[The American Funds Group(r)]
SMALLCAP World Fund
2000
Semi-Annual Report
for the six months ended March 31
[ILLUSTRATION: close-up of Asia on globe]
[border: Asian silk drawing]
SMALLCAP World Fund(r) seeks long-term growth of capital through investments in
smaller companies in the United States and around the world.
SMALLCAP is one of the 29 mutual funds in The American Funds Group,(r) the
nation's third-largest mutual fund family. For nearly seven decades, Capital
Research and Management Company, the American Funds adviser, has invested with
a long-term focus based on thorough research and attention to risk.
Investment Highlights
Total returns for periods ended March 31, 2000, with all distributions
reinvested
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SMALLCAP Salomon Smith S&P 500 MSCI
World Fund Barney World Index EAFE Index
Smallcap Index
Six months +56.3% +16.9% +17.5% +17.0%
One year +88.6 +32.5 +17.9 +25.4
Five years +204.4 +68.5 +226.5 +81.9
Since fund's inception +433.5 +156.8 +475.3 +154.6
on April 30, 1990
Since fund's inception +18.4 +10.0 +19.3 +9.9
(annualized)
</TABLE>
All market indexes cited in this report are unmanaged and include reinvestment
of all distributions. The Salomon Smith Barney World Smallcap Index tracks
close to 5,000 publicly traded stocks in 23 countries with market
capitalizations between $100 million and $1.5 billion. Standard & Poor's 500
Composite Index tracks 500 large, primarily U.S. stocks. The Morgan Stanley
Capital International EAFE(r) (Europe, Australasia, Far East) Index tracks
large-company stocks in all major markets outside North America.
Fund results in this report were calculated for Class A shares at net asset
value (without a sales charge) unless otherwise indicated. Here are the average
annual compound returns on a $1,000 investment for periods ended March 31,
2000, with all distributions reinvested:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Lifetime Five years 12 months
(since 4/30/90)
Class A Shares
reflecting 5.75%
maximum sales charge +17.68% +23.46% +77.70%
</TABLE>
Results for Class B shares are not shown because of the brief time between
their introduction on March 15 and the end of the fund's fiscal period.
Please see back cover for important information about Class A and Class B
shares.
Figures shown are past results and are not predictive of future results. Share
price and return will vary, so you may lose money. Investing for short periods
makes losses more likely. Investments are not FDIC-insured, nor are they
deposits of or guaranteed by a bank or any other entity.
Fellow Shareholders:
The six months ended March 31, 2000, were remarkable both for the extraordinary
returns generated by your fund and for a steep decline in technology stocks at
the end of the period that may well have marked a turning point for financial
markets worldwide.
SMALLCAP World Fund posted a 56.3% gain for the six months if, like most
shareholders, you reinvested December's dividend of 1.5 cents a share and
capital gain distribution of 60.5 cents a share. This was well ahead of the
fund's usual benchmarks, as the table at top left shows.
These gains came on top of strong results in the second half of our previous
fiscal year. Looking back over those 12 months, SMALLCAP has gained 88.6%. Over
its lifetime - which, on March 31, was one month short of 10 years - the fund
has gained 433.5%, or 18.4% annually, turning an original $10,000 investment
into more than $53,000.
Letting Air Out of the Balloon
Before we all congratulate ourselves on a job well done, it's worth pointing
out that such periods of market euphoria don't happen often, perhaps once or
twice a decade at most, and typically don't end well. Indeed, this one may
already be in the process of correcting itself. Technology stocks are down
sharply since March 10, and in mid-April they began to take the broader market
down with them.
How far down the market may go is anyone's guess. The economy remains sound,
and many businesses are in fact experiencing explosive growth. Stock prices in
the technology area were clearly far ahead of reality, however, and had been
for some time. Ironically, investors who only a short while ago were paying no
attention to valuations are now focusing intently on them and finding,
disturbingly, that some Internet firms' most valuable asset appears to be hot
air. That doesn't argue for a short resolution to the decline, although a
convincing case can be made that a correction will restore a healthy balance to
the market as a whole.
What Worked, Worked Very Well
Investor preferences during the period were fairly simple. If you owned a
technology, telecommunications or media stock, it probably went up; if you
owned anything else, chances are it went down.
[Begin Sidebar]
Where Are SMALLCAP's Portfolio Companies Located?
Geographical distribution of net assets on March 31, 2000
<TABLE>
<CAPTION>
<S> <C> <C>
THE AMERICAS 44.1%
United States 39.6%
Canada 2.0
Brazil 1.6
Mexico .6
Other Americas .3
EUROPE 22.4%
United Kingdom 6.4%
Sweden 3.7
Germany 2.7
France 2.2
Finland 1.1
Netherlands 1.1
Denmark .7
Ireland .6
Norway .6
Spain .5
Turkey .5
Switzerland .5
Belgium .5
Luxembourg .5
Other Europe .8
ASIA/PACIFIC 19.7%
Japan 7.2%
Taiwan 2.8
Singapore 2.5
Hong Kong 2.5
Australia 1.9
India 1.0
South Korea .6
Other Asia/Pacific 1.2
OTHER COUNTRIES 3.8%
Israel 1.9%
South Africa .7
Other 1.2
CASH & EQUIVALENTS 10.0%
Total 100.0%
</TABLE>
[End Sidebar]
That was certainly true for SMALLCAP's portfolio. All but a handful of the best
performers were in one of those three industries, with a few biotechnology
stocks providing the rare exceptions. Almost 100 of the fund's holdings -
again, mostly in technology, telecom or media - at least doubled in price. But
reflecting the clear old-economy, new-economy dichotomy, more than one-third of
our stocks held throughout the period went down in value.
Small-company stocks generally did even better than larger ones, especially in
the United States. Outside the U.S., where small-capitalization stocks have
often been treated as second-class citizens, a number of countries are opening
exchanges, modeled on our NASDAQ system, that should provide more visibility
for smaller companies and better access to capital. Japan's JASDAQ, Korea's
KOSDAQ and Germany's Neuer market have all experienced explosive growth in
trading volumes during the past year, mirroring the intense interest in smaller
technology stocks in the U.S.
Most major markets around the world fared well during the six months, with the
U.S. doing slightly better than Europe, which, in turn, did somewhat better
than Asia. The world economy is experiencing a rare "super cycle" in which
virtually every region of the globe is experiencing simultaneous growth. Just
as rare, inflation remains subdued in most major markets. It is, in short, a
very benign economic environment, although stock prices already reflect this
good news.
Making Moves
One of the benefits of SMALLCAP's global approach is that we can move money
from one region to another, or one industry to another, to take advantage of
the best values.
During the semi-annual period, we began selling some of our U.S. technology
stocks, although in retrospect we should have sold more. Some of the proceeds
were reinvested in selected financial services and retailing stocks, and some
in specialty chemicals. Some was also held in cash as a reserve to buy
technology stocks at lower levels. Most of the money, though, was invested in
Asia, which we continue to believe offers some of the world's most exciting
growth opportunities as that region's recovery continues.
As a result of these moves, we now have substantially more invested in Asia
than a year ago, somewhat less in technology (though this remains a significant
presence) and a bit more cash. We now have just under 40% of the portfolio in
U.S. stocks, the lowest percentage in the fund's history, a little over 20% in
Europe, a little under 20% in Asia and 10% in cash.
What Goes Up Must Come Down
The decline in technology stocks, though it occurred mainly after our reporting
period ended, is worth discussing given how important technology stocks have
been to the fund's results.
Some of the most serious damage inflicted on technology stocks in recent months
has occurred among Internet companies. Many firms involved in
business-to-consumer "e-tailing" or in business-to-business commerce have seen
their stocks drop as much as 90% from their peaks. We purchased a number of
these stocks months ago at their initial public offerings but sold soon after
at sharply higher - and some might say ludicrously high - prices. Other stocks
we avoided because we were unable to understand how the firms' business
strategies would ever result in superior profitability.
And yet, the Internet is indeed changing the way people live and work. That's
why we have chosen to participate in this area of explosive growth but with a
somewhat different strategy. Our approach has been to invest in companies that
provide the "picks and shovels" of this modern-era gold rush. This includes
firms that produce semiconductors to power today's high-tech communications
equipment, such as Micrel; consulting firms that help companies develop and
implement their Web strategies, such as Scient; security providers for Web
sites, such as Baltimore Technologies; and companies that host Web sites, such
as Digex. Many of these stocks have done quite well and have business models
that make good sense to us.
Our attraction to these stocks has been based on a fairly simple premise: The
three most dynamic businesses of the past half-century - telecommunications,
media and technology - are converging into a single information economy. While
we don't subscribe to the notion that we have entered a new era of
unprecedented wealth creation (thus justifying ever-higher stock prices), we do
believe the dynamics driving these businesses will remain in force for some
time to come. That's why we view the recent market decline as representing more
a shift in investor psychology (one might say a return to sanity) than
reflecting any underlying change in fundamentals.
Where Do We Go From Here?
There is no doubt the stock market today feels a bit treacherous. Like other
bumps in the road over the past decade, this may be behind us quickly. But more
likely, it will take some time to work through. A lot depends on what action
the Federal Reserve takes. The Fed has increased interest rates five times so
far during the past year, but three of those simply put interest rates back to
where they were during the Asian crisis in 1998. A good case can be made that
the Fed has been too timid. With recent signs that inflation may be returning
to the economy, Alan Greenspan and his colleagues may come around to that view
as well. If so, the stock market will be rowing against the tide.
At this juncture, it's hard not to be thankful for the returns we've enjoyed
over the past year; it's also difficult not to be concerned about giving some
of those gains back. That's what is meant by a risk-return tradeoff. You can't
have one without the other. Our job, of course, is to mitigate the risks
shareholders face, but we cannot eliminate them.
We look forward to reporting to you again in six months, in the fund's 10th
annual report. It should be quite an interesting period ahead.
Cordially,
/s/ Gordon Crawford
Gordon Crawford
Chairman of the Board
/s/ Gregory W. Wendt
Gregory W. Wendt
President
SMALLCAP WORLD FUND
PORTFOLIO SUMMARY
March 31, 2000
[begin pie chart]
<TABLE>
<CAPTION>
<S> <C>
INDUSTRY DIVERSIFICATION PERCENT OF NET ASSETS
Business Services 12.61%
Electronic Components 11.08
Broadcasting & Publishing 7.98
Health & Personal Care 6.94
Data Processing & Reproduction 6.05
Other Industries 45.38
Cash & Equivalents 9.96
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
LARGEST EQUITY HOLDINGS PERCENT PERCENTAGE
OF NET PRICE
ASSETS CHANGE FOR
THE SIX
MONTHS
ENDED
3/31/00
Baltimore Technologies 1.93% 6.075
UnitedGlobalCom 1.55 +109.6
Scient 1.00 +200.1
TranSwitch .96 +153.0
Micrel .91 +121.3
Disco .86 +45.2
Andrx .85 +97.3
Venture Manufacturing (Singapore) .85 +57.6
Westwood One .77 +60.7
NatSteel Electronics .73 +75.1
</TABLE>
OUR 10 MOST SUCCESSFUL HOLDINGS
<TABLE>
<CAPTION>
<S> <C>
VA Linux Systems (U.S.; computer software) +1,229.5%
Baltimore Technologies (U.K.; computer security) +607.5
Scoot.com (U.K.; Internet business directory) +500.6
WatchGuard Technologies (U.S.; computer security) +500.0
Framtidsfabriken (Sweden; Internet services) +461.4
Fantastic (Switzerland; communications software) +435.0
Applied Micro Circuits (U.S.; electronic +426.5
circuits)
FI System (France; Internet consulting) +409.2
Digex (U.S. Web site services) +368.3
AVANT Immunotherapeutics (U.S.; biotechnology) +347.1
</TABLE>
OUT 10 LEAST SUCCESSFUL HOLDINGS
<TABLE>
<CAPTION>
<S> <C>
Casella Waste Systems (U.S.; waste management) -55.1%
Profit Recovery Group International (U.S.; -58.5
collection services)
Chapters Online (Canada; Internet retailing) -59.2
Intertape Polymer Group (Canada; packaging -59.7
products)
AHL Services (U.S.; employment services) -61.2
GP Strategies (U.S.; personnel training and -68.3
development)
Northrock Resources (Canada; oil and gas -64.7
exploration)
InaCom (U.S.; communications products) -70.1
Ashanti Goldfields (Ghana; gold mining) -74.6
CINAR Films (Canada; television programming ) -88.4
</TABLE>
May 15, 2000
<TABLE>
Smallcap World Fund, Inc.
