<PAGE>
<PAGE>
DEAR SHAREHOLDER:
After an extended rally, the bull market weakened over the period while
disparity among sector returns increased. With suggestions that economic growth
had picked up, particularly in the U.S. and Japan, prospects for further
interest rate cuts became less certain. This belief, coupled with inflationary
fears, shifted fixed-income market leadership away from last year's
top-performing U.S. Treasuries toward other market sectors.
Despite these changes in the market, the Trust's portfolio continued to perform
well. Its six-month total return at net asset value was 5.51%. Its dividend
yield was 9.47% as of April 30, 1996.(1)
Investment Breakdown:
Oppenheimer Multi-Sector Income
Trust as of 4/30/96(2)
[GRAPHIC REPRESENTATION OF BREAKDOWN]
U.S. corporate bonds & notes: 30.2%
Foreign government obligations: 26.2%
U.S. government obligations:
Agency: 20.5%
Foreign corporate bonds & notes: 9.1%
U.S. government obligations:
Treasury: 6.5%
Structured notes: 3.4%
Short-term securities: 2.1%
Equity securities: 2.0%
During the period, we decreased our holdings in U.S. government bonds, while we
increased our holdings in international bonds and maintained our position in
high yield bonds. The Trust benefited from this positioning; in addition to
offering a higher level of income than U.S. government bonds, high yield and
international bonds represented the strongest performing sectors of the market
over the period.(2)
High yield bonds led the market in price performance and continued to offer
higher income than lower-risk investment-grade bonds. Moderate default rates and
the issuers' ability to pay down debt, coupled with the strong U.S. equity
market, contributed to their strong performance.
Overseas, falling interest rates in Europe continued to push bond prices higher.
Meanwhile, these markets continued to offer yields well above those available in
the U.S. In the emerging markets of Southeast Asia, Latin America and Eastern
Europe, growing consumer demand, solidifying balance sheets, and improving
creditworthiness continued to provide significant opportunities for capital
appreciation.
The portfolio also benefited from reduced exposure to the U.S. government
sector. We maintained a short average maturity, which resulted in low price
sensitivity to interest rate changes. This positioning was advantageous, because
as domestic interest rates increased, shorter maturity bonds generated the best
price performance. In addition, the sector was aided by an overweighting in
mortgage-backed securities.(3) They were able to outperform Treasuries because
as rates rose, prepayments slowed.
<PAGE>
<PAGE>
At the current time, we are repositioning the portfolio for what we believe will
be a slower domestic growth scenario over the next six to twelve months. In high
yield bonds, we are moving our holdings into the relatively higher credit
quality segment of the non-investment-grade market. We're also extending the
average maturity of our U.S. government assets, as slower economic growth may
lead to lower interest rates later in the year.
Finally, we continue to favor international markets, particularly emerging
markets debt. We believe Latin America, where economies and markets are
rebounding, has further upside potential. Several Eastern European markets also
look promising, and we expect Western European debt to outperform the U.S.
government market this year.
Unlike U.S. government securities, many foreign investments entail currency
risk. For this reason, we've had a currency hedge in place designed to protect
a portion of our overseas assets from a rising U.S. dollar.
Thank you for your confidence in OppenheimerFunds. We look forward to helping
you meet your financial goals in the future.
Sincerely,
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
President
Oppenheimer Multi-Sector Income Trust
April 30, 1996
1. Total return is based on the change in net asset value per share from 4/30/95
to 4/30/96, without deducting any brokerage costs. Dividend yield is determined
by annualizing the April 1996 dividend of $0.074 and dividing by the closing
price on the New York Stock Exchange of $9.375 per share on 4/26/96 (payment
date). Past performance does not guarantee future results.
2. Portfolio composition is subject to change. Chart is based on total
investments at market value rather than net assets.
3. These securities involve risks from early prepayment of underlying mortgages
that can affect the Trust's income and principal value.
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
U.S. GOVERNMENT SECTOR -- 6.4%
U.S. Treasury Bonds, 7.125%, 2/15/23 (2).................................. $ 10,600,000 $ 10,672,875
U.S. Treasury Nts.:
6%, 8/31/97 (2)......................................................... 3,850,000 3,856,013
7.75%, 1/31/00.......................................................... 4,400,000 4,603,500
------------
Total U.S. Government Sector (Cost $19,663,660)........................... 19,132,388
------------
Units
--------------
CONVERTIBLE SECTOR -- 1.8%
RIGHTS, WARRANTS AND CERTIFICATES -- 0.5%
American Communications Services, Inc. Wts., Exp. 11/05 (3)............... 700 45,500
American Telecasting, Inc. Wts., Exp. 6/99................................ 4,750 35,625
Ames Department Stores, Inc.:
Excess Cash Flow Payment Certificates, Series AG-7A (3)................. 40,300 403
Litigation Trust (3).................................................... 128,889 1,289
Becker Gaming, Inc. Wts., Exp. 11/00 (3).................................. 25,000 6,250
Cellular Communications International, Inc. Wts., Exp. 8/03............... 2,500 37,500
Federated Department Stores, Inc.:
Cl. C Wts., Exp. 12/99.................................................. 26,963 350,519
Cl. D Wts., Exp. 12/01.................................................. 26,963 350,519
Foamex LP/JPS Automotive Corp. Wts., Exp. 7/99............................ 1,000 5,000
Gaylord Container Corp. Wts., Exp. 7/96................................... 50,625 506,250
In-Flight Phone Corp. Wts., Exp. 8/02 (3)................................. 900 --
IntelCom Group, Inc. Wts., Exp. 9/05 (3).................................. 4,125 49,500
People's Choice TV Corp. Wts., Exp. 6/00.................................. 500 5,000
Protection One, Inc. Wts., Exp. 6/05...................................... 6,400 81,600
SD Warren Co. Wts., Exp. 12/06 (4)........................................ 20,000 62,500
SDW Holdings Corp., Cl. B Wts., Exp. 12/06 (3)............................ 1,875 24,375
Terex Corp. Rts., Exp. 7/96 (3)........................................... 186 9
Wireless One, Inc. Wts., Exp. 10/00....................................... 1,500 10,500
------------
1,572,339
------------
Shares
--------------
PREFERRED STOCKS AND OTHER SECURITIES -- 1.3%
California Federal Bank, 10.625% Non-Cum., Series B....................... 1,995 215,709
First Nationwide Bank, 11.50% Non-Cum..................................... 10,000 1,120,000
Gulfstream Housing Corp. (5).............................................. 714 --
SD Warren Co., 14% Cum. Exchangeable, Series B (5)........................ 20,000 625,000
SDW Holdings Corp., 15% Cum. Sr. Exchangeable Preferred Stock (3)(5)...... 18,750 553,125
</TABLE>
3
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
-------------- ------------
CONVERTIBLE SECTOR (CONTINUED)
<S> <C> <C>
PREFERRED STOCKS AND OTHER SECURITIES (CONTINUED)
Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred Stock
(3)(6).................................................................. 1,250 $ 1,250,000
------------
3,763,834
------------
Total Convertible Sector (Cost $3,982,540)................................ 5,336,173
------------
CORPORATE SECTOR -- 29.8%
COMMON STOCKS -- 0.1%
Capital Gaming International, Inc. (5).................................... 7,198 2,249
Grand Union Co. (5)....................................................... 40,000 250,000
Hollywood Casino Corp. (5)................................................ 20,000 107,500
Triangle Wire & Cable, Inc. (3)(5)........................................ 84,444 84,444
------------
444,193
------------
Face Amount(1)
--------------
CORPORATE BONDS AND NOTES -- 29.7%
BASIC INDUSTRY -- 2.6%
Chemicals -- 0.4%
NL Industries, Inc., 11.75% Sr. Sec. Nts., 10/15/03....................... $ 500,000 518,750
Terra Industries, Inc., 10.50% Sr. Nts., Series B, 6/15/05................ 500,000 536,250
------------
1,055,000
------------
Containers -- 0.2%
Container Corp., 9.75% Gtd. Sr. Nts., 4/1/03.............................. 500,000 502,500
------------
Metals/Mining -- 0.6%
Carbide/Graphite Group, Inc. (The), 11.50% Sr. Nts., 9/1/03............... 500,000 535,625
Kaiser Aluminum & Chemical Corp., 9.875% Sr. Nts., 2/15/02................ 750,000 750,000
UCAR Global Enterprises, Inc., 12% Sr. Sub. Nts., 1/15/05................. 530,000 609,500
------------
1,895,125
------------
Paper -- 1.1%
Buckeye Cellulose Corp., 8.50% Sr. Sub. Nts., 12/15/05.................... 500,000 485,000
Crown Paper Co., 11% Sr. Sub. Nts., 9/1/05................................ 500,000 465,000
Repap Wisconsin, Inc., 9.25% First Priority Sr. Sec. Nts., 2/1/02......... 500,000 482,500
Riverwood International Corp., 10.25% Sr. Nts., 4/1/06.................... 750,000 753,750
SD Warren Co., 12% Sr. Sub. Nts., 12/15/04................................ 500,000 520,000
Stone Container Corp., 10.75% First Mtg. Nts., 10/1/02.................... 500,000 505,000
------------
3,211,250
------------
Steel -- 0.3%
