<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
LETTER TO THE SHAREHOLDERS April 30, 1997
Two World Trade Center, New York, New York 10048
DEAR SHAREHOLDER:
The six-month period ended April 30, 1997, was a difficult one for precious
metals. Gold prices continued their year-long period of weakness and declined
by 10 percent, ending the period at $340 per ounce. A number of factors
combined to create this unfavorable environment, including concerns over the
European central bank selling gold reserves to meet European Monetary Union
(EMU) requirements, producer hedging, a strong dollar and a recent increase
in U.S. interest rates. However, the single most significant event during the
period, and the most damaging to the sector's share pricing, has been the
Bre-X fiasco.
The fallout from Bre-X began in March when reports began to surface that this
Canadian company's original estimates of the quantity of gold present at
their site in Busang on the Indonesian island of Borneo were, in fact, vastly
overstated. This fraud turned out to be the biggest ever perpetrated in the
world mining industry. An independent auditor, brought in to verify the
disputed drilling results, commented that "the magnitude of the tampering
with core samples that we believe has occurred and the resulting
falsification of asset values at Busang, is of scale and over a period of
time and with precision that, to our knowledge, is without precedent in the
history of mining anywhere in the world." Following the news, the company's
share price declined rapidly, with the damage spreading to all
Indonesian-related gold companies and junior explorers in general. Although
investor confidence, particularly toward junior explorers, was shaken, the
episode opens the way for future opportunities as larger companies will be
poised to acquire the more promising projects, thereby accelerating the
consolidation of the industry.
In 1996, total worldwide gold fabrication demand outpaced mine production by
3,290 tons to 2,346 tons, according to the annual Gold Fields Mineral Service
Report. The gap in supply was filled by official sector sales, scrap and
implied disinvestment. Demand was soft in industrialized countries,
particularly in Japan, because of economic difficulties there and a recently
weak currency.
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
LETTER TO THE SHAREHOLDERS April 30, 1997, continued
In the first quarter of 1997, the gold market showed some of the
characteristics that led to the bull market of 1993. The similarities include
the depressed prices and the resulting record levels of demand from the gold
markets of Asia, not including Japan. The price decline of January 1997 was
perceived as the market's negative reaction to the Dutch bank's sale of gold
reserves and fear of additional selling from the official sector, related
mainly to the approach of EMU. But equally, it might be simply the result of
the rapid increase in the value of the dollar, as there was no collapse in
gold prices in Japanese yen, German marks or Swiss francs. The widespread
perception that the price of gold in U.S. dollars had finally reached bottom
resulted in buyers in many countries coming into the market in increasing
numbers during the first three months of 1997, resulting in impressive
shortages of the metal.
PERFORMANCE AND PORTFOLIO
For the six-month period ended April 30, 1997, Dean Witter Precious Metals
and Minerals Trust posted a total return of -18.68 percent. This included
short-term and long-term capital gains distributions of $0.71 per share
payable on December 31, 1996 to shareholders of record as of December 23,
1996. Over the same period, the Standard & Poor's 500 Composite Stock Price
Index (S&P 500) registered a total return of 14.73 percent and the Lipper
Gold Fund Index produced a total return of -19.19 percent. The Fund's
performance reflected the generally poor environment of the precious metals
market. However, we believe that the precious metals environment is likely to
improve as industry consolidation accelerates.
The Fund consolidated its holdings by eliminating one-quarter of its
positions. High-cost producers, such as Battle Mountain Gold Co., Echo Bay
Mines Ltd. and Pegasus Gold, Inc., among others, were sold. The only
significant additions were the royalty company Euro-Nevada Mining Corp. and
the exploration company Sutton Resources Ltd. Other key remaining holdings
include Newmont Mining Corp., Getchell Gold Corp. and Barrick Gold Corp.
LOOKING AHEAD
The long-term outlook for precious metals appears promising. Demand is strong
in emerging countries, particularly in India and China. With 38 percent of
the world's population and rapidly increasing wealth, these two countries are
experiencing dramatic increases in demand. In 1996 alone, fabrication usage
in developing countries increased by 40 percent, led by the jewelry sector.
In Japan, gold demand should increase as the national economy strengthens.
Future trends may depend to a large extent on the market's perception of the
probability of success for EMU. Much remains to be decided about gold's role
in this process, and there is still no clear consensus on whether gold will
benefit. Regardless, however, of what develops concerning EMU, we believe
that the strong fabrication demand, which is expected to continue, may
provide a favorable environment for gold investments.