Investment Portfolio, March 31, 2000 (UNAUDITED)
Shares or Market Percent
Principal Value of Net
EQUITY SECURITIES (common and preferred stocks and convertible debentures) Amount (000) Assets
-------------------------------------------------- -------------------------------
<S> <C> <C> <C>
BUSINESS SERVICES - 12.61%
Scient Corp. (USA) (1,2,3) 1,934,646 $157,903 1.00%
ISS-International Service System A/S, Class B (Denmark) (1) 1,116,950 73,300 .47
Flextronics International Ltd. (USA - Incorporated in Singapore) (1) 900,000 63,394 .40
Black Box Corp. (USA) (1) 878,000 60,788 .39
Ubizen (Belgium) (1) 267,000 47,091 .30
Falck A/S (Denmark) 295,000 39,858 .25
Mosaic Group Inc. (Canada) (1) 2,873,300 38,601 .24
DII Group, Inc. (USA) (1) 325,000 36,745 .23
Zuken Inc. (Japan) 1,300,000 35,101 .22
Alphameric PLC (United Kingdom) (4) 5,262,009 33,488 .21
Bally Total Fitness Holding Corp. (USA) (1,4) 1,360,500 33,332 .21
I-D Media AG (Germany) (1) 406,420 33,081 .21
GFT Technologies AG (Germany) (1) 121,000 28,967 .18
Digex, Inc., Class A (USA) (1) 260,000 28,844 .18
Integra SA (France) (1) 810,000 28,381 .18
Scoot.com PLC (United Kingdom) (1) 7,000,000 26,796 .17
Photobition Group PLC (United Kingdom) 1,700,000 14,100
Photobition Group PLC (2) 1,500,000 12,441 .17
Uproar Ltd. (Austria) (1) 1,148,640 25,298 .16
Midas, Inc. (USA) (4) 1,050,000 25,200 .16
eLoyalty Corp. (USA) (1) 1,046,500 24,985 .16
MSC Industrial Direct Co., Inc., Class A (USA) (1) 1,250,000 22,500 .14
Computer Engineering & Consulting Ltd. (Japan) (4) 1,145,000 22,186 .14
Corporate Services Group PLC (United Kingdom) (1,2) 7,528,427 11,647
Corporate Services Group PLC, 7.50% convertible debentures 2005 $6,000,000 6,986
Corporate Services Group PLC (1) 2,000,000 3,094 .14
Corporate Services Group PLC, rights, expire 2000 (1.2) 1,254,737 120
Corporate Services Group PLC, rights, expire 2000 (1) 333,333 32
Infosources (France) (1) 94,000 21,603 .14
Profit Recovery Group International, Inc. (USA) (1) 1,167,600 21,601 .14
PLAUT AG (Germany) (1) 510,000 21,000 .13
Ziff-Davis Inc. (USA) (1) 890,000 18,913 .12
Framtidsfabriken AB (Sweden) (1) 770,000 18,853 .12
MEDION AG (Germany) 187,200 18,823 .12
WatchGuard Technologies, Inc. (USA) (1) 200,000 18,000 .11
SmartForce PLC (formerly CBT Group PLC) (ADR) (Ireland) (1) 375,000 17,203 .11
PentaMedia Graphics Ltd. (India) 650,000 17,155 .11
Effnet Group AB (Sweden) (1) 233,000 17,033 .11
Parsytec AG (Germany) (1) 78,000 16,806 .11
Icon Medialab International AB (Sweden) (1) 750,000 16,535 .10
Information Highway AB (Sweden) (1) 1,798,750 16,489 .10
ProBusiness Services, Inc. (USA) (1) 633,900 16,363 .10
Teligent AB (Sweden) (1) 674,000 16,033 .10
Tecnomatix Technologies Ltd. (Israel) (1) 356,700 15,472 .10
InternetStudios.com, Inc. (USA) (1,2,3,4) 950,000 15,393 .10
ParaRede SGPS (Portugal) (1) 400,000 15,126 .10
Hotel Reservations Network, Inc., Class A, (USA) (1) 850,000 15,088 .10
PSD Group PLC (United Kingdom) 978,000 14,960 .09
ITE Group PLC (United Kingdom) (4) 9,608,800 14,406 .09
TTI Team Telecom International Ltd. (Israel) (1) 434,250 14,330 .09
Elbit Ltd. (Israel) (1,4) 1,082,500 14,072 .09
4M Technologies Holding SA (Switzerland) (1) 40,000 13,968 .09
OpenTV Corp., Class A (British Virgin Islands) (1) 115,900 13,720 .09
Internet Gold-Golden Lines Ltd. (Israel) (1) 535,000 13,342 .08
Cross Systems SA (France) (1) 41,300 13,051 .08
London Bridge Software Holdings PLC (United Kingdom) 137,800 13,023 .08
Eimo Oyj (Finland) (1) 330,000 12,798 .08
SR Teleperformance SA (France) 38,842 12,609 .08
Sapiens International Corp. NV (Israel) (1,4) 1,015,000 12,434 .08
Stericycle, Inc. (USA) (1) 485,600 12,140 .08
Talentum Oyj (Finland) (1) 550,000 12,114 .08
Ubi Soft Entertainment SA (France) (1) 200,000 11,932 .08
Ci Technologies Group Ltd. (Australia) 2,425,784 11,923 .08
RT-SET Ltd. (Israel) (1) 420,000 11,744 .07
Sausage Software Ltd. (Australia) (1) 3,092,500 11,259 .07
VALTECH SA (France) (1) 67,000 11,080 .07
MDC Communications Corp., Class A (Canada) (1) 970,933 11,037 .07
VIA NET.WORKS, Inc. (USA) (1) 364,300 10,849 .07
SciQuest.com, Inc. (USA) (1) 420,500 10,828 .07
Nippon Kanzai (Japan) 503,800 10,765 .07
Fitness First PLC (United Kingdom) (1) 530,000 10,246 .07
BPP Holdings PLC (United Kingdom) 800,000 10,208 .06
Iron Mountain Inc. (USA) (1) 291,000 9,912 .06
Kanamoto Co., Ltd. (Japan) 1,086,000 9,630 .06
Source Information Management Co. (USA) (1) 550,000 9,625 .06
Launch Media, Inc. (USA) (1) 600,000 9,375 .06
GTS Duratek, Inc. (USA) (1) 891,100 9,245 .06
BVRP Software (France) (1) 73,271 8,750 .06
BVRP Software, rights, expire 2000 71,796 275
Yuxing Info Tech Holdings (Hong Kong) (1) 8,400,000 8,954 .06
APCOA Parking AG (Germany) (4) 122,688 8,941 .06
Bertrandt AG (Germany) 145,000 8,873 .06
Synstar PLC (United Kingdom) (1) 3,000,000 8,852 .06
NDS Group PLC, Class A (ADR) (United Kingdom) (1) 121,800 8,587 .05
eXchange Holdings PLC (United Kingdom) (1) 3,346,200 8,272 .05
PopNet Internet AG (Germany) (1) 216,100 7,885 .05
iVillage Inc. (USA) (1) 500,000 7,836 .05
Optosof AB, Class B (Sweden) (1) 403,000 7,809 .05
Metron Technology NV (USA - Incorporated in Netherlands) (1) 367,500 7,718 .05
Paramount Publishing Group Ltd. (Hong Kong) (1) 20,000,000 7,641 .05
Trafficmaster PLC (United Kingdom) (1) 595,833 7,465 .05
Fantastic Corp., co-ownership shares (Switzerland) (1) 250,000 7,414 .05
NCO Group, Inc. (USA) (1) 227,000 7,250 .05
Zhejiang Expressway Co. Ltd., Class H (China) 63,900,000 7,222 .05
AIT Group PLC (United Kingdom) 350,000 7,218 .05
Kipling Holding AB (Sweden) (1,4) 234,000 7,168 .05
OnVista AG (Germany) (1) 200,966 7,024 .04
United Rentals, Inc. (USA) (1) 400,000 6,900 .04
CoSine Communications Inc., Series D, convertible preferred (USA) (1,2,3) 1,925,820 6,750 .04
freenet.de AG (Germany) (1) 60,000 6,665 .04
Pixelpark AG (Germany) (1) 50,000 6,464 .04
Kroll-O'Gara Co. (USA) (1) 590,000 6,453 .04
M-Web Holdings Ltd. (South Africa) (1) 7,252,896 6,447 .04
Razorfish, Inc., Class A (USA) (1) 230,000 6,325 .04
Infoteria Inc. (Japan) (1,2,3,4) 167 6,241 .04
ricardo.de AG (Germany) (1) 45,000 6,205 .04
Sherwood International PLC, (United Kingdom) 375,000 6,161 .04
ALTEN SA (France) (1) 32,500 6,106 .04
DIS Deutscher Industrie Service AG (Germany) 60,000 6,090 .04
International Container Terminal Services, Inc., 1.75% convertible $5,905,000 5,935 .04
debentures 2004 (Philippines)
LibertyOne Ltd. (Australia) (1) 9,000,000 5,789 .04
Seminis, Inc., Class A (USA) (1) 890,000 5,729 .04
INTERNOLIX AG (Germany) (1) 148,800 5,642 .03
HearMe.com (USA) (1) 222,500 5,618 .03
Nocom AB, Class B (Sweden) (1) 156,212 5,365 .03
digital advertising AG (Germany) (1) 180,000 5,343 .03
AHL Services, Inc. (USA) (1) 500,000 5,063 .03
MITIE Group PLC (United Kingdom) 1,100,000 4,895 .03
RemarQ Communities, Inc., Series B, convertible preferred (USA) (1,2,3) 548,000 4,658 .03
Apropos Technology, Inc. (USA) (1) 124,500 4,607 .03
Regis Corp. (USA) 310,500 4,599 .03
secunet Security Networks AG (Germany) (1) 55,000 4,477 .03
China.com Corp., Class A (Hong Kong) (1) 51,600 4,180 .03
Extreme Networks, Inc. (USA) (1) 52,000 4,108 .03
Commerx, Inc. Series B, convertible preferred (USA) (1,2,3) 321,802 4,000 .03
Multiemedia.com Ltd. (Australia) (1) 10,300,000 3,938 .03
Sylvan Learning Systems, Inc. (USA) (1) 219,850 3,504 .02
Casella Waste Systems, Inc., Class A (USA) (1) 435,900 3,269 .02
Beeson Gregory Group PLC (United Kingdom)(1,3) 666,600 3,190 .02
WWL Internet AG (Germany) (1) 120,000 2,976 .02
Pre-Paid Legal Services, Inc. (USA) (1) 100,000 2,969 .02
Norman ASA (Norway) (1) 120,000 2,954 .02
Solution 6 Holdings Ltd. (Australia) (1) 456,276 2,949 .02
UroCor, Inc. (USA) (1,4) 575,000 2,803 .02
SkillSoft Corp. (USA) (1) 95,000 2,761 .02
FortuneCity.com Inc. (USA) (1) 225,000 2,478 .02
Applied Optical Technologies PLC (United Kingdom) (1) 366,627 2,251 .01
Ituran Group (Israel) (1) 49,445 2,214 .01
Artnet.com AG (Germany) (1) 147,000 2,182 .01
Primark Corp. (USA) (1) 89,102 2,150 .01
Cyber Agent Co., Ltd. (Japan) (1) 14 1,876 .01
IXLA Ltd. (Australia) (1) 1,584,000 1,807 .01
Cyber Com Consulting Group Scandinavia AB, Class B (Sweden) (1) 90,000 1,744 .01
e4L, Inc. (USA) (1) 780,000 1,658 .01
Day Interactive Holding AG (Switzerland) (1) 5,217 1,382 .01
IBA Technologies Ltd. (Australia) (1) 900,000 1,038 .01
Crayfish Co., Ltd. (ADR) (Japan) (1) 25,400 965 .01
WEB.DE AG (Germany) (1) 26,300 680 .00
Industrial & Financial Systems, IFS AB, rights, expire 2000 (Sweden) (1) 203,200 436 .00
Livin' on the Edge (USA) 1,3 3 170 .00
ELECTRONIC COMPONENTS - 11.08%
Micrel, Inc. (USA) (1) 1,496,100 143,626 .91
Venture Manufacturing (Singapore) Ltd (Singapore) 6,976,000 95,785 .85
Venture Manufacturing (Singapore) Ltd (2) 2,710,000 37,210