WCI Steel, Inc., 10.50% Sr. Gtd. Nts., Series B, 3/1/02................... 750,000 757,500
------------
</TABLE>
4
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
CONSUMER RELATED -- 7.0%
Consumer Products -- 0.7%
Coleman Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts., Series B,
10.615%, 5/27/98 (7).................................................... $ 1,000,000 $ 837,500
Revlon Consumer Products Corp., 10.50% Sr. Sub. Nts., Series B, 2/15/03... 500,000 513,750
Samsonite Corp., 11.125% Sr. Sub. Nts., 7/15/05........................... 750,000 763,125
------------
2,114,375
------------
Food/Beverages/Tobacco -- 0.6%
Consolidated Cigar Corp., 10.50% Sr. Sub. Nts., 3/1/03.................... 1,000,000 1,037,500
Doane Products Co., 10.625% Sr. Nts., 3/1/06.............................. 750,000 765,000
------------
1,802,500
------------
Healthcare -- 1.3%
AmeriSource Health Corp., 11.25% Sr. Debs., 7/15/05 (6)................... 250,000 274,375
Magellan Health Services, Inc., 11.25% Sr. Sub. Nts., Series A, 4/15/04... 1,000,000 1,115,000
Quorum Health Group, Inc., 11.875% Sr. Sub. Nts., 12/15/02................ 750,000 834,375
Tenet Healthcare Corp., 10.125% Sr. Sub. Nts., 3/1/05..................... 750,000 806,250
Total Renal Care, Inc., 0%/12% Sr. Sub. Disc. Nts., 8/15/04 (8)........... 723,000 710,347
------------
3,740,347
------------
Hotel/Gaming -- 3.5%
Arizona Charlie's, Inc., 12% First Mtg. Nts., Series A, 11/15/00 (3)...... 550,000 357,500
Bally's Casino Holdings, Inc., Zero Coupon Sr. Disc. Nts., 10.025%,
6/15/98 (7)............................................................. 600,000 525,000
Bally's Park Place Funding, Inc., 9.25% Gtd. First Mtg. Nts., 3/15/04..... 250,000 256,875
Boyd Gaming Corp., 10.75% Sr. Sub. Nts., 9/1/03........................... 500,000 528,750
California Hotel Finance Corp., 11% Sr. Sub. Nts., 12/1/02................ 500,000 531,250
Capital Gaming International, Inc. Promissory Nts......................... 5,500 --
Capitol Queen & Casino, Inc., 12% First Mtg. Nts., Series A, 11/15/00
(3)(9).................................................................. 200,000 140,000
Empress River Casino Finance Corp., 10.75% Sr. Gtd. Nts., 4/1/02.......... 750,000 786,562
GNF Corp., 10.625% Gtd. First Mtg. Nts., Series B, 4/1/03................. 250,000 258,750
Grand Casinos, Inc., 10.125% Gtd. First Mtg. Nts., 12/1/03................ 750,000 785,625
HMC Acquisition Properties, Inc., 9% Sr. Nts., 12/15/07 (4)............... 1,000,000 931,250
HMH Properties, Inc., 9.50% Sr. Sec. Nts., 5/15/05........................ 1,000,000 976,250
Mohegan Tribal Gaming Authority, 13.50% Sr. Sec. Nts., 11/15/02 (4)....... 1,000,000 1,245,000
Players International, Inc., 10.875% Sr. Nts., 4/15/05.................... 750,000 766,875
</TABLE>
5
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
CONSUMER RELATED (CONTINUED)
Hotel/Gaming (Continued)
Showboat Marina Casino Partnership/Showboat Marina Finance Corp., 13.50%
First Mtg. Nts., 3/15/03 (4)............................................ $ 750,000 $ 798,750
Station Casinos, Inc., 9.625% Sr. Sub. Nts., 6/1/03....................... 500,000 493,750
Trump Atlantic City Associates/Trump Atlantic City Funding, Inc., 11.25%
First Mtg. Nts., 5/1/06................................................. 1,000,000 1,028,750
------------
10,410,937
------------
Restaurants -- 0.3%
Carrols Corp., 11.50% Sr. Nts., 8/15/03................................... 500,000 511,250
Foodmaker, Inc., 9.25% Sr. Nts., 3/1/99................................... 250,000 243,125
------------
754,375
------------
Textile/Apparel -- 0.6%
Clark-Schwebel, Inc., 10.50% Sr. Nts., 4/15/06 (4)........................ 500,000 510,625
Consoltex Group, Inc., 11% Sr. Sub. Gtd. Nts., Series B, 10/1/03.......... 500,000 446,250
WestPoint Stevens, Inc., 9.375% Sr. Sub. Debs., 12/15/05.................. 750,000 738,750
------------
1,695,625
------------
ENERGY -- 3.9%
Chesapeake Energy Corp.:
10.50% Sr. Nts., 6/1/02................................................. 500,000 530,625
9.125% Sr. Nts., 4/15/06................................................ 500,000 497,500
Coda Energy, Inc., 10.50% Sr. Sub. Nts., 4/1/06 (4)....................... 750,000 757,500
Crown Central Petroleum Corp., 10.875% Sr. Nts., 2/1/05................... 500,000 510,000
DeepTech International, Inc., 12% Sr. Sec. Nts., 12/15/00................. 500,000 478,750
Falcon Drilling, Inc., 8.875% Sr. Nts., Series B, 3/15/03................. 1,000,000 990,000
Ferrellgas LP/Ferrellgas Finance Corp., 10% Sr. Nts., 8/1/01.............. 500,000 525,000
Giant Industries, Inc., 9.75% Sr. Sub. Nts., 11/15/03..................... 500,000 501,250
Kelley Oil & Gas Corp., 13.50% Sr. Nts., 6/15/99.......................... 850,000 892,500
OPI International, Inc., 12.875% Sr. Gtd. Nts., 7/15/02................... 1,000,000 1,115,000
Petroleum Heat & Power Co., Inc.:
12.25% Sub. Debs., 2/1/05............................................... 456,000 509,580
9.375% Sub. Debs., 2/1/06............................................... 1,000,000 987,500
Santa Fe Energy Resources, Inc., 11% Sr. Sub. Debs., 5/15/04.............. 1,000,000 1,095,000
TransTexas Gas Corp., 11.50% Sr. Sec. Gtd. Nts., 6/15/02.................. 1,000,000 1,008,750
United Meridian Corp., 10.375% Sr. Sub. Nts., 10/15/05.................... 750,000 783,750
Vintage Petroleum, Inc., 9% Sr. Sub. Nts., 12/15/05....................... 500,000 481,875
------------
11,664,580
------------
</TABLE>
6
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
FINANCIAL SERVICES -- 1.1%
Banks & Thrifts -- 0.2%
First Nationwide Holdings, Inc., 9.125% Sr. Sub. Nts., 1/15/03 (4)........ $ 750,000 $ 729,375
------------
Diversified Financial -- 0.4%
GPA Delaware, Inc., 8.75% Gtd. Nts., 12/15/98............................. 1,250,000 1,262,500
------------
Insurance -- 0.5%
American Life Holding Co., 11.25% Sr. Sub. Nts., 9/15/04.................. 790,000 837,400
Reliance Group Holdings, Inc., 9% Sr. Nts., 11/15/00...................... 500,000 500,000
------------
1,337,400
------------
HOUSING RELATED -- 0.8%
Building Materials -- 0.3%
Building Materials Corp., 0%/11.75% Sr. Deferred Coupon Nts., Series B,
7/1/04 (8).............................................................. 500,000 373,750
Pacific Lumber Co., 10.50% Sr. Nts., 3/1/03............................... 500,000 492,500
------------
866,250
------------
Homebuilders/Real Estate -- 0.5%
NVR, Inc., 11% Sr. Gtd. Nts., 4/15/03..................................... 500,000 507,500
Saul (B.F.) Real Estate Investment Trust, 11.625% Sr. Sec. Nts., Series B,
4/1/02.................................................................. 500,000 507,500
U.S. Home Corp., 9.75% Sr. Nts., 6/15/03.................................. 500,000 500,000
------------
1,515,000
------------
MANUFACTURING -- 0.8%
Aerospace/Electronics/Computers -- 0.2%
Tracor, Inc., 10.875% Sr. Sub. Nts., 8/15/01.............................. 500,000 535,000
------------
Automotive -- 0.6%
Aftermarket Technology Corp., 12% Sr. Sub. Nts., Series B, 8/1/04......... 500,000 535,000
Foamex LP/JPS Automotive Corp., 0%/14% Sr. Disc. Nts., Series B, 7/1/04
(8)..................................................................... 750,000 489,375
JPS Automotive Products Corp., 11.125% Sr. Nts., 6/15/01.................. 750,000 768,750
------------
1,793,125
------------
Capital Goods -- 0.0%
Farley, Inc., Zero Coupon Sub. Debs., 14.147%, 12/30/12 (3)(7)............ 198,000 20,491
------------
MEDIA -- 5.1%
Broadcasting -- 1.7%
American Radio Systems Corp., 9% Sr. Sub. Nts., 2/1/06.................... 500,000 487,500
</TABLE>
7
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
MEDIA (CONTINUED)
Broadcasting (Continued)
Argyle Television, Inc., 9.75% Sr. Sub. Nts., 11/1/05..................... $ 500,000 $ 485,000
New World Communications Group Holding Corp., Zero Coupon Sr. Disc. Nts.,
Series B, 11.837%, 6/15/99 (7).......................................... 750,000 551,250
Paxson Communications Corp., 11.625% Sr. Sub. Nts., 10/1/02............... 750,000 798,750
Sinclair Broadcast Group, Inc., 10% Sr. Sub. Nts., 9/30/05................ 1,000,000 980,000
Univision Television Group, Inc., 11.75% Sr. Sub. Nts., 1/15/01........... 1,300,000 1,387,750
Young Broadcasting, Inc., 9% Sr. Sub. Nts., 1/15/06 (4)................... 500,000 462,500
------------
5,152,750
------------
Cable Television -- 2.2%
American Telecasting, Inc., 0%/14.50% Sr. Disc. Nts., 6/15/04 (8)......... 750,000 555,000
Cablevision Industries Corp., 10.75% Sr. Nts., 1/30/02.................... 500,000 538,750
Century Communications Corp., 9.50% Sr. Nts., 3/1/05...................... 250,000 249,375
Comcast Corp., 10.625% Sr. Sub. Debs., 7/15/12............................ 500,000 544,375
EchoStar Communications Corp., 0%/12.875% Sr. Disc. Nts., 6/1/04
(8)(10)................................................................. 500,000 372,500
EchoStar Satellite Broadcasting Corp., 0%/13.125% Sr. Sec. Disc. Nts.,
3/15/04 (4)(8).......................................................... 500,000 311,250
Helicon Group LP/Helicon Capital Corp., 9% Sr. Sec. Nts., Series B,
11/1/03 (11)............................................................ 625,000 626,562
International CableTel, Inc.:
0%/10.875% Sr. Deferred Coupon Nts., 10/15/03 (8)....................... 1,000,000 747,500
0%/11.50% Sr. Deferred Coupon Nts., Series A, 2/1/06 (4)(8)............. 1,000,000 590,000
Marcus Cable Operating Co. LP/Marcus Cable Capital Corp., 0%/13.50% Sr.
