<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND SEMIANNUAL REPORT
December 15, 1998
Dear Shareholder,
We are pleased to present you with the semiannual report for Mitchell Hutchins
LIR Select Money Fund (the "Fund") for the fiscal period from commencement of
operations on August 10, 1998 through October 31, 1998.
GENERAL MARKET OVERVIEW
- --------------------------------------------------------------------------------
[GRAPHIC]
U.S. bond market yields fell over the last six months, reflecting investor
demand for high-quality securities and diminishing concern over inflation. The
bond market traded in tandem with the dollar and the yield curve flattened as
long-term rates fell more than short-term rates. Stock market volatility
increased during the summer. In response, investors shifted some of their assets
into Treasury bonds, causing yields to fall and prices to rise. Other sectors of
the fixed income markets did not rise to the same extent, due to doubts about
corporate earnings and uncertainty in the global economy, especially regarding
Japan and Russia.
PERFORMANCE
- --------------------------------------------------------------------------------
[GRAPHIC]
The Fund commenced operations on August 10, 1998. As of the end of the
fiscal reporting period on October 31, 1998, the Fund's net assets stood at
$508.3 million. The Fund's current yield for Institutional shares was 5.34% for
the seven-day period ended October 31, 1998.
We adopted a cautious outlook on the markets given the rising uncertainty,
and during the period kept the Fund's weighted average maturity below its peer
group. The Fund's weighted-average maturity was 14 days as of October 31, 1998.
While seeking to maximize current income, we emphasized credit quality,
liquidity and appropriate diversification.
- --------------------------------------------------------------------------------
MITCHELL HUTCHINS
LIR SELECT MONEY FUND
FUND PROFILE
[GRAPHIC]
GOAL:
Maximum current income consistent with liquidity and capital preservation
[GRAPHIC]
PORTFOLIO MANAGER:
Anthony Balestrieri, Mitchell Hutchins Asset Management Inc.
[GRAPHIC]
TOTAL NET ASSETS AS OF OCTOBER 31, 1998:
$508.3 million
[GRAPHIC]
DIVIDEND PAYMENTS:
Monthly
- --------------------------------------------------------------------------------
1
<PAGE>
SEMIANNUAL REPORT
OUTLOOK
- --------------------------------------------------------------------------------
[GRAPHIC]
As 1998 draws to a close, the uncertainty in the financial markets appears
to be subsiding. Global economic conditions appear to be stabilizing at this
time, and governments around the world seem more aware of the impact their
actions have on global economic problems. Interest rates in the United States
continue to reflect both the underlying economy and a flight to quality.
After three cuts in short-term interest rates this fall, we do not believe
the Federal Reserve will lower rates again this year. We continue to look for
rates to trend lower over the long term, and therefore anticipate increasing the
Fund's weighted average maturity.
Our ultimate objective in managing your investments is to help you
successfully meet your financial goals. We thank you for your continued support
and welcome any comments or questions you may have.
For a quarterly FUND PROFILE on one of the non-money market mutual funds in
the PaineWebber Family of Funds(1), please contact your investment executive.
Sincerely,
/s/ Margo Alexander
MARGO ALEXANDER
President,
Mitchell Hutchins
Asset Management Inc.
/s/ Dennis L. McCauley
DENNIS L. MCCAULEY
Managing Director and Chief
Investment Officer-
Fixed Income, Mitchell Hutchins
Asset Management Inc.
/s/ Anthony Balestrieri
ANTHONY BALESTRIERI
Senior Vice President,
Mitchell Hutchins
Asset Management Inc.
This letter is intended to assist shareholders in understanding how the Fund
performed during the fiscal period ended October 31, 1998, and reflects our
views at the time of writing this report. Of course, these views may change in
response to changing circumstances. We encourage you to consult your investment
executive regarding your personal investment program.
(1)Mutual funds are sold by prospectus only. The prospectuses for the funds
contain more complete information regarding risks, charges and expenses, and
should be read carefully before investing.
