0.58%(6) 0.67% 0.64% 1.02%
Expenses 1.51%(6) 1.54% 1.62% 1.69%
- ---------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 19.9% 30.0% 25.4% 21.0%
Average brokerage commission rate(8) $0.0577 $0.0575 $0.0554 --
</TABLE>
1. For the period from December 16, 1996 (inception of offering) to
October 31, 1997.
2. For the period from September 1, 1993 (inception of offering) to
October 31, 1993.
3. On November 22, 1995, OppenheimerFunds, Inc. became the investment
advisor to the Fund.
4. Based on average shares outstanding for the period.
5. Assumes a hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the
reinvestment date, and redemption at the net asset value calculated on
the last business day of the fiscal period. Sales charges are not
reflected in the total returns. Total returns are not annualized for
periods of less than one full year.
18 Oppenheimer Quest Opportunity Value Fund
<PAGE> 19
<TABLE>
<CAPTION>
CLASS B
- ------------------------ --------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30,
1998 YEAR ENDED OCTOBER 31,
1994 1993 (UNAUDITED) 1997 1996(3) 1995
====================================================================================================
<S> <C> <C> <C> <C> <C>
$18.71 $16.73 $35.05 $29.49 $24.33 $19.59
- ----------------------------------------------------------------------------------------------------
.18(4) .35(4) .01 .06 .05 .11(4)
1.35 2.02 4.61 6.31 5.47 5.36
------ ------ ------ ------ ------ ------
1.53 2.37 4.62 6.37 5.52 5.47
- ----------------------------------------------------------------------------------------------------
(.33) (.07) (.04) (.03) (.07) (.12)
(.22) (.32) (1.03) (.78) (.29) (.61)
------ ------ ------ ------ ------ ------
(.55) (.39) (1.07) (.81) (.36) (.73)
- ----------------------------------------------------------------------------------------------------
$19.69 $18.71 $38.60 $35.05 $29.49 $24.33
====== ====== ====== ====== ====== ======
====================================================================================================
8.41% 14.34% 13.56% 22.05% 22.92% 29.19%
====================================================================================================
$163,340 $127,225 $2,141,645 $1,706,258 $718,506 $217,663
- ----------------------------------------------------------------------------------------------------
$136,623 $ 87,864 $1,911,079 $1,238,673 $426,358 $116,523
- ----------------------------------------------------------------------------------------------------
0.96% 2.69% 0.08%(6) 0.17% 0.12% 0.48%
1.78% 1.83% 2.01%(6) 2.03% 2.14% 2.21%
- ----------------------------------------------------------------------------------------------------
42.0% 24.0% 19.9% 30.0% 25.4% 21.0%
-- -- $0.0577 $0.0575 $0.0554 --
</TABLE>
6. Annualized.
7. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended April 30, 1998 were $1,241,161,068 and $776,011,614, respectively.
8. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
19 Oppenheimer Quest Opportunity Value Fund
<PAGE> 20
FINANCIAL HIGHLIGHTS (Continued)
<TABLE>
<CAPTION>
CLASS B (CONTINUED) CLASS C
--------------------------- ------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
1998 OCT. 31,
1994 1993(2) (UNAUDITED) 1997
===================================================================================================================
<S> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period $18.70 $18.73 $35.01 $29.45
- -------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .08(4) .02(4) .01 .06
Net realized and unrealized gain (loss) 1.34 (.05) 4.61 6.30
------ ------ ------ ------
Total income (loss) from investment
operations 1.42 (.03) 4.62 6.36
- -------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.31) -- (.04) (.02)
Distributions from net realized gain (.22) -- (1.03) (.78)
------ ------ ------ ------
Total dividends and distributions
to shareholders (.53) -- (1.07) (.80)
- -------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $19.59 $18.70 $38.56 $35.01
====== ====== ====== ======
===================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(5) 7.84% (0.16)% 13.56% 22.05%
===================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of
period (in thousands) $43,317 $ 2,115 $525,809 $433,785
- -------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $16,216 $ 1,175 $477,369 $316,280
- -------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 0.43% 1.32%(6) 0.07%(6) 0.17%
Expenses 2.34% 2.52%(6) 2.01%(6) 2.04%
- -------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 42.0% 24.0% 19.9% 30.0%
Average brokerage commission rate(8) -- -- $ 0.0577 $ 0.0575
</TABLE>
1. For the period from December 16, 1996 (inception of offering) to
October 31, 1997.
2. For the period from September 1, 1993 (inception of offering) to
October 31, 1993.
3. On November 22, 1995, OppenheimerFunds, Inc. became the investment
advisor to the Fund.
4. Based on average shares outstanding for the period.
5. Assumes a hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the
reinvestment date, and redemption at the net asset value calculated on
the last business day of the fiscal period. Sales charges are not
reflected in the total returns. Total returns are not annualized for
periods of less than one full year.