Sub. Gtd. Disc. Nts., Series II, 8/1/04 (8)............................. 500,000 364,375
People's Choice TV Corp., 0%/13.125% Sr. Disc. Nts., 6/1/04 (8)........... 500,000 310,000
United International Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts.,
Series B, 14%, 11/15/99 (7)............................................. 1,000,000 650,000
Wireless One, Inc., 13% Sr. Nts., 10/15/03................................ 500,000 530,000
------------
6,389,687
------------
Diversified Media -- 0.9%
Heritage Media Corp., 8.75% Sr. Sub. Nts., 2/15/06........................ 900,000 850,500
Panamsat LP/Panamsat Capital Corp., 0%/11.375% Sr. Sub. Disc. Nts., 8/1/03
(8)..................................................................... 2,000,000 1,710,000
------------
2,560,500
------------
</TABLE>
8
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
MEDIA (CONTINUED)
Publishing/Printing -- 0.3%
Bell & Howell Co. (New), 0%/11.50% Sr. Disc. Debs., Series B, 3/1/05
(8)..................................................................... $ 500,000 $ 337,500
Hollinger International Publishing, Inc., 9.25% Sr. Sub. Gtd. Nts.,
2/1/06.................................................................. 500,000 482,500
------------
820,000
------------
OTHER -- 1.0%
Environmental -- 0.2%
Mid-American Waste Systems, Inc., 12.25% Sr. Sub. Nts., 2/15/03 (3)(9).... 300,000 198,000
Norcal Waste Systems, Inc., 12.50% Sr. Nts., 11/15/05 (4)(11)............. 500,000 525,625
------------
723,625
------------
Services -- 0.8%
Imo Industries, Inc., 11.75% Sr. Sub. Nts., 5/1/06 (3).................... 750,000 755,625
Protection One, Inc., 0%/13.625% Sr. Disc. Nts., 6/30/05 (8).............. 2,000,000 1,730,000
------------
2,485,625
------------
RETAIL -- 2.2%
Department Stores -- 0.2%
Federated Department Stores, Inc., 8.125% Sr. Nts., 10/15/02.............. 500,000 497,500
------------
Specialty Retailing -- 0.8%
Brylane LP/Brylane Capital Corp., 10% Sr. Sub. Nts., Series B, 9/1/03..... 750,000 708,750
Cole National Group, Inc., 11.25% Sr. Nts., 10/1/01....................... 500,000 512,500
Finlay Fine Jewelry Corp., 10.625% Sr. Nts., 5/1/03....................... 750,000 731,250
United Stationers Supply Co., 12.75% Sr. Sub. Nts., 5/1/05................ 500,000 548,750
------------
2,501,250
------------
Supermarkets -- 1.2%
Grand Union Co., 12% Sr. Nts., 9/1/04..................................... 1,000,000 897,500
Kash 'N Karry Food Stores, Inc., 11.50% Sr. Nts., 2/1/03.................. 951,300 956,057
Penn Traffic Co., 9.625% Sr. Sub. Nts., 4/15/05........................... 1,000,000 866,250
Ralph's Grocery Co., 10.45% Sr. Nts., 6/15/04............................. 1,000,000 985,000
------------
3,704,807
------------
TRANSPORTATION -- 0.7%
Air Transportation -- 0.2%
Atlas Air, Inc., 12.25% Pass-Through Certificates, 12/1/02................ 500,000 540,000
------------
</TABLE>
9
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
CORPORATE SECTOR (CONTINUED)
CORPORATE BONDS AND NOTES (CONTINUED)
TRANSPORTATION (CONTINUED)
Railroads -- 0.3%
Transtar Holdings LP/Transtar Capital Corp., 0%/13.375% Sr. Disc. Nts.,
Series B, 12/15/03 (8).................................................. $ 1,500,000 $ 1,023,750
------------
Shipping -- 0.2%
Trans Ocean Container Corp., 12.25% Sr. Sub. Nts., 7/1/04................. 750,000 780,000
------------
UTILITIES -- 4.5%
Electric Utilities -- 0.5%
El Paso Electric Co., 9.40% First Mtg. Bonds, Series E, 5/1/11............ 1,000,000 1,002,500
Ferrellgas Partners LP, 9.375% Sr. Sec. Nts., 6/15/06 (3)................. 500,000 497,500
------------
1,500,000
------------
Telecommunications -- 4.0%
American Communications Services, Inc., 0%/13% Sr. Disc. Nts., 11/1/05
(8)..................................................................... 700,000 385,000
Arch Communications Group, Inc., 0%/10.875% Sr. Disc. Nts., 3/15/08 (8)... 750,000 422,813
Brooks Fiber Properties, Inc., 0%/10.875% Sr. Disc. Nts., 3/1/06 (4)(8)... 750,000 416,250
Cellular Communications International, Inc., Zero Coupon Sr. Disc. Nts.,
12.972%, 8/15/00 (7).................................................... 2,000,000 1,200,000
Cellular, Inc., 0%/11.75% Sr. Sub. Disc. Nts., 9/1/03 (8)................. 2,000,000 1,650,000
Cencall Communications Corp., 0%/10.125% Sr. Disc. Nts., 1/15/04 (8)...... 500,000 298,750
Horizon Cellular Telephone LP/Horizon Finance Corp., 0%/11.375% Sr. Sub.
Disc. Nts., 10/1/00 (8)................................................. 2,000,000 1,790,000
In-Flight Phone Corp., 0%/14% Sr. Disc. Nts., 5/15/02 (8)................. 900,000 283,500
IntelCom Group (USA), Inc., 0%/13.50% Sr. Disc. Nts., 9/15/05 (8)......... 2,000,000 1,250,000
Intercel, Inc., 0%/12% Sr. Disc. Nts., 5/1/06 (8)......................... 1,500,000 843,750
MFS Communications Co., Inc.:
0%/8.875% Sr. Disc. Nts., 1/15/06 (8)................................... 1,250,000 776,563
0%/9.375% Sr. Disc. Nts., 1/15/04 (8)................................... 750,000 570,938
Nextel Communications, Inc., 0%/11.50% Sr. Disc. Nts., 9/1/03 (8)......... 500,000 335,000
PriCellular Wireless Corp.:
0%/12.25% Sr. Sub. Disc. Nts., 10/1/03 (8).............................. 1,000,000 780,000
0%/14% Sr. Sub. Disc. Nts., 11/15/01 (8)................................ 1,000,000 900,000
------------
11,902,564
------------
88,245,313
------------
Total Corporate Sector (Cost $89,121,287)................................. 88,689,506
------------
</TABLE>
10
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR -- 40.0%
FOREIGN CERTIFICATES OF DEPOSIT -- 2.0%
Bank Pacific CD, Zero Coupon, 17.948%, 3/5/96 (7)(12)(13) (IDR)........... 1,000,000,000 $ 214,646
CS First Boston, Inc. CD, 15.75%, 6/11/96 (4)(12) (IDR)................... 4,448,000,000 1,909,486
Indonesia (Republic of) Bank Negara CD, Zero Coupon, 15.916%, 6/17/96
(7)(12) (IDR)........................................................... 4,000,000,000 1,680,704
Krungthai Thanakit CD, Zero Coupon, 10.085%, 6/10/96 (7)(12) (THB)........ 52,000,000 2,040,356
------------
5,845,192
------------
FOREIGN CORPORATE BONDS AND NOTES -- 8.9%
Acetex Corp., 9.75% Sr. Sec. Nts., 10/1/03................................ 1,000,000 1,005,000
Banco Bamerindus do Brasil SA:
10.50% Debs., 6/23/97................................................... 500,000 482,500
11% Unsub. Unsec. Nts., 11/24/97........................................ 1,800,000 1,714,500
Banco de Colombia, 5.20% Cv. Jr. Sub. Unsec. Nts., 2/1/99................. 2,400,000 2,172,000
Banco Ganadero SA, Zero Coupon:
Nts., 9.931%, 7/1/96 (4)(7)............................................. 1,000,000 984,596
Sr. Unsub. Unsec. Nts., 9.931%, 6/15/96 (4)(7).......................... 500,000 494,318
Banco Itamarati SA:
10.50% Medium-Term Nts., 11/29/96....................................... 50,000 50,125
11.625% Sr. Unsec. Debs., 11/23/97...................................... 1,100,000 1,124,750
Banco Mexicano SA, 8% Sr. Unsub. Unsec. Exchangeable Medium-Term Nts.,
11/4/98................................................................. 1,000,000 938,750
Bell Cablemedia PLC, 0%/11.95% Sr. Disc. Nts., 7/15/04 (8)................ 2,000,000 1,460,000
Comcast UK Cable Partner Ltd., 0%/11.20% Sr. Disc. Debs., 11/15/07 (8).... 1,000,000 597,500
Comunicacion Celular SA, Units (each unit consists of $1,000 principal
0%/13.125% sr. deferred coupon bond, 11/15/03 and one warrant for 12,860
shares of common stock at $1.32 per 1,000 shares) (4)(8)(10)............ 1,000,000 605,000
Cott Corp., 9.375% Sr. Nts., 7/1/05....................................... 750,000 733,125
Diamond Cable Communications PLC, 0%/11.75% Sr. Disc. Nts., 12/15/05
(8)..................................................................... 500,000 305,000
Fundy Cable Ltd./Ltee, 11% Sr. Sec. Second Priority Nts., 11/15/05........ 500,000 510,000
Gearbulk Holding Ltd., 11.25% Sr. Nts., 12/1/04........................... 750,000 787,500
Imax Corp., 7% Sr. Nts., 3/1/01 (14)...................................... 1,000,000 995,000
</TABLE>
11
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR (CONTINUED)
FOREIGN CORPORATE BONDS AND NOTES (CONTINUED)
Indah Kiat International Finance Co. BV, 12.50% Sr. Sec. Gtd. Nts., Series
C, 6/15/06.............................................................. $ 750,000 $ 766,875
PT Inti Indorayon Utama, Zero Coupon Promissory Nts., 17.235%, 2/12/97 (7)
(IDR)................................................................... 2,700,000,000 1,020,678
Morgan Stanley Group, Inc., 14.25% Indian Rupee Indexed Nts., 6/26/96 (12)
(INR)................................................................... 15,705,000 451,957
PT Polysindo Eka Perkasa:
13% Sr. Nts., 6/15/01................................................... 1,000,000 1,062,500
Zero Coupon Promissory Nts., 17.903%, 10/23/96 (7) (IDR)................ 2,000,000,000 779,692
Zero Coupon Promissory Nts., 19.218%, 2/28/97 (7) (IDR)................. 1,000,000,000 367,354
Zero Coupon Promissory Nts., 19.347%, 4/29/97 (7) (IDR)................. 4,200,000,000 1,499,474
QUNO Corp., 9.125% Sr. Nts., 5/15/05...................................... 1,000,000 995,000
Repap New Brunswick, Inc., 9.875% First Priority Sr. Sec. Nts., 7/15/00... 200,000 200,000
Rogers Cablesystems Ltd., 10% Sr. Sec. Second Priority Debs., 12/1/07..... 500,000 511,250
TAG Heuer International SA, 12% Sr. Sub. Nts., 12/15/05 (4)............... 500,000 515,000
TeleWest PLC, 0%/11% Sr. Disc. Debs., 10/1/07 (8)......................... 2,000,000 1,245,000
Tembec Finance Corp., 9.875% Gtd. Sr. Nts., 9/30/05....................... 500,000 457,500
Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11 (3).......... 500,000 377,500
Videotron Holdings PLC, 0%/11% Sr. Disc. Nts., 8/15/05 (8)................ 2,000,000 1,330,000
------------
26,539,444
------------
FOREIGN GOVERNMENT OBLIGATIONS -- 25.8%
Algeria -- 1.1%
Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A,
6.812%, 9/4/06 (3)(11).................................................. 6,000,000 3,390,000
------------
Argentina -- 1.6%
Argentina (Republic of):
Past Due Interest Bonds, Series L, 6.312%, 3/31/05 (11)................. 6,930 5,301
Sr. Unsec. Unsub. Bonds, 13.45%, 10/21/97 (ITL)......................... 450,000,000 294,451
Banco Hipotecario Nacional (Argentina) Medium-Term Nts., 10.625%, 3/29/99
(3)..................................................................... 1,500,000 1,507,500
Buenos Aires (Province of):
Bonds, 10%, 3/5/01 (DEM)................................................ 1,500,000 1,007,486
Sr. Unsub. Unsec. Nts., 10%, 12/7/98 (DEM).............................. 3,000,000 2,073,661
------------
4,888,399
------------
</TABLE>
12
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR (CONTINUED)
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
Australia -- 1.5%
Australia (Commonwealth of) Bonds:
12%, 7/15/99 (AUD)...................................................... 1,050,000 $ 911,446
12.50%, 1/15/98 (AUD)................................................... 1,100,000 925,745
First Australia National Mortgage Acceptance Corp. Ltd. Bonds, Series 22,
11.40%, 12/15/01 (AUD).................................................. 1,754,865 1,474,352
New South Wales Treasury Corp. Gtd. Bonds, 12%, 12/1/01 (AUD)............. 1,125,000 1,014,585
------------
4,326,128
------------
Brazil -- 0.6%
Banco do Estado de Sao Paulo SA Nts., 9.25%, 10/4/96...................... 1,000,000 995,000
Banco Estado Minas Gerais, 8.25%, 2/10/00................................. 1,000,000 890,000
------------
1,885,000
------------
Bulgaria -- 0.1%
Bulgaria (Republic of) Disc. Bonds, Tranche A, 6.25%, 7/28/24 (11)........ 500,000 249,375
------------
Canada -- 1.0%
Canada (Government of) Bonds, 7.75%, 9/1/99 (2) (CAD)..................... 3,742,000 2,840,606
------------
Colombia -- 0.2%
Colombia (Republic of) Concorde Loan Participation, 6.188%, 1/31/98
(3)(11)................................................................. 660,043 650,142
------------
Costa Rica -- 0.4%
Central Bank of Costa Rica Interest Claim Bonds, Series B, 6.094%, 5/21/05
(11).................................................................... 1,176,172 1,046,794
------------
Denmark -- 0.5%
Denmark (Kingdom of) Bonds, 8%, 5/15/03 (DKK)............................. 8,560,000 1,547,584
------------
Ecuador -- 0.5%
Ecuador (Republic of) Disc. Bonds, 6.063%, 2/28/25 (11)................... 2,600,000 1,456,000
------------
Finland -- 0.5%
Finland (Republic of) Bonds, 9.50%, 3/15/04 (FIM)......................... 6,660,000 1,543,196
------------
Great Britain -- 2.4%
United Kingdom Treasury Nts., 13%, 7/14/00 (2) (GBP)...................... 3,935,000 7,112,348
------------
Ireland -- 0.5%
National Treasury Management Agency (Irish Government) Bonds, 8%, 10/18/00
(IEP)................................................................... 915,000 1,486,948
------------
</TABLE>
13
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR (CONTINUED)
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
Italy -- 0.8%
Italy (Republic of) Treasury Bonds, Buoni del Tesoro Poliennali, 10.50%,
11/1/98 (ITL)........................................................... 3,425,000,000 $ 2,271,639
------------
Jamaica -- 0.5%
Jamaica (Government of) 1990 Refinancing Agreement Nts.:
Tranche A, 6.344%, 10/16/00 (3)(11)..................................... 750,000 705,000
Tranche B, 6.063%, 11/15/04 (3)(11)..................................... 1,000,000 762,500
------------
1,467,500
------------
Jordan -- 1.1%
Hashemite Kingdom of Jordan:
Disc. Bonds, 6.437%, 12/23/23 (11)...................................... 2,250,000 1,535,625
Interest Arrears Bonds, 6.438%, 12/23/05 (11)........................... 2,260,000 1,802,350
------------
3,337,975
------------
Mexico -- 2.2%
United Mexican States:
Bonds, 10.375%, 1/29/03 (DEM)........................................... 7,000,000 4,678,778
Combined Facility 3, Loan Participation Agreement, Tranche A, 6.50%,
9/20/97 (3)(11)...................................................... 303,458 250,353
Nacional Financiera SNC Nts., 13.60%, 4/2/98 (ESP)...................... 100,000,000 821,453
Petroleos Mexicanos Gtd. Medium-Term Nts., 7.60%, 6/15/00............... 1,000,000 942,500
------------
6,693,084
------------
Morocco -- 0.3%
Morocco (Kingdom of) Loan Participation Agreement:
Tranche A, 6.594%, 1/1/09 (11).......................................... 400,000 287,375
Tranche B, 6.521%, 1/1/04 (11).......................................... 941,176 754,118
------------
1,041,493
------------
New Zealand -- 2.0%
New Zealand (Republic of) Bonds, 8%, 2/15/01 (NZD)........................ 9,160,000 6,080,574
------------
Norway -- 0.3%
Norwegian Government Bonds, 9.50%, 10/31/02 (NOK)......................... 4,860,000 869,612
------------
Panama -- 1.0%
Panama (Republic of):
Debs., 6.75%, 5/10/02 (11).............................................. 2,500,000 2,312,500
Past Due Interest Debs., 12/29/49 (15).................................. 1,000,000 546,500
------------
2,859,000
------------
</TABLE>
14
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR (CONTINUED)
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
Poland -- 0.7%
Poland (Republic of) Treasury Bills, Zero Coupon:
21.466%, 10/16/96 (7) (PLZ)............................................. 1,000,000 $ 342,076
22.131%, 7/17/96 (7) (PLZ).............................................. 2,500,000 898,309
22.405%, 7/24/96 (7) (PLZ).............................................. 2,200,000 787,501
------------
2,027,886
------------
Portugal -- 1.0%
Portugal (Republic of) Gtd. Bonds, Obrigicion do tes Medio Prazo, 11.875%,
2/23/00 (2) (PTE)....................................................... 405,000,000 2,886,107
------------
Spain -- 1.6%
Spain (Kingdom of) Gtd. Bonds, Bonos y Obligacion del Estado, 12.25%,
3/25/00 (ESP)........................................................... 530,000,000 4,690,553
------------
Supranational -- 0.6%
European Bank for Reconstruction & Development Sr. Unsec. Medium-Term
Nts., 10%, 12/20/96 (CZK)............................................... 54,000,000 1,929,260
------------
Sweden -- 0.9%
Sweden (Kingdom of) Bonds, Series 1028, 11%, 1/21/99 (SEK)................ 16,200,000 2,615,159
------------
Thailand -- 0.7%
Thai Fuji Finance Zero Coupon Bonds, 10.348%, 6/3/96 (7) (THB)............ 50,000,000 1,962,350
------------
Trinidad & Tobago -- 0.6%
Trinidad & Tobago Loan Participation Agreement:
Tranche A, 1.772%, 9/30/00 (3)(11) (JPY)................................ 108,000,000 886,670
Tranche B, 1.772%, 9/30/00 (3)(11) (JPY)................................ 108,000,000 886,670
------------
1,773,340
------------
Venezuela -- 0.6%
Venezuela (Republic of):
Disc. Bonds, Series DL, 6.563%, 12/18/07 (11)........................... 2,000,000 1,310,000
Front-Loaded Interest Reduction Bonds, Series A, 6.375%, 3/31/07 (11)... 825,000 547,594
------------
1,857,594
------------
76,785,646
------------
STRUCTURED INSTRUMENTS -- 3.3%
Banque Paribas, Grand Cayman Branch, 31.81% Pass-Through CD, 2/1/97
(HUF)................................................................... 100,000,000 691,906
</TABLE>
15
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
INTERNATIONAL SECTOR (CONTINUED)
STRUCTURED INSTRUMENTS (CONTINUED)
Bayerische Landesbank Girozentrale, New York Branch, 5.60% CD Linked Nts.,
1/30/97 (indexed to the closing Nikkei 225 Index on 1/23/97 10 yr.