2
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
STATEMENT OF NET ASSETS OCTOBER 31, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MATURITY INTEREST
(000) DATES RATES VALUE
- ------------- -------------------- ----------------- --------------
<C> <S> <C> <C> <C>
CERTIFICATES OF DEPOSIT--8.07%
DOMESTIC--7.87%
$ 20,000 First Tennessee Bank, N.A........................... 11/08/98 5.340% $ 19,999,957
20,000 KeyBank, N.A........................................ 11/30/98 5.145 20,000,401
--------------
40,000,358
--------------
YANKEE--0.20%
1,000 Societe Generale.................................... 01/07/99 5.700 999,716
--------------
Total Certificates of Deposit (cost--$41,000,074).................... 41,000,074
--------------
COMMERCIAL [email protected]%
ASSET-BACKED - BANKING--3.33%
17,000 Atlantis One Funding Corporation.................... 11/13/98 to 11/30/98 5.400 to 5.520 16,942,933
--------------
ASSET-BACKED - FINANCE--10.09%
10,000 Beta Finance Incorporated........................... 11/06/98 5.510 to 5.520 9,992,346
13,000 CC (USA), Incorporated.............................. 11/13/98 5.330 12,976,903
24,692 Quincy Capital Corporation.......................... 11/06/98 to 01/22/99 5.240 to 5.400 24,626,510
3,680 Receivables Capital Corporation..................... 11/12/98 5.280 3,674,063
--------------
51,269,822
--------------
ASSET-BACKED - MISCELLANEOUS--9.45%
15,000 Asset Securitization Cooperative Corporation........ 11/17/98 5.350 14,964,333
20,411 Enterprise Funding Corporation...................... 11/06/98 to 11/30/98 5.350 to 5.400 20,358,631
6,230 Falcon Asset Securitization Corporation............. 11/10/98 to 01/11/99 5.300 to 5.330 6,192,286
2,035 Preferred Receivables Funding Corporation........... 11/06/98 5.400 2,033,474
4,496 Triple-A One Funding Corporation.................... 11/04/98 5.240 4,494,037
--------------
48,042,761
--------------
AUTO & TRUCK--6.24%
20,000 BMW US Capital Incorporated......................... 11/02/98 to 11/17/98 5.300 19,974,972
11,750 General Motors Acceptance Corporation............... 11/03/98 to 11/13/98 5.120 to 5.300 11,731,836
--------------
31,706,808
--------------
BANKING--2.40%
1,250 Bankers Trust Corporation........................... 01/22/99 5.500 1,234,340
10,000 Scotiabank Incorporated............................. 11/23/98 5.120 9,968,711
1,000 Unifunding Incorporated............................. 11/04/98 5.510 999,541
--------------
12,202,592
--------------
BUILDING MATERIALS--0.96%
4,900 Sherwin-Williams Company............................ 11/02/98 5.130 4,899,302
--------------
BUSINESS SERVICES--3.33%
16,919 Block Financial Corporation......................... 11/03/98 to 11/20/98 5.100 to 5.300 16,909,418
--------------
CHEMICALS--2.54%
1,600 DuPont (E.I.) de Nemours & Company.................. 11/04/98 5.320 1,599,291
11,355 Henkel Corporation.................................. 11/19/98 to 12/10/98 5.080 to 5.280 11,318,280
--------------
12,917,571
--------------
</TABLE>
3
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MATURITY INTEREST
(000) DATES RATES VALUE
- ------------- -------------------- ----------------- --------------
<C> <S> <C> <C> <C>
</TABLE>
COMMERCIAL PAPER@ (CONCLUDED)
<TABLE>
<C> <S> <C> <C> <C>
CONSUMER PRODUCTS--3.71%
$ 18,900 Rubbermaid Incorporated............................. 11/17/98 to 12/03/98 5.320 to 5.550% $ 18,843,752
--------------
DRUGS, HEALTHCARE--0.97%
4,970 Novartis Finance Corporation........................ 11/19/98 5.120 4,957,277
--------------
DRUGS & MEDICINE--3.60%
18,400 Zeneca Wilmington Incorporated...................... 11/30/98 5.150 18,323,666
