G T INVESTMENT FUNDS INC, N-30D, 1995-07-05

G T INVESTMENT FUNDS INC
N-30D, 1995-07-05

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<PAGE>
G.T. CAPITAL

[LOGO]

TWENTY-FIVE
YEARS OF
PROVIDING
ACCESS TO
GLOBAL MARKETS

/ /
G.T. GLOBAL
HIGH INCOME
FUND

/ /
SEMIANNUAL REPORT
APRIL 30, 1995
<PAGE>
TABLE
OF CONTENTS

<TABLE>
<S> <C>
Report from the Fund
Managers and Key
Portfolio Holdings..... 1

Financial Statements... F-1
</TABLE>
<PAGE>
REPORT FROM THE FUND MANAGERS

The G.T. Global High Income Fund seeks high current income and capital
appreciation. The Fund invests all of its assets in the Global High Income
Portfolio which, in turn, invests primarily in debt securities from emerging
markets around the world.

PERFORMANCE REVIEW
The Fund's total return for the six months ending April 30, 1995, was -10.24%
for Class A shares (-14.50% including the effect of the maximum 4.75% sales
charge). Total return for Class B shares was -10.55% (-14.81% including the
maximum effect of the 5% contingent deferred sales charge). Total return for the
Salomon Brothers Brady Bond Index(1) over the same period was -7.21%. The Fund
underperformed relative to the Index due to our underweighting of Mexico and a
relatively large (10%-15%) cash position in the first quarter of 1995. This
meant we did not fully participate in the sharp recovery which occurred in the
beginning of March. For additional performance information, please see page 5.

ECONOMIC REVIEW

THE CRISIS IN MEXICO
The dominant news item during this period was the financial crisis in Mexico
that accompanied the devaluation of the peso at the end of December 1994. At the
time, the Fund held relatively little in peso-denominated instruments, and those
were sold before the new year began. Nonetheless, the value of the Fund fell
sharply during January and February because emerging markets debt was hit across
the board. Even the debt of countries with absolutely no economic connection to
Mexico, such as Russia, Bulgaria and Morocco, plummeted (by 28% in the case of
Russia). Much of the decline in prices was attributable to the selling activity
of mutual fund managers, who liquidated heavily.

We took a different approach and did not sell bonds to the same degree that some
other funds did. We did not experience high redemptions, and the cash position
of the Fund, including holdings in U.S. Treasuries, only rose to about 22% at
the worst part of the crisis. In addition, as the crisis began to subside from
the beginning of March, we moved to steadily reinvest these funds and to
participate in the rally. Between March 9 and March 31, the Fund recovered in
value by 10.46%.

- ------------------
(1) The Salomon Brothers Brady Bond Index measures the total return of Brady
bonds issued since April 1, 1990, by governments undergoing economic
restructuring under the Brady Plan.

1
<PAGE>
In the first quarter of 1995, Mexican authorities were concerned with re-
establishing stability in their banking sector, which represented the weakest
link in the chain connecting the country's economy with financial markets. At
the time, the government could not restrain credit to the extent expected by the
market, and thus stabilize the peso, without creating a possibly fatal banking
crisis. At the beginning of March, the Mexican government announced a series of
programs intended to shore up the balance sheets of the Mexican banking sector
which, in turn, allowed it to tighten credit conditions and control monetary
expansion. These activities were later seen as the key turning point, not just
for Mexico but for all emerging markets debt.

The programs included the restructuring of NP83 billion (approximately US $13.4
billion) in non-performing loans on bank balance sheets, increasing bank loan
loss reserve requirements, and creating a program for the temporary
capitalization of banks that could not meet minimum liquidity standards. The
tighter credit policies towards commercial banks, which the government then
implemented, exerted a restraining influence on money supply growth, leading to
higher interest rates and causing the peso to stabilize.

THE AFTERMATH
Once the financial markets stabilized, market participants began to focus on the
remarkable turnaround of the external trade sector. Given the underlying strong
fundamental condition of the Mexican economy, the export market reacted to the
gain in competitiveness created by the lower currency. At this point, we began
to steadily reinvest at a pace that allowed the Fund to rally.

The crisis in Mexico created expectations in the market that Argentina would be
the next country forced to devalue its currency. Argentina represented our
largest country holding throughout this difficult period and, as with Mexico,
its debt suffered heavily but then recovered. The crisis in Argentina hinged on
whether its Convertibility Plan, the mechanism by which Argentina maintains the
value of its peso to the dollar, would survive. In the two months following the
devaluation of the Mexican peso, convertibility faced two challenges: foreign
reserves at the central bank fell precipitously as nervous investors and
business people sold Argentine pesos for dollars and, simultaneously, Argentine
banks suffered a run on deposits as higher rates and the prospects of slower
growth threatened their

2
<PAGE>
solvency. Several of the smallest, weakest banks did default, stimulating fears
in the public about the larger, healthier ones.

To a significant degree, the first challenge fueled the second one. The
Argentine government responded strongly. By eliminating its peso reserve
requirement in January and allowing banks to hold only dollars in reserve, it
moved to strengthen the Convertibility Plan. Then, standing by as interest rates
rose above 90% at the peak of the liquidity squeeze in March, the government
demonstrated its commitment to containing inflation and to preserving the value
of its currency at the expense of economic growth and employment. Argentina
subsequently moved to shore up its ability to meet potential peso redemptions
and to handle bank failures by raising $11 billion in new financing. The
government also announced a series of tighter fiscal measures and accelerated
privatizations to maintain a balanced budget, and introduced federal deposit
insurance and an emergency capital fund to restore public confidence in banks.
In short, Argentina exhibited extraordinary strength of purpose in defending its
low inflation economic policies, despite impending presidential elections in
mid-May. As the tension of the emerging debt crisis relaxed, Argentine debt
outperformed dramatically.

The silver lining of the Mexican peso crisis is that, across the board, the
authorities in emerging economies moved swiftly to demonstrate their commitment
to sound macroeconomic and financial management in order to recover credibility.

PORTFOLIO STRATEGY
Prior to the peso crisis, our strategy had been modestly defensive. While we
believed that Mexican authorities would hold the line and not devalue, we also
saw market risk rising. Accordingly, we reduced the Fund's Mexican exposure in
late October from 15% to 9%, while building up cash reserves to approximately
18%. These measures proved marginal, however, in light of the spillover effect
of the crisis across all emerging and, in some cases, core markets and the sharp
selloff that followed.

Throughout the crisis, the paramount concern was to maintain a high level of
liquidity by positioning assets primarily in collateralized Brady bonds. The
Fund's Mexican exposure was further reduced to 4% - all in tesobonos (U.S.
dollar-denominated short-term paper.) By mid-January, the Fund was close to
fully invested, reflecting modest redemptions and, most importantly,

3
<PAGE>
the tremendous value offered by emerging markets securities in the wake of the
sharp selloff.

Over the period, our strategy has been to overweight those markets that had
corrected the most with no plausible fundamental justification - Argentina,
Brazil, Poland and Morocco.

OUTLOOK
Looking ahead, we anticipate continued strong performance from emerging markets
debt and currently plan to remain close to fully invested. Fundamentally,
conditions have improved recently in every country. In our view, the growth
story remains strong. As of the end of May, the Fund had rallied by another 10%,
and prices are still lower than they were before the Mexican crisis erupted. The
combination of surviving this crisis fully intact, while maintaining a continued
emphasis on economic reform and inflation control, and a simultaneous strong
rally in global interest rates, has created strong technical support for
emerging markets.

While there is no question that emerging markets have proven themselves to be
volatile, we believe there is, nevertheless, still substantial value,
particularly in light of an improved outlook for global fixed income. We plan to
maintain a strong overweighing in Argentina - by far the best-managed economy in
the asset class - with significant positions in Brazil and Poland.

The past months have been very dramatic for the entire universe of emerging
markets debt. Some have questioned whether the asset class could remain viable.
The strength with which policy makers in these countries responded to recent
challenges, however, combined with the strength of the recovery of the markets,
indicates to us that debt securities will not only survive, but should continue
to appreciate.