Japanese Yen swap rate & New Zealand Dollar on 1/28/97) (12) (NZD)...... 1,508,523 $ 1,106,012
Canadian Imperial Bank of Commerce, New York Branch, 16% CD Linked Nts.,
9/11/96 (indexed to the Russian Federation GKO, Zero Coupon, 9/4/96).... 1,500,000 1,491,750
Canadian Imperial Bank, 10% CD British Pound Sterling Maximum Rate Linked
Nts., 11/8/96 (indexed to the 3-month GBP LIBOR, multiplied by 9) (3)... 750,000 765,675
ING Baring Securities Ltd., Zero Coupon Promissory Nts., 10.518%, 4/28/97
(7) (CZK)............................................................... 30,600,000 992,400
ING Baring Securities Ltd., Zero Coupon Promissory Nts., 11.13%, 7/18/96
(7) (CZK)............................................................... 28,000,000 984,541
Salomon Brothers, Inc., Zero Coupon Brazilian Credit Linked Nts., 12.38%,
1/3/97 (indexed to the Brazilian National Treasury Nts., Zero Coupon,
1/2/97) (7)............................................................. 3,000,000 2,776,800
United Mexican States Linked Nts. (indexed to the greater of Cetes Option
Amount or USD LIBOR Option Amount, 11/27/96) (3)........................ 1,000,000 1,143,750
------------
9,952,834
------------
</TABLE>
<TABLE>
<CAPTION>
Date Strike Contracts
------- ----------- ----------
<S> <C> <C> <C> <C>
CALL OPTION PURCHASED -- 0.0%
OTC German Deutsche Mark/U.S. Dollar Call Opt........ 5/2/96 1.495 DEM 2,288,084 229
------------
PUT OPTION PURCHASED -- 0.0%
OTC German Deutsche Mark/U.S. Dollar Put Opt......... 5/2/96 1.495 DEM 2,288,084 54,457
------------
Total International Sector (Cost $117,661,471)....... 119,177,802
------------
</TABLE>
<TABLE>
<CAPTION>
Face Amount(1)
--------------
<S> <C> <C>
MORTGAGE-BACKED SECTOR -- 20.1%
GOVERNMENT AGENCY -- 19.8%
FHLMC/FNMA/Sponsored -- 12.8%
Federal Home Loan Mortgage Corp.:
Certificates of Participation, 12%, 10/1/11............................. $ 490,707 558,346
Certificates of Participation, 12%, 10/1/14............................. 204,305 227,136
Certificates of Participation, 12%, 5/1/10.............................. 792,275 898,392
Certificates of Participation, 12%, 6/1/15.............................. 300,762 343,246
Certificates of Participation, 12%, 8/1/13.............................. 45,271 51,666
Certificates of Participation, 12%, 8/1/14.............................. 917,598 1,047,210
</TABLE>
16
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Market Value
Face Amount(1) See Note 1
-------------- ------------
<S> <C> <C>
MORTGAGE-BACKED SECTOR (CONTINUED)
GOVERNMENT AGENCY (CONTINUED)
FHLMC/FNMA/Sponsored (Continued)
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg.
Participation Certificates, 6.65%, 4/15/21........................... $ 4,700,000 $ 4,504,621
Federal National Mortgage Assn.:
11%, 7/1/16............................................................. 1,156,021 1,290,048
7%, 11/1/25............................................................. 18,227,502 17,581,337
Gtd. Mtg. Pass-Through Certificates, 13%, 6/1/15........................ 1,526,661 1,791,430
Interest-Only Stripped Mtg.-Backed Security, Trust 222, Cl. 2, 17.56%,
6/1/23 (16).......................................................... 20,435,264 6,849,006
Interest-Only Stripped Mtg.-Backed Security, Trust 257, Cl. 2, 11.472%,
2/1/24 (16).......................................................... 6,090,328 2,089,744
Principal-Only Stripped Mtg.-Backed Security, Trust 4, Cl. J, Zero
Coupon, 1.786%, 9/25/22 (17)......................................... 1,700,000 850,000
------------
38,082,182
------------
GNMA/Guaranteed -- 7.0%
Government National Mortgage Assn.:
6%, 5/15/26 (15)........................................................ 4,000,000 3,980,000
7%, 3/15/26............................................................. 2,697,037 2,598,974
7%, 4/15/26............................................................. 2,000,000 1,927,280
7%, 5/1/26 (15)......................................................... 2,500,000 2,407,025
7.50%, 8/15/25.......................................................... 9,053,582 8,955,079
12%, 11/20/13........................................................... 268,304 307,627
12%, 2/20/15............................................................ 313,760 359,745
12%, 9/20/15............................................................ 248,587 270,612
------------
20,806,342
------------
PRIVATE -- 0.3%
Commercial -- 0.3%
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through Certificates,
Series 1996-C1, Cl. D-1, 7.51%, 2/21/28 (3)............................. 1,000,000 956,875
------------
Total Mortgage-Backed Sector (Cost $60,320,758)........................... 59,845,399
------------
MONEY MARKET SECTOR -- 0.1%
Repurchase agreement with J.P. Morgan Securities, Inc., 5.31%, dated
4/30/96, to be repurchased at $400,059 on 5/1/96, collateralized by U.S.
Treasury Bonds, 8.75%-9.875%, 11/15/15-8/15/17, with a value of $411,855
(Cost $400,000)......................................................... 400,000 400,000
------------
Total Investments, at Value (Cost $291,149,716)........................... 98.2% 292,581,268
Other Assets Net of Liabilities........................................... 1.8 5,304,416
-------------- ------------
Net Assets................................................................ 100.0% $297,885,684
-------------- ------------
-------------- ------------
</TABLE>
17
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
1. Face amount is reported in U.S. Dollars, except for those denoted in the
following currencies:
<TABLE>
<S> <C> <C> <C>
AUD -- Australian Dollar IEP -- Irish Punt
CAD -- Canadian Dollar INR -- Indian Rupee
CZK -- Czech Koruna ITL -- Italian Lira
DEM -- German Deutsche Mark JPY -- Japanese Yen
DKK -- Danish Krone NOK -- Norwegian Krone
ESP -- Spanish Peseta NZD -- New Zealand Dollar
FIM -- Finnish Markka PLZ -- Polish Zloty
GBP -- British Pound Sterling PTE -- Portuguese Escudo
HUF -- Hungarian Forint SEK -- Swedish Krona
IDR -- Indonesian Rupiah THB -- Thai Baht
</TABLE>
2. A sufficient amount of liquid assets has been designated to cover
outstanding written call options, as follows:
<TABLE>
<CAPTION>
CONTRACTS EXPIRATION EXERCISE PREMIUM MARKET VALUE
SUBJECT TO CALL DATE PRICE RECEIVED SEE NOTE 1
--------------- ---------- -------- -------- ------------
<S> <C> <C> <C> <C> <C>
OTC Australian Dollar Call Opt............ 1,080,063 5/20/96 1.273 AUD $ 8,749 $ 7,452
OTC Australian Dollar Call Opt............ 540,513 5/24/96 1.272 AUD 4,621 3,730
OTC Australian Dollar Call Opt............ 542,231 5/28/96 1.268 AUD 4,392 2,874
OTC German Deutsche Mark/U.S. Dollar Call
Opt..................................... 2,288,085 5/2/96 1.495 DEM 55,143 229
------- ------------
$72,905 $ 14,285
------- ------------
------- ------------
</TABLE>
3. Identifies issues considered to be illiquid -- See Note 8 of Notes to
Financial Statements.
4. Represents a security sold under Rule 144A, which is exempt from
registration under the Securities Act of 1933, as amended. This security has
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $11,849,025 or 3.98% of the Fund's net
assets, at April 30, 1996.
5. Non-income producing security.
6. Interest or dividend is paid in kind.
7. For zero coupon bonds, the interest rate shown is the effective yield on the
date of purchase.
8. Denotes a step bond: a zero coupon bond that converts to a fixed rate of
interest at a designated future date.
9. Non-income producing -- issuer is in default of interest payment.
10. Units may be comprised of several components, such as debt and equity and/or
warrants to purchase equity at some point in the future. For units which
represent debt securities, face amount disclosed represents total underlying
principal.
11. Represents the current interest rate for a variable rate security.
12. Indexed instrument for which the principal amount and/or interest due at
maturity is affected by the relative value of a foreign currency.
13. Issuer is in default. The security is being valued under procedures
established by the Board of Trustees to determine fair value in good faith.
14. Represents the current interest rate for an increasing rate security.
15. When-issued security to be delivered and settled after April 30, 1996.
16. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed-income
securities increase in price when interest rates decline. The principal
amount of the underlying pool represents the notional amount on which
current interest is calculated. The price of these securities is typically
more sensitive to changes in prepayment rates than traditional mortgage-
backed securities (for example, GNMA pass-throughs). Interest rates
disclosed represent current yields based upon the current cost basis and
estimated timing and amount of future cash flows.