--------------
ENERGY--0.53%
2,700 Shell Oil Company................................... 11/19/98 5.280 2,692,872
--------------
FINANCE - AIRCRAFT--0.22%
1,124 International Lease Finance Corporation............. 11/19/98 5.130 1,121,117
--------------
FINANCE - CONDUIT--0.46%
2,360 ANZ (Delaware) Incorporated......................... 11/05/98 5.120 2,358,658
--------------
FINANCE - RETAIL--3.93%
20,000 American Express Credit Corporation................. 11/12/98 5.280 19,967,733
--------------
FOOD, BEVERAGE & TOBACCO--4.91%
20,000 Allied Domecq North America Corporation............. 11/19/98 to 11/25/98 5.080 to 5.090 19,942,373
5,000 Best Foods Corporation.............................. 11/09/98 5.100 4,994,333
--------------
24,936,706
--------------
INSURANCE-PROPERTY/CASUALTY--3.98%
20,275 John Hancock Capital Corporation.................... 11/16/98 to 11/19/98 5.150 to 5.250 20,224,306
--------------
MACHINERY--1.97%
10,036 Caterpillar Financial Services Corporation.......... 11/03/98 to 11/17/98 5.090 to 5.300 10,019,271
--------------
MANUFACTURING-DIVERSIFIED--3.32%
16,900 BTR Dunlop Finance Incorporated..................... 11/09/98 to 11/19/98 5.080 to 5.550 16,867,483
--------------
METALS & MINING--0.29%
1,500 U.S. Borax Incorporated............................. 12/15/98 5.100 1,490,650
--------------
PAPER & FOREST PRODUCTS--1.97%
10,000 Weyerhaeuser Company................................ 11/05/98 5.300 9,994,111
--------------
OIL EQUIPMENT & SERVICES--4.29%
21,900 Colonial Pipeline Company........................... 11/30/98 to 12/11/98 5.070 to 5.280 21,794,570
--------------
UTILITY-ELECTRIC--3.93%
20,000 Southern Company.................................... 11/13/98 5.280 to 5.300 19,964,733
--------------
Total Commercial Paper (cost--$388,448,112).......................... 388,448,112
--------------
DOMESTIC MASTER NOTES--9.15%
20,500 Bear Stearns Companies Incorporated................. 11/02/98 5.888* 20,500,000
5,500 Goldman Sachs Group L.P............................. 11/02/98 5.409* 5,500,000
20,500 Morgan Stanley Dean Witter & Company................ 11/02/98 5.788* 20,500,000
--------------
Total Domestic Master Notes (cost--$46,500,000)...................... 46,500,000
--------------
</TABLE>
4
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MATURITY INTEREST
(000) DATE RATE VALUE
- ------------- -------------------- ----------------- --------------
<C> <S> <C> <C> <C>
TIME DEPOSIT--3.93%
$ 20,000 NationsBank, N.A. (cost--$20,000,000)............... 11/02/98 5.375% $ 20,000,000
--------------
<CAPTION>
NUMBER
OF
SHARES
- -------------
<C> <S> <C> <C> <C>
MONEY MARKET FUNDS--2.78%
9,176,631 Aim Liquid Portfolio................................ 9,176,631
4,936,288 Temp Fund Portfolio................................. 4,936,288
--------------
Total Money Market Funds (cost--$14,112,919)......................... 14,112,919
--------------
Total Investments (cost--$510,061,105 which approximates cost for
federal income tax purposes)--100.35%.............................. 510,061,105
(1,771,704)
--------------
Liabilities in excess of other assets--(0.35)%.......................
$ 508,289,401
--------------
Net Assets (applicable to 508,289,554 Institutional shares
outstanding at $1.00 per share)--100.00%.............................
</TABLE>
- -----------------
* Variable rate securities--maturity date reflects earlier of reset date or
maturity date. The interest rates shown are the current rates as of October
31, 1998 and reset periodically.
@ Interest rates shown are the discount rates at date of purchase.