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
LETTER TO THE SHAREHOLDERS April 30, 1997, continued
We appreciate your support of Dean Witter Precious Metals and Minerals Trust
and look forward to continuing to serve your investment objectives.
Very truly yours,
/s/ Charles A. Fiumefreddo
CHARLES A. FIUMEFREDDO
Chairman of the Board
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
PORTFOLIO OF INVESTMENTS April 30, 1997 (unaudited)
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ---------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (88.8%)
AUSTRALIA (9.5%)
Gold Mining
300,000 Delta Gold ...................................................... $ 508,366
15,000 Lihir Gold Ltd. (ADR)* .......................................... 543,750
475,000 Normandy Poseidon Ltd.* ......................................... 582,356
160,000 Plutonic Resources Ltd. ........................................ 612,226
492,917 Ross Mining N.L. ............................................... 365,673
105,000 Sons of Gwalia Ltd. ............................................. 463,269
125,375 Western Mining Corp. Holdings Ltd. .............................. 744,080
-----------
3,819,720
-----------
Metals & Mining
300,000 Pasminco Ltd. ................................................... 571,619
-----------
TOTAL AUSTRALIA ................................................. 4,391,339
-----------
CANADA (42.8%)
Diamonds
95,000 Aber Resources Ltd.* ............................................ 1,502,326
-----------
Gold Mining
60,000 Arizona Star Resource Corp.* .................................... 429,338
90,000 Barrick Gold Corp. ............................................. 2,013,750
185,000 Bema Gold Corporation* .......................................... 1,264,222
130,000 Cambior, Inc. .................................................. 1,560,322
115,000 Eldorado Corporation Ltd.* ...................................... 518,426
50,000 Euro-Nevada Mining Corp. ....................................... 1,434,705
291,100 Geomaque Explorations Ltd* ...................................... 666,562
150,000 Goldcorp, Inc.* ................................................. 1,089,190
85,000 Greenstone Resources Ltd.* ...................................... 802,862
200,000 Indomin Resources Ltd.* ......................................... 412,165
150,000 Kinross Gold Corp.* ............................................. 822,531
100,000 Placer Dome, Inc. .............................................. 1,637,500
125,000 Prime Resources Group, Inc. .................................... 966,010
100,000 Repadre Capital Corp.* .......................................... 593,918
80,000 Sutton Resources Ltd.* .......................................... 715,563
55,000 Teck Corp. (B Shares) ........................................... 1,088,192
200,000 TVX Gold, Inc.* ................................................. 1,125,000
475,000 Vengold Inc.* ................................................... 560,823
200,000 Yamana Resources, Inc.* ......................................... 508,050
-----------
18,209,129
-----------
TOTAL CANADA .................................................... 19,711,455
-----------
PERU (1.0%)
Gold Mining
20,000 Compania de Minas Buenaventura S.A. (ADR)* ...................... 435,000
-----------
UNITED KINGDOM (1.4%)
Metals & Mining
10,000 RTZ Corp. PLC (ADR) ............................................ $ 645,000
-----------
UNITED STATES (34.1%)
Diamonds
50,000 Lazare Kaplan International, Inc. .............................. 681,250
-----------
Gold Mining
100,000 Amax Gold, Inc.* ................................................ 562,500
125,000 Canyon Resources Corp.* ......................................... 320,312
75,000 Crown Resource Corp.* ........................................... 440,625
70,000 Freeport-McMoran Copper & Gold, Inc. (Class A) .................. 1,960,000
65,000 Getchell Gold Corp.* ............................................ 2,494,375
75,000 Golden Star Resources Ltd.* ..................................... 543,750
100,000 Homestake Mining Co. ........................................... 1,325,000
130,000 Meridian Gold Inc.* ............................................. 617,500
25,000 Newmont Gold Co. ............................................... 887,500
40,000 Newmont Mining Corp. ........................................... 1,385,000
50,000 Santa Fe Pacific Gold Corp.* .................................... 737,500
-----------
11,274,062
-----------
Platinum & Palladium
75,000 Stillwater Mining Co.* .......................................... 1,481,250
-----------
Silver
90,000 Coeur D'Alene Mines Corp.* ...................................... 1,237,500
195,000 Hecla Mining Co.* ............................................... 1,048,125
-----------
2,285,625
-----------
TOTAL UNITED STATES ............................................. 15,722,187
-----------
TOTAL COMMON STOCKS
(Identified Cost $43,853,677) ................................... 40,904,981
-----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ---------------------------------------------------------------------------------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (10.2%)
U.S. GOVERNMENT AGENCIES (a)(9.5%)
$2,600 Federal Home Loan Banks 5.38% due 05/06/97 ................... 2,598,061
1,800 Student Loan Marketing Association 5.28% due 05/10/97 ........ 1,800,000
-----------
TOTAL U.S. GOVERNMENT AGENCIES
(Amortized Cost $4,398,061) .................................. 4,398,061
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