GARY KREPS SIMON NOCERA
CHIEF INVESTMENT OFFICER PORTFOLIO MANAGER
GLOBAL FIXED INCOME INVESTMENTS SAN FRANCISCO
SAN FRANCISCO
DON MATTERSDORF
ASSISTANT PORTFOLIO MANAGER
SAN FRANCISCO

JUNE 1, 1995

G.T. GLOBAL HIGH INCOME FUND

4
<PAGE>
G.T. GLOBAL HIGH INCOME FUND
PORTFOLIO SUMMARY

PERFORMANCE SUMMARY

THE CHART AT LEFT SHOWS THE PERFORMANCE OF THE G.T. GLOBAL
HIGH INCOME FUND CLASS A SHARES SINCE THE FUND'S INCEPTION VERSUS THE SALOMON
BROTHERS BRADY BOND INDEX. THIS REPRESENTS A CUMULATIVE RETURN OF 14.89% AND AN
AVERAGE ANNUAL TOTAL RETURN OF 5.66%. THE CHART ASSUMES A HYPOTHETICAL $10,000
INITIAL INVESTMENT IN THE FUND'S CLASS A SHARES AND REFLECTS ALL FUND EXPENSES
AND THE MAXIMUM 4.75% SALES CHARGE. INVESTORS SHOULD NOTE THAT THE FUND IS A
PROFESSIONALLY MANAGED MUTUAL FUND WHILE THE INDICES ARE UNMANAGED, DO NOT INCUR
EXPENSES AND ARE NOT AVAILABLE FOR INVESTMENT. THE PERFORMANCE OF OTHER CLASSES
WILL BE GREATER OR LESS THAN THE LINE SHOWN BASED ON THE DIFFERENCES IN CHARGES
AND FEES PAID BY SHAREHOLDERS INVESTING IN DIFFERENT CLASSES.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
Salomon
G.T. Global Brothers
High Income Brady Bond
Month Fund Index
<S> <C> <C>
10/22/92 9,525 10,000
10/31/92 9,525 9,955
11/30/92 9,508 9,745
12/31/92 9,684 9,963
01/31/93 9,743 10,042
02/28/93 9,991 10,156
03/31/93 10,645 10,712
04/30/93 10,887 10,947
05/31/93 11,283 11,328
06/30/93 11,747 11,701
07/31/93 12,290 12,204
08/31/93 12,596 12,419
09/30/93 12,723 12,592
10/31/93 13,681 13,670
11/30/93 13,848 13,496
12/31/93 14,678 14,333
01/31/94 14,895 14,376
02/28/94 13,615 13,193
03/31/94 11,578 11,598
04/30/94 11,413 11,597
05/31/94 12,236 12,237
06/30/94 11,722 11,423
07/31/94 11,930 11,763
08/31/94 12,640 12,844
09/30/94 12,952 13,050
10/31/94 12,799 12,693
11/30/94 12,840 12,783
12/31/94 11,854 11,985
01/31/95 11,315 11,763
02/28/95 10,948 10,992
03/31/95 10,604 10,655
04/30/95 11,489 11,777
</TABLE>

PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS.

AVERAGE ANNUAL TOTAL RETURNS+
APRIL 30, 1995

<TABLE>
<CAPTION>
SHARE WITHOUT SALES CHARGE WITH SALES CHARGE++
LIFE OF LIFE OF
CLASS 1 YEAR FUND 1 YEAR FUND
<S> <C> <C> <C> <C>
CLASS A* 0.66% 7.72% -4.12% 5.66%
CLASS B* -0.02% 7.02% -4.59% 6.00%
<FN>
* The Fund began operations on October 22, 1992.
+ Figures assume reinvestment of all dividends and capital gains distributions
at net asset value.
++ The performance of the Class A and Class B shares reflects the effects of
the maximum 4.75% sales charge or the maximum applicable contingent deferred
sales charge (5% in first year, decreasing to 0% after six years).
</TABLE>

THE DATA ABOVE REPRESENT PAST PERFORMANCE OF THE FUND'S SHARES, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE 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 THEIR ORIGINAL COST.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
GEOGRAPHIC ALLOCATION AS OF APRIL
OF NET ASSETS 30, 1995
<S> <C>
ARGENTINA 15.6%
POLAND 10.8%
BRAZIL 10.3%
MOROCCO 8.2%
ECUADOR 4.9%
VENEZUELLA 4.9%
PHILIPPINES 4.7%
NIGERIA 3.9%
BULGARIA 3.8%
MEXICO 3.4%
COSTA RICA 2.5%
URUGUAY 2.1%
SHORT TERM & OTHER 24.9%
</TABLE>

ALLOCATIONS WILL CHANGE BASED ON CURRENT MARKET CONDITIONS.

5
<PAGE>
/ /
G.T. GLOBAL
HIGH INCOME
FUND

/ /
FINANCIAL
STATEMENTS
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

REPORT OF
INDEPENDENT ACCOUNTANTS

- --------------------------------------------------------------------------------

SEMIANNUAL REPORT
To the Shareholders of G.T. Global High Income Fund and Board of Directors of
G.T. Investment Funds, Inc.:

We have audited the accompanying statement of assets and liabilities of G.T.
Global High Income Fund, one of the funds organized as a series of G.T.
Investment Funds, Inc., as of April 30, 1995, the related statement of
operations for the six months then ended, the statement of changes in net assets
for the six months then ended and for the year ended October 31, 1994, and the
financial highlights for the six months ended April 30, 1995, for each of the
two years in the period ended October 31, 1994 and for the period from October
22, 1992 (commencement of operations) to October 31, 1992. These financial
statements and the financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and the financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of April
30, 1995 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements and the financial highlights referred
to above present fairly, in all material respects, the financial position of
G.T. Global High Income Fund as of April 30, 1995, the results of its operations
for the six months then ended, the changes in its net assets for the six months
then ended and for the year ended October 31, 1994 and the financial highlights
for the six months ended April 30, 1995, for each of the two years in the period
ended October 31, 1994 and for the period from October 22, 1992 (commencement of
operations) to October 31, 1992, in conformity with generally accepted
accounting principles.

COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
JUNE 12, 1995

F-1
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

STATEMENT OF ASSETS
AND LIABILITIES

April 30, 1995

- --------------------------------------------------------------------------------

<TABLE>
<S> <C>
Assets:
Investments in Global High Income Portfolio (cost $337,031,013) (Note 1)............................. $ 321,802,375
Receivable for Fund shares sold...................................................................... 2,625,190
Unamortized organizational expenses (Note 1)......................................................... 75,402
-------------
Total assets......................................................................................... 324,502,967
-------------
Liabilities:
Payable for Fund shares repurchased.................................................................. 1,723,265
Payable for service and distribution expenses (Note 2)............................................... 176,473
Payable for administration fees (Note 2)............................................................. 64,993
Payable for fund accounting fees..................................................................... 47,611
Payable for printing and postage expenses............................................................ 41,331
Payable for professional fees........................................................................ 28,663
Payable for registration fees........................................................................ 28,543
Payable for transfer agent fees (Note 2)............................................................. 19,837
Income distribution payable.......................................................................... 15,285
Payable for Directors' fees and expenses (Note 2).................................................... 2,573
Accrued expenses..................................................................................... 64,047
-------------
Total liabilities.................................................................................... 2,212,621
-------------
Net assets............................................................................................. $ 322,290,346
-------------
-------------
Class A:
Net asset value and redemption price per share
($131,117,137 DIVIDED BY 12,245,561 shares outstanding).............................................. $ 10.71
-------------
-------------
Maximum offering price per share
(100/95.25 of $10.71)*................................................................................ $ 11.24
-------------
-------------
Class B:+
Net asset value and offering price per share
($191,173,209 DIVIDED BY 17,866,875 shares outstanding).............................................. $ 10.70
-------------
-------------
Net assets consist of:
Paid in capital (Note 3)............................................................................. $ 403,876,669
Undistributed net investment income.................................................................. 1,448,355
Accumulated net realized loss on investments and foreign currency transactions....................... (67,806,040)
Net unrealized appreciation on translation of assets and liabilities in foreign currencies -- Global
High Income Portfolio............................................................................... 11,422
Net unrealized depreciation of investments -- Global High Income Portfolio........................... (15,240,060)
-------------
Total -- representing net assets applicable to capital shares outstanding............................ $ 322,290,346
-------------
-------------
<FN>
- ----------------

* On sales of $50,000 or more, the offering price is reduced.