Weighted Average Maturity--14 Days
See accompanying notes to financial statements
5
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE PERIOD
AUGUST 10, 1998+
TO
OCTOBER 31, 1998
(UNAUDITED)
-----------------
<S> <C>
INVESTMENT INCOME:
Interest................................ $ 5,501,069
-----------------
EXPENSES:
Management fee.......................... 176,225
Trustees' fees.......................... 2,094
-----------------
178,319
Less: Fee waivers and expense
reimbursements from adviser........... (142,752)
-----------------
Net expenses............................ 35,567
-----------------
Net investment income................... 5,465,502
NET REALIZED LOSSES FROM INVESTMENT
TRANSACTIONS.......................... (153)
-----------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS....................... $ 5,465,349
-----------------
-----------------
</TABLE>
- ---------------
+ Commencement of operations
See accompanying notes to financial statements
6
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE PERIOD
AUGUST 10,
1998+
TO
OCTOBER 31,
1998
(UNAUDITED)
--------------
<S> <C>
FROM OPERATIONS:
Net investment income............................................ $ 5,465,502
Net realized losses from investment transactions................. (153)
--------------
Net increase in net assets resulting from operations............. 5,465,349
--------------
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income--Institutional Shares...................... (5,465,502)
--------------
NET INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST
TRANSACTIONS................................................... 508,189,554
--------------
Net increase in net assets....................................... 508,189,401
NET ASSETS:
Beginning of period.............................................. 100,000
--------------
End of period.................................................... $508,289,401
--------------
--------------
</TABLE>
- ---------------
+ Commencement of operations
See accompanying notes to financial statements
7
<PAGE>
NOTES TO FINANCIAL STATEMENTS(UNAUDITED)
ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Mitchell Hutchins LIR Select Money Fund (the "Fund") is registered with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, as a diversified series of Mitchell Hutchins Institutional Series
("Trust"), an open-end management investment company organized as a Delaware
business trust.
The Fund offers two classes of shares, Institutional shares and Financial
Intermediary shares. Each class represents interests in the same assets of the
Fund, and both classes have equal voting privileges, except that beneficial
owners of Financial Intermediary shares receive certain services directly from
financial intermediaries, bear certain service fees and, to the extent that
matters pertaining to the Shareholder Services Plan or to the Financial
Intermediary shares are submitted to shareholders for approval, only the holders
of Financial Intermediary shares are entitled to vote thereon. For the period
ended October 31, 1998 the Fund had no Financial Intermediary shares
outstanding.
The preparation of financial statements in accordance with generally accepted
accounting principles requires Fund management to make estimates and assumptions
that affect the reported amounts and disclosures in the financial statements.
Actual results could differ from those estimates. Following is a summary of
significant accounting policies:
VALUATION AND ACCOUNTING FOR INVESTMENTS AND INVESTMENT INCOME--Investments
are valued at amortized cost which approximates market value. Investment
transactions are recorded on the trade date. Realized gains and losses from
investment transactions are calculated using the identified cost method.
Interest income is recorded on an accrual basis. Premiums are amortized and
discounts are accreted as adjustments to interest income and the identified cost
of investments.
REPURCHASE AGREEMENTS--The Fund's custodian takes possession of the collateral
pledged for investments in repurchase agreements. The underlying collateral is
valued daily on a mark-to-market basis to ensure that the value, including
accrued interest, is at least equal to the repurchase price. In the event that a
counterparty defaults on its obligation to repurchase, the Fund has the right to
liquidate the collateral and apply the proceeds in satisfaction of the
obligation. Under certain circumstances, in the event of default or bankruptcy
by the other party to the agreement, realization and/or retention of the
collateral may be subject to legal proceedings.
DIVIDENDS AND DISTRIBUTIONS--Dividends and distributions to shareholders are
recorded on the ex-dividend date. The amount of dividends and distributions 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 these
differences are permanent in nature, such amounts are reclassified within the
capital accounts based on their federal tax-basis treatment; temporary
differences do not require reclassification.
CONCENTRATION OF RISK
The ability of the issuers of the debt securities held by the Fund to meet
their obligations may be affected by economic developments, including those
particular to a specific industry or region.