NatSteel Electronics Ltd (Singapore) 17,700,000 115,828 .73
Acer Display Technology (Taiwan)(1,2,3) 35,475,000 87,578 .56
Universal Scientific Industrial Co., Ltd. (Taiwan) (1) 14,734,000 73,719 .47
Varian Semiconductor Equipment Associates, Inc. (USA) (1) 1,039,800 66,157 .42
S.O.I.TEC SA (France)(1) 237,000 64,227 .41
Malaysian Pacific Industries Bhd. (Malaysia) 4,420,000 59,321 .38
QPL International Holdings Ltd. (Hong Kong - Incorporated in Bermuda) (1) 25,399,000 52,354 .33
CTS Corp. (USA) 910,000 51,870 .33
Semtech Corp. (USA) (1) 715,000 45,805 .29
Applied Micro Circuits Corp. (USA) (1) 290,000 43,518 .28
Cymer, Inc. (USA) (1) 850,000 42,500 .27
Acer Laboratories Inc. (Taiwan) (1,4) 6,200,000 42,245 .27
Power Integrations, Inc. (USA) (1,4) 1,620,000 40,500 .26
Littelfuse, Inc. (USA) (1,4) 1,000,000 36,687 .23
Sanmina Corp. (USA) (1) 534,000 36,078 .23
Wus Printed Circuit Co., Ltd. (Taiwan) (1,4) 22,083,750 35,328 .22
Perlos Oyj (Finland) (1) 918,800 32,730 .21
JIT Holdings Ltd. (Singapore) 10,755,700 32,050 .20
Photronics, Inc. (USA) (1) 850,000 30,016 .19
Omni Industries Ltd. (Singapore) 12,600,000 29,595 .19
Dainippon Screen Mfg. Co., Ltd. (Japan) (1) 4,150,000 28,658 .18
hi/fn, inc. (USA) (1) 435,000 28,302 .18
Fujitsu Devices Inc. (Japan) 900,000 27,972 .18
Procomp Informatics Ltd. (Taiwan) (1) 2,880,000 27,871 .18
Dynarc AB (Sweden) (1) 1,125,000 15,665 .17
Dynarc AB (1,2) 775,000 10,791
Etron Technology, Inc. (Taiwan) (1) 5,330,000 25,790 .16
ATMI, Inc. (USA) (1) 500,000 23,875 .15
Sunplus Technology Co., Ltd. (Taiwan) (1) 3,650,000 23,308 .15
ELMOS Semiconductor AG (Germany) (1) 560,000 22,523 .14
Unicap Electronics Industrial Corp. (Taiwan) (1,4) 20,396,505 22,491 .14
Dallas Semiconductor Corp. (USA) 625,600 21,974 .14
Optoma Corp. (Taiwan) (1,4) 7,500,000 19,503 .12
DuPont Photomasks, Inc. (USA) (1) 325,000 18,830 .12
Orad Hi-Tec Systems Ltd. (Israel) (1) 300,000 16,921 .11
Anam Semiconductor, Inc. (South Korea) (1) 800,000 13,900 .09
Imagination Technologies Group PLC (United Kingdom) (1) 2,100,000 12,829 .08
Paltek (Japan) 432,000 10,909 .07
Tower Semiconductor Ltd. (Israel) (1) 420,000 9,555 .06
Honda Tsushin Kogyo Co., Ltd. (Japan) 218,000 9,422 .06
Kopin Corp. (USA) (1) 125,000 8,594 .05
Technology Nexus AB (Sweden) (1,4) 167,500 7,988 .05
Varitronix International Ltd. (Honk Kong--Incorporated in Bermuda) 3,162,300 7,351 .05
PILKOR Electronics Ltd. (South Korea) (1,4) 700,000 6,747 .04
Komatsu Electronic Metals Co., Ltd. (Japan) (1) 541,900 6,211 .04
Veeco Instruments Inc. (USA) (1) 75,000 5,550 .03
Melexis NV (Belguim) (1) 300,000 4,769 .03
Elec & Eltek International Holdings Ltd. (Hong Kong--Incorporate in Bermud 32,160,000 4,750 .03
MegaChips Corp. (Japan) 60,000 4,050 .02
Elec & Eltek International Co. Ltd. (Singapore) 920,000 2,328 .01
Quantum Effect Devices, Inc. (USA) (1) 24,600 1,959 .01
Metalink Ltd. (Israel) (1) 35,400 1,358 .01
BROADCASTING & PUBLISHING - 7.98%
UnitedGlobalCom, Inc., Class A (USA) (1) 3,250,000 243,953 1.55
Westwood One, Inc. (USA) (1) 3,356,800 121,684 .77
SBS Broadcasting SA (Luxembourg) (1,4) 1,297,000 79,766 .51
Scottish Media Group PLC (United Kingdom) (1) 3,500,750 71,929 .46
Fox Kids Europe NV (Netherlands) (1) 2,988,000 62,949 .40
Nasionale Pers Beperk (South Africa) 4,000,000 48,981 .31
United Television, Inc. (USA) 350,000 46,331 .29
Highlight Communications AG, co-ownership shares (Switzerland) (1) 275,200 46,118 .29
MIH Ltd., Class A (South Africa) (1) 718,000 43,798 .28
Antena 3 de Television, SA (GDR) (Spain) (1,2,3,4) 1,500 39,207 .25
HIT Entertainment PLC (United Kingdom) (2,4) 4,567,100 29,867 .22
HIT Entertainment PLC (4) 700,000 4,578
ENDEMOL Entertainment Holding NV (Netherlands) 245,520 32,680 .21
Class Editori SpA, Class A (Italy) 2,082,000 32,414 .20
NRJ SA (France) 40,284 29,896 .19
Zee Telefilms Ltd. (India) 1,100,000 25,940 .16
Antenna TV SA (ADR) (Greece) (1) 900,000 21,037 .13
Modern Times Group MTG AB, Class B (ADR) (Sweden) (1) 69,200 18,822 .12
Agora SA (GDR) (Poland) (1) 625,000 17,500 .11
MIH Holdings Ltd. (South Africa) (1) 1,727,700 17,476 .11
Chrysalis Group PLC (United Kingdom) 693,100 16,803 .11
NTV Broadcasting Co. (GDR) (Russia) (1,2,3) 812,520 16,000 .10
APN News & Media Ltd. (Australia) 5,723,922 13,442 .08
Radio One, Inc., Class A (USA) (1) 200,000 13,325 .08
Senator Film AG (Germany) (1) 111,000 12,745 .08
CanWest Global Communications Corp. (Canada) 1,154,946 12,532 .08
P4 Radio Hele Norge ASA (Norway) 1,626,000 11,548 .07
Roularta Media Group NV (Belguim) (1) 150,000 11,046 .07
Primedia Ltd., units (South Africa) 7,718,508 11,001 .07
Rural Press Ltd. (Australia) 3,726,466 10,922 .07
Future Network PLC (United Kingdom) (1) 750,000 10,357 .07
Ten Network Holdings Ltd. (Australia) 6,500,000 9,545 .07
Sky Network Television Ltd. (ADR) (New Zealand) (1) 376,000 9,071 .06
Sky Network Television Ltd. (1) 106,500 275
Media General, Inc., Class A (USA) 139,500 7,306 .05
RTV Family Entertainment AG (Germany) (1) 110,000 7,268 .05
SuperSport International Holdings Ltd. (South Africa) 5,985,600 6,742 .04
TVA Group Inc., Class B (Canada) 243,600 5,387 .03
Alma Media Oyj (Finland) 107,400 5,067 .03
Classic Communications, Inc., Class A (USA) (1) 300,000 4,725 .03
Television Eighteen India Ltd. (India) (1) 170,000 4,718 .03
Information Holdings Inc. (USA) (1) 150,000 4,697 .03
United Broadcasting Corp. (Thailand) (1) 5,800,000 4,644 .03
BKN International AG (Germany) (1) 75,000 4,165 .03
Spanish Broadcasting System, Inc., Class A (USA) (1) 177,000 4,151 .03
TNT-Teleset (GDR) (Russia) (1,2,3) 287,324 4,000 .02
StoryFirst Communications Inc., convertible preferred, Class B (Russia) (1 4,022 1,207 .01
Southern Star Group Ltd. (Australia) 3,290,000 858 .00
HEALTH & PERSONAL CARE - 6.94%
Andrx Corp. (USA) (1) 1,160,000 133,980 .85
United Therapeutics Corp. (USA) (1,2,4) 1,200,000 93,300 .59
Inhale Therapeutic Systems, Inc. (USA)(1,2,4) 1,000,000 74,500 .52
Inhale Therapeutic Systems, Inc. (1,4) 101,646 7,573
SuperGen, Inc. (USA) (1,2) 561,000 26,928 .35
SuperGen Inc., warrants, expire 2002 (1,2,3) 336,600 12,080
SuperGen Inc., warrants, expire 2002 (1,3) 231,800 8,482
SuperGen, Inc. (1) 154,534 7,418
Pharmacyclics, Inc. (USA) (1,2,4) 580,000 32,299 .33
Pharmacyclics, Inc. (1,4) 350,000 19,491
ImClone Systems Inc. (USA) (1) 650,000 49,969 .32
ViroPharma Inc. (USA) (1) 740,000 45,371 .29
IDEXX Laboratories, Inc. (USA) (1,4) 1,931,300 45,023 .29
ILEX Oncology, Inc. (USA) (1) 885,000 37,170 .24
Digene Corp. (USA) (1,4) 800,000 36,800 .23
Nobel Biocare AB (Sweden) (4) 1,291,900 34,779 .22
Vertex Pharmaceuticals Inc. (USA) (1) 730,000 34,173 .22
Vical Inc. (USA) (1) 875,000 29,313 .19
Mentor Corp. (USA) 1,080,000 29,160 .19
COR Therapeutics, Inc. (USA) (1) 371,500 24,490 .16
Amylin Pharmaceuticals, Inc. (USA) (1,2,3) 1,845,833 22,531 .14
Protein Design Labs, Inc. (USA) (1) 280,000 22,260 .14
OSI Pharmaceuticals, Inc. (USA) (1,2,3) 561,000 9,845 .12
OSI Pharmaceuticals, Inc. (1) 480,000 9,360
BioMarin Pharmaceutical Inc. (USA) (1) 500,000 17,750 .11
Aviron (USA) (1) 605,000 16,827 .11
PolyMedica Corp. (USA) (1) 275,000 16,156 .10
Nadro, SA de CV, B share (Mexico) 13,262,773 15,745 .10
AVANT Immunotherapeutics, Inc. (USA) (1) 1,300,000 12,350 .09
AVANT Immunotherapeutics, Inc. (1,2) 200,000 1,900
XOMA Ltd. (USA - Incorporated in Bermuda) (1,2,3) 2,000,000 13,950 .09
Transkaryotic Therapies, Inc. (USA) (1,2) 250,000 13,906 .09
Neose Technologies, Inc. (USA) (1) 400,000 12,875 .08
Ventana Medical Systems, Inc. (USA) (1,2,3) 250,000 9,717 .07
Ventana Medical Systems, Inc. (1) 32,500 1,404
CIMA LABS INC. (USA) (1,4) 617,200 10,608 .07
Genetronics Biomedical Ltd., warrants, expire 2000 (Canada) (1) 1,650,000 10,231 .07
Thermedics Inc. (USA) (1) 1,249,100 10,227 .06
OrthoLogic Corp. (USA) (1,4) 1,620,000 9,922 .06
Scotia Holdings PLC (United Kingdom) (1) 3,476,900 9,594 .06
Anesta Corp. (USA) (1,4) 715,000 9,462 .06
HemaSure Inc. (USA) (1,2,3) 882,000 8,335 .05
Hollis-Eden Pharmaceuticals, Inc. (USA) (1,2) 555,556 8,194 .05
TriPath Imaging, Inc. (USA) (1) 886,242 7,921 .05
Myriad Genetics, Inc. (USA) (1) 115,000 6,929 .04
Emisphere Technologies Inc., (USA) (1) 90,000 4,669 .03
Neurocrine Biosciences, Inc. (USA) (1) 200,000 4,650 .03
Computer Motion, Inc. (USA) (1,4) 434,900 4,104 .03
Grupo Casa Autrey, SA de CV (ADR) (Mexico) (1) 498,500 3,801 .02
Women First HealthCare, Inc. (USA) (1) 800,000 3,800 .02
Vision-Sciences, Inc. (USA) (1) 984,500 2,215 .01
GP Strategies Corp. (USA) (1) 49,600 205 .00
DATA PROCESSING & REPRODUCTION - 6.05%
HNC Software Inc. (USA) (1) 1,309,698 94,380 .60
Datacraft Asia Ltd (Singapore) 8,998,896 84,140 .53
VA Linux Systems, Inc. (USA) (1,2,3) 1,554,404 79,770 .51