+ Redemption price per share is equal to the net asset value per share less
any applicable contingent deferred sales charge.
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-2
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

STATEMENT OF OPERATIONS

Six months ended April 30, 1995

- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
Investment income:
Interest income -- Global High Income Portfolio...................................................... $ 20,753,604
------------
Total investment income.............................................................................. 20,753,604
------------
Expenses:
Expenses -- Global High Income Portfolio............................................................. 1,408,295
Service and distribution expenses (Note 2):
Class A.............................................................................. $ 235,908
Class B.............................................................................. 985,530 1,221,438
------------
Administration fees (Note 2)......................................................................... 414,888
Transfer agent fees (Note 2)......................................................................... 309,200
Registration fees.................................................................................... 111,200
Professional fees.................................................................................... 86,575
Printing and postage expenses........................................................................ 76,245
Fund accounting fees................................................................................. 59,653
Amortization of organizational expenses (Note 1)..................................................... 14,779
Directors' fees and expenses (Note 2)................................................................ 10,430
Other................................................................................................ 8,473
------------
Total expenses....................................................................................... 3,721,176
------------
Net investment income.................................................................................. 17,032,428
------------
Net realized and unrealized gain (loss) on investments and foreign currencies:
Net realized loss on investments -- Global High Income Portfolio....................... (60,435,049)
Net realized loss on foreign currency transactions -- Global High Income Portfolio..... (801,592)
------------
Net realized loss during the period................................................................ (61,236,641)
Net change in unrealized appreciation on translation of assets and liabilities in
foreign currencies -- Global High Income Portfolio.................................... 4,885
Net change in unrealized depreciation of investments -- Global High Income Portfolio... 601,544
------------
Net unrealized appreciation during the period...................................................... 606,429
------------
Net realized and unrealized loss on investments and foreign currencies -- Global High Income
Portfolio.......................................................................................... (60,630,212)
------------
Net decrease in net assets resulting from operations................................................... $(43,597,784)
------------
------------
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-3
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

STATEMENTS OF CHANGES IN NET ASSETS

- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1995 OCTOBER 31, 1994
----------------- ----------------
<S> <C> <C>
Increase (decrease) in net assets
Operations:
Net investment income....................................................................... $ 17,032,428 $ 23,589,347
Net realized loss on investments and foreign currency transactions -- Global High Income
Portfolio.................................................................................. (61,236,641) (170,977)
Net change in unrealized appreciation (depreciation) on translation of assets and
liabilities in foreign currencies -- Global High Income Portfolio.......................... 4,885 (517,677)
Net change in unrealized appreciation (depreciation) of investments -- Global High Income
Portfolio.................................................................................. 601,544 (39,147,066)
----------------- ----------------
Net decrease in net assets resulting from operations........................................ (43,597,784) (16,246,373)
----------------- ----------------
Class A:
Distributions to shareholders: (Note 1)
From net investment income.................................................................. (6,596,920) (11,509,080)
From net realized gain on investments....................................................... (566,681) (3,211,912)
In excess of net realized gain on investments............................................... -- (2,599,203)
Class B:
Distributions to shareholders: (Note 1)
From net investment income.................................................................. (8,987,153) (12,080,267)
From net realized gain on investments....................................................... (743,491) (3,255,413)
In excess of net realized gain on investments............................................... -- (2,634,405)
Capital shares transactions: (Note 3)
Increase from capital shares sold and reinvested............................................ 264,863,472 644,572,576
Decrease from capital shares repurchased.................................................... (282,477,726) (462,844,981)
----------------- ----------------
Net increase (decrease) from capital shares transactions.................................... (17,614,254) 181,727,595
----------------- ----------------
Total increase (decrease) in net assets....................................................... (78,106,283) 130,190,942
Net assets:
Beginning of period......................................................................... 400,396,629 270,205,687
----------------- ----------------
End of period............................................................................... $ 322,290,346 $ 400,396,629
----------------- ----------------
----------------- ----------------
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-4
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

FINANCIAL HIGHLIGHTS

- --------------------------------------------------------------------------------

Contained below is per share operating performance data for a share outstanding
throughout each period, total investment return, ratios and supplemental data.
This information has been derived from information provided in the financial
statements.
<TABLE>
<CAPTION>
CLASS A+
---------------------------------------------------
OCTOBER
22, 1992
(COMMENCE-
SIX MENT OF
MONTHS YEAR ENDED OCTOBER OPERATIONS)
ENDED 31, TO
APRIL 30, --------------------- OCTOBER
1995 1994(e) 1993(e) 31, 1992
--------- -------- -------- ----------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period................... $ 12.56 $ 14.92 $ 11.43 $11.43
--------- -------- -------- ----------
Income from investment operations:
Net investment income................................ 0.60 0.94 0.78 --
Net realized and unrealized gain (loss) on
investments......................................... (1.87) (1.87) 3.92 --
--------- -------- -------- ----------
Net increase (decrease) from investment
operations........................................ (1.27) (0.93) 4.70 --
--------- -------- -------- ----------
Distributions to shareholders:
From net investment income........................... (0.54) (0.94) (0.78) --
From net realized gain on investments................ (0.04) (0.27) -- --
In excess of net realized gain on investments........ -- (0.22) -- --
From sources other than net income................... -- -- (0.43) --
--------- -------- -------- ----------
Total distributions................................ (0.58) (1.43) (1.21) --
--------- -------- -------- ----------
Net asset value, end of period......................... $ 10.71 $ 12.56 $ 14.92 $11.43
--------- -------- -------- ----------
Total investment return (d)............................ (10.24)%(a) (6.45)% 43.6% 0.0%(a)

Ratios and supplemental data:
Net assets, end of period
(in 000's)............................................ $131,117 $167,974 $143,171 $ 207
Ratio of net investment income to average net assets... 10.65%(b) 7.00% 6.4% N/A(c)
Ratio of expenses to average net assets................ 1.85%(b) 1.57% 2.2% N/A(c)
Ratio of interest expense to average net assets........ N/A 0.22% N/A N/A

CLASS B++
---------------------------------------------------
OCTOBER
22, 1992
(COMMENCE-
SIX MENT OF
MONTHS YEAR ENDED OCTOBER OPERATIONS)
ENDED 31, TO
APRIL 30, --------------------- OCTOBER
1995 1994(e) 1993(e) 31, 1992
--------- -------- -------- ----------
<S> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period................... $ 12.56 $ 14.90 $ 11.43 $11.43
--------- -------- -------- ----------
Income from investment operations:
Net investment income................................ 0.55 0.86 0.70 --
Net realized and unrealized gain (loss) on
investments......................................... (1.87) (1.85) 3.90 --
--------- -------- -------- ----------
Net increase (decrease) from investment
operations........................................ (1.32) (0.99) 4.60 --
--------- -------- -------- ----------
Distributions to shareholders:
From net investment income........................... (0.50) (0.86) (0.70) --
From net realized gain on investments................ (0.04) (0.27) -- --
In excess of net realized gain on investments........ -- (0.22) -- --
From sources other than net income................... -- -- (0.43) --
--------- -------- -------- ----------
Total distributions................................ (0.54) (1.35) (1.13) --
--------- -------- -------- ----------
Net asset value, end of period......................... $ 10.70 $ 12.56 $ 14.90 $11.43
--------- -------- -------- ----------
Total investment return (d)............................ (10.55)%(a) (6.99)% 42.6% 0.0%(a)
Ratios and supplemental data:
Net assets, end of period
(in 000's)............................................ $191,173 $232,423 $127,035 $ 53
Ratio of net investment income to average net assets... 10.00%(b) 6.35% 5.8% N/A(c)
Ratio of expenses to average net assets................ 2.50%(b) 2.22% 2.8% N/A(c)
Ratio of interest expense to average net assets........ N/A 0.22% N/A N/A
<FN>
- ------------------

+ All capital shares issued and outstanding as of October 21, 1992 were
reclassified as Class A shares.

++ Commencing October 22, 1992, the Fund began offering Class B shares.

(a) Not annualized.

(b) Annualized.

(d) Total investment return does not include sales charges.

(e) These selected per share data were calculated based upon weighted average
shares during the year.
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-5
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

NOTES TO
FINANCIAL STATEMENTS

April 30, 1995

- --------------------------------------------------------------------------------

1. SIGNIFICANT ACCOUNTING POLICIES
G.T. Global High Income Fund ("Fund") is a separate series of G.T. Investment
Funds, Inc. ("Company"). The Company is organized as a Maryland corporation and
is registered under the Investment Company Act of 1940, as amended ("1940 Act"),
as a non-diversified, open-end management investment company. The Company has
twelve series of shares in operation, each series corresponding to a distinct
portfolio of investments. The Fund invests substantially all of its investable
assets in Global High Income Portfolio ("Portfolio"), which is registered as an
open-end management investment company under the 1940 Act and has investment
objectives, policies and limitations substantially identical to those of the
Fund. The value of the Fund's investment in the Portfolio reflects the Fund's
proportionate interest in the net assets of the Portfolio. The financial
statements of the Portfolio, including the Portfolio of Investments, are
included elsewhere in this Report and should be read in conjunction with the
Fund's financial statements.

The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of the financial statements. The
policies are in conformity with generally accepted accounting principles.

(A) INVESTMENT VALUATION
Valuation of securities and other investment practices by the Portfolio are
discussed in Note 1 of the Portfolio's Notes to Financial Statements which are
included elsewhere in this Report.