PORTFOLIO OF INVESTMENTS April 30, 1997 (unaudited) continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ---------------------------------------------------------------------------------------
<S> <C> <C>
REPURCHASE AGREEMENT (0.7%)
The Bank of New York 5.50% due 05/01/97 (dated 04/30/97;
proceeds $299,218; collateralized by $290,877 U.S. Treasury
Note 8.25% due 07/15/98 valued at $305,155) (Identified Cost
$ 299 $299,172) .................................................... $ 299,172
-----------
TOTAL SHORT-TERM INVESTMENTS
(Identified Cost $4,697,233) ................................. 4,697,233
-----------
TOTAL INVESTMENTS
(Identified Cost $48,550,910)(b) ........................... 99.0% 45,602,214
OTHER ASSETS IN EXCESS OF
LIABILITIES ................................................ 1.0 456,447
------ -----------
NET ASSETS ................................................. 100.0% $46,058,661
====== ===========
</TABLE>
- --------------
ADR American Depository Receipt.
* Non-income producing security.
(a) Securities were purchased on a discount basis. The interest rates
shown have been adjusted to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes approximates
identified cost. The aggregate gross unrealized appreciation is
$3,269,833 and the aggregate gross unrealized depreciation is
$6,218,529, resulting in a net unrealized depreciation of $2,948,696.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1997 (unaudited)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $48,550,910)....................................... $45,602,214
Receivable for:
Investments sold................................................... 726,655
Shares of beneficial interest sold................................. 162,487
Dividends.......................................................... 34,455
Prepaid expenses and other assets.................................... 23,671
-----------
TOTAL ASSETS ...................................................... 46,549,482
-----------
LIABILITIES:
Payable for:
Shares of beneficial interest repurchased.......................... 334,721
Plan of distribution fee........................................... 39,868
Investment management fee.......................................... 31,895
Accrued expenses and other payables ................................. 84,337
-----------
TOTAL LIABILITIES.................................................. 490,821
-----------
NET ASSETS:
Paid-in-capital...................................................... 56,931,787
Net unrealized depreciation ......................................... (2,947,754)
Accumulated net investment loss...................................... (1,573,497)
Accumulated net realized loss ....................................... (6,351,875)
-----------
NET ASSETS......................................................... $46,058,661
===========
NET ASSET VALUE PER SHARE,
5,517,301 shares outstanding (unlimited shares authorized of $.01
par value).......................................................... $ 8.35
===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
FINANCIAL STATEMENTS, continued
STATEMENT OF OPERATIONS
For the six months ended April 30, 1997 (unaudited)
<TABLE>
<CAPTION>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $12,810 foreign withholding tax).................. $ 178,056
Interest ........................................................... 126,404
------------
TOTAL INCOME...................................................... 304,460
------------
EXPENSES
Plan of distribution fee............................................ 278,079
Investment management fee........................................... 222,462
Transfer agent fees and expenses.................................... 52,490
Professional fees .................................................. 29,865
Shareholder reports and notices .................................... 24,133
Registration fees .................................................. 23,714
Trustees' fees and expenses......................................... 10,317
Custodian fees...................................................... 10,290
Other............................................................... 2,226
------------
TOTAL EXPENSES.................................................... 653,576
------------
NET INVESTMENT LOSS............................................... (349,116)
------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments ...................................................... (6,141,788)
Foreign exchange transactions..................................... 278
------------
NET LOSS.......................................................... (6,141,510)
------------
Net change in unrealized appreciation on:
Investments ...................................................... (4,282,270)
Translation of other assets and liabilities denominated in foreign
currencies....................................................... 932
------------
NET DEPRECIATION.................................................. (4,281,338)
------------
NET LOSS ......................................................... (10,422,848)
------------
NET DECREASE ....................................................... $(10,771,964)
============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
FINANCIAL STATEMENTS, continued
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
APRIL 30, 1997 OCTOBER 31, 1996
- ---------------------------------------------------------------------------------------
(UNAUDITED)
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment loss.................................... $ (349,116) $ (552,437)