MMC Networks, Inc. (USA) (1,4) 2,060,000 67,980 .43
RadiSys Corp. (USA) (1,4) 1,060,000 63,733 .40
DSP Group, Inc. (USA) (1) 843,800 55,691 .35
Documentum, Inc. (USA) (1) 650,000 50,700 .32
Great Plains Software, Inc. (USA) (1,4) 920,500 49,132 .31
SOTEC Co., Ltd. (Japan) (1,2,3) 4,297 48,173 .31
Apex Inc. (USA) (1,4) 1,175,000 43,622 .28
Nice Systems Ltd. (ADR) (Israel) (1) 485,000 34,556 .22
Remedy Corp. (USA) (1) 800,000 33,700 .21
Electronics for Imaging, Inc. (USA) (1) 500,000 30,000 .19
Macromedia, Inc. (USA) (1) 315,300 28,476 .18
Radiant Systems, Inc. (USA) (1) 440,500 27,696 .18
Aspen Technology, Inc. (USA) (1) 541,500 21,863 .14
Inet Technologies, Inc. (USA) (1) 354,100 18,745 .12
National Computer Systems, Inc. (USA) 353,100 17,920 .11
Primax Electronics Ltd. (Taiwan) (1) 13,239,285 17,170 .11
Accrue Software, Inc. (USA) (1) 335,000 15,342 .10
Garnet Systems Co., Ltd (South Korea) (1) 448,740 14,741 .09
Witness Systems, Inc. (USA) (1) 300,800 9,137 .06
Integral Systems, Inc. (USA) (1,2) 200,000 9,000 .06
Xiox Corp., Series B, convertible preferred (USA) (1,2,3) 230,000 8,875 .06
eBenX, Inc. (USA) (1) 199,000 5,870 .04
Efficient Networks, Inc. (USA) (1) 36,700 5,716 .04
MedQuist Inc. (USA) (1) 166,400 4,524 .03
CacheFlow Inc. (USA) (1) 31,100 3,685 .02
eCollege.com (USA) (1) 500,000 3,500 .02
InterTrust Technologies Corp. (USA) (1) 60,000 2,550 .02
Versata, Inc. (USA) (1) 37,800 2,275 .01
MERCHANDISING - 5.23%
Michaels Stores, Inc. (USA) (1,4) 1,794,600 73,130 .46
Giordano International Ltd. (Hong Kong) (4) 42,954,000 52,131 .33
KOMERI Co., Ltd. (Japan) 1,625,000 51,452 .33
JJB Sports PLC (United Kingdom) 5,725,000 50,497 .32
Too, Inc. (USA) (1) 1,475,000 46,555 .29
Williams-Sonoma, Inc. (USA) (1) 1,284,099 39,807 .28
Williams-Sonoma, Inc. (1,2) 134,099 4,157
Sundrug Co., Ltd. (Japan) 550,000 38,835 .25
Lands' End, Inc. (USA) (1) 575,700 35,406 .22
Senshukai Co., Ltd. (Japan) (4) 3,095,000 32,976 .21
DFS Furniture Co. PLC (United Kingdom) (4) 5,682,700 31,270 .20
Homac Corp. (Japan) 1,379,910 30,289 .19
Tsuruha Co., Ltd. (Japan) 396,000 29,615 .19
Webvan Group, Inc. (USA) (1,2,3) 3,813,220 25,390 .16
Sunglass Hut International, Inc. (USA) (1,4) 3,200,000 25,000 .16
Migros Turk TAS (Turkey) 40,904,025 22,587 .14
Cost Plus, Inc. (USA) (1) 626,000 21,167 .13
Whitehall Jewellers, Inc. (USA) (1,4) 850,000 19,975 .13
School Specialty, Inc. (USA) (1,4) 917,000 19,716 .12
Alloy Online, Inc. (USA) (1,4) 876,300 14,623 .09
Sixt AG (Germany) 331,136 8,926 .09
Sixt AG, nonvoting preferred 294,768 5,349
Miami Computer Supply Corp. (USA) (1) 450,000 14,119 .09
Rent-Way, Inc. (USA) (1) 711,900 13,882 .09
Jean Coutu Group (PJC) Inc., Class A (Canada) 635,200 11,925 .08
PETsMART, Inc. (USA) (1) 3,848,400 11,545 .07
GrandVision SA (France) 321,704 9,658 .06
Sharper Image Corp. (USA) (1,4) 775,000 9,494 .06
Claire's Stores, Inc. (USA) 450,000 9,028 .06
Jo-Ann Stores, Inc., Class A (USA) (1,4) 525,000 4,397 .05
Jo-Ann Stores, Inc., Class B (1,4) 525,000 3,150
Miadora Inc., preferred, Series B (USA) (1,2,3,4) 602,410 4,030 .05
Miadora Inc., preferred, Series C (1,2,3,4) 448,431 3,000
PlanetRx.com, Inc. (USA) (1,2,3) 1,000,000 6,800 .04
Piercing Pagoda, Inc. (USA) (1,4) 502,500 6,721 .04
O'Reilly Automotive, Inc. (USA) (1) 400,000 5,675 .04
Hornbach Holding AG, preferred (Germany) 132,650 5,589 .04
Shop At Home, Inc. (USA) (1) 580,000 5,003 .03
Dickson Concepts (International) Ltd. (Hong Kong---Incorporated in Bermuda 4,324,699 4,721 .03
EUROBIKE AG (Germany) (4) 364,000 4,183 .03
Athlon Groep NV (Netherlands) 225,000 3,609 .02
Bombay Co., Inc. (USA) (1) 944,700 3,129 .02
Chapters Inc. (Canada) (1) 324,200 2,915 .02
Chapters Online Inc. (Canada) (1) 330,000 1,364 .01
Haverty Furniture Companies, Inc. (USA) 100,000 1,062 .01
Homeplace of America Inc. (USA) (1,3) 22,536 362 .00
Homeplace of America Inc., Series A, warrants, expire 2004 (1,3) 112,679 -
ELECTRONIC INSTRUMENTS - 4.45%
TranSwitch Corp. (USA) (1) 1,570,000 150,916 .96
Disco Corp. (Japan) 500,000 89,841 .86
Disco Corp.(1,5) 250,000 45,406
Applied Materials, Inc. (formerly Etec Systems, Inc.) (USA) (1) 778,800 73,402 .47
Orbotech Ltd. (Israel) (1) 675,000 57,375 .36
ASM Pacific Technology Ltd. (Hong Kong) 16,537,000 56,068 .36
Picvue Electronics, Ltd. (Taiwan) (4) 34,810,000 40,906 .26
Trimble Navigation Ltd. (USA) (1,4) 1,450,000 37,337 .24
Ando Electric Co., Ltd. (Japan) (1,4) 1,700,000 34,674 .22
Mercury Computer Systems, Inc. (USA) (1) 690,000 33,724 .21
Yamatake Corp. (Japan) 3,535,000 30,729 .19
Micronic Laser Systems AB (Sweden) (1,4) 735,710 13,488 .14
Micronic Laser Systems AB (1,2,4)
Lumonics Inc. (Canada) (1) 710,000 11,862 .08
Lasertec Corp. (Japan) (4) 325,000 8,523 .05
Caliper Technologies Corp. (USA) (1) 55,000 4,448 .03
Conexant Systems, Inc. (USA) (1) 44,946 3,191 .02
IT CONSULTING & SERVICES - 3.75%
Baltimore Technologies PLC (United Kingdom) (1,4) 2,126,130 289,708 1.93
Baltimore Technologies PLC (ADR) (1,4) 100,000 14,300
Enea Data AB (Sweden) (4) 399,400 76,470 .48
Data Communication System Co., Ltd. (Japan) 435,000 28,983 .18
Telelogic AB (Sweden) (1) 315,750 28,578 .18
FI System SA (France) (1) 272,975 25,487 .16
ChoicePoint Inc. (USA) (1) 600,000 22,425 .14
Aldata Solutions (Finland) (1) 245,900 22,135 .14
Securenet Ltd. (Australia) (1) 2,811,634 21,326 .14
StepStone ASA (Norway) (1) 6,480,000 16,721 .11
Connecta AB (Sweden) (1) 420,000 13,159 .08
Satama Interactive Oy (Finland) (1) 516,500 11,870 .08
Biodata Information Technology AG (Germany) (1) 19,300 7,300 .05
Catena Corp (Japan) 600,000 5,012 .03
GigaMedia Ltd. (Taiwan) (1) 83,800 4,546 .03
Lorien PLC (United Kingdom) 819,663 1,203 .01
InaCom Corp. (USA) (1) 395,500 1,088 .01
Xpedior Inc. (USA) (1) 24,900 560 .00
LEISURE & TOURISM - 3.56%
J D Wetherspoon PLC (United Kingdom) 7,404,935 52,532 .33
Cheesecake Factory Inc. (USA) (1,4) 1,205,500 50,179 .32
Extended Stay Amercia, Inc. (USA) (1,4) 5,500,000 41,250 .26
Corporacion Interamericana de Entretenimiento, SA de CV, Class B (Mexico) 8,153,679 41,138 .26
Imax Corp. (Canada) (1) 1,382,200 29,804 .19
Village Roadshow Ltd. (Australia) 11,701,596 19,761 .19
Village Roadshow Ltd., Class A, 5.50% preferred 6,940,468 9,686
American Classic Voyages Co. (USA) (1,4) 1,150,000 28,966 .18
Vail Resorts, Inc. (USA) (1,4) 1,761,300 28,401 .18
Travelocity.com Inc. (USA) (1) 875,000 25,703 .16
Constantin Film AG (Germany) (1) 425,000 22,587 .14
Alliance Atlantis Communications Inc., nonvoting, Class B (Canada) (1) 1,216,450 16,342 .10
Boca Resorts, Inc., Class A (USA) (1) 1,175,000 10,061
Boca Resorts, Inc., Class A, 1997 Series (1,2) 500,000 4,281 .10
Boca Resorts, Inc., Class A, 1999 Series (1,2) 231,730 1,984
Consolidated Products, Inc. (USA) (1,4) 1,718,750 16,221 .10
Ruby Tuesday, Inc. (USA) 841,800 14,731 .09
Helkon Media AG (Germany) (1) 385,000 13,457 .09
Mandarin Oriental International Ltd. (Singapore) 24,149,434 12,799 .08
Kinowelt Medien AG (Germany) (1) 240,000 12,181 .08
Luminar PLC (United Kingdom) 850,000 11,931 .08
Scandic Hotels AB (Sweden) 822,600 10,118 .07
PizzaExpress PLC (United Kingdom) 840,000 9,847 .06
Morton's Restaurant Group, Inc. (USA) (1,4) 415,000 7,911 .05
Filmes Lusomundo, SA, non-voting preferred (Portugal) 248,500 7,615 .05
Lions Gate Entertainment Corp. (Canada) (1,4) 998,300 3,473 .04
Lions Gate Entertainment Corp. (1,2,4) 885,834 3,082
Kinepolis Group NV (Belgium) 89,485 5,913 .04
Johnnies Industrial Corp. Ltd. (South Africa) 374,797 5,744 .04
Gaumont SA (France) 81,370 5,704 .04
CDL Hotels International Ltd. (Hong Kong) 19,000,000 5,673 .04
Norsk Lotteridrift ASA (Norway) 965,000 5,369 .03
NH Hoteles, SA (Spain) (1) 450,000 5,292 .03
Travel24.com AG (Germany) (1) 201,900 4,118 .03
Four Seasons Hotels Inc. (Canada) 90,500 4,053 .03
I T International Theatres Ltd. (Israel) (1) 375,000 3,937 .03
CINAR Films Inc., Class B (Canada) (1,3) 1,042,700 3,649 .02
Mandalay Resort Group (USA) (1) 200,000 3,375 .02
DAS WERK AG (Germany) (1) 45,000 1,616 .01
ELECTRICAL & ELECTRONICS - 2.51%
Toyo Communication Equipment Co., Ltd. (Japan) (4) 3,063,000 71,547 .45
Kokusai Electric Co., Ltd. (Japan) (4) 4,705,000 62,377 .40
ERG Ltd. (Australia) 8,014,840 55,200 .35
Gilat Satellite Networks Ltd. (Israel) (1) 420,000 49,245 .31
Elron Electronic Industries Ltd. (Israel) 1,030,000 38,937 .25
Locus Co., Ltd. (South Korea) (1) 178,867 23,147 .15
ITG Group PLC (Ireland) (1,4) 1,408,455 20,443 .13
Trigem Computer Inc. (South Korea) 190,900 14,771 .09
Trigem Computer Inc. rights, expires 2000 (1) 3,930 68
York International Corp. (USA) 550,000 12,856 .08
GlobeSpan, Inc. (USA) (1) 100,000 10,194 .07
InterCept Group, Inc. (USA) (1) 350,000 9,012 .06
Tollgrade Communications, Inc. (USA) (1) 125,000 6,625 .04
Tandberg Television AS (Norway) (1) 684,000 5,506 .04