20 Oppenheimer Quest Opportunity Value Fund
<PAGE> 21
<TABLE>
<CAPTION>
CLASS Y
- --------------------------------------------------------------------------- -------------------------------
SIX MONTHS
ENDED PERIOD
APRIL 30, ENDED
YEAR ENDED OCTOBER 31, 1998 OCT. 31,
1996(3) 1995 1994 1993(2) (UNAUDITED) 1997(1)
============================================================================================================================
<S> <C> <C> <C> <C> <C>
$24.31 $19.58 $18.70 $18.73 $35.77 $29.93
- ----------------------------------------------------------------------------------------------------------------------------
.06 .08(4) .08(4) .02(4) .20 .17
5.44 5.38 1.33 (.05) 4.68 5.67
------ ------ ------- ------ ------ ------
5.50 5.46 1.41 (.03) 4.88 5.84
- ----------------------------------------------------------------------------------------------------------------------------
(.07) (.12) (.31) -- (.32) --
(.29) (.61) (.22) -- (1.03) --
------ ------ ------- ------ ------ ------
(.36) (.73) (.53) -- (1.35) --
- ----------------------------------------------------------------------------------------------------------------------------
$29.45 $24.31 $19.58 $18.70 $39.30 $35.77
====== ====== ====== ====== ====== ======
============================================================================================================================
22.89% 29.16% 7.78% (0.16)% 14.10% 19.51%
============================================================================================================================
$181,066 $49,608 $7,289 $313 $21,900 $15,341
- ----------------------------------------------------------------------------------------------------------------------------
$105,445 $24,168 $2,709 $172 $18,561 $6,108
- ----------------------------------------------------------------------------------------------------------------------------
0.12% 0.37% 0.43% 1.13%(6) 1.09%(6) 1.30%(6)
2.14% 2.31% 2.35% 2.52%(6) 1.00%(6) 0.91%(6)
- ----------------------------------------------------------------------------------------------------------------------------
25.4% 21.0% 42.0% 24.0% 19.9% 30.0%
$0.0554 -- -- -- $0.0577 $0.0575
</TABLE>
6. Annualized.
7. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended April 30, 1998 were $1,241,161,068 and $776,011,614, respectively.
8. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
21 Oppenheimer Quest Opportunity Value Fund
<PAGE> 22
NOTES TO FINANCIAL STATEMENTS (Unaudited)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Quest Opportunity Value Fund (the Fund), a series of Oppenheimer
Quest for Value Funds, is a diversified open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek growth of capital. The Fund seeks its investment
objective through investments in a diversified portfolio of common stocks, bonds
and cash equivalents, the proportions of which will vary based upon management's
assessment of the relative values of each investment under prevailing market
conditions. The Fund's investment advisor is OppenheimerFunds, Inc. (the
Manager) and the Manager has entered into a sub-advisory agreement with OpCap
Advisors. The Fund offers Class A, Class B, Class C and Class Y shares. Class A
shares are sold with a front-end sales charge. Class B and Class C shares may be
subject to a contingent deferred sales charge. All classes of shares have
identical rights to earnings, assets and voting privileges, except that each
class has its own expenses directly attributable to that class and exclusive
voting rights with respect to matters affecting that class. Classes A, B and C
have separate distribution and/or service plans. No such plan has been adopted
for Class Y shares. Class B shares will automatically convert to Class A shares
six years after the date of purchase. The following is a summary of significant
accounting policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
the last sale price on the prior trading day. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Trustees. Such securities which cannot be valued by an
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Trustees to
determine fair value in good faith. Short-term "money market type" debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount.
22 Oppenheimer Quest Opportunity Value Fund
<PAGE> 23
================================================================================
ALLOCATION OF INCOME, EXPENSES, AND GAINS AND LOSSES. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax
purposes. The character of the distributions made during the year from net
investment income or net realized gains may differ from its ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the fiscal year in which the income or realized gain was recorded by
the Fund.