(B) TAXES
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to avoid imposition of any excise tax under Section 4982 of the Code.
Therefore, no provision has been made for Federal taxes on income, capital
gains, or unrealized appreciation of securities held, and excise tax on income
and capital gains.

(C) DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded by the Fund on the ex-date. Income
and capital gain distributions are determined in accordance with Federal income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Portfolio and timing differences.

(D) DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Fund in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $149,100. These
expenses are being amortized on a straightline basis over a five-year period.

2. RELATED PARTIES
G.T. Capital Management, Inc. ("G.T. Capital") is the Fund's administrator. The
Fund pays administration fees to G.T. Capital at the annualized rate of 0.25% of
the Fund's average daily net assets. These fees are computed daily and paid
monthly, and are subject to reduction in any year to the extent that the Fund's
expenses (exclusive of brokerage commissions, taxes, interest,
distribution-related expenses and extraordinary expenses) exceed the most
stringent limits prescribed by the laws or regulations of any state in which the
Fund's shares are offered for sale, based on the average total net asset value
of the Fund.

G.T. Global Financial Services, Inc. ("G.T. Global"), an affiliate of G.T.
Capital, serves as the Fund's distributor. The Fund offers Class A shares and
Class B shares for purchase.

Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. G.T. Global collects the sales charges imposed on sales of Class A
shares, and reallows a portion of such charges to dealers through which the
sales are made. For the period ended April 30, 1995, G.T. Global retained
$37,999 of such sales charges. Purchases of Class A shares exceeding $500,000
may be subject to a contingent deferred sales charge ("CDSC") upon redemption,
in accordance with the Fund's current prospectus. G.T. Global collected CDSCs in
the amount of $29,253 for the period ended April 30, 1995. G.T. Global also
makes ongoing

F-6
<PAGE>
G.T. GLOBAL HIGH INCOME FUND
shareholder servicing and trail commission payments to dealers whose clients
hold Class A shares.

Class B shares are not subject to initial sales charges. When Class B shares are
sold, G.T. Global from its own resources pays commissions to dealers through
which the sales are made. Certain redemptions of Class B shares made within six
years of purchase are subject to CDSCs, in accordance with the Fund's current
prospectus. For the period ended April 30, 1995, G.T. Global collected CDSCs in
the amount of $700,511. In addition, G.T. Global makes on-going shareholder
servicing and trail commission payments to dealers whose clients hold Class B
shares.

Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate distribution plans with respect to the Fund's Class A shares
("Class A Plan") and Class B shares ("Class B Plan"), pursuant to which the Fund
reimburses G.T. Global for a portion of its shareholder servicing and
distribution expenses. Under the Class A Plan, the Fund may pay G.T. Global a
service fee at the annualized rate of up to 0.25% of the average daily net
assets of the Fund's Class A shares for G.T. Global's expenditures incurred in
servicing and maintaining shareholder accounts, and may pay G.T. Global a
distribution fee at the annualized rate of up to 0.35% of the average daily net
assets of the Fund's Class A shares, less any amounts paid by the Fund as the
aforementioned service fee, for G.T. Global's expenditures incurred in providing
services as distributor. All expenses for which G.T. Global is reimbursed under
the Class A Plan will have been incurred within one year of such reimbursement.

Pursuant to the Fund's Class B Plan, the Fund may pay G.T. Global a service fee
at the annualized rate of up to 0.25% of the average daily net assets of the
Fund's Class B shares for G.T. Global's expenditures incurred in servicing and
maintaining shareholder accounts, and may pay G.T. Global a distribution fee at
the annualized rate of up to 0.75% of the average daily net assets of the Fund's
Class B Shares for G.T. Global's expenditures incurred in providing services as
distributor. Expenses incurred under the Class B Plan in excess of 1.00%
annually may be carried forward for reimbursement in subsequent years as long as
that Plan continues in effect.

G.T. Capital and G.T. Global voluntarily have undertaken to limit the Fund's
expenses (exclusive of brokerage commissions, taxes, interest, and extraordinary
expenses) to the maximum annual rate of 2.20% and 2.85% of the average daily net
assets of the Fund's Class A and Class B shares, respectively. If necessary,
this limitation will be effected by waivers by G.T. Capital of administration
fees, waivers by G.T. Global of payments under the Class A Plan and/or Class B
Plan and/or reimbursements by G.T. Capital or G.T. Global of portions of the
Fund's other operating expenses.

G.T. Global Investor Services, Inc. ("G.T. Services"), an affiliate of G.T.
Capital and G.T. Global, is the transfer agent of the Fund.

The Company pays each of its Directors who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $5,000 per year plus $300
for each meeting of the board or any committee thereof attended by the Director.

3. CAPITAL SHARES
At April 30, 1995, there were 6,000,000,000 shares of the Company's common stock
authorized, at $0.0001 par value. Of this amount, 200,000,000 were classified as
shares of the Fund; 400,000,000 were classified as shares of G.T. Global
Government Income Fund; 200,000,000 were classified as shares of G.T. Global
Health Care Fund; 200,000,000 were classified as shares of G.T. Global Emerging
Markets Fund; 200,000,000 were classified as shares of G.T. Global Currency Fund
(inactive); 200,000,000 were classified as shares of G.T. Global Growth & Income
Fund; 200,000,000 were classified as shares of G.T. Global Small Companies Fund
(inactive); 200,000,000 were classified as shares of G.T. Latin America Growth
Fund; 400,000,000 were classified as shares of G.T. Global Telecommunications
Fund; 200,000,000 were classified as shares of G.T. Global Strategic Income
Fund; 200,000,000 were classified as shares of G.T. Global Financial Services
Fund; 200,000,000 were classified as shares of G.T. Global Natural Resources
Fund; 200,000,000 were classified as shares of G.T. Global Infrastructure Fund;
200,000,000 were classified as shares of G.T. Global Consumer

F-7
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

Products and Services Fund; and 2,800,000,000 shares remain unclassified. The
shares of each of the foregoing series of the Company were divided equally into
two classes, designated Class A and Class B common stock. Transactions in
capital shares of the Fund were as follows:

CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1995 OCTOBER 31, 1994
-------------------------- --------------------------
CLASS A SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................... 17,415,509 $ 193,388,771 25,772,262 $ 337,096,408
Shares issued in connection with reinvestment of distributions............ 373,567 4,183,059 908,473 12,121,929
----------- ------------- ----------- -------------
17,789,076 197,571,830 26,680,735 349,218,337
Shares repurchased........................................................ (18,917,687) (209,713,994) (22,900,774) (305,091,442)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... (1,128,611) $ (12,142,164) 3,779,961 $ 44,126,895
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------

SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1995 OCTOBER 31, 1994
-------------------------- --------------------------
CLASS B SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold............................................................... 5,613,794 $ 62,440,785 21,671,430 $ 286,814,947
Shares issued in connection with reinvestment of distributions............ 435,872 4,850,857 646,902 8,539,292
----------- ------------- ----------- -------------
6,049,666 67,291,642 22,318,332 295,354,239
Shares repurchased........................................................ (6,694,541) (72,763,732) (12,332,246) (157,753,539)
----------- ------------- ----------- -------------
Net increase (decrease)................................................... (644,875) $ (5,472,090) 9,986,086 $ 137,600,700
----------- ------------- ----------- -------------
----------- ------------- ----------- -------------
</TABLE>

4. SUBSEQUENT EVENT
On June 1, 1995, the Fund, along with the other series of G.T. Investment Funds,
Inc., commenced offering a new class of shares, the "Advisor Class" shares.
These shares are available, subject to certain terms and conditions, to employee
benefit plans; to investor accounts managed or advised by financial planners,
bank trust departments, or under a "wrap fee" program; and to other accounts
advised by companies affiliated with the G.T. Group. With respect to the
issuance of "Advisor Class" shares, 100,000,000 shares were classified as shares
of each of the fourteen series of the Company and designated as "Advisor Class"
common stock. 1,400,000,000 shares remain unclassified.

F-8
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

REPORT OF
INDEPENDENT ACCOUNTANTS

- --------------------------------------------------------------------------------

SEMIANNUAL REPORT
To the Shareholders and Board of Trustees of
Global High Income Portfolio:

We have audited the accompanying statement of assets and liabilities of Global
High Income Portfolio, including the portfolio of investments as of April 30,
1995, the related statement of operations for the six months then ended, the
statement of changes in net assets for the six months then ended and for the
year ended October 31, 1994, and the supple-
mentary data for the six months ended April 30, 1995, for each of the two years
in the period ended October 31, 1994 and for the period from October 22, 1992
(commencement of operations) to October 31, 1992. These financial statements and
the supplementary data are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and the
supplementary data based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the
supplementary data are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of April 30, 1995 by correspondence with the custodian and brokers. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements and the supplementary data referred to
above present fairly, in all material respects, the financial position of Global
High Income Portfolio as of April 30, 1995, the results of its operations for
the six months then ended, the changes in its net assets for the six months then
ended and for the year ended October 31, 1994 and the supplementary data for the
six months ended April 30, 1995, for each of the two years in the period ended
October 31, 1994 and for the period from October 22, 1992 (commencement of
operations) to October 31, 1992, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.