Sewon Telecom (South Korea) (1) 390,000 5,453 .03
Finisar Corp. (USA) (1) 32,900 4,820 .03
P-Com, Inc. (USA) (1) 200,000 3,700 .02
Johnson Electric Holdings Ltd. (Hong Kong -- Incorporated in Bermuda) 131,300 898 .01
Advanced Systems Automation Ltd. (Singapore) 648,000 670 .00
WIRELESS TELECOMMUNICATION SERVICES - 2.32%
Tele Celular Sul Participacoes SA, preferred nominative (ADR) (Brazil) 1,297,200 64,860 .52
Tele Celular Sul Participacoes SA, ordinary nominative 5,070,300,000 17,106
Tele Centro Oeste Celular Participacoes SA, preferred nominative (ADR) (Br 4,550,000 52,894 .34
Telemig Celular Participacoes SA, preferred nominative (ADR) (Brazil) 565,700 50,100 .32
Tele Nordeste Celular Participacoes SA, preferred nominative (ADR) (Brazil 678,600 48,689 .31
Himachal Futuristic Communications Ltd. (India) 1,000,000 38,836 .25
Hutchison Telecommunications (Australia) Ltd. (Australia) (1) 7,148,735 25,810 .16
interWAVE Communications International, Ltd. (USA) (1) 514,000 15,484 .10
BreezeCOM Ltd. (Israel) (1) 290,750 10,867 .07
CESKE RADIOKOMUNIKACE AS (GDR) (Czech Republic) (1) 208,300 10,738 .07
Alamosa PCS Holdings, Inc. (USA) (1) 224,900 8,490 .05
M-Cell Ltd. (South Africa) 1,484,000 8,187 .05
WebLink Wireless, Inc. (formerly PageMart Wireless, Inc.) (USA) (1) 500,000 6,687 .04
Aether Systems, Inc. (USA) (1) 30,000 5,445 .03
Triton PCS Holdings, Inc., Class A (USA)(1) 29,500 1,763 .01
ENERGY SOURCES - 1.76%
Newfield Exploration Co. (USA) (1,4) 2,300,000 81,075 .52
Louis Dreyfus Natural Gas Corp. (USA) (1) 1,443,400 49,076 .31
Cairn Energy PLC (United Kingdom) (1,4) 11,000,000 22,633 .14
Mitchell Energy & Development Corp., nonvoting, Class B (USA) 1,000,000 22,000 .14
Fletcher Challenge Energy (New Zealand) 6,000,000 13,362 .09
Oil Search Ltd. (Australia) (1) 8,000,000 7,282
Oil Search Ltd., 9.50% convertible preferred 50,000 3,341 .08
Oil Search Ltd. (1,2) 1,150,000 1,047
Encal Energy Ltd. (Canada) (1) 2,000,000 9,576 .06
Tullow Oil PLC (Ireland) (1,2) 8,000,000 8,549 .05
Ramco Energy PLC (United Kingdom) (1) 1,297,000 8,275 .05
Ivanhoe Energy Inc., units (formerly Black Sea Energy Ltd.) (Canada) (1,2, 4,000,000 7,074 .05
Ivanhoe Energy Inc. (1) 490,400 1,020
Cabre Exploration Ltd. (Canada) (1,4) 1,099,000 7,723 .05
Novus Petroleum Ltd. (Australia) (1) 7,969,508 7,157 .05
Paramount Resources Ltd. (Canada) 600,000 5,415 .03
Paladin Resources NL (Australia) (1,4) 11,270,998 5,034 .03
Western Oil Sands Inc., units (Canada) (1,2,3) 1,100,000 3,789 .03
Western Oil Sands Inc., units (1,2,3) 110,000 568
Berkley Petroleum Corp. (Canada) (1) 510,400 3,165 .02
Arcon International Resources PLC (Ireland) (1) 11,798,000 2,917 .02
Northrock Resources Ltd. (Canada) (1) 603,000 2,285 .02
Bharat Petroleum Corp. Ltd. (India) 351,806 2,092 .01
Aminex PLC (Ireland) (1,2) 3,150,000 2,047 .01
Anzoil NL (Australia) (1) 2,730,000 207 .00
DIVERSIFIED TELECOMMUNICATION SERVICES - 1.54%
Intermedia Communications Inc. (USA) (1) 1,365,000 65,947 .42
VersaTel Telecom International NV (Netherlands) (1) 772,500 35,833 .23
EniTel ASA (Norway) (1) 776,550 34,470 .22
EniTel ASA, warrants, expire 2004 (1,3) 30,000 663
Focal Communications Corp. (USA) (1) 623,900 34,938 .22
Highpoint Telecommunications Inc. (Canada) (1) 1,000,000 15,157 .12
Highpoint Telecommunications Inc. (1,2,3) 322,000 4,148
Global Tele-Systems Ltd. (India) 320,000 16,614 .10
Global Light Telecommunications Inc. (Canada) (1) 600,000 12,300 .08
Flashcom, Inc., preferred, Series B (USA) (1,2,3) 1,484,018 10,017 .06
Corus Entertainment Inc., Class B (Canada) (1) 350,000 9,163 .06
Redstone Telecom PLC (United Kingdom) (1) 400,000 4,051 .03
Redstone Telecom PLC, rights, expire 2000 (1) 109,091 191 .00
FINANCIAL SERVICES - 1.46%
OM Gruppen AB (Sweden) 2,706,400 113,056 .72
MarketWatch.com, Inc. (USA) (1,4) 727,900 25,113 .16
Fidelity National Financial, Inc. (USA) (4) 1,700,000 23,481 .15
Mycal Card Inc. (Japan) 425,920 14,396 .09
American Capital Strategies, Ltd. (USA) 450,000 11,419 .07
Nissin Co., Ltd. (Japan) 250,000 10,781 .07
Metris Companies Inc. (USA) 240,000 9,330 .06
Challenger International Ltd. (Australia) 3,700,000 8,882 .06
Federal Agricultural Mortgage Corp., Class C (USA) (1) 350,000 5,425 .03
Medallion Financial Corp. (USA) 275,000 4,623 .03
JCG Holdings Ltd. (Hong Kong -- Incorporated in Bermuda) 7,990,000 3,617 .02
RECREATION & OTHER CONSUMER PRODUCTS - 1.35%
Infogrames Entertainment (France) (1) 1,622,500 66,654
Infogrames Entertainment, 2.00% convertible debentures 2002 $7,872 7,913 .48
Infogrames Entertainment, warrants, expire 2001 (1) 25,500 1,807
AVEX Inc. (Japan) 298,610 56,700 .36
VTech Holdings Ltd. (Hong Kong) (4) 12,700,964 50,892 .32
Communication Network Interface, Inc. (South Korea) (4) 1,060,000 15,396 .10
Boyds Collection, Ltd. (USA) (1) 1,000,000 6,063 .04
GTR Group Inc. (Canada) (1) 1,965,000 3,926 .03
edel music AG (Germany) (1) 70,000 2,078 .01
Bajaj Auto Ltd. (GDR) (India) 75,000 711 .01
HEALTH CARE PROVIDERS & SERVICES - 1.34%
Medicis Pharmaceutical Corp., Class A (USA) (1) 1,295,000 51,800 .33
Service Corp. International (USA) 10,000,000 30,000 .19
Rhon-Klinikum AG, nonvoting preferred (Germany) 561,300 25,424 .16
Trigon Healthcare, Inc. (USA) (1) 525,700 18,794 .12
Triad Hospitals, Inc. (USA) (1) 1,118,347 18,732 .12
AmeriSource Health Corp., Class A (USA) (1) 1,050,000 15,750 .10
Stewart Enterprises, Inc., Class A (USA) 3,000,000 14,813 .09
Bright Horizons Family Solutions, Inc. (USA) (1) 555,000 12,002 .08
LifePoint Hospitals, Inc. (USA) (1) 468,347 7,786 .05
CuraGen Corp. (USA) (1) 150,000 7,012 .04
AmSurg Corp., Class B (USA) (1,4) 309,972 1,860 .02
AmSurg Corp., Class A (1,4) 250,000 1,469
ICON PLC (ADR) (Ireland) (1) 209,000 3,109 .02
American Dental Partners, Inc. (USA) (1,4) 443,000 3,073 .02
CHEMICALS - 1.28%
Cambrex Corp. (USA) (4) 1,400,000 60,900 .39
OM Group, Inc. (USA) 1,050,000 47,775 .30
Valspar Corp. (USA) 991,100 37,972 .24
Bush Boake Allen Inc. (USA) (1) 690,100 19,193 .12
Ionics, Inc. (USA) (1) 750,000 19,172 .12
Kingboard Chemical Holdings Ltd. (Hong Kong) (4) 27,720,000 9,612 .06
CK Witco Corp. (USA) 671,200 6,838 .05
BEVERAGES & TOBACCO - 1.20%
BRL Hardy Ltd. (Australia) (4) 8,420,836 36,760 .23
Beringer Wine Estates Holdings, Inc., Class B (USA) (1) 708,000 25,400 .16
Chukyo Coca-Cola Bottling Co., Ltd. (Japan) 2,025,000 20,061 .13
Robert Mondavi Corp., Class A (USA) (1) 500,000 17,438 .11
Coca-Cola West Japan Co. Ltd. (Japan) 536,200 14,061 .09
Montana Group Ltd. (New Zealand) (4) 13,950,000 13,492 .09
Hokkaido Coca-Cola Bottling Co., Ltd. (Japan) 1,011,000 11,292 .07
Mikuni Coca-Cola Bottling Co., Ltd. (Japan) 805,000 10,094 .06
Kinki Coca-Cola Bottling Co., Ltd. (Japan) 720,000 9,021 .06
Quilmes Industrial SA, nonvoting preferred (ADR) (Argentina) 700,000 7,350 .05
Mikasa Coca-Cola Bottling Co., Ltd. (Japan) 815,000 6,689 .04
Vitasoy International Holdings Ltd. (Hong Kong) 23,576,000 5,056 .03
AL-Ahram Beverages Co. (GDR) (Egypt) (1) 240,000 4,356 .03
Brau und Brunnen AG (Germany) (1) 77,304 2,739 .02
Petaluma Ltd. (Australia) 689,950 1,989 .01
Simeon Wines Ltd. (Australia) 832,748 1,631 .01
Vina Concha y Toro SA (ADR) (Chile) 27,200 1,047 .01
Guinness Anchor Bhd. (Malaysia) 781,200 847 .00
REAL ESTATE - 0.89%
Newhall Land and Farming Co. (USA) 1,000,000 28,250 .18
Castellum AB (Sweden) (4) 2,659,200 24,840 .16
Cadiz Inc. (USA) (1,4) 2,232,000 18,972 .12
IRSA Inversiones y Representaciones SA (Argentina) 3,345,000 10,408 .12
IRSA Inversiones y Representaciones SA (GDR) 265,500 8,297
Muse Prime Software, Inc., preferred, Series B (USA) (1,2,3,4) 1,770,000 17,558 .11
Unibail (France) 94,000 12,332 .08
Diligentia AB (Sweden) 763,000 7,835 .05
Mandamus AB (Sweden) 727,575 5,699 .03
Sponda Oyj (Finland) 1,330,000 4,700 .03
Pillar Property PLC (United Kingdom) 340,000 1,599 .01
GESCO Corp. (India) (1,3,4) 1,440,250 331 .00
GESCO Corp. (GDR) (1,2,3,4) 32,550 37
MACHINERY & ENGINEERING - 0.85%
JOT Automation Group Oyj (Finland) 8,162,600 73,475 .46
Yushin Precision Equipment Co., Ltd. (Japan) 493,130 43,968 .28
Thermo Fibertek Inc. (USA) (1) 1,200,000 8,250 .05
Miura Co., Ltd. (Japan) 500,000 5,774 .04
Chen Hsong Holdings Ltd. (Hong Kong -- Incorporated in Bermuda) 8,038,000 1,528 .01
KCI Konecranes International Corp. (Finland) 39,424 1,216 .01
BANKING - 0.84%
Yapi ve Kredi Bankasi AS (Turkey) 1,040,000,000 27,831 .18
Imperial Bancorp (USA) (1) 839,808 26,034 .17
Industrial Finance Corp. of Thailand (Thailand) (1) 74,000,000 23,994 .15
Banco de Galicia y Buenos Aires SA, Class B (ADR) (Argentina) 822,783 16,661 .11
Fulton Financial Corp. (USA) 752,867 15,857 .10
KorAm Bank (South Korea) 1,200,000 7,059 .05
Provident Bankshares Corp. (USA) 312,559 4,923 .03