- --------------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Interest income is accrued on a daily basis. Realized gains
and losses on investments and unrealized appreciation and depreciation are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
23 Oppenheimer Quest Opportunity Value Fund
<PAGE> 24
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of $.01 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED APRIL 30, 1998 YEAR ENDED OCTOBER 31, 1997(1)
----------------------------------- -------------------------------------
SHARES AMOUNT SHARES AMOUNT
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 9,768,448 $ 357,827,635 29,187,396 $ 963,814,139
Dividends and distributions
reinvested 1,742,756 61,154,493 895,931 27,272,152
Redeemed (6,024,770) (222,271,359) (8,466,400) (281,626,521)
---------- ------------- ----------- -------------
Net increase 5,486,434 $ 196,710,769 21,616,927 $ 709,459,770
========== ============= =========== =============
- -----------------------------------------------------------------------------------------------------------------------------
Class B:
Sold 8,031,132 $ 291,481,108 27,082,534 $ 879,940,989
Dividends and distributions
reinvested 1,478,178 51,189,391 673,907 20,277,098
Redeemed (2,702,991) (98,486,940) (3,442,467) (113,643,013)
---------- ------------- ----------- -------------
Net increase 6,806,319 $ 244,183,559 24,313,974 $ 786,575,074
========== ============= =========== =============
- -----------------------------------------------------------------------------------------------------------------------------
Class C:
Sold 2,085,705 $ 75,675,816 7,353,599 $ 238,923,162
Dividends and distributions
reinvested 374,282 12,946,348 171,000 5,140,248
Redeemed (1,212,557) (44,237,520) (1,283,150) (42,527,605)
---------- ------------- ----------- -------------
Net increase 1,247,430 $ 44,384,644 6,241,449 $ 201,535,805
========== ============= =========== =============
- -----------------------------------------------------------------------------------------------------------------------------
Class Y:
Sold 167,000 $ 6,167,458 478,353 $ 16,256,910
Dividends and distributions
reinvested 17,532 615,549 -- --
Redeemed (56,157) (2,081,731) (49,521) (1,697,812)
---------- ------------- ----------- -------------
Net increase 128,375 $ 4,701,276 428,832 $ 14,559,098
========== ============= =========== =============
</TABLE>
1. For the year ended October 31, 1997 for Class A, B and C shares and for the
period from December 16, 1996 (inception of offering) to October 31, 1997 for
Class Y shares.
================================================================================
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At April 30, 1998, net unrealized appreciation on investments of $1,038,834,161
was composed of gross appreciation of $1,073,959,870, and gross depreciation of
$35,125,709.
24 Oppenheimer Quest Opportunity Value Fund
<PAGE> 25
================================================================================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of 1.00% of the first
$400 million of average annual net assets, 0.90% of the next $400 million of
average annual net assets, 0.85% of the next $3.2 billion of average annual net
assets, 0.80% of the next $4 billion of average annual net assets, and 0.75% of
average annual net assets over $8 billion. The Manager acts as the accounting
agent for the Fund at an annual fee of $55,000, plus out-of-pocket costs and
expenses reasonably incurred.
The Manager pays OpCap Advisors (the Sub-Advisor) monthly an annual
fee based on the fee schedule set forth in the Prospectus. For the six months
ended April 30, 1998, the Manager paid $6,032,116 to the Sub-Advisor.
For the six months ended April 30, 1998, commissions (sales charges
paid by investors) on sales of Class A shares totaled $5,685,958, of which
$1,393,439 was retained by OppenheimerFunds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B and Class C shares totaled $10,289,589 and $695,338,
respectively, of which $582,181 and $18,108, respectively, was paid to an
affiliated broker/dealer. During the six months ended April 30, 1998, OFDI
received contingent deferred sales charges of $1,580,407 and $72,430,
respectively, upon redemption of Class B and Class C shares as reimbursement
for sales commissions advanced by OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund and for other registered
investment companies. The Fund pays OFS an annual maintenance fee of $14.85 for
each Fund shareholder account and reimburses OFS for its out-of-pocket expenses.
During the six months ended April 30, 1998, the Fund paid OFS $2,191,845.
Effective May 1, 1998, the Board of Trustees approved an increase in the annual
maintenance fee from $14.85 to $18.00 for each shareholder account.
The Fund has adopted a Distribution and Service Plan for Class A
shares to compensate OFDI for a portion of its costs incurred in connection with
the personal service and maintenance of shareholder accounts that hold Class A
shares. Under the Plan, the Fund pays an annual asset-based sales charge to OFDI
of 0.25% per year on Class A shares. The Fund also pays a service fee to OFDI of
0.25% per year. Each fee is computed on the average annual net assets of Class A
shares of the Fund, determined as of the close of each regular business day.
OFDI uses all of the service fee and a portion of the asset-based sales charge
to compensate brokers, dealers, banks and other financial institutions quarterly
for providing personal service and maintenance of accounts of their customers
that hold Class A shares. OFDI retains the balance of the asset-based sales
charge to reimburse itself for its other expenditures under the Plan. During the
six months ended April 30, 1998, OFDI paid $172,239 to an affiliated
broker/dealer as compensation for Class A personal service and maintenance
expenses.