Net realized gain (loss)............................... (6,141,510) 3,861,093
Net change in unrealized appreciation/depreciation .... (4,281,338) 4,900,602
------------ -----------
NET INCREASE (DECREASE).............................. (10,771,964) 8,209,258
------------ -----------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income.................................. (656,571) --
Net realized gain...................................... (3,712,483) (1,036,713)
------------ -----------
TOTAL................................................ (4,369,054) (1,036,713)
------------ -----------
Net increase (decrease) from transactions in shares of
beneficial interest................................... 358,437 (1,779,587)
------------ -----------
NET INCREASE (DECREASE).............................. (14,782,581) 5,392,958
NET ASSETS:
Beginning of period.................................... 60,841,242 55,448,284
------------ -----------
END OF PERIOD
(Including accumulated net investment losses of
$1,573,497 and $567,810, respectively)............... $ 46,058,661 $60,841,242
============ ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
NOTES TO FINANCIAL STATEMENTS April 30, 1997 (unaudited)
1. ORGANIZATION AND ACCOUNTING POLICIES
Dean Witter Precious Metals and Minerals Trust (the "Fund") is registered
under the Investment Company Act of 1940, as amended (the "Act"), as a
diversified, open-end management investment company. The Fund's investment
objective is long-term capital appreciation. The Fund will attempt to achieve
its investment objective by investing principally in the securities of
foreign and domestic companies engaged in the exploration, mining,
fabrication, processing, distribution or trading of precious metals and
minerals or in companies engaged in financing, managing, controlling or
operating companies engaged in these activities and also by investing a
portion of its assets in gold, silver, platinum and palladium bullion and
coins. The Fund was organized as a Massachusetts business trust on December
28, 1989 and commenced operations on August 6, 1990.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect reported amounts and disclosures. Actual results could differ
from those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- (1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at
its latest sale price on that exchange prior to the time when assets are
valued; if there were no sales that day, the security is valued at the latest
bid price (in cases where securities are traded on more than one exchange,
the securities are valued on the exchange designated as the primary market
pursuant to procedures adopted by the Trustees); (2) all other portfolio
securities for which over-the-counter market quotations are readily available
are valued at the latest available bid price prior to the time of valuation;
(3) when market quotations are not readily available, including circumstances
under which it is determined by Dean Witter InterCapital Inc. (the
"Investment Manager") that sale and bid prices are not reflective of a
security's market value, portfolio securities are valued at their fair value
as determined in good faith under procedures established by and under the
general supervision of the Trustees (valuation of debt securities for which
market quotations are not readily available may be based upon current market
prices of securities which are comparable in coupon, rating and maturity or
an appropriate matrix utilizing similar factors); and (4) short-term debt
securities having a maturity date of more than sixty days at time of purchase
are valued on a mark-to-market basis until sixty days prior to maturity and
thereafter at amortized cost based on their value on the 61st day. Short-term
debt securities having a maturity date of sixty days or less at the time of
purchase are valued at amortized cost.
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
NOTES TO FINANCIAL STATEMENTS April 30, 1997 (unaudited) continued
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on
the trade date (date the order to buy or sell is executed). Realized gains
and losses on security transactions are determined by the identified cost
method. Dividend income and other distributions are recorded on the
ex-dividend date except for certain dividends from foreign securities which
are recorded as soon as the Fund is informed after the ex-dividend date.
Discounts are accreted over the life of the respective securities. Interest
income is accrued daily.
C. FOREIGN CURRENCY TRANSLATION -- The books and records of the Fund are
maintained in U.S. dollars as follows: (1) the foreign currency market value
of investment securities, other assets and liabilities and forward foreign
currency contracts are translated at the exchange rates prevailing at the end
of the period; and (2) purchases, sales, income and expenses are translated
at the exchange rates prevailing on the respective dates of such
transactions. The resultant exchange gains and losses are included in the
Statement of Operations as realized and unrealized gain/loss on foreign
exchange transactions. Pursuant to U.S. Federal income tax regulations,
certain foreign exchange gains/losses included in realized and unrealized
gain/loss are included in or are a reduction of ordinary income for federal
income tax purposes. The Fund does not isolate that portion of the results of
operations arising as a result of changes in the foreign exchange rates from
the changes in the market prices of the securities.