BOSTON, MASSACHUSETTS
JUNE 12, 1995

F-9
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

PORTFOLIO OF INVESTMENTS

April 30, 1995

- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
% of Net
Principal Market Assets
Fixed Income Investments Currency Amount Value (DELTA)
- ---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government
Agency Obligations (67.0%)
- ----------------------------
Argentina (14.5%)
- ----------------------------
Republic of Argentina:
Par Bond, 5.00% due
3/31/23 ++........... USD 46,500,000 $ 20,430,938 6.3
Floating Rate Bond,
7.3125% due
3/31/05 +............ USD 21,000,000 12,573,750 3.9
BOCON Pre 2, 6.1875%
due 4/1/01 +......... USD 9,626,301 6,666,213 2.1
Discount Bond, 7.125%
due 3/31/23 +........ USD 7,750,000 4,519,219 1.4
Bote 10, 6.3125% due
4/1/00 +............. USD 4,250,000 2,564,875 0.8
Brazil (9.1%)
- ----------------------------
Federal Republic of
Brazil:
Earned Interest Bond,
7.25% due
4/15/06 +............ USD 16,600,000 9,482,750 3.0
New Money Bond Series
L, 7.3125% due
4/15/09 +............ USD 10,500,000 5,421,150 1.7
Par Bond Series YL4,
4.25% due
4/15/24 ++........... USD 12,500,000 4,984,375 1.6
C Bond, 4.00% due
4/15/14[]............ USD 10,404,000 4,499,730 1.4
IDU Notes, 7.8125% due
1/1/01 +............. USD 2,308,600 1,760,308 0.5
Discount Bond, 7.25%
due 4/15/24 +........ USD 3,000,000 1,631,250 0.5
Debt Conversion Bond
Series L, 7.3125% due
4/15/12 +............ USD 2,000,000 1,003,750 0.3
Exit Bond, 6% due
9/15/13.............. USD 1,000,000 452,500 0.1
Bulgaria (3.8%)
- ----------------------------
Bulgaria:
Past Due Interest Bond
(IAB), 7.5625% due
7/28/11 +............ USD 9,115,768 3,612,123 1.1
Discount Bond Series
A, 7.5625% due
7/28/24 - Euro +..... USD 7,532,000 3,558,870 1.1
Discount Bond Series
A, 7.5625% due
7/28/24 - 144A +
(DIAMOND)............ USD 7,468,426 3,500,825 1.1
Discount Bond Series
B, 8.0625% due
7/28/24 - Euro +..... USD 3,000,000 1,410,000 0.5
Costa Rica (2.5%)
- ----------------------------
Banco Central de Costa
Rica:
Interest Bond Series
A, 7.0625% due
5/21/05 +............ USD 9,037,502 6,778,127 2.1
Principal Bond Series
A, 6.25% due
5/21/10.............. USD 2,700,000 1,350,000 0.4
Ecuador (4.9%)
- ----------------------------
Ecuador:
Par Bond, 3% due
2/28/25 - Euro ++.... USD 19,750,000 5,702,813 1.8
Par Bond, 3% due
2/28/25 - 144A ++
(DIAMOND)............ USD 17,000,000 4,908,750 1.5
Past Due Interest
Bond, 7.25% due
2/27/15 - 144A +
(DIAMOND)............ USD 8,917,000 2,686,246 0.8
Discount Bond, 7.25%
due 2/28/25 -
Euro +............... USD 3,500,000 1,750,000 0.5
Earned Interest Bond,
7.6875% due 12/21/04
- 144A + (DIAMOND)... USD 1,365,000 757,575 0.3
Jordan (1.0%)
- ----------------------------
Jordan:
Past Due Interest
Bond, 7.625% due
12/23/05 - 144A +
(DIAMOND)............ USD 3,241,547 1,863,890 0.6
Past Due Interest
Bond, 7.625% due
12/23/05 - Euro +.... USD 2,000,000 1,200,000 0.4
Mexico (3.4%)
- ----------------------------
United Mexican States:
Par Bond Series A,
6.25% due
12/31/19(CROSS)...... USD 15,500,000 8,137,500 2.5
Discount Bond Series
A, 7.21875% due
12/31/19 + (CROSS)... USD 4,500,000 2,955,938 0.9
Nigeria (3.9%)
- ----------------------------
Central Bank of Nigeria,
Par Bond, 6.25% due
11/15/20 ++ (CROSS) ... USD 30,750,000 12,492,188 3.9
Philippines (4.7%)
- ----------------------------
Central Bank of the
Philippines:
Par Bond Series B,
5.75% due
12/1/17 ++........... USD 16,000,000 9,880,000 3.1
Debt Conversion Bond
Series B, 7.25% due
12/1/09 +............ USD 6,250,000 5,156,250 1.6
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-10
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO
<TABLE>
<CAPTION>
% of Net
Principal Market Assets
Fixed Income Investments Currency Amount Value (DELTA)
- ---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Government & Government
Agency Obligations
(Continued)
- ----------------------------
Poland (10.8%)
- ----------------------------
Poland:
Past Due Interest
Bond, 3.25% due
10/27/14 - 144A ++
(DIAMOND)............ USD 25,162,000 $ 11,385,805 3.5
Past Due Interest
Bond, 3.25% due
10/27/14 - Euro ++... USD 23,000,000 10,925,000 3.4
Discount Bond, 7.125%
due 10/27/24 -
Euro +............... USD 11,500,000 8,006,875 2.5
Discount Bond, 7.125%
due 10/27/24 - 144A +
(DIAMOND)............ USD 6,467,000 4,502,649 1.4
South Africa (1.7%)
- ----------------------------
Republic of South
Africa, 9.625% due
12/15/99............... USD 5,600,000 5,586,000 1.7
Uruguay (2.1%)
- ----------------------------
Banco Central del
Uruguay:
Par Bond Series B,
6.75% due
2/18/21(CROSS)....... USD 5,500,000 2,915,000 0.9
Par Bond Series A,
6.75% due
2/18/21(CROSS)....... USD 3,290,000 1,743,700 0.6
New Money Bond, 8.00%
due 2/18/06 +........ USD 3,750,000 2,043,750 0.6
Venezuela (4.6%)
- ----------------------------
Republic of Venezuela:
Par Bond Series B,
6.75% due
3/31/20(CROSS)....... USD 17,500,000 8,126,563 2.5
Par Bond Series A,
6.75% due
3/31/20(CROSS)....... USD 7,000,000 3,250,625 1.0
6.75% due 9/20/95 -
144A(DIAMOND)........ USD 1,700,000 1,649,000 0.5
Discount Bond Series
A, 7.1875% due
3/31/20 + (CROSS).... USD 2,925,000 1,502,719 0.5
Discount Bond Series
B, 7.00% due
3/31/20 + (CROSS).... USD 425,000 218,344 0.1
------------
Total Government &
Government Agency
Obligations (cost
$219,595,165).............. 215,547,933
------------
Sovereign Debt (11.7%)
- ----------------------------
Morocco (8.2%)
- ----------------------------
Kingdom of Morocco,
Tranche A Loan
Agreement, 7.375% due
1/1/09 +............... USD 43,000,000 26,445,000 8.2
Peru (1.6%)
- ----------------------------
Peru Loan Agreement **
(CHECK MARK)........... USD 8,500,000 4,632,500 1.4
Peru Loan Agreement
(Citibank Issued) **
(CHECK MARK)........... USD 1,000,000 560,000 0.2
Russia (1.9%)
- ----------------------------
Bank for Foreign
Economic Affairs
(Vnesheconombank) Loan
Agreement ** (CHECK
MARK).................. USD 18,700,000 4,639,938 1.4
Bank for Foreign
Economic Affairs
(Vnesheconombank) Loan
Agreement ** (CHECK
MARK).................. DEM 8,400,000 1,519,159 0.5
------------
Total Sovereign Debt (cost
$42,573,251)............... 37,796,597
------------
Corporate Bonds (2.4%)
- ----------------------------
Brazil (1.2%)
- ----------------------------
Siderurgica Brasileiras
S.A., 6% due
8/15/99(MALTESE)....... BRL 328,675 4,016,971 1.2
Hong Kong (0.8%)
- ----------------------------
Pacific Concord Finance
Ltd., 4.75% due
12/10/98............... USD 2,000,000 1,475,000 0.5
Goldlion Capital,
Convertible Bond,
4.875% due 2/1/99...... USD 1,000,000 812,500 0.3
Peru (0.1%)
- ----------------------------
Guaranteed Capital
Corp., Ltd., Medium
Term Note, 11% due
3/21/97:
144A(DIAMOND)......... USD 250,000 225,000 0.1
Euro.................. USD 200,000 180,000 --
Venezuela (0.3%)
- ----------------------------
Bariven (Petroleos de
Venezuela, S.A.),
10.625% due 3/17/02.... USD 1,000,000 865,000 0.3
------------
Total Corporate Bonds (cost
$7,679,991)................ 7,574,471
------------
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-11
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO
<TABLE>
<CAPTION>
% of Net
Principal Market Assets
Fixed Income Investments Currency Amount Value (DELTA)
- ---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Structured Notes (1.1%)
- ----------------------------
Argentina (1.1%)
- ----------------------------
Republic of Argentina,
BOCON Pre 2 Linked
Note, 13.875% due
4/2/01 (Issued by
Bankers Trust New York
Corporation. The
underlying asset is
Republic of Argentina
BOCON Pre 2.).......... USD 5,000,000 $ 3,634,000 1.1
Mexico (0.0%)
- ----------------------------
Mexican Spread Linked
Note, 5.625% due 9/5/95
(Issued by Goldman
Sachs Group. This
12-month MediumTerm
Note has a
performance linked to
the spread between
the Mexican Par
Bonds, due 12/13/19,
yield on the bid side
and the U.S. Treasury
Note, 7.5% due
11/15/16, yield on
the offer side. The
initial spread was
1.90%.).............. USD 5,000,000 -- --
------------
Total Structured Notes (cost
$10,000,000)............... 3,634,000
------------ -----