17. Principal-Only Strips represent the right to receive the monthly principal
payments on an underlying pool of mortgage loans. The value of these
securities generally increases as interest rates decline and prepayment
rates rise. The price of these securities is typically more volatile than
that of coupon-bearing bonds of the same maturity. Interest rates disclosed
represent current yields based upon the current cost basis and estimated
timing of future cash flows.
See accompanying Notes to Financial Statements.
18
<PAGE>
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES April 30, 1996 (Unaudited)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $291,149,716) -- see accompanying statement................. $292,581,268
Cash...................................................................................... 1,279,207
Unrealized appreciation on forward foreign currency exchange contracts -- Note 5........ 272,523
Receivables:
Investments sold and options written.................................................... 13,819,550
Interest and principal paydowns......................................................... 5,818,787
Closed forward foreign currency exchange contracts...................................... 79,391
Other..................................................................................... 50,717
------------
Total assets......................................................................... 313,901,443
------------
LIABILITIES:
Options written, at value (premiums received $72,905) -- see accompanying
statement -- Note 7................................................................... 14,285
Unrealized depreciation on forward foreign currency exchange contracts -- Note 5........ 5,618
Payables and other liabilities:
Investments purchased................................................................... 15,420,428
Dividends............................................................................... 224,629
Trustees' fees.......................................................................... 153,334
Shareholder reports..................................................................... 87,314
Management and administrative fees...................................................... 59,201
Closed forward foreign currency exchange contracts...................................... 26,245
Other................................................................................... 24,705
------------
Total liabilities.................................................................... 16,015,759
------------
NET ASSETS................................................................................ $297,885,684
------------
------------
COMPOSITION OF NET ASSETS:
Par value of shares of beneficial interest................................................ $ 291,161
Additional paid-in capital................................................................ 315,440,767
Overdistributed net investment income..................................................... (115,894)
Accumulated net realized loss on investments and foreign currency transactions............ (19,459,751)
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies....................................................... 1,729,401
------------
NET ASSETS -- Applicable to 29,116,068 shares of beneficial interest outstanding........ $297,885,684
------------
------------
NET ASSET VALUE PER SHARE................................................................. $10.23
------
------
</TABLE>
See accompanying Notes to Financial Statements.
19
<PAGE>
<PAGE>
STATEMENT OF OPERATIONS For the Six Months Ended April 30, 1996 (Unaudited)
Oppenheimer Multi-Sector Income Trust
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest (net of foreign withholding taxes of $12,383)...................................... $14,876,076
Dividends................................................................................... 68,098
-----------
Total income...................................................................... 14,944,174
-----------
EXPENSES:
Management fees -- Note 4................................................................. 962,337
Administrative fees -- Note 4............................................................. 295,978
Shareholder reports......................................................................... 100,720
Trustees' fees and expenses -- Note 1..................................................... 71,428
Transfer agent and accounting service fees -- Note 4........................................ 41,963
Custodian fees and expenses................................................................. 39,664
Legal and auditing fees..................................................................... 19,489
Registration and filing fees................................................................ 15,850
Other....................................................................................... 6,199
-----------
Total expenses.................................................................... 1,553,628
-----------
NET INVESTMENT INCOME....................................................................... 13,390,546
-----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments............................................................................... 5,585,707
Closing of futures contracts.............................................................. (325,072)
Closing and expiration of options written -- Note 7..................................... (174,620)
Foreign currency transactions............................................................. 319,442
-----------
Net realized gain................................................................. 5,405,457
-----------
Net change in unrealized appreciation or depreciation on:
Investments............................................................................... (1,534,396)
Translation of assets and liabilities denominated in foreign currencies................... (1,110,881)
-----------
Net change........................................................................ (2,645,277)
-----------
NET REALIZED AND UNREALIZED GAIN............................................................ 2,760,180
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................................ $16,150,726
-----------
-----------
</TABLE>
See accompanying Notes to Financial Statements.
20
<PAGE>
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Six Months Ended
April 30, 1996 Year Ended
(Unaudited) October 31, 1995
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income....................................................... $ 13,390,546 $ 27,458,297
Net realized gain (loss).................................................... 5,405,457 (9,847,515)
Net change in unrealized appreciation or depreciation....................... (2,645,277) 8,597,737
---------------- ----------------
Net increase in net assets resulting from operations................... 16,150,726 26,208,519
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income........................................ (13,393,365) (26,608,817)
Tax return of capital distribution.......................................... -- (625,807)
BENEFICIAL INTEREST TRANSACTIONS:
Proceeds from shares issued to shareholders in reinvestment of
dividends -- Note 2..................................................... -- 496,299
---------------- ----------------
NET ASSETS:
Total increase (decrease)................................................... 2,757,361 (529,806)
Beginning of period......................................................... 295,128,323 295,658,129
---------------- ----------------
End of period (including overdistributed net investment income of $115,894
and $113,075, respectively)............................................... $297,885,684 $295,128,323
---------------- ----------------
---------------- ----------------
</TABLE>
See accompanying Notes to Financial Statements.
21
<PAGE>
<PAGE>
FINANCIAL HIGHLIGHTS
Oppenheimer Multi-Sector Income Trust
<TABLE>
<CAPTION>
Six Months
Ended
April 30, Year Ended October 31,
1996 ------------------------------------------------------------
(Unaudited) 1995 1994 1993 1992 1991
----------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period... $ 10.14 $ 10.17 $ 10.96 $ 10.46 $ 10.64 $ 9.88
----------- -------- -------- -------- -------- --------
Income (loss) from investment
operations:
Net investment income................ .46 .94 1.00 1.08 1.06 1.11
Net realized and unrealized gain
(loss)............................. .09 (.04) (.82) .43 (.08) .82
----------- -------- -------- -------- -------- --------
Total income from investment
operations....................... .55 .90 .18 1.51 .98 1.93
----------- -------- -------- -------- -------- --------
Dividends and distributions to
shareholders:
Dividends from net investment
income............................. (.46) (.91) (.84) (1.01) (1.16) (1.07)
Distributions from net realized
gain............................... -- -- -- -- -- (.10)
Tax return of capital................ -- (.02) (.13) -- -- --
----------- -------- -------- -------- -------- --------
Total dividends and distributions
to shareholders.................. (.46) (.93) (.97) (1.01) (1.16) (1.17)
----------- -------- -------- -------- -------- --------
Net asset value, end of period......... $ 10.23 $ 10.14 $ 10.17 $ 10.96 $ 10.46 $ 10.64
----------- -------- -------- -------- -------- --------
----------- -------- -------- -------- -------- --------
Market value, end of period............ $ 9.38 $ 10.00 $ 9.50 $ 11.25 $ 11.13 $ 11.13
TOTAL RETURN, AT MARKET VALUE(1)....... (1.91)% 15.62% (7.46)% 11.10% 11.48% 33.05%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)........................... $ 297,886 $295,128 $295,658 $316,647 $299,368 $301,568
Average net assets (in thousands)...... $ 297,650 $288,884 $306,686 $307,244 $303,773 $289,681
Ratios to average net assets:
Net investment income................ 9.05%(3) 9.51% 9.17% 10.13% 9.95% 10.80%
Expenses............................. 1.05%(3) 1.05% 1.02% 1.00% 1.11% 1.16%(2)
Portfolio turnover rate(4)............. 125.8% 240.1% 187.6% 131.3% 95.9% 59.7%
</TABLE>
(1) Assumes a hypothetical purchase at the current market price on the business
day before the first day of the fiscal period, with all dividends and
distributions reinvested in additional shares on the reinvestment date, and
a sale at the current market price on the last business day of the period.
Total return does not reflect sales charges or brokerage commissions. Total
returns are not annualized for periods of less than one full year.
(2) Includes $.01 per share of federal excise tax expense. The expense ratio,
exclusive of federal excise tax expense, was 1.10%.
(3) Annualized.
(4) 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, 1996 were $344,154,132
and $347,454,144, respectively.
See accompanying Notes to Financial Statements.
22
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
Oppenheimer Multi-Sector Income Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Multi-Sector Income Trust (the Trust) is registered under the
Investment Company Act of 1940, as amended, as a diversified, closed-end
management investment company. The Trust's investment objective is to seek high
current income consistent with preservation of capital. The Trust's investment
advisor is OppenheimerFunds, Inc. (the Manager). The following is a summary of
significant accounting policies consistently followed by the Trust.
Investment Valuation -- Portfolio securities are valued at the close of the
New York Stock Exchange on the last day of each week on which day the New York
Stock Exchange is open. 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 asked price
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 the
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. Forward foreign currency contracts are valued based on the
closing prices of the forward currency contract rates in the London foreign
exchange markets on a daily basis as provided by a reliable bank or dealer.
Options are valued based upon the last sale price on the principal exchange on
which the option is traded or, in the absence of any transactions that day, the
value is based upon the last sale price on the prior trading date if it is
within the spread between the closing bid and asked prices. If the last sale
price is outside the spread, the closing bid or asked price closest to the last
reported sale price is used.
Securities Purchased on a When-Issued Basis -- Delivery and payment for
securities that have been purchased by the Trust on a forward commitment or
when-issued basis can take place a month or more after the transaction date.
During this period, such securities do not earn interest, are subject to market
fluctuation and may increase or decrease in value prior to their delivery. The
Trust maintains, in a segregated account with its custodian, assets with a
market value equal to the amount of its purchase commitments. The purchase of
securities on a when-issued or forward commitment basis may increase the
volatility of the Trust's net asset value to the extent the Trust makes such
purchases while remaining substantially fully invested. As of April 30, 1996,
the Trust had entered into outstanding when-issued or forward commitments of
$6,888,750.