D. FORWARD FOREIGN CURRENCY CONTRACTS -- The Fund may enter into forward
foreign currency contracts which are valued daily at the appropriate exchange
rates. The resultant unrealized exchange gains and losses are included in the
Statement of Operations as unrealized foreign currency gain or loss and in
the Statement of Assets and Liabilities as part of the related foreign
currency denominated asset or liability. The Fund records realized gains or
losses on delivery of the currency or at the time the forward contract is
extinguished (compensated) by entering into a closing transaction prior to
delivery.
E. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
F. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends
and distributions to its shareholders on the record date. The amount of
dividends and distributions from net investment income and net realized
capital gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent that these differences are permanent in nature, such
amounts are reclassified within the capital accounts based on their federal
tax-basis treatment; temporary
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
NOTES TO FINANCIAL STATEMENTS April 30, 1997 (unaudited) continued
differences do not require reclassification. Dividends and distributions
which exceed net investment income and net realized capital gains for
financial reporting purposes but not for tax purposes are reported as
dividends in excess of net investment income or distributions in excess of
net realized capital gains. To the extent they exceed net investment income
and net realized capital gains for tax purposes, they are reported as
distributions of paid-in-capital.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement, the Fund pays the Investment
Manager a management fee, accrued daily and payable monthly, by applying the
annual rate of 0.80% to the net assets of the Fund determined as of the close
of each business day.
Under the terms of the Agreement, in addition to managing the Fund's
investments, the Investment Manager maintains certain of the Fund's books and
records and furnishes, at its own expense, office space, facilities,
equipment, clerical, bookkeeping and certain legal services and pays the
salaries of all personnel, including officers of the Fund who are employees
of the Investment Manager. The Investment Manager also bears the cost of
telephone services, heat, light, power and other utilities provided to the
Fund.
3. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the Investment Manager. The Fund has adopted
a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act
pursuant to which the Fund pays the Distributor compensation, accrued daily
and payable monthly, at an annual rate of 1.0% of the lesser of: (a) the
average daily aggregate gross sales of the Fund's shares since the Fund's
inception (not including reinvestment of dividend or capital gain
distributions) less the average daily aggregate net asset value of the Fund's
shares redeemed since the Fund's inception upon which a contingent deferred
sales charge has been imposed or upon which such charge has been waived; or
(b) the Fund's average daily net assets. Amounts paid under the Plan are paid
to the Distributor to compensate it for the services provided and the
expenses borne by it and others in the distribution of the Fund's shares,
including the payment of commissions for sales of the Fund's shares and
incentive compensation to, and expenses of, the account executives of Dean
Witter Reynolds Inc. ("DWR"), an affiliate of the Investment Manager and
Distributor, and others who engage in or support distribution of the Fund's
shares or who service shareholder accounts, including overhead and telephone
expenses, printing and distribution of prospectuses and reports used in
connection with the offering of the Fund's shares to other than current
shareholders and preparation, printing and distribution of sales
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
NOTES TO FINANCIAL STATEMENTS April 30, 1997 (unaudited) continued
literature and advertising materials. In addition, the Distributor may
utilize fees paid pursuant to the Plan to compensate DWR and other selected
broker-dealers for their opportunity costs in advancing such amounts, which
compensation would be in the form of a carrying charge on any unreimbursed
distribution expenses.
Provided that the Plan continues in effect, any cumulative expenses incurred
by the Distributor but not yet recovered, may be recovered through future
distribution fees from the Fund and contingent deferred sales charges from
the Fund's shareholders.
Although there is no legal obligation for the Fund to pay expenses incurred
in excess of payments made to the Distributor under the Plan and the proceeds
of contingent deferred sales charges paid by investors upon redemption of
shares, if for any reason the Plan is terminated, the Trustees will consider
at that time the manner in which to treat such expenses. The Distributor has
advised the Fund that such excess amounts, including carrying charges,
totaled $3,253,212 at April 30, 1997.
The Distributor has informed the Fund that for the six months ended April 30,
1997, it received approximately $91,000 in contingent deferred sales charges
from certain redemptions of the Fund's shares.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities,
excluding short-term investments, for the six months ended April 30, 1997
aggregated $12,275,873 and $18,357,560, respectively. Included in the
aforementioned are sales of U.S. Government securities of $3,337,938.