Banco Rio de la Plata SA, Class B (ADR) (Argentina) 221,000 3,163 .02
City National Corp. (USA) 64,473 2,172 .01
Grupo Financiero BBV Probursa, SA de CV, Class B (Mexico) (1) 16,785,500 2,102 .01
Industrial Credit and Investment Corp. of India Ltd. (ADR) (India) (1) 141,000 2,062 .01
INDUSTRIAL COMPONENTS - 0.56%
Toyoda Machine Works, Ltd. (Japan) 2,310,000 19,295 .12
Tower Automotive, Inc. (USA) (1) 805,400 13,188 .08
Senior PLC (formerly Senior Engineering Group PLC) (United Kingdom) 9,100,000 12,482 .08
Exedy Corp. (Japan) 1,395,900 12,446 .08
Kiekert AG (Germany) 425,000 10,948 .07
Koito Manufacturing Co., Ltd. (Japan) 1,670,000 8,661 .06
Roper Industries, Inc. (USA) 150,000 5,091 .03
BlueStar Battery Systems International Corp. (Canada) (1) 1,000,000 3,018 .02
BERU AG (Germany) 70,800 2,298 .01
THK Co., Ltd. (Japan) 27,000 1,238 .01
INSURANCE - 0.52%
Independent Insurance Group PLC (United Kingdom) (4) 13,940,000 42,912 .27
HCC Insurance Holdings, Inc. (USA) 2,304,100 30,530 .20
Clark/Bardes Holdings, Inc. (USA) (1) 456,300 6,502 .04
Lindsey Morden Group Inc. (Canada) 150,300 1,812 .01
TRANSPORTATION: SHIPPING - 0.47%
Stolt-Nielsen SA, Class B (ADR) (Multinational) 1,040,000 19,240 .12
Teekay Shipping Corp. (Bahamas) 520,000 14,333 .09
Odfjell ASA, Class B (Norway) 445,000 6,268 .06
Odfjell ASA, Class A 214,320 3,171
MIF Ltd. (Greece) (1,4) 682,903 7,760 .05
Ugland International Holdings PLC (United Kingdom) 6,082,807 6,112 .04
Great Eastern Shipping Co. Ltd. (India) (4) 12,962,250 5,090 .04
Great Eastern Shipping Co. Ltd. (GDR) (3,4) 292,950 575
Benor Tankers Ltd. (Norway) (1,4) 1,240,000 3,376 .02
Knightsbridge Tankers Ltd. (Bermuda) 150,000 2,672 .02
Frontline Ltd. (Bermuda) (1) 483,300 2,120 .01
Shipping Corp. of India Ltd. (India) 5,391,600 1,733 .01
Mosvold Shipping Ltd (Norway) (1) 2,580,000 702 .01
Waterfront Shipping ASA (Norway) (1) 34,110 598 .00
MISCELLANEOUS MATERIALS & COMMODITIES - 0.47%
American National Can Group, Inc. (USA) 2,550,000 33,469 .21
Intertape Polymer Group Inc. (Canada) (1,4) 1,500,000 17,062 .11
Arisawa Mfg. Co., Ltd (Japan) 418,000 9,256 .06
Kafus Industries Ltd. (Canada) (1) 1,300,000 7,881 .05
Park-Ohio Holdings Corp. (USA) (1) 300,000 3,188 .02
AptarGroup, Inc. (USA) 100,000 2,669 .02
FOOD & HOUSEHOLD PRODUCTS - 0.45%
Geest PLC (United Kingdom) 2,250,000 18,948 .12
Celestial Seasonings, Inc. (USA) (1,4) 530,000 18,219 .12
PT Indofood Sukses Makmur Tbk (Indonesia) (1) 22,694,800 17,273 .11
Fyffes PLC (Ireland) 5,850,000 12,324 .08
Grupo Industrial Maseca, SA de CV, Class B (ADR) (Mexico) 420,000 3,675 .02
TRANSPORTATION: AIRLINES - 0.44%
Atlantic Coast Airlines Holdings, Inc. (USA) (1,4) 1,268,000 32,809 .21
SkyWest, Inc. (USA) 750,000 29,344 .18
Alaska Air Group, Inc. (USA) (1) 155,400 4,672 .03
BRIT AIR Group (France) (4) 81,650 2,854 .02
MULTI-INDUSTRY - 0.44%
Corporacion Financiera Alba, SA (Spain) 1,070,694 32,143 .20
Novestra AB (Sweden) (1,2,4) 299,000 25,327 .16
Varetis AG (Germany) 186,000 12,112 .08
WHOLESALE & INTERNATIONAL TRADE - 0.42%
Li & Fung Ltd. (Hong Kong-Incorporated in Bermuda) 8,600,000 39,872 .25
Fuji Electronics Co., Ltd. (Japan) (4) 688,000 13,899 .09
Performance Food Group Co. (USA) (1) 550,000 12,031 .08
BUILDING MATERIALS & COMPONENTS - 0.34%
Elcor Corp. (USA) 900,000 31,050 .20
Apasco, SA de CV (Mexico) 1,322,620 8,222 .05
Puerto Rican Cement Co., Inc. (USA) 250,000 8,000 .05
RHI AG (Austria) 204,147 5,437 .03
Futuris Corp. Ltd. (Australia) 725,000 730 .01
TEXTILES & APPAREL - 0.33%
Esprit Holdings Ltd. (Hong Kong-Incorporated in Bermuda) 39,649,605 38,700 .24
Wolford Group (Austria) 244,000 7,710 .05
WestPoint Stevens Inc. (USA) 300,000 5,700 .04
UTILITIES: ELECTRIC & GAS - 0.29%
Australian Gas Light Co. (Australia) 4,080,037 19,682 .13
International Energy Group Ltd. (United Kingdom) (4) 4,640,000 16,652 .11
Centrais Eletricas de Santa Catarina SA - CELESC, preferred nominative, 135,000 5,062 .03
Class B (ADR) (Brazil)
Cia. de Eletricidade do Estado do Rio de Janeiro - CERJ, 11,835,646,00 3,618 .02
ordinary nominative (Brazil) (1)
Espirito Santo Centrais Eletricas SA - ESCELSA, ordinary nominative (Brazi 17,335 620 .00
ENERGY EQUIPMENT - 0.26%
Rowan Companies, Inc. (USA) (1) 825,200 24,292 .16
Newpark Resources, Inc. (USA) (1) 1,349,700 10,798 .07
Shaw Industries Ltd., Class A (Canada) 596,500 5,342 .03
EQUITY COMMON TRUSTS - 0.18%
Atle AB, Class A (Sweden) 1,590,000 28,597 .18
METALS: STEEL - 0.17%
Tubos de Acero de Mexico, SA (ADR) (Mexico) 1,633,747 26,753 .17
APPLIANCES & HOUSEHOLD DURABLES - 0.17%
Fisher & Paykel Industries Ltd. (New Zealand) (4) 6,550,000 19,655 .13
Stanley Furniture Co., Inc. (USA) (1) 250,000 4,844 .03
Tohoku Pioneer Corp. (Japan) 29,000 1,952 .01
METALS: NONFERROUS - 0.16%
Kaiser Aluminum Corp. (USA) (1) 3,100,000 13,950 .09
Minmet PLC (Ireland) (1,2,4) 25,235,027 11,874 .07
AUTOMOBILES - 0.13%
Mahindra & Mahindra Ltd. (GDR) (India) 1,795,948 15,041 .13
Mahindra & Mahindra Ltd. 804,052 5,927
AEROSPACE & MILITARY TECHNOLOGY - 0.10%
REMEC, Inc. (USA) (1) 160,000 8,080 .05
Aeroflex Inc. (USA) (1) 150,000 7,425 .05
CONSTRUCTION & HOUSING - 0.06%
Palm Harbor Homes, Inc. (USA) (1) 648,906 9,977 .06
GOLD MINES - 0.06%
Gabriel Resources Ltd. (Canada) (1,2,3) 3,000,000 3,689 .02
Bema Gold Corp. (Canada) (1,2) 4,400,000 2,674 .02
Bema Gold Corp., warrants, expire 2001 (1,2,3) 2,200,000 0
Avocet Mining PLC (United Kingdom) (1,2,4) 2,750,000 1,096 .01
Avocet Mining PLC (1,4) 1,100,000 439
Ashanti Goldfields Co. Ltd. (Ghana) (1) 400,000 840 .01
Philippine Gold PLC (United Kingdom) (1,4) 4,953,700 356 .00
TRANSPORTATION: RAIL & ROAD - 0.02%
C.H. Robinson Worldwide, Inc. (USA) 100,000 3,725 .02
FOREST PRODUCTS & PAPER - 0.02%
PT Indah Kiat Pulp & Paper Corp. Tbk (Indonesia) (1) 8,707,000 2,881 .02
MISCELLANEOUS - 4.99% 786,309 4.99
Other equity securities in initial period of acquisition
TOTAL EQUITY SECURITIES (cost: $8,870,897,000) 14,189,171 90.04
Principal Market Percent
Amount Value of Net
SHORT-TERM SECURITIES (000) (000) Assets
------------------------------------------------------------------------- ---------- --------- --------
Corporate Short-Term Notes - 9.44%
CDC Commerical Paper Corp. 5.90%-5.96% due 4/14-4/19/2000 (2) $100,000 $99,728 .63%
France Telecom, SA 5.83%-6.04% due 4/17-5/23/2000 (2) 97,220 96,558 .61
Ciesco LP 5.85%-5.98% due 4/12-4/27/2000 86,300 85,981 .55
International Lease Finance Corp. 5.89%-6.01% due 4/13-5/26/2000 85,951 85,556 .54
BMW US Capital Corp. 5.81%-6.04% due 4/17-5/30/2000 84,305 83,703 .53
DaimlerChrysler NA Holdings 5.84%-5.95% due 4/11-4/26/2000 80,800 80,577 .51
Associates First Capital Finance BV 5.95%-6.04% due 4/20-5/30/2000 75,000 74,558 .47
Societe Generale North America Inc. 6.00%-6.02% due 5/19-5/22/2000 75,000 74,374 .47
Abbey National North America 5.83%-6.05% due 4/10-6/22/2000 70,000 69,262 .44
Preferred Receivable Funding 5.87%-5.88% due 4/10-4/11/2000 (2) 65,500 65,391 .42
Ford Motor Credit Co. 5.92%-6.02% due 4/6-5/3/2000 65,500 65,343 .42
Motorola, Inc. 5.88%-6.07% due 5/26-6/29/2000 66,000 65,088 .41
TOTAL FINA SA 5.89%-6.03% due 4/14-5/26/2000 (2) 65,000 64,745 .41
American Honda Finance Corp. 5.82%-5.90% due 4/7-5/26/2000 63,600 63,199 .40
Park Avenue Receivables Corp. 6.03%-6.05% due 4/24-4/26/2000 (2) 55,829 55,599 .35
AB Spintab 5.98%-6.07% due 4/14-6/26/2000 54,750 54,185 .34
CBA (Delaware) Finance Inc. 5.89%-5.97% due 5/10-6/9/2000 52,700 52,185 .33
Motiva Enterprises LLC 5.82%-6.01% due 4/5-5/1/2000 51,500 51,343 .33
Bayerische Vereinsbank AG 5.87%-6.02% due 5/15-5/22/2000 50,000 49,588 .32
Telstra Corp. Ltd. 5.80%-5.85% due 4/3-4/10/2000 45,000 44,961 .29
Asset Securitization Corp. 5.82%-6.02% due 4/4-5/12/2000 (2) 45,000 44,843 .29
Equilon Enterprises, LLC 5.83%-6.03% due 4/17-5/03/2000 45,000 44,803 .28
Glaxo Wellcome PLC 5.81% due 4/7/2000 (2) 14,900 14,883 .10
Certificates of Deposit - 0.66%
Canadian Imperial Bank of Commerce 5.84%-5.97% due 4/3-4/13/2000 53,000 53,000 .34
Lloyds Bank PLC 5.93% due 5/1/2000 50,000 50,000 .32
Federal Agency Discount Notes - 0.53%
Freddie Mac 5.80%-6.00% due 4/25-5/25/2000 84,900 84,292 .53
Non-U.S. Currency - 0.02%
New Taiwanese Dollar NT$110,055 3,623 .02
TOTAL SHORT-TERM SECURITIES (cost: $1,677,277,000) 1,677,368 10.65
TOTAL INVESTMENT SECURITIES (cost: $10,548,174,000) 15,866,539 100.69
Excess of payables over cash and receivables 108,594 .69
NET ASSETS $15,757,94100.00%
(1) Non-income-producing security.
(2) Purchased in a private placement transaction; resale to the
public may require registration or sale only to qualified instiutional buyers.
(3) Valued under procedures established by the Board of Directors.
(4) Represents an affiliated company as defined under the Investment
Company Act of 1940.
(5) When-issued security.