Total Fixed Income
Investments (cost
$279,848,407).............. 264,553,001 82.2
------------ -----
------------ -----
<CAPTION>

% of Net
Principal Market Assets
Short-Term Investments Currency Amount Value (DELTA)
- ---------------------------- -------- ----------- ------------ -------------
<S> <C> <C> <C> <C>
Repurchase Agreement (11.8%)
- ----------------------------
United States (11.8%)
- ----------------------------
Dated April 28, 1995
with State Street Bank
& Trust Company, due
May 1, 1995, for an
effective yield of
5.89%, collateralized
by $38,570,000 Federal
National Mortgage
Association, 6.23% due
4/24/96 (market value
of collateral is
$38,508,226, including
accrued interest) (cost
$37,827,558)........... 37,827,558 11.8
------------
Treasury Bills (2.6%)
- ----------------------------
Mexico (2.6%)
- ----------------------------
Mexican Tesobonos:...... USD -- -- 2.6
Effective yield
17.00%, due
5/25/95.............. -- 3,320,000 3,284,183 --
Effective yield
14.60%, due
8/17/95.............. -- 2,958,000 2,827,240 --
Effective yield
14.44%, due
7/13/95.............. -- 2,218,000 2,152,170 --
------------
Total Treasury Bills (cost
$8,171,739)................ 8,263,593
------------
Commercial Paper -
Discounted (1.8%)
- ----------------------------
Thailand (1.8%)
- ----------------------------
Finance One, effective
yield 13.27%, due
7/24/95 (cost
$5,949,236)............ THB 150,000,000 5,912,728 1.8
------------ -----

Total Short-Term Investments
(cost $51,948,533)......... 52,003,879 16.2
------------ -----

Total Investments (cost
$331,796,940) *............ 316,556,880 98.4
Other Assets and
Liabilities................ 5,245,595 1.6
------------ -----

Net Assets.................. $321,802,475 100.0
------------ -----
------------ -----
<FN>
-----------------
(DELTA) Percentages indicated are based on net assets of $321,802,475.
+ The coupon rate shown on floating rate note represents the rate at
period end.
++ The coupon rate shown on step-up coupon bond represents the rate at
period end.
** Underlying loan agreement currently in default.
(CHECK MARK) Non-income producing security.
(MALTESE) The principal amount should be read as units.
(DIAMOND) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers.
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-12
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO
<TABLE>
<C> <S>
[] Bond pays additional interest with 'payment-in-kind' shares at a
stated rate of 4%. Effective rate at period end for this bond is
5.73%.
(CROSS) Issued with detachable warrants or value recovery rights. The
current market value of each warrant or right is zero.
* For Federal income tax purposes, cost is $338,070,211 and
appreciation (depreciation) is as follows:

Unrealized appreciation: $ 9,252,690
Unrealized depreciation: (30,766,021)
-------------
Net unrealized depreciation: $ (21,513,331)
-------------
-------------
</TABLE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

FORWARD FOREIGN CURRENCY CONTRACTS OUTSTANDING
APRIL 30, 1995

<TABLE>
<CAPTION>
Market Value Contract Delivery Unrealized
Contracts to Buy: (U.S. Dollars) Price Date (Depreciation)
- --------------------------------------------------------------------------- -------------- ----------- -------- --------------
<S> <C> <C> <C> <C>
Indonesian Rupiahs (Payable amount $2,932,166)............................. 2,931,563 2,285.00000 08/01/95 $(603)
------
THE VALUE OF CONTRACTS TO BUY AS A PERCENTAGE OF NET ASSETS IS .91%
Total Open Forward Foreign Currency Contracts, Net......................... $(603)
------
------
</TABLE>

- ----------------
See Note 1 to the financial statements.

The accompanying notes are an integral part of the financial statements.

F-13
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

STATEMENT OF ASSETS
AND LIABILITIES

April 30, 1995

- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
Assets:
Investments in securities, at value (cost $293,969,382) (Note 1).................................... $ 278,729,322
Repurchase agreement, at value and cost (Note 1).................................................... 37,827,558
U.S. currency.......................................................................... $ 344
Foreign currencies (cost $1,845,410)................................................... 1,861,537 1,861,881
-----------
Interest receivable................................................................................. 6,826,421
Receivable for securities sold (Note 1)............................................................. 3,075,000
Unamortized organizational expenses (Note 1)........................................................ 12,405
Other assets........................................................................................ 100
-------------
Total assets...................................................................................... 328,332,687
-------------
Liabilities:
Payable for securities purchased.................................................................... 6,289,274
Payable for custodian fees (Note 1)................................................................. 87,056
Payable for investment management and administration fees (Note 2).................................. 75,428
Payable for printing and postage expenses........................................................... 28,901
Payable for professional fees....................................................................... 17,389
Payable for Trustees' fees and expenses (Note 2).................................................... 2,726
Payable for open forward foreign currency contracts, net (Note 1)................................... 603
Accrued expenses.................................................................................... 28,835
-------------
Total liabilities................................................................................. 6,530,212
-------------
Net assets............................................................................................ $ 321,802,475
-------------
-------------
Net assets consist of:
Paid in capital..................................................................................... $ 335,046,134
Undistributed net investment income................................................................. 53,790,966
Accumulated net realized loss on investments and foreign currency transactions...................... (51,805,987)
Net unrealized appreciation on translation of assets and liabilities in foreign currencies.......... 11,422
Net unrealized depreciation of investments.......................................................... (15,240,060)
-------------
Total -- representing net assets applicable to shares of beneficial interest outstanding............ $ 321,802,475
-------------
-------------
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-14
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

STATEMENT OF OPERATIONS

Six months ended April 30, 1995

- --------------------------------------------------------------------------------

<TABLE>
<S> <C> <C>
Investment income (Note 1):
Interest income (net of foreign tax withheld of $33,911)............................................. $ 20,753,604
------------
Total investment income.............................................................................. 20,753,604
------------
Expenses:
Investment management and administration fees (Note 2)............................................... 1,217,342
Custodian fees (Note 1).............................................................................. 154,121
Professional fees.................................................................................... 18,607
Printing and postage expenses........................................................................ 8,688
Trustees' fees and expenses (Note 2)................................................................. 3,439
Amortization of organizational expenses (Note 1)..................................................... 2,478
Other................................................................................................ 3,620
------------
Total expenses....................................................................................... 1,408,295
------------
Net investment income.................................................................................. 19,345,309
------------
Net realized and unrealized gain (loss) on investments and foreign currencies (Note 1):
Net realized loss on investments....................................................... $(60,435,049)
Net realized loss on foreign currency transactions..................................... (801,592)
------------
Net realized loss during the period................................................................ (61,236,641)
Net change in unrealized appreciation on translation of assets and liabilities in
foreign currencies.................................................................... 4,885
Net change in unrealized depreciation of investments................................... 601,544
------------
Net unrealized appreciation during the period...................................................... 606,429
------------
Net realized and unrealized loss on investments and foreign currencies................................. (60,630,212)
------------
Net decrease in net assets resulting from operations................................................... $(41,284,903)
------------
------------
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-15
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

STATEMENTS OF CHANGES IN NET ASSETS

- --------------------------------------------------------------------------------

The accompanying notes are an integral part of the financial statements.