Dean Witter Trust Company, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At April 30, 1997, the Fund had
transfer agent fees and expenses payable of approximately $16,200.
5. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
APRIL 30, 1997 OCTOBER 31, 1996
---------------------------- ------------------------------
(UNAUDITED)
SHARES AMOUNT SHARES AMOUNT
------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
Sold ........................................ 5,674,989 $ 57,219,086 11,549,105 $ 136,343,744
Reinvestment of dividends and distributions 402,436 4,004,238 90,619 963,279
--------- ------------ ---------- -------------
6,077,425 61,223,324 11,639,724 137,307,023
Repurchased ................................. (6,021,032) (60,864,887) (11,855,110) (139,086,610)
--------- ------------ ---------- -------------
Net increase (decrease) ..................... 56,393 $ 358,437 (215,386) $ (1,779,587)
========= ============ ========== =============
</TABLE>
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
NOTES TO FINANCIAL STATEMENTS April 30, 1997 (unaudited) continued
6. FEDERAL INCOME TAX STATUS
At October 31, 1996, the Fund had temporary book/tax differences attributable
to capital loss deferrals on wash sales and income from the mark-to-market of
passive foreign investment companies.
7. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS
The Fund may enter into forward foreign currency contracts ("forward
contracts") to facilitate settlement of foreign currency denominated
portfolio transactions or to manage foreign currency exposure associated with
foreign currency denominated securities.
Forward contracts involve elements of market risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The Fund bears the risk
of an unfavorable change in the foreign exchange rates underlying the forward
contracts. Risks may also arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their
contracts.
At April 30, 1997, there were no outstanding forward contracts.
<PAGE>
DEAN WITTER PRECIOUS METALS AND MINERALS TRUST
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR ENDED OCTOBER 31
MONTHS ENDED -------------------------------------------------
APRIL 30, 1997 1996 1995 1994 1993 1992
- ----------------------------------------------------------------------------------------------------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ... $11.14 $ 9.77 $ 11.45 $10.80 $ 7.87 $ 8.59
------ ------- ------- ------ ------ ------
Net investment loss..................... (0.05) (0.10) (0.08) (0.06) (0.04) (0.05)
Net realized and unrealized gain
(loss)................................. (1.90) 1.66 (1.38) 0.73 2.97 (0.62)
------ ------- ------- ------ ------ ------
Total from investment operations ....... (1.95) 1.56 (1.46) 0.67 2.93 (0.67)
------ ------- ------- ------ ------ ------
Less dividends and distributions from:
Net investment income.................. (0.13) -- -- -- -- (0.04)
Net realized gain...................... (0.71) (0.19) (0.22) (0.02) -- (0.01)
------ ------- ------- ------ ------ ------
Total dividends and distributions ...... (0.84) (0.19) (0.22) (0.02) -- (0.05)
------ ------- ------- ------ ------ ------
Net asset value, end of period.......... $ 8.35 $ 11.14 $ 9.77 $11.45 $10.80 $ 7.87
====== ======= ======= ====== ====== ======
TOTAL INVESTMENT RETURN+ ............... (18.68)%(1) 15.93% (12.78)% 6.18% 37.23% (7.97)%
RATIOS TO AVERAGE NET ASSETS:
Expenses................................ 2.35%(2) 2.27% 2.29% 2.28% 2.79% 3.30%
Net investment loss..................... (1.26)%(2) (0.84)% (0.70)% (0.87)% (1.07)% (0.74)%
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands.............................. $46,059 $60,841 $55,448 $73,444 $45,204 $15,135
Portfolio turnover rate................. 24%(1) 46% 23% 46% 25% 9%
--
Average commission rate paid............ $0.0237 $0.0217 -- -- --
</TABLE>
- --------------
+ Does not reflect the deduction of sales charge. Calculated based on the
net asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
John R. Haire
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Barry Fink
Vice President, Secretary and General Counsel
Robert Rossetti
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Dean Witter Trust Company
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
INVESTMENT MANAGER
Dean Witter InterCapital Inc.
Two World Trade Center
New York, New York 10048
The financial statements included herein have been taken from the records
of the Fund without examination by the independent accountants and
accordingly they do not express an opinion thereon.
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its officers and trustees,
fees, expenses and other pertinent information, please see the prospectus of
the Fund.
This report is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus.
DEAN WITTER
PRECIOUS METALS
AND MINERALS TRUST
Semiannual Report
April 30, 1997