ADR = American Depositary Receipts
GDR = Global Depositary Receipts
See Notes To Financial Statements
</TABLE>
<TABLE>
SmallCap World Fund
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES UNAUDITED
at March 31, 2000 (dollars in thousands)
<S> <C> <C>
Assets:
Investment securities at market:
Unaffiliated issuers (cost: $ 8,484,037) $12,901,826
Affiliated issuers (cost: $2,064,137) 2,964,713
-----------
$15,866,539
Cash 17,041
Receivables for--
Sales of investments 150,038
Sales of fund's shares 36,324
Forward currency contracts-net
Dividends and interest 9,484 195,846
Other
----------- -----------
16,079,426
Liabilities:
Payables for--
Purchases of investments 278,193
Repurchases of fund's shares 24,587
Management services 9,132
Other expenses 9,569 321,481
----------- -----------
Net Assets at March 31, 2000-- $15,757,945
===========
Total authorized capital stock--
400,000,000 shares
Class A shares, $0.01 par value
Net assets $15,747,748
Shares outstanding 346,587,042
Net asset value per share $45.44
Class B shares, $0.01 par value
Net assets $10,197
Shares outstanding 224,492
Net asset value per share $45.42
UNAUDITED
STATEMENT OF OPERATIONS
for the six months ended March 31, 2000 (dollars in thousands)
Investment Income:
Income:
Dividends (includes $7,442 from affiliates) $31,533
Interest 27,139 $58,672
-----------
Expenses:
Management services fee 40,874
Distribution expenses- Class A 17,429
Distribution expenses- Class B 3
Transfer agent fee- Class A 5,758
Transfer agent fee- Class B 1
Reports to shareholders 370
Registration statement and prospectus 412
Postage, stationery and supplies 1,041
Directors' fees 92
Auditing and legal fees 75
Custodian fee 1,691
Taxes other than federal income tax 215
Other expenses 239 68,200
----------- -----------
Net investment loss (9,528)
-----------
Realized Gain and Unrealized
Appreciation on Investments:
Net realized gain (including $480,795 net gain from affiliates) 1,853,576
Net increase in unrealized
appreciation on investments:
Beginning of period 2,008,296
End of period 5,313,360
-----------
Net unrealized appreciation on investments 3,305,064
-----------
Net realized gain and
unrealized appreciation
on investments 5,158,640
-----------
Net Increase in Net Assets Resulting
from Operations $5,149,112
===========
STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands)
Six Months Year Ended
Ended March 31,September 30,
2000* 1999
----------- -----------
Operations:
Net investment (loss)income $(9,528) $9,655
Net realized gain on investments 1,853,576 157,055
Net unrealized appreciation
on investments 3,305,064 2,567,219
----------- -----------
Net increase in net assets
resulting from operations 5,149,112 2,733,929
----------- -----------
Dividends and Distributions Paid to
Shareholders:
Dividends from net investment income:
Class A (4,626) (28,122)
Class B - -
Distributions from net realized gain on investments:
Class A (186,548) (403,091)
Class B - -
----------- -----------
Total dividends and distributions (191,174) (431,213)
----------- -----------
Capital Share Transactions:
Proceeds from shares sold 2,578,996 1,309,044
Proceeds from shares issued in reinvestment
of net investment income dividends and
distributions of net realized gain on investments 183,484 415,013
Cost of shares repurchased (945,011) (2,145,795)
----------- -----------
Net increase(decrease) in net assets resulting from 1,817,469 (421,738)
capital share transactions ----------- -----------
Total Increase in Net Assets 6,775,407 1,880,978
Net Assets:
Beginning of period 8,982,538 7,101,560
----------- -----------
End of period (including distributions in
excess of net investment income and
undistributed net investment income:
$(14,275) and $2,359, respectively) $15,757,945 $8,982,538
========== ==========
*Unaudited
See Notes to Financial Statements
</TABLE>
SMALLCAP WORLD FUND
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION - SMALLCAP World Fund, Inc. (the "fund") is registered under the
Investment Company Act of 1940 as an open-end, diversified management
investment company. The fund seeks long-term growth of capital through
investments in smaller companies in the U.S. and around the world.
The fund offers Class A and Class B shares. Class A shares are sold with an
initial sales charge of up to 5.75%. Class B shares are sold with a contingent
deferred sales charge, which declines from 5% to zero depending on the length
of time the shares are held, and include a higher distribution fee than Class A
shares. Class B shares are automatically converted to Class A shares eight
years after the date of purchase. Holders of both classes of shares have equal
pro rata rights to assets and identical voting, dividend, liquidation and other
rights, except that each class bears different distribution and transfer agent
expenses, and each class shall have exclusive rights to vote on matters
affecting only their class.
SIGNIFICANT ACCOUNTING POLICIES - The financial statements have been prepared
in conformity with generally accepted accounting principles which require
management to make estimates and assuptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The following is a summary of the significant accounting
policies consistently followed by the fund in the preparation of its financial
statements:
SECURITY VALUATION - Equity securities, including depositary receipts, are
valued at the last reported sale price on the exchange or market on 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 equity securities are traded on more than one exchange, the
securities are valued on the exchange or market determined by the investment
adviser to be the broadest and most representative market, which may be either
a securities exchange or the over-the-counter market. Short-term securities
maturing within 60 days are valued at amortized cost, which approximates market
value. Forward currency contracts are valued at the mean of their
representative quoted bid and asked prices. Securities and assets for which
representative market quotations are not readily available are valued at fair
value as determined in good faith by a committee appointed by the Board of
Directors.
NON-U.S. CURRENCY TRANSLATION - Assets and liabilities initially expressed in
terms of non-U.S. currencies are translated into U.S. dollars at the prevailing
market rates at the end of the reporting period. Purchases and sales of
securities and income and expenses are translated into U.S. dollars at the
prevailing market rates on the dates of such transactions. The effects of
changes in non-U.S. currency exchange rates on investment securities and other
assets and liabilities are included with the net realized and unrealized gain
or loss on investment securities.
SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME -Security transactions are
accounted for as of the trade date. Realized gains and losses from securities
transactions are determined based on specific identified cost. In the event
securities are purchased on a delayed delivery or "when-issued" basis, the fund
will instruct the custodian to segregate liquid assets sufficient to meet its
payment obligations in these transactions. Dividend income is recognized on
the ex-dividend date, and interest income is recognized on an accrual basis.
Market discounts, premiums, and original issue discounts on securities
purchased are amortized daily over the expected life of the security.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions paid
to shareholders are recorded on the ex-dividend date.
FORWARD CURRENCY CONTRACTS - The fund may enter into forward currency
contracts, which represent agreements to exchange currencies of different
countries at specified future dates at specified rates. The fund enters into
these contracts to manage its exposure to fluctuations in foreign exchange
rates arising from investments denominated in non-U.S. currencies.
COMMON EXPENSES - Income, expenses (other than class-specific expenses) and
realized and unrealized gains and losses are prorated between the classes based
on the relative net assets of each class. Distribution and transfer agent fees,
and any other class-specific expenses, if any, are calculated daily at the
class level based on the relative daily net assets of each class and the
specific expense rate applicable to each class.
2. NON-U.S. INVESTMENTS
INVESTMENT RISK - Investments in securities of non-U.S. issuers in certain
countries involve special investment risks. These risks may include, but are
not limited to, investment and repatriation restrictions, revaluation of
currencies, adverse political, social, and economic developments, government
involvement in the private sector, limited and less reliable investor
information, lack of liquidity, certain local tax law considerations, and
limited regulation of the securities markets.
TAXATION - Dividend and interest income is recorded net of non-U.S. taxes paid.
For the six months ended March 31, 2000, such non-U.S. taxes were $2,729,000.
Net realized gain of the fund derived in certain countries are subject to
certain non-U.S. taxes. The fund provides for such non-U.S. taxes on
investment income, net realized gain and net unrealized gain.
CURRENCY GAINS AND LOSSES - Net realized currency losses on dividends,
interest, sales of non-U.S. bonds and notes, forward contracts, and other
receivables and payables, on a book basis, were $175,000 for the six months
ended March 31, 2000.
3. FEDERAL INCOME TAXATION
The fund complies with the requirements of the Internal Revenue Code applicable
to regulated investment companies and intends to distribute all of its net
taxable income and net capital gains for the fiscal year. As a regulated
investment company, the fund is not subject to income taxes if such
distributions are made. Required distributions are determined on a tax basis
and may differ from net investment income and net realized gains for financial
reporting purposes. In addition, the fiscal year in which amounts are
distributed may differ from the year in which the net investment income and net
realized gains are recorded by the fund.
As of March 31, 2000, net unrealized appreciation on investments for book and
federal income tax purposes aggregated $5,313,515,000, net of accumulated
deferred taxes totaling $4,850,000 on unrealized appreciation of Indian
securities, of which $6,205,723,000 related to appreciated securities and
$892,208,000 related to depreciated securities. During the six months ended
March 31, 2000, the fund realized, on a tax basis, a net capital gain of
$1,856,086,000 on securities transactions. In addition, the fund has
recognized, for tax purposes, losses relating to non-U.S. currency transactions
totaling $622,000 which were realized during the period November 1, 1998
through September 30, 1999.
The cost of portfolio securities for book and federal income tax purposes was
$10,548,174,000 at March 31, 2000.
4. FEES AND TRANSACTIONS WITH RELATED PARTIES
INVESTMENT ADVISORY FEE - The fee of $40,874,000 for management services was
incurred pursuant to an agreement with Capital Research and Management Company
(CRMC), with which certain officers and Directors of the fund are affiliated.
The Investment Advisory and Service Agreement provides for monthly fees,
accrued daily, based on an annual rate of 0.80% of the first $1 billion of
average net assets; 0.70% of such assets in excess of $1 billion but not
exceeding $2 billion; 0.67% of such assets in excess of $2 billion but not
exceeding $3 billion; 0.65% of such assets in excess of $3 billion but not
exceeding $5 billion; 0.635% of such assets in excess of $5 billion but not
exceeding $8 billion; 0.625% of such assets in excess of $8.0 billion but not
exceeding $13.0 billion; and 0.615% of such assets in excess of $13.0 billion.
DISTRIBUTION EXPENSES - Pursuant to a Plan of Distribution for Class A shares,
the fund may expend up to 0.30% of Class A average daily net assets annually
for any activities primarily intended to result in sales of fund shares,
provided the categories of expenses for which reimbursement is made are
approved by the fund's Board of Directors. Fund expenses under the Plan
include payments to dealers to compensate them for their selling and servicing
efforts. Pursuant to a Plan of Distribution for Class B shares, the fund may
expend up to 1.00% of Class B average daily net assets annually to compensate
dealers for their selling and servicing efforts. During the six months ended
March 31, 2000, distribution expenses under the Plans of Distribution for Class
A and Class B shares were $17,429,000 and $3,000. As of March 31, 2000,
accrued and unpaid distribution expenses for Class A and Class B shares were
$3,604,000 and $3,000, respectively.
American Funds Distributors, Inc. (AFD), the principal underwriter of the
fund's shares, received $3,422,000 (after allowances to dealers) as its portion
of the sales charges paid by purchasers of the fund's shares. Such sales
charges are not an expense of the fund and, hence, are not reflected in the
accompanying statement of operations.
TRANSFER AGENT FEE - American Funds Service Company (AFS), the transfer agent
for the fund, was paid a fee of $5,759,000.
DEFERRED DIRECTORS' FEES - Directors who are unaffiliated with CRMC may elect
to defer part or all of the fees earned for services as members of the Board.
Amounts deferred are not funded and are general unsecured liabilities of the
fund. As of March 31, 2000, aggregate deferred amounts and earnings thereon
since the deferred compensation plan's adoption (1993), net of any payments to
Directors, were $397,000.
CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both wholly
owned subsidiaries of CRMC. Certain Directors and officers of the fund are or
may be considered to be affiliated with CRMC, AFS and AFD. No such persons
received any remuneration directly from the fund.
5. INVESTMENT TRANSACTIONS AND OTHER DISCLOSURES
The fund made purchases and sales of investment securities, excluding
short-term securities, of $4,303,778,000 and $3,796,236,000, respectively,
during the six months ended March 31, 2000.
As of March 31, 2000, net assets consist of the following:
<TABLE>
<CAPTION>
<S> <C>
Capital paid in on shares of beneficial $8,634,664
interest
Distributions in excess of net investment -14,275
income
Accumulated net realized gain 1,824,196
Net unrealized appreciation 5,313,360
Net Assets $15,757,945
</TABLE>
Capital share transations in the fund were as follows:
<TABLE>
SMALLCAP WORLD FUND Six Months
March 31, 2000 Ended Year Ended
March 31, September 31,
2000 1999
Amount (000) Shares Amount (000) Shares
<S> <C> <C> <C> <C>
Class A Shares:
Sold $2,568,461 61,213,268 $ 1,309,044 50,434,688
Reinvestment of dividends and distributions 183,484 5,078,912 415,013 17,698,049
Repurchased (945,000) (23,459,372) (2,145,795) (85,119,727)
Net (decrease) increase in Class A 1,806,945 42,832,808 (421,738) (16,986,990)
Class B Shares:
Sold 10,535 224,723 - -
Reinvestment of dividends and distributions - - - -
Repurchased (11) (231) - -
Net (decrease) increase in Class B 10,524 224,492 - -
Total net increase (decrease) in fund $1,817,469 43,057,300 $ (421,738) (16,986,990)
</TABLE>
The fund reclassified $2,480,000 from undistributed net investment income to
additional paid-in capital during the six months ended March 31, 2000, as a
result of permanent differences between book and tax.
Pursuant to the custodian agreement, the fund receives credits against its
custodian fee for imputed interest on certain balances with the custodian bank.
The custodian fee of $1,691,000 includes $64,000 that was paid by these
credits rather than in cash.