25 Oppenheimer Quest Opportunity Value Fund
<PAGE> 26
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
The Fund has adopted Distribution and Service Plans for Class B and Class C
shares to compensate OFDI for its costs in distributing Class B and Class C
shares and servicing accounts. Under the Plans, the Fund pays OFDI an annual
asset-based sales charge of 0.75% per year on Class B and Class C shares for
it's services rendered in distributing Class B and Class C shares. OFDI also
receives a service fee of 0.25% per year to compensate dealers for providing
personal services for accounts that hold Class B and Class C shares. Each fee is
computed on the average annual net assets of Class B or Class C shares,
determined as of the close of each regular business day. During the six months
ended April 30, 1998, OFDI paid $27,298 and $15,086, respectively, to an
affiliated broker/dealer as compensation for Class B and Class C personal
service and maintenance expenses and retained $8,129,161 and $1,278,905,
respectively, as compensation for Class B and Class C sales commissions and
service fee advances, as well as financing costs. If either Plan is terminated
by the Fund, the Board of Trustees may allow the Fund to continue payments of
the asset-based sales charge to OFDI for distributing shares before the Plan was
terminated. At April 30, 1998, OFDI had incurred excess distribution and
servicing costs of $46,761,111 for Class B and $3,747,515 for Class C.
================================================================================
5. BANK BORROWINGS
The Fund may borrow from a bank for temporary or emergency purposes including,
without limitation, funding of shareholder redemptions provided asset coverage
for borrowings exceeds 300%. The Fund has entered into an agreement which
enables it to participate with other Oppenheimer funds in an unsecured line of
credit with a bank, which permits borrowings up to $400 million, collectively.
Interest is charged to each fund, based on its borrowings, at a rate equal to
the Federal Funds Rate plus 0.35%. Borrowings are payable 30 days after such
loan is executed. The Fund also pays a commitment fee equal to its pro rata
share of the average unutilized amount of the credit facility at a rate of
0.0575% per annum.
The Fund had no borrowings outstanding during the six months ended
April 30, 1998.
26 Oppenheimer Quest Opportunity Value Fund
<PAGE> 27
OPPENHEIMER QUEST OPPORTUNITY VALUE FUND
A series of Oppenheimer Quest for Value Funds
================================================================================
OFFICERS AND TRUSTEES Bridget A. Macaskill, Chairman of the
Board of Trustees and President
Paul Y. Clinton, Trustee
Thomas W. Courtney, Trustee
Lacy B. Herrmann, Trustee
George Loft, Trustee
Robert C. Doll, Jr., Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
================================================================================
INVESTMENT ADVISOR OppenheimerFunds, Inc.
================================================================================
SUB-ADVISOR OpCap Advisors
================================================================================
DISTRIBUTOR OppenheimerFunds Distributor, Inc.
================================================================================
TRANSFER AND SHAREHOLDER OppenheimerFunds Services
SERVICING AGENT
================================================================================
CUSTODIAN OF PORTFOLIO State Street Bank and Trust Company
SECURITIES
================================================================================
INDEPENDENT ACCOUNTANTS Price Waterhouse LLP
================================================================================
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have
been taken from the records of the Fund
without examination by the independent
accountants. This is a copy of a report to
shareholders of Oppenheimer Quest Opportunity
Value Fund. This report must be preceded or
accompanied by a Prospectus of Oppenheimer
Quest Opportunity Value Fund. For material
information concerning the Fund, see the
Prospectus.
Shares of Oppenheimer funds are not deposits
or obligations of any bank, are not
guaranteed by any bank, and are not insured
by the FDIC or any other agency, and involve
investment risks, including possible loss
of the principal amount invested.
27 Oppenheimer Quest Opportunity Value Fund
<PAGE> 28
INTERNET
24-hr access to account
information. Online
transactions now available
WWW.OPPENHEIMERFUNDS.COM
GENERAL INFORMATION
Mon-Fri 8:30am-9pm ET
Sat 10am-4pm ET
1-800-525-7048
ACCOUNT TRANSACTIONS
Mon-Fri 8:30am-8pm ET
1-800-852-8457
PHONELINK
24-hr automated information
and automated transactions
1-800-533-3310
TELECOMMUNICATION DEVICE
FOR THE DEAF (TDD)
Mon-Fri 8:30am-2pm ET
1-800-843-4461
OPPENHEIMERFUNDS
INFORMATION HOTLINE
24 hours a day, timely and
insightful messages on the
economy and issues that
affect your investments
1-800-835-3104
INFORMATION AND SERVICES
- --------------------------------------------------------------------------------
As an Oppenheimer fund shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing simple.
And when you need help, our Customer Service Representatives are only
a tol-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling
our toll-free Telephone Transactions number or by visiting our website. And, by
enrolling in AccountLink, a convenient service that "links" your Oppenheimer
funds accounts and your bank checking or savings account, you can use the
Telephone Transactions number or website to make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
[OPPENHEIMERFUNDS LOGO]
RS0236.001.0498 June 29,1998