INVESTMENT ADVISER AND ADMINISTRATOR
The Trust has an Investment Advisory and Administration Contract ("Advisory
Contract") with Mitchell Hutchins Asset Management Inc. ("Mitchell Hutchins"), a
wholly owned subsidiary of PaineWebber Incorporated ("PaineWebber"), under which
Mitchell Hutchins serves as investment adviser and administrator of the Fund. In
accordance with the Advisory Contract, Mitchell Hutchins receives compensation
from the Fund, computed daily and paid monthly, at an annual rate of 0.18% of
the Fund's average daily net assets.
8
<PAGE>
NOTES TO FINANCIAL STATEMENTS(UNAUDITED)
Under the Advisory Contract, Mitchell Hutchins has agreed to pay all Fund
expenses other than the management fees, the fees payable pursuant to the
Shareholder Service Plan adopted by the Trust with respect to the Fund's
Financial Intermediary shares, fees and expenses (including counsel fees) of
those trustees who are not "interested persons" of the Trust (as defined in the
Investment Company Act of 1940, as amended) ("Independent Trustees"), interest,
taxes and the cost (including brokerage commissions and other transaction costs,
if any) of securities purchased or sold by the Fund and any losses incurred in
connection therewith and extraordinary expenses (such as costs of litigation to
which the Trust or Fund is a party and of indemnifying officers and trustees of
the Trust.) Although Mitchell Hutchins is not obligated to pay the fees and
expenses of the Independent Trustees, it is contractually obligated to reduce
its management fee in an amount equal to those fees and expenses. Mitchell
Hutchins has also agreed to waive 12 basis points (0.12%) of its 18 basis points
(0.18%) management fee from October 19, 1998 through January 18, 1999. Until
that date, management fees will be 6 basis points (0.06%). For the period ended
October 31, 1998 Mitchell Hutchins voluntarily waived $142,752 in management
fees.
OTHER LIABILITIES
At October 31, 1998 the amounts payable for investments purchased and
dividends payable aggregated $20,000,000 and $2,234,833, respectively.
FEDERAL TAX STATUS
The Fund intends to distribute all of its taxable income and to comply with
the other requirements of the Internal Revenue Code applicable to regulated
investment companies. Accordingly, no provision for federal income taxes is
required. In addition, by distributing during each calendar year substantially
all of its net investment income, capital gains and certain other amounts, if
any, the Fund intends not to be subject to federal excise tax.
SHAREHOLDER SERVICE PLAN AND AGREEMENT
Under a Shareholder Service Plan and Agreement with respect to its Financial
Intermediary shares, the Fund pays PaineWebber monthly fees at the annual rate
of 0.25% of the average daily net assets of the Financial Intermediary shares
held by financial intermediaries on behalf of their customers. Under Service
Agreements with those financial intermediaries, PaineWebber pays an identical
fee to the financial intermediaries for certain support services that they
provide to the beneficial owners of the Financial Intermediary shares.
SHARES OF BENEFICIAL INTEREST
There is an unlimited amount of $0.001 par value shares of beneficial interest
authorized. Transactions in shares of beneficial interest, at $1.00 per share,
were as follows:
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES
------------------
FOR THE PERIOD
ENDED
OCTOBER 31, 1998*
------------------
<S> <C>
Shares sold............................. 2,046,694,679
Shares repurchased...................... (1,540,945,422)
Dividends reinvested.................... 2,440,297
------------------
Net increase in shares outstanding...... 508,189,554
------------------
------------------
</TABLE>
- ---------------
* Commencement of issuance of shares was August 10, 1998.