F-16
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

SUPPLEMENTARY DATA

- --------------------------------------------------------------------------------

Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.

<TABLE>
<CAPTION>
YEAR ENDED OCTOBER
31, OCTOBER 22, 1992
SIX MONTHS ENDED ------------------ (COMMENCEMENT OF OPERATIONS)
APRIL 30, 1995 1994 1993 TO OCTOBER 31, 1992
---------------- -------- -------- ----------------------------
<S> <C> <C> <C> <C>
Ratios and supplemental data:
Net assets, end of period (in 000's)......................... $321,802 $400,911 $256,740 $ 200
Ratio of net investment income to average net assets 11.65%(b) 7.93% 8.0% N/A(a)
Ratio of expenses to average net assets...................... 0.85%(b) 0.72% 0.9% N/A(a)
Ratio of interest expense to average net assets N/A 0.22% N/A N/A
Portfolio turnover rate 256%(b) 178% 195% none
<FN>
- ----------------
(a) Ratios are not meaningful due to short period of operation.
(b) Annualized
</TABLE>

The accompanying notes are an integral part of the financial statements.

F-17
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

NOTES TO
FINANCIAL STATEMENTS

April 30, 1995

- --------------------------------------------------------------------------------

1. SIGNIFICANT ACCOUNTING POLICIES
Global High Income Portfolio ("Portfolio") is organized as a New York Trust and
is registered under the Investment Company Act of 1940, as amended ("1940 Act"),
as a non-diversified, open-end management investment company. The following is a
summary of significant accounting policies consistently followed by the
Portfolio in the preparation of the financial statements. The policies are in
conformity with generally accepted accounting principles.

(A) PORTFOLIO VALUATION
The Portfolio calculates the net asset value of and completes orders to purchase
or repurchase Portfolio shares of beneficial interest on each business day, with
the exception of those days on which the New York Stock Exchange is closed.

Equity securities are valued at the last sale price on the exchange on which
such securities are traded, or in the principal over-the-counter market in which
such securities are traded, as of the close of business on the day the
securities are being valued, or, lacking any sales, at the last available bid
price. In cases where securities are traded on more than one exchange, the
securities are valued on the exchange determined by G.T. Capital Management,
Inc. ("G.T. Capital") to be the primary market.

Fixed income investments are valued at the mean of representative quoted bid and
ask prices for such investments or, if such prices are not available, at prices
for investments of comparative maturity, quality and type; however, when G.T.
Capital deems it appropriate, prices obtained for the day of valuation from a
bond pricing service will be used. Short-term investments with a maturity of 60
days or less are valued at amortized cost adjusted for foreign exchange
translation and market fluctuation, if any.

Investments for which market quotations are not readily available (including
restricted securities which are subject to limitations on their sale) are valued
at fair value as determined in good faith by or under the direction of the
Portfolio's Board of Trustees.

Portfolio securities which are primarily traded on foreign exchanges are
generally valued at the preceding closing values of such securities on their
respective exchanges, and those values are then translated into U.S. dollars at
the current exchange rates, except that when an occurrence subsequent to the
time a value was so established is likely to have materially changed such value,
then the fair value of those securities will be determined by consideration of
other factors by or under the direction of the Portfolio's Board of Trustees.

(B) FOREIGN CURRENCY TRANSLATIONS
The accounting records of the Portfolio are maintained in U.S. dollars. The
market values of foreign securities, currency holdings, and other assets and
liabilities are recorded in the books and records of the Portfolio 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 earned or
incurred.

The Portfolio does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss from
investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of forward foreign currency
contracts, sales of foreign currencies, currency gains or losses realized
between the trade and settlement dates on securities transactions, and the
difference between the amounts of dividends, interest, and foreign withholding
taxes recorded on the Portfolio's books and the U.S. dollar equivalent of the
amounts actually received or paid. Net unrealized foreign exchange gains or
losses arise from changes in the value of assets and liabilities other than
investments in securities at period end, resulting from changes in exchange
rates.

(C) REPURCHASE AGREEMENTS
With respect to repurchase agreements entered into by the Portfolio, it is the
Portfolio's policy to always receive, as collateral, United States government
securities or other high quality debt securities of which the value, including
accrued interest, is at least equal to the amount to be repaid to the Portfolio
under each agreement at its maturity.

F-18
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

(D) FORWARD FOREIGN CURRENCY CONTRACTS
A forward foreign currency contract ("Forward") is an agreement between two
parties to buy and sell a currency at a set price on a future date. The market
value of the Forward Contract fluctuates with changes in currency exchange
rates. The Forward Contract is marked-to-market daily and the change in market
value is recorded by the Portfolio as an unrealized gain or loss. When the
Forward Contract is closed, the Portfolio records a realized gain or loss equal
to the difference between the value at the time it was opened and the value at
the time it was closed. Forward Contracts involve market risk in excess of the
amounts shown in the Portfolio's "Statement of Assets and Liabilities." The
Portfolio could be exposed to risk if a counterparty is unable to meet the terms
of the contract or if the value of the currency changes unfavorably. The
Portfolio may enter into Forward Contracts in connection with planned purchases
or sales of securities, or to hedge against adverse fluctuations in exchange
rates between currencies.

(E) OPTION ACCOUNTING PRINCIPLES
When the Portfolio writes a call or put option, an amount equal to the premium
received is included in the Portfolio's "Statement of Assets and Liabilities" as
an asset and an equivalent liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the option.
The current market value of an option listed on a traded exchange is valued at
its last bid price, or, in the case of an over-the-counter option, is valued at
the average of the last bid prices obtained from brokers. If an option expires
on its stipulated expiration date or if the Portfolio enters into a closing
purchase transaction, a gain or loss is realized without regard to any
unrealized gain or loss on the underlying security, and the liability related to
such option is extinguished. If a written call option is exercised, a gain or
loss is realized from the sale of the underlying security and the proceeds of
the sale are increased by the premium originally received. If a written put
option is exercised, the cost of the underlying security purchased would be
decreased by the premium originally received. The Portfolio can write options
only on a covered basis, which, for a call, requires that the portfolio hold the
underlying security and, for a put, requires the Portfolio to set aside cash,
U.S. government securities, or other liquid, high-grade debt securities in an
amount not less than the exercise price or otherwise provide adequate cover at
all times while the put option is outstanding. The Portfolio may use options to
manage its exposure to the bond market and to fluctuations in currency values or
interest rates.

The premium paid by the Portfolio for the purchase of a call or put option is
included in the Portfolio's "Statement of Assets and Liabilities" as an
investment and subsequently "marked-to-market" to reflect the current market
value of the option. If an option which the Portfolio has purchased expires on
the stipulated expiration date, the Portfolio realizes a loss in the amount of
the cost of the option. If the Portfolio enters into a closing sale transaction,
the Portfolio realizes a gain or loss, depending on whether proceeds from the
closing sale transaction are greater or less than the cost of the option. If the
Portfolio exercises a call option, the cost of the securities acquired by
exercising the call is increased by the premium paid to buy the call. If the
Portfolio exercises a put option, it realizes a gain or loss from the sale of
the underlying security, and the proceeds from such sale are decreased by the
premium originally paid.

The risk associated with purchasing options is limited to the premium originally
paid. The risk in writing a call option is that the Portfolio may forego the
opportunity of profit if the market value of the underlying security or index
increases and the option is exercised. The risk in writing a put option is that
the Portfolio may incur a loss if the market value of the underlying security or
index decreases and the option is exercised. In addition, there is the risk the
Portfolio may not be able to enter into a closing transaction because of an
illiquid secondary market.

(F) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
security at a set price on a future date. Upon entering into such a contract the
Portfolio is required to pledge to the broker an amount of cash or securities
equal to the minimum "initial margin" requirements of the exchange on which the
contract is traded. Pursuant to the contract, the Portfolio agrees to receive
from or pay to the broker an amount of cash equal to the daily fluctuation in
value of the contract. Such receipts or payments are known as "variation margin"
and are recorded by the Portfolio as unrealized gains or losses. When the
contract is closed, the Portfolio 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 potential risk to the Portfolio is that the
change in value of the underlying securities may not correlate to the change in
value of the contracts. The Portfolio may use futures contracts to manage its
exposure to the bond market and to fluctuations in currency values or interest
rates.