In connection with its ability to purchase securities on a when-issued or
forward commitment basis, the Trust may enter into mortgage 'dollar-rolls' in
which the Trust sells securities for delivery in the current month and
simultaneously contracts with the same counterparty to repurchase similar (same
type, coupon and maturity) but not identical securities on a specified future
date. The Trust records each dollar-roll as a sale and a new purchase
transaction.
23
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
Security Credit Risk -- The Trust invests in high yield securities, which may
be subject to a greater degree of credit risk, greater market fluctuations and
risk of loss of income and principal, and may be more sensitive to economic
conditions than lower yielding, higher rated fixed income securities. The Trust
may acquire securities in default, and is not obligated to dispose of securities
whose issuers subsequently default. At April 30, 1996, securities with an
aggregate market value of $552,646, representing 0.19% of the Trust's net
assets, were in default.
Foreign Currency Translation -- The accounting records of the Trust are
maintained in U.S. dollars. Prices of securities denominated in foreign
currencies are translated into U.S. dollars at the closing rates of exchange.
Amounts related to the purchase and sale of securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Trust's Statement of Operations.
Repurchase Agreements -- The Trust requires the custodian to take possession,
to have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Trust may be delayed or limited.
Federal Taxes -- The Trust 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.
Trustees' Fees and Expenses -- The Trust has adopted a nonfunded retirement
plan for the Trust's independent trustees. Benefits are based on years of
service and fees paid to each trustee during the years of service. During the
six months ended April 30, 1996, a provision of $36,454 was made for the Trust's
projected benefit obligations and payments of $4,853 were made to retired
trustees, resulting in an accumulated liability of $144,675 at April 30, 1996.
Distributions to Shareholders -- The Trust intends to declare and pay
dividends from net investment income monthly. Distributions from net realized
gains on investments, if any, will be made at least once each year.
Classification of Distributions to Shareholders -- Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of paydown gains and losses and the recognition of certain
foreign currency gains (losses) as ordinary income (loss) for tax purposes. The
character of the distributions made during the year from net investment income
or net realized gains may differ from their ultimate characterization for
federal income tax purposes. Also, due to timing of dividend distributions, the
fiscal year in which amounts
24
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
are distributed may differ from the year that the income or realized gain (loss)
was recorded by the Trust.
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. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
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. Dividends in kind are recognized as income
on the ex-dividend date, at the current market value of the underlying security.
Interest on payment-in-kind debt instruments is accrued as income at the coupon
rate and a market adjustment is made periodically.
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.
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of $.01 par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
April 30, 1996 October 31, 1995
----------------- -----------------
Shares Amount Shares Amount
------ -------- ------ --------
<S> <C> <C> <C> <C>
Net increase from
dividends
reinvested....... -- $ -- 51,219 $496,299
</TABLE>
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At April 30, 1996 net unrealized appreciation on investments and options written
of $1,490,172 was composed of gross appreciation of $7,710,643, and gross
depreciation of $6,220,471.
4. MANAGEMENT AND ADMINISTRATIVE FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Trust which provides for an annual fee of 0.65% on
the Trust's average annual net assets.
Mitchell Hutchins Asset Management Inc. serves as the Trust's Administrator. The
Trust pays the Administrator an annual fee of 0.20% of the Trust's average
annual net assets.
The Manager acts as the accounting agent for the Trust at an annual fee of
$24,000, plus out-of-pocket costs and expenses reasonably incurred.
25
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
Shareholder Financial Services, Inc. (SFSI), a wholly-owned subsidiary of the
Manager, is the transfer agent and registrar for the Trust. Fees paid to SFSI
are based on the number of accounts and the number of shareholder transactions,
plus out-of-pocket costs and expenses.
5. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
A forward foreign currency exchange contract (forward contract) is a commitment
to purchase or sell a foreign currency at a future date, at a negotiated rate.
The Trust uses forward contracts to seek to manage foreign currency risks. They
may also be used to tactically shift portfolio currency risk. The Trust
generally enters into forward contracts as a hedge upon the purchase or sale of
a security denominated in a foreign currency. In addition, the Trust may enter
into such contracts as a hedge against changes in foreign currency exchange
rates on portfolio positions.
Forward contracts are valued based on the closing prices of the forward currency
contract rates in the London foreign exchange markets on a daily basis as
provided by a reliable bank or dealer. The Trust will realize a gain or loss
upon the closing or settlement of the forward transaction.
Securities held in segregated accounts to cover net exposure on outstanding
forward contracts are noted in the Statement of Investments where applicable.
Unrealized appreciation or depreciation on forward contracts is reported in the
Statement of Assets and Liabilities. Realized gains and losses are reported with
all other foreign currency gains and losses in the Trust's Statement of
Operations.
Risks include the potential inability of the counterparty to meet the terms of
the contract and unanticipated movements in the value of a foreign currency
relative to the U.S. dollar.
At April 30, 1996, outstanding forward contracts to purchase and sell currencies
were as follows:
<TABLE>
<CAPTION>
Valuation
Contract as of
Expiration Amount April 30, Unrealized Unrealized
Contracts to Sell Date (000s) 1996 Appreciation Depreciation
- - ------------------------------------ --------------- ----------- --------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Swiss Francs (CHF).................. 6/17/96-7/18/96 3,391 CHF $ 2,742,085 $ 37,334 $ --
Danish Krone (DKK).................. 5/2/96 9,150 DKK 1,547,600 5,860 --
Japanese Yen (JPY).................. 12/18/96 203,550 JPY 1,997,044 109,446 --
New Zealand Dollar (NZD)............ 5/1/96 7 NZD 4,761 -- 12
--------------- ------------ ------
$ 6,291,490 152,640 12
--------------- ------------ ------
---------------
Contracts to Purchase
- - ------------------------------------
Finnish Markka (FIM)................ 5/2/96 7,590 FIM $ 1,564,263 $ -- $5,606
New Zealand Dollar (NZD)............ 12/18/96 3,319 NZD 2,226,373 119,883 --
--------------- ------------ ------
$ 3,790,636 119,883 5,606
--------------- ------------ ------
---------------
$272,523 $5,618
------------ ------
------------ ------
</TABLE>
26
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
6. FUTURES CONTRACTS
The Trust may buy and sell interest rate futures contracts in order to gain
exposure to or protect against changes in interest rates. The Trust may also buy
or write put or call options on these futures contracts.
The Trust generally sells futures contracts to hedge against increases in
interest rates and the resulting negative effect on the value of fixed rate
portfolio securities. The Trust may also purchase futures contracts to gain
exposure to changes in interest rates as it may be more efficient or cost
effective than actually buying fixed income securities.
Upon entering into a futures contract, the Trust is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Trust each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Trust recognizes a realized gain or loss when the contract is closed
or expired.
Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.
7. OPTION ACTIVITY
The Trust may buy and sell put and call options, or write covered put and call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Trust generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Trust receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Trust will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Shares subject to call, expiration
date, exercise price, premium received and market value are detailed in a
footnote to the Statement of Investments. Options written are reported as a
liability in the Statement of Assets and Liabilities. Gains and losses are
reported in the Statement of Operations.
The risk in writing a call option is that the Trust gives up the opportunity for
profit if the market price of the security increases and the option is
exercised. The risk in writing a put option is that the Trust may incur a loss
if the market price of the security decreases and the option is exercised. The
risk in buying an option is that the Trust pays a premium whether or not the
option is exercised. The Trust also has the additional risk of not being able to
enter into a closing transaction if a liquid secondary market does not exist.
27
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
Written option activity for the six months ended April 30, 1996 was as follows:
<TABLE>
<CAPTION>
Call Options
--------------------------
Number Amount
of of
Options Premiums
---------- -----------
<S> <C> <C>
Options outstanding at
October 31, 1995........... 7,745 $ 91,447
Options written............. 10,449,826 211,006
Options closed or expired... (6,006,680) (229,548)
---------- -----------
Options outstanding at
April 30, 1996............. 4,450,891 $ 72,905
---------- -----------
---------- -----------
</TABLE>
8. ILLIQUID AND RESTRICTED SECURITIES
At April 30, 1996, investments in securities included issues that are illiquid
or restricted.
The securities are often purchased in private placement transactions, are not
registered under the Securities Act of 1933, may have contractual restrictions
on resale, and are valued under methods approved by the Board of Trustees as
reflecting fair value. The Trust intends to invest no more than 10% of its net
assets (determined at the time of purchase) in illiquid or restricted
securities. The aggregate value of these securities subject to this limitation
at April 30, 1996 was $16,266,646 which represents 5.46% of the Trust's net
assets.