6. TRANSACTIONS WITH AFFILIATES
Affiliated issuers, as defined under the Investment Company Act of 1940, are
those in which the fund's holdings of an issuer represent 5% or more of the
outstanding voting securities of the issuer. A summary of the fund's
transactions in the securities of these issuers during the six months ended
March 31, 2000 is as follows:
<TABLE>
Market
Value
of
Beginning Ending DividenAffiliates
Company Shares Purchases Sales Shares Income at 3/31/00
(000) (000)
<S> <C> <C> <C> <C> <C> <C>
Acer Laboratories 6,200,00 6,200,00 -$ 42,24
Alloy Online 876,30 876,30 - 14,62
Alphameric 5,262,00 5,262,00$ 34 33,48
American Classic Voyages 600,00 550,00 1,150,00 - 28,96
American Dental Partners 443,00 443,00 - 3,07
American Healthcorp/1/ 522,00 522,00 -
AmSurg 559,97 559,97 - 3,32
Ando Electric 484,00 1,216,00 1,700,00 - 34,67
Anesta 740,00 25,00 715,00 - 9,46
Antena 3 de Television 1,50 1,50 - 39,20
APCOA Parking 120,80 1,88 122,68 - 8,94
Apex 875,00 300,00 1,175,00 - 43,62
Atlantic Coast Airlines Holding 1,268,00 1,268,00 - 32,80
Avocet Mining 3,850,00 3,850,00 - 1,53
Bally Total Fitness Holding 1,160,50 200,00 1,360,50 - 33,33
Baltimore Technologies 1,910,00 316,13 - 2,226,13 - 304,00
Benor Tankers 1,240,00 1,240,00 - 3,37
BRIT AIR Group 29,50 52,15 81,65 24 2,85
BRL Hardy 7,216,82 1,204,01 8,420,83 438 36,76
Cabre Exploration 1,099,00 1,099,00 - 7,72
Cadiz 2,232,00 2,232,00 - 18,97
Cairn Energy 11,000,00 11,000,00 - 22,63
Cambrex 1,400,00 1,400,00 84 60,90
Castellum 2,359,20 300,00 2,659,20 - 24,84
Celestial Seasonings 530,00 530,00 - 18,21
Cheesecake Factory 1,205,50 1,205,50 - 50,17
Chieftain International/1/ 860,00 247,20 860,00 247,20 -
CIMA LABS 617,20 617,20 - 10,60
Communication Network Interface 1,060,00 1,060,00 - 15,39
Computer Engineering & Consulti 1,145,00 1,145,00 57 22,18
Computer Motion 434,90 434,90 - 4,10
Consolidated Products 1,562,50 156,25 1,718,75 - 16,22
DFS Furniture 4,852,70 830,00 5,682,70 1,620 31,27
Digene 800,00 800,00 - 36,80
Documentum/1/ 1,095,00 445,00 650,00 -
Elbit 50,00 1,082,50 50,00 1,082,50 - 14,07
Elec & Eltek International 52,905,00 20,745,00 32,160,00 1,089
Holdings/1/
Enea Data 399,40 399,40 - 76,47
Etec Systems/1/ 1,210,00 1,210,00 -
EUROBIKE 364,00 364,00 193 4,18
Extended Stay America 4,000,00 1,500,00 5,500,00 - 41,25
Fidelity National Financial 1,700,00 1,700,00 - 23,48
Fisher & Paykel Industries 6,550,00 6,550,00 1,285 19,65
Fuji Electronics 688,00 688,00 79 13,89
Genetronics Biomedical/1/ 1,650,00 1,650,00 -
GESCO 1,472,80 1,472,80 - 36
Giordano International 42,954,00 42,954,00 - 52,13
Great Eastern Shipping 14,728,00 1,472,80 13,255,20 - 5,66
Great Plains Software 700,00 310,00 89,50 920,50 - 49,13
Highpoint Telecommunications/1/ 1,322,00 1,322,00 -
HIT Entertainment 1,053,42 4,213,68 5,267,10 10 34,44
HNC Software/1/ 1,675,19 365,50 1,309,69 -
Hollis-Eden Pharmaceuticals/1/ 555,55 555,55 -
IDEXX Laboratories 825,00 1,106,30 1,931,30 - 45,02
Imax /1/ 1,558,00 175,80 1,382,20 -
Independent Insurance Group 13,940,00 13,940,00 - 42,91
Infoteria 16 16 - 6,24
Inhale Therapeutic Systems 1,101,64 1,101,64 - 82,07
International Energy Group 4,640,00 4,640,00 156 16,65
InternetStudios.com 950,00 950,00 - 15,39
Intertape Polymer Group 1,500,00 1,500,00 - 17,06
ITE Group 9,608,80 9,608,80 141 14,40
ITG Group 1,408,45 1,408,45 - 20,44
Jo-Ann Stores 1,050,00 1,050,00 - 7,54
Kingboard Chemical Holdings 27,720,00 27,720,00 107 9,61
Kipling Holding 234,00 234,00 - 7,16
Kokusai Electric 4,675,00 30,00 4,705,00 340 62,37
Lasertec 147,00 178,00 325,00 - 8,52
Lions Gate Entertainment 1,884,13 1,884,13 - 6,55
Liquidation World/1/ 450,00 450,00 -
Littelfuse 1,000,00 1,000,00 - 36,68
MarketWatch.com 727,90 727,90 - 25,11
Miadora 602,41 448,43 1,050,84 - 7,03
Michaels Stores 1,400,00 394,60 1,794,60 - 73,13
Micrel/1/ 2,422,00 925,90 1,496,10 -
Micronic Laser Systems 466,66 735,71 1,202,37 - 22,04
Midas 700,00 350,00 1,050,00 35 25,20
MIF 682,90 682,90 - 7,76
Minmet 25,235,02 25,235,02 - 11,87
MMC Networks 1,460,60 599,40 2,060,00 - 67,98
Momentum Business Applications/ 302,00 302,00 -
Montana Group 13,950,00 13,950,00 452 13,49
Morton's Restaurant Group 415,00 415,00 - 7,91
Muse Prime Software 1,770,00 1,770,00 - 17,55
NeoPath/1/ 1,121,40 1,121,40 -
Newfield Exploration 2,200,00 500,00 400,00 2,300,00 - 81,07
Nice Systems/1/ 625,00 140,00 485,00 -
Nobel Biocare 1,591,90 300,00 1,291,90 - 34,77
Novestra 299,00 299,00 - 25,32
Novus Petroleum/1/ 9,050,75 3,700,00 4,781,24 7,969,50 -
Optoma 7,500,00 7,500,00 - 19,50
OrthoLogic 1,620,00 1,620,00 - 9,92
Paladin Resources 11,270,99 11,270,99 - 5,03
Pharmacyclics 795,00 135,00 930,00 - 51,79
Philippine Gold 4,953,70 4,953,70 - 35
Picvue Electronics 17,990,00 16,820,00 34,810,00 - 40,90
Piercing Pagoda 502,50 502,50 - 6,72
PILKOR Electronics 700,00 700,00 - 6,74
PMC-Sierra/1/ 3,270,00 3,270,00 -
Power Integrations 833,90 1,022,50 236,40 1,620,00 - 40,50
RadiSys 500,00 560,00 1,060,00 - 63,73
Ramco Energy/1/A137 1,297,00 1,297,00 -
Sapiens International 1,015,00 1,015,00 - 12,43
SBS Broadcasting 1,021,55 435,45 160,00 1,297,00 - 79,76
School Specialty 500,00 417,00 917,00 - 19,71
Senshukai 1,195,00 1,900,00 3,095,00 199 32,97
Sharper Image 775,00 775,00 - 9,49
Simeon Wines/1/ 3,900,00 32,74 3,100,00 832,74 351
SIPEX/1/ 1,160,00 1,160,00 -
Sunglass Hut International 3,200,00 3,200,00 - 25,00
Technology Nexus 167,50 167,50 - 7,98
Too/1/ 1,775,00 108,10 408,10 1,475,00 -
Toyo Communication Equipment 3,063,00 3,063,00 123 71,54
Trimble Navigation 1,450,00 1,450,00 - 37,33
Ugland International Holdings/1 7,342,00 1,366,50 2,625,69 6,082,80 -
Unicap Electronics Industrial 18,037,50 2,359,00 20,396,50 - 22,49
United Therapeutics 1,200,00 1,200,00 - 93,30
UroCor 600,00 25,00 575,00 - 2,80
Vail Resorts 1,571,30 190,00 1,761,30 - 28,40
ViroPharma/1/ 740,00 740,00 -
Vision-Sciences/1/ 984,50 984,50 -
VTech Holdings 10,500,00 2,200,96 12,700,96 625 50,89
Whitehall Jewellers 510,00 340,00 850,00 - 19,97
Wolford Group/1/ 324,00 80,00 244,00 -
Wus Printed Circuit 22,083,75 22,083,75 - 35,32
Total $7,442 $2,964,713
/1/Unaffiliated issuer at 3/31/2000
</TABLE>
<TABLE>
PER-SHARE DATA AND RATIOS
Net
Net asset gains(losses)
value, Net on securities Total from
Period beginning investment (both realized investment
ended (1) of period income and unrealized) operations
<S> <C> <C> <C> <C> <C>
Class A :
2000 $29.57 $(.03)(3) $16.52(3) $16.49
1999 22.14 .03 8.78 8.81
1998 30.72 .07 (6.10) (6.03)
1997 26.92 .10 6.17 6.27
1996 26.11 .17 3.32 3.49
1995 23.61 .22 3.79 4.01
Class B (6):
2000 47.11 - (1.69)(3) (1.69)
Dividends
(from net Distributions
investment (from capital Total
income) gains) Distributions
Class A :
2000 $(.02) $(.60) $(.62)
1999 (.09) (1.29) (1.38)
1998 (.05) (2.50) (2.55)
1997 (.12) (2.35) (2.47)
1996 (.23) (2.45) (2.68)
1995 (.16) (1.35) (1.51)
Class B (6):
2000 - - -
Net asset
value, end Total
of period return (2)
Class A :
2000 $45.44 56.31% (4)
1999 29.57 41.42
1998 22.14 (20.70)
1997 30.72 25.41
1996 26.92 15.21
1995 26.11 18.59
Class B (6):
2000 45.42 (3.59) (4)
Ratio of Ratio of
Net assets, expenses net income Portfolio
end of period to average to average turnover
(in millions) net assets net assets rate
Class A :
2000 $ 15,748 .55%(4) - 33.22%(5)
1999 8,983 1.09 .12% 50.06
1998 7,102 1.06 .27 44.31
1997 9,256 1.07 .40 42.21
1996 6,607 1.09 .68 42.88
1995 4,625 1.13 .97 45.63
Class B (6):
2000 10 .08 (4) - 33.22(5)
(1) The periods ended 1995 through 1999 represent
fiscal years ended September 30; the period ended
2000 represents the six months ended March 31
(unaudited).
(2) Excludes sales charge on A shares or
contingent deferred sales charge on B shares.
(3) Based on average shares outstanding.
(4) Based on operations for the period shown
and, accordingly, not representative of a full year.
(5) Represents portfolio turnover rate
for the six months ended March 31, 2000.
(6) Class B shares offered for sale
commencing March 15, 2000.
</TABLE>
[The American Funds Group(r)]
Offices of the fund and
of the investment adviser,
Capital Research and
Management Company
333 South Hope Street
Los Angeles, California 90071-1443
135 South State College Boulevard
Brea, California 92821-5823
Transfer agent for
shareholder accounts
American Funds Service Company
(Please write to the address nearest you.)
P.O. Box 2205
Brea, California 92822-2205
P.O. Box 659522
San Antonio, Texas 78265-9522
P.O. Box 6007
Indianapolis, Indiana 46206-6007
P.O. Box 2280
Norfolk, Virginia 23501-2280
Custodian of assets
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02105-1713
Counsel
O'Melveny & Myers LLP
400 South Hope Street
Los Angeles, California 90071-2899
Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, California 90071-1462
Class A and Class B Shares
There are two ways to invest in this fund. Class A shares are subject to a
5.75% maximum up-front sales charge that declines for accounts of $25,000 or
more. Class B shares, which are not available for certain employer-sponsored
retirement plans, have no up-front charge. They are, however, subject to
additional expenses of approximately 0.75% a year over the first eight years of
ownership. If redeemed within six years, they may also be subject to a
contingent deferred sales charge (5% maximum) that declines over time.
For information about your account or any of the fund's services, or for a
prospectus for any of the American Funds, please contact your financial
adviser. You may also call American Funds Service Company, toll-free, at
800/421-0180 or visit www.americanfunds.com on the World Wide Web. Please read
the prospectus carefully before you invest or send money.
This report is for the information of shareholders of SMALLCAP World Fund, but
it may also
be used as sales literature when preceded or accompanied by the current
prospectus, which gives details about charges, expenses, investment objectives
and operating policies of the fund. If used
as sales material after June 30, 2000, this report must be accompanied by an
American Funds Group Statistical Update for the most recently completed
calendar quarter.
Printed on recycled paper
Litho in USA BDC/GRS/4591
Lit. No. SCWF-013-0500