F-19
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

(G) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME
Security transactions are accounted for on the trade date (date the order to buy
or sell is executed). The cost of securities sold is determined on a first-in,
first-out basis, unless otherwise specified. Dividends are recorded on the
ex-dividend date. Interest income is recorded on the accrual basis. Where a high
level of uncertainty exists as to its collection, income is recorded net of all
withholding tax with any rebate recorded when received. The Portfolio may trade
securities on other than normal settlement terms. This may increase the risk if
the other party to the transaction fails to deliver and causes the Portfolio to
subsequently invest at less advantageous prices.

(H) PORTFOLIO SECURITIES LOANED
For international securities, cash collateral is received by the Portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. This collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the Portfolio against loaned securities in an amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan, and is maintained at this level during the period of the
loan. For the period ended April 30, 1995, the Portfolio received fees of $929
which were used to reduce the Fund's custodian fees. At April 30, 1995, there
were no securities on loan to brokers.

(I) TAXES
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code of 1986, as amended ("Code"). Therefore, no provision has been made
for Federal taxes on income, capital gains, or unrealized appreciation of
securities held.

(J) DEFERRED ORGANIZATIONAL EXPENSES
Expenses incurred by the Portfolio in connection with its organization, its
registration with the Securities and Exchange Commission and with various states
and the initial public offering of its shares aggregated $25,000. These expenses
are being amortized on a straightline basis over a five-year period.

(K) FOREIGN SECURITIES
There are certain additional considerations and risks associated with investing
in foreign securities and currency transactions that are not inherent with
investments of domestic origin. The Portfolio's investment in emerging market
countries may involve greater risks than investments in more developed markets
and the price of such investments may be volatile. These risks of investing in
foreign and emerging markets may include foreign currency exchange rate
fluctuations, perceived credit risk, adverse political and economic developments
and possible adverse foreign government intervention.

(L) INDEXED SECURITIES
The Portfolio may invest in indexed securities whose value is linked either
directly or indirectly to changes in foreign currencies, interest rates,
equities, indices, or other reference instruments. Indexed securities may be
more volatile than the reference instrument itself, but any loss is limited to
the amount of the original investment.

(M) RESTRICTED SECURITIES
The Portfolio is permitted to invest in privately placed restricted securities.
These securities may be resold in transactions exempt from registration or to
the public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.

2. RELATED PARTIES
G.T. Capital is the Portfolio's investment manager and administrator. The
Portfolio pays investment management and administration fees to G.T. Capital at
the annualized rate of 0.475% on the first $500 million of average daily net
assets of the Portfolio; 0.45% on the next $1 billion; 0.425% on the next $1
billion; and 0.40% on amounts thereafter, plus 2% of the Portfolio's total
investment income calculated in accordance with generally accepted accounting
principles, adjusted daily for currency revaluations, on a mark to market basis,
of the Portfolio's assets; provided, however, that during any fiscal year this
amount shall not exceed 2% of the Portfolio's total investment income calculated
in accordance with generally accepted accounting principles. These fees are
computed daily and paid monthly.

F-20
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

The Portfolio pays each of its Trustees who is not an employee, officer or
director of G.T. Capital, G.T. Global or G.T. Services $500 per year plus $150
for each meeting of the board or any committee thereof attended by the Trustees.

At April 30, 1995, all of the shares of beneficial interest of the Portfolio
were owned either by G.T. Global High Income Fund or G.T. Capital.

3. PURCHASES AND SALES OF SECURITIES
For the period ended April 30, 1995, purchases and sales of investment
securities by the Portfolio, other than U.S. government obligations and
short-term investments, aggregated $258,872,121 and $259,450,875, respectively.
Purchases and sales of U.S. government obligations by the Portfolio aggregated
$106,255,313 and $122,928,126, respectively.

4. WRITTEN OPTIONS:
The Portfolio's written options contract activity for the period ended April 30,
1995 was as follows:
COVERED CALL OPTIONS WRITTEN

<TABLE>
<CAPTION>
UNDERLYING
NOMINAL
AMOUNT PREMIUMS
------------- -----------
<S> <C> <C>
Options outstanding at October 31, 1994.................................... 0 $ 0
Options written............................................................ 10,000,000 73,000
Options cancelled in closing purchase transactions......................... 0 0
Options expired prior to exercise.......................................... (10,000,000) (73,000)
Options exercised.......................................................... 0 0
------------- -----------
Options outstanding at April 30, 1995...................................... 0 $ 0
------------- -----------
------------- -----------
</TABLE>

F-21
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

NOTES

- --------------------------------------------------------------------------------
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

NOTES

- --------------------------------------------------------------------------------
<PAGE>
GLOBAL HIGH INCOME PORTFOLIO

NOTES

- --------------------------------------------------------------------------------
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

[LOGO]
G.T. GLOBAL GROUP OF FUNDS

G.T. GLOBAL OFFERS A BROAD RANGE OF MUTUAL FUNDS TO COMPLEMENT MANY
INVESTORS' PORTFOLIOS. FOR MORE INFORMATION AND A PROSPECTUS ON ANY OF THE
G.T. GLOBAL MUTUAL FUNDS, PLEASE CONTACT YOUR INVESTMENT COUNSELOR OR CALL
G.T. GLOBAL DIRECTLY AT 1-800-824-1580. THE PROSPECTUS CONTAINS MORE
COMPLETE INFORMATION, INCLUDING CHARGES, EXPENSES AND RISKS. INVESTORS
SHOULD READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.

GROWTH FUNDS

/ / GLOBALLY DIVERSIFIED FUNDS

G.T. GLOBAL WORLDWIDE GROWTH FUND
Invests around the world, including the U.S.

G.T. GLOBAL INTERNATIONAL GROWTH FUND
Provides portfolio diversity by investing outside
the U.S.

G.T. GLOBAL EMERGING MARKETS FUND
Gives access to the growth potential of developing economies

/ / GLOBAL THEME FUNDS

G.T. GLOBAL HEALTH CARE FUND
Invests in growing health care industries worldwide

G.T. GLOBAL TELECOMMUNICATIONS FUND
Invests in companies worldwide that develop, manufacture, or sell
telecommunications services or equipment

G.T. GLOBAL INFRASTRUCTURE FUND
Seeks companies that build, improve, or maintain a country's infrastructure

G.T. GLOBAL FINANCIAL SERVICES FUND
Focuses on the worldwide opportunities from the demand for financial services
and products

G.T. GLOBAL NATURAL RESOURCES FUND
Concentrates on companies that own, explore, or develop natural resources

G.T. GLOBAL CONSUMER PRODUCTS AND SERVICES FUND
Invests in companies that manufacture, market, retail, or distribute consumer
products or services

/ / REGIONALLY DIVERSIFIED FUNDS

G.T. GLOBAL NEW PACIFIC GROWTH FUND
Offers access to the emerging and established markets of the Pacific Rim

G.T. GLOBAL EUROPE GROWTH FUND
Focuses on investment opportunities in the new, unified Europe

G.T. LATIN AMERICA GROWTH FUND
Invests in the emerging markets of Latin America

/ / SINGLE COUNTRY FUNDS

G.T. GLOBAL AMERICA GROWTH FUND
Concentrates on small and medium-sized companies in the U.S.

G.T. GLOBAL JAPAN GROWTH FUND
Provides U.S. investors with direct access to the Japanese market

GROWTH AND INCOME FUND

G.T. GLOBAL GROWTH & INCOME FUND
Invests in blue-chip stocks and government bonds from around the world

INCOME FUNDS

G.T. GLOBAL GOVERNMENT INCOME FUND
Earns monthly income from global government securities

G.T. GLOBAL STRATEGIC INCOME FUND
Allocates its assets among debt securities from the U.S., developed foreign
countries and emerging markets

G.T. GLOBAL HIGH INCOME FUND
Invests in debt securities in emerging markets

MONEY MARKET FUND

G.T. GLOBAL DOLLAR FUND
Invests in high quality, U.S. dollar-denominated money market securities
worldwide for stability and preservation of capital

THIS REPORT MUST BE ACCOMPANIED OR PRECEDED BY A CURRENT PROSPECTUS.
<PAGE>
G.T. GLOBAL HIGH INCOME FUND

[LOGO]
G.T. GLOBAL FINANCIAL SERVICES BULK RATE
FIFTY CALIFORNIA STREET, 27TH FLOOR U.S. POSTAGE
SAN FRANCISCO, CALIFORNIA 94111 PAID
G.T. GLOBAL

DATED MATERIAL
PLEASE EXPEDITE