28
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Sector Income Trust
Information concerning these securities is as follows:
<TABLE>
<CAPTION>
Valuation Per
Acquisition Cost Unit as of
Security Date Per Unit April 30, 1996
- - ---------------------------------------------------------------- ----------- --------- ------------------
<S> <C> <C> <C>
Algeria (Republic of) Reprofiled Debt Loan Participation,
Tranche A, 6.812%, 9/4/06..................................... 3/13/96- $ 55.00 $ 56.50
3/21/96
American Communications Services, Inc. Wts., Exp. 11/05......... 2/8/96- $ -- $ 65.00
2/14/96
Ames Department Stores, Inc.:
Excess Cash Flow Payment Certificates, Series AG-7A........... 12/30/92 $ -- $ 0.01
Litigation Trust.............................................. 12/30/92 $ -- $ 0.01
Arizona Charlie's, Inc., 12% First Mtg. Nts., Series A,
11/15/00...................................................... 11/18/93 $ 100.00 $ 65.00
Banco Hipotecario Nacional (Argentina) Medium-Term Nts.,
10.625%, 3/29/99.............................................. 3/22/96 $ 99.95 $ 100.50
Becker Gaming, Inc. Wts., Exp. 11/00............................ 11/18/93 $ 2.00 $ 0.25
Canadian Imperial Bank, 10% CD British Pound Sterling Maximum
Rate Linked Nts., 11/8/96..................................... 4/28/95 $ 100.00 $ 102.09
Capitol Queen & Casino, Inc., 12% First Mtg. Nts., Series A,
11/15/00...................................................... 11/18/93 $ 87.50 $ 70.00
Colombia (Republic of) Concorde Loan Participation, 6.188%,
1/31/98....................................................... 12/5/95 $ 99.00 $ 98.50
Farley, Inc., Zero Coupon Sub. Debs., 14.147%, 12/30/12......... 1/1/93- $ 7.44 $ 10.35
3/10/95
Ferrellgas Partners LP, 9.375% Sr. Sec. Nts., 6/15/06........... 4/23/96 $ 100.00 $ 99.50
Imo Industries, Inc., 11.75% Sr. Sub. Nts., 5/1/06.............. 4/23/96 $ 98.56 $ 100.75
In-Flight Phone Corp. Wts., Exp. 8/02........................... 4/28/95 $ -- $ --
IntelCom Group, Inc. Wts., Exp. 9/05............................ 8/3/95- $ -- $ 12.00
10/13/95
Jamaica (Government of) 1990 Refinancing Agreement Nts.:
Tranche A, 6.344%, 10/16/00................................... 7/12/95- $ 88.75 $ 94.00
8/15/95
Tranche B, 6.063%, 11/15/04................................... 3/12/96 $ 71.75 $ 76.25
Mid-American Waste Systems, Inc., 12.25% Sr. Sub. Nts.,
2/15/03....................................................... 2/7/96 $ 79.00 $ 66.00
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through
Certificates, Series 1996-C1, Cl. D-1, 7.51%, 2/1/28.......... 4/25/96 $ 96.02 $ 95.69
SDW Holdings Corp.:
15% Cum. Sr. Exchangeable Preferred Stock..................... 6/30/95 $ 27.04 $ 29.50
Cl. B Wts., Exp. 12/06........................................ 6/30/95 $ -- $ 13.00
Terex Corp. Rts., Exp. 7/96..................................... 6/29/94 $ 1.49 $ 0.05
Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred
Stock......................................................... 4/3/96 $1,000.00 $ 1,000.00
Triangle Wire & Cable, Inc. Common Stock........................ 5/2/94 $ 9.50 $ 1.00
Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11.... 1/31/96 $ 76.50 $ 75.50
Trinidad & Tobago Loan Participation Agreement:
Tranche A, 1.772%, 9/30/00.................................... 12/18/95 $ 84.00 $ 86.00
Tranche B, 1.772%, 9/30/00.................................... 12/13/95 $ 84.00 $ 86.00
United Mexican States:
Linked Nts.................................................... 11/30/95 $ 100.00 $ 114.38
Combined Facility 3, Loan Participation Agreement, Tranche A,
6.50%, 9/20/97.............................................. 10/25/94 $ 89.00 $ 82.50
</TABLE>
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GENERAL INFORMATION CONCERNING THE TRUST
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-Sector Income Trust (the Trust) is a closed-end diversified
management investment company with a primary investment objective of seeking
high current income consistent with preservation of capital. The Trust's
secondary investment objective is capital appreciation. In seeking its
objectives, the Trust may invest any percentage of its assets in at least three
of the following seven fixed-income sectors: U.S. Government, Corporate,
International, Asset-Backed, Municipal, Convertible and Money Market. Current
income, preservation of capital and, secondarily, possible capital appreciation
will be considerations in the allocation of assets among such sectors. The Trust
may invest in a number of different kinds of 'derivative investments' and may
also engage in certain special investment techniques, including repurchase
transactions, when-issued and delayed delivery transactions and hedging. The
investment advisor to the Trust is OppenheimerFunds, Inc. (the Manager).
The Portfolio Managers of the Trust are Thomas P. Reedy, David A. Rosenberg and
Ashwin K. Vasan, who also serve as Vice Presidents of the Trust and of the
Manager, and are officers of certain mutual funds managed by the Manager
(OppenheimerFunds). Messrs. Reedy, Rosenberg and Vasan have been the persons
principally responsible for the day-to-day management of the Trust's portfolio
since August 1993, June 1994 and August 1993, respectively. During the past five
years, Mr. Reedy served as a securities analyst for the Manager, and, prior to
joining the Manager, Mr. Rosenberg served as an officer and portfolio manager
for Delaware Investment Advisors and one of its mutual funds and Mr. Vasan
served as a securities analyst for Citibank, N.A.
Dividend Reinvestment and Cash Purchase Plan -- Pursuant to the Trust's
Dividend Reinvestment and Cash Purchase Plan (the Plan), as to shares of the
Trust (Shares) not registered in nominee name, all dividends and capital gains
distributions (Distributions) declared by the Trust will be automatically
reinvested in additional full and fractional Shares unless a shareholder elects
to receive cash. If Shares are registered in nominee name, the shareholder
should consult the nominee if the shareholder desires to participate in the
Plan. Shareholders that participate in the Plan (Participants) may, at their
option, make additional cash investments in Shares, semi-annually in amounts of
at least $100, through payment to Shareholder Financial Services, Inc., the
agent for the Plan (the Agent), accompanied by a service fee of $0.75.
Depending upon the circumstances hereinafter described, Plan Shares will be
acquired by the Agent for the Participant's account through receipt of newly
issued Shares or the purchase of outstanding Shares on the open market. If the
market price of Shares on the relevant date (normally the payment date) equals
or exceeds their net asset value, the Agent will ask the Trust for payment of
the Distribution in additional Shares at the greater of the Trust's net asset
value determined as of the date of purchase or 95% of the then-current market
price. If the market price is lower than net asset value, the Distribution will
be paid in cash, which the Agent will use to buy Shares on The New York Stock
Exchange (the NYSE), or otherwise on the open market to the extent available. If
the market price exceeds the net asset value before the Agent has completed its
purchases, the average purchase price per Share paid by the Agent may exceed the
net asset value, resulting in fewer Shares being acquired than if the
Distribution had been paid in Shares issued by the Trust.
30
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Participants may elect to withdraw from the Plan at any time and thereby receive
cash in lieu of Shares by sending appropriate written instructions to the Agent.
Elections received by the Agent will be effective only if received more than ten
days prior to the record date for any Distribution; otherwise, such termination
will be effective shortly after the investment of such Distribution with respect
to any subsequent Distribution. Upon withdrawal from or termination of the Plan,
all Shares acquired under the Plan will remain in the Participant's account
unless otherwise requested. For full Shares, the Participant may either: (1)
receive without charge a share certificate for such Shares; or (2) request the
Agent (after receipt by the Agent of signature guaranteed instructions by all
registered owners) to sell the Shares acquired under the Plan and remit the
proceeds less any brokerage commissions and a $2.50 service fee. Fractional
Shares may either remain in the Participant's account or be reduced to cash by
the Agent at the Oppenheimer Multi-Sector Income Trust current market price with
the proceeds remitted to the Participant.
Shareholders who have previously withdrawn from the Plan may rejoin at any time
by sending written instructions signed by all registered owners to the Agent.
There is no direct charge for participation in the Plan; all fees of the Agent
are paid by the Trust. There are no brokerage charges for Shares issued directly
by the Trust. However, each Participant will pay a pro rata share of brokerage
commissions incurred with respect to open market purchases of Shares to be
issued under the Plan. Participants will receive tax information annually for
their personal records and to assist in federal income tax return preparation.
The automatic reinvestment of Distributions does not relieve Participants of any
income tax that may be payable on Distributions.
The Plan may be terminated or amended at any time upon 30 days' prior written
notice to Participants which, with respect to a Plan termination, must precede
the record date of any Distribution by the Trust. Additional information
concerning the Plan may be obtained by shareholders holding Shares registered
directly in their names by writing the Agent, Shareholder Financial Services,
Inc., P.O. Box 173673, Denver, CO 80217-3673 or by calling 1-800-647-7374.
Shareholders holding Shares in nominee name should contact their brokerage firm
or other nominee for more information.
Shareholder Information -- The Shares are traded on the NYSE. Daily market
prices for the Trust's shares are published in the New York Stock Exchange
Composite Transaction section of newspapers under the designation 'OppenMlti.'
The Trust's NYSE trading symbol is OMS. Weekly net asset value (NAV) and market
price information about the Trust is published each Monday in The Wall Street
Journal, each Sunday in The New York Times and each Saturday in Barron's, and
other newspapers in a table called 'Closed-End Bond Funds.'
31
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OPPENHEIMER MULTI-SECTOR INCOME TRUST
Officers and Trustees
Leon Levy, Chairman of the
Board of Trustees
Donald W. Spiro, Vice Chairman of the
Board of Trustees
Bridget A. Macaskill, Trustee and
President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Robert E. Patterson, Vice President
Thomas P. Reedy, Vice President
David A. Rosenberg, Vice President
Ashwin K. Vasan, Vice President
Carol E. Wolf, Vice President
Arthur J. Zimmer, 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.
Administrator
Mitchell Hutchins Asset Management Inc.
Transfer Agent and Registrar
Shareholder Financial Services, Inc.
Custodian of Portfolio Securities
The Bank of New York
Independent Auditors
KPMG Peat Marwick LLP
Legal Counsel
Gordon Altman Butowsky Weitzen Shalov
& Wein
The financial statements included herein have been taken from the records of the
Trust without examination by the independent auditors.
This is a copy of a report to shareholders of Oppenheimer Multi-Sector Income
Trust. It does not offer for sale or solicit orders to buy any securities.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that periodically the Trust may purchase its shares of
beneficial interest in the open market at prevailing market prices.
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.
RS0860.001.0496 [Logo] Printed on recycled paper
1996 SEMIANNUAL REPORT
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OPPENHEIMER
MULTI-SECTOR
INCOME TRUST
APRIL 30, 1996
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