9
<PAGE>
MITCHELL HUTCHINS LIR SELECT MONEY FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period is presented below:
<TABLE>
<CAPTION>
INSTITUTIONAL
SHARES
-----------
FOR THE
PERIOD
AUGUST 10,
1998+
TO
OCTOBER 31,
1998
-----------
<S> <C>
Net asset value, beginning of period.............. $1.00
-----------
Net investment income............................. 0.013
Dividends from net investment income.............. (0.013)
-----------
Net asset value, end of period.................... $1.00
-----------
-----------
Total investment return (1)....................... 1.27%
-----------
-----------
Ratios/Supplemental Data:
Net assets, end of period (000's)................. $508,289
Expenses to average net assets net of
waivers/reimbursements from adviser.............. 0.03%*
Expenses to average net assets before
waivers/reimbursements from adviser.............. 0.18%*
Net investment income to average net assets net of
waivers/reimbursements from adviser.............. 5.52%*
Net investment income to average net assets before
waivers/reimbursements from adviser.............. 5.37%*
</TABLE>
- -----------------
+ Commencement of issuance of shares
* Annualized
(1) Total investment return is calculated assuming a $1,000 investment on the
first day of the period reported, reinvestment of all dividends and
distributions at net asset value on the payable dates, and a sale at net
asset value on the last day of the period reported. Total investment return
has not been annualized.
10
<PAGE>
- --------------------------------------------------------------------------------
TRUSTEES
E. Garrett Bewkes, Jr.
CHAIRMAN
Margo N. Alexander
Richard Q. Armstrong
Richard R. Burt
Mary C. Farrell
Meyer Feldberg
George W. Gowen
Frederic V. Malek
Carl W. Schafer
OFFICERS
Margo N. Alexander
PRESIDENT
Victoria E. Schonfeld
VICE PRESIDENT
Dianne E. O'Donnell
VICE PRESIDENT AND SECRETARY
Paul H. Schubert
VICE PRESIDENT AND TREASURER
Dennis L. McCauley
VICE PRESIDENT
Anthony G. Balestrieri
VICE PRESIDENT
INVESTMENT ADVISER AND ADMINISTRATOR
Mitchell Hutchins Asset Management Inc.
1285 Avenue of the Americas
New York, New York 10019
DISTRIBUTOR
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
THIS REPORT IS NOT TO BE USED IN CONNECTION WITH THE OFFERING OF SHARES OF THE
FUND UNLESS ACCOMPANIED OR PRECEDED BY AN EFFECTIVE PROSPECTUS.
THE FINANCIAL INFORMATION HEREIN IS TAKEN FROM THE RECORDS OF THE FUND WITHOUT
EXAMINATION BY INDEPENDENT AUDITORS WHO DO NOT EXPRESS AN OPINION THEREON.
A PROSPECTUS CONTAINING MORE COMPLETE INFORMATION FOR ANY OF THE FUNDS LISTED ON
THE BACK COVER CAN BE OBTAINED FROM A PAINEWEBBER INVESTMENT EXECUTIVE OR
CORRESPONDENT FIRM. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
<PAGE>
PaineWebber offers a family of 27 funds which encompass a diversified range of
investment goals.
BOND FUNDS
- - High Income Fund
- - Investment Grade Income Fund
- - Low Duration U.S. Government Income Fund
- - Strategic Income Fund
- - U.S. Government Income Fund
TAX-FREE BOND FUNDS
- - California Tax-Free Income Fund
- - Municipal High Income Fund
- - National Tax-Free Income Fund
- - New York Tax-Free Income Fund
STOCK FUNDS
- - Financial Services Growth Fund
- - Growth Fund
- - Growth and Income Fund
- - Mid Cap Fund
- - Small Cap Fund
- - S&P 500 Index Fund
- - Tax-Managed Equity Fund
- - Utility Income Fund
ASSET ALLOCATION FUNDS
- - Balanced Fund
- - Tactical Allocation Fund
GLOBAL FUNDS
- - Asia Pacific Growth Fund
- - Emerging Markets Equity Fund
- - Global Equity Fund
- - Global Income Fund
MITCHELL HUTCHINS PORTFOLIOS
- - Aggressive Portfolio
- - Moderate Portfolio
- - Conservative Portfolio
PAINEWEBBER MONEY MARKET FUND
[LOGO]
- -C-1998 PaneWebber Incorporated
Member SIPC
- --------------------------------------------------------------------------------
MITCHELL HUTCHINS
LIR SELECT
MONEY FUND
SEMIANNUAL REPORT
OCTOBER 31, 1998
