PAINEWEBBER INVESTMENT TRUST, N-30D, 1997-07-02

PAINEWEBBER INVESTMENT TRUST
N-30D, 1997-07-02

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<PAGE>

PAINEWEBBER GLOBAL EQUITY FUND SEMIANNUAL REPORT

June 16, 1997

PAINEWEBBER GLOBAL
EQUITY FUND

FUND PROFILE

GOAL:
Long-term growth of
capital

PORTFOLIO MANAGERS:
Ralph Layman with
the assistance of
Michael Solecki,
GE Investment
Management Inc.

TOTAL NET ASSETS:
$526.6 million (as of
April 30, 1997)

DIVIDEND PAYMENT:
Annually

Dear Shareholder,

We are pleased to present the semiannual report for PaineWebber Global Equity
Fund (the "Fund") for the six months ended April 30, 1997

PERFORMANCE
- --------------------------------------------------------------------------------

For the period, the Fund's total return, reflecting reinvested distributions
but not the Fund's sales charges, was 4.0% for Class A shares, 3.7% for Class
B shares, 3.7% for Class C shares and 4.3% for Class Y shares. In comparison,
the Morgan Stanley Capital International World Index (the "Index") advanced
8.3% for the same period

The total return experienced by Fund shareholders who purchased or
redeemed shares during the period may be lower due to the Fund's sales
charge. For example, after deducting the maximum applicable sales charge, the
Fund's total return for the six-month period was (0.7)% for Class A shares,
1.4% for Class B shares, 2.7% for Class C shares and 4.3% for Class Y shares.
The Fund's underweighted exposure in U.S. stocks (29.4% of net assets as of
April 30, 1997) hampered its performance compared to the Index (which has a
larger U.S. equity component). During the past six-month period, the U.S.
stock market recorded stronger investment results compared to most world
markets.

[CHART]

PAINEWEBBER GLOBAL
EQUITY FUND

Top Five Countries
(As a % of net assets as
of April 30, 1997)

United States 29.4%
Japan 9.6%
Switzerland 7.5%
United Kingdom 7.3%
France 6.9%

ECONOMIC OVERVIEW
- --------------------------------------------------------------------------------

Moderate growth with low inflation lifted U.S. stock prices to higher
levels in late 1996 and early 1997. Following a series of
stronger-than-expected economic reports in February and March, the Federal
Reserve (the "Fed") raised the federal funds rate by 25 basis points (one
quarter of one percent) late in the period to keep inflation under control.
(The most sensitive indicator of interest rates, the federal funds rate is
the rate banks charge each other for overnight loans.) The U.S. market and
most major markets around the world were negatively affected by the Fed
tightening. U.S. stocks still managed to finish the period with impressive
gains. European stocks also recorded strong investment results due largely to
generally improving economic conditions and continuing optimism that a single
form of European currency will become reality. In particular, Germany and
Switzerland registered solid gains. Japanese stocks did not fare as well for
the period. A main reason is that the economy showed signs of slowing,
following much enthusiasm about the prospects for stronger growth early in
1997

<PAGE>

SEMIANNUAL REPORT

[CHART]
PAINEWEBBER GLOBAL
EQUITY FUND

Top Five Countries
(As a % of net assets as
of April 30, 1997)

Novartis AG 2.9%
HSBC Corp. Holdings plc 2.4%
First Data Corp. 2.4%
Telecom Italia Mobilare 2.3%
Electronic Data Systems Corp. 2.2%

PORTFOLIO REVIEW
- --------------------------------------------------------------------------------

Throughout the period, we remained underweighted in the U.S. because we
believe these stocks are trading at high valuations compared to stocks in
other markets. We were overweighted in Europe and the Pacific-Basin
(ex-Japan), which helped performance, and underweighted in Japan, which also
contributed to our investment results. One of our better performing holdings
was Hong Kong-based HSBC Holdings plc (2.4% of total net assets), one of the
world's largest financial institutions. We remain optimistic on the growth
prospects for this company given the economic activity in Asia and around the
world. During the period, we added several stocks to the fund that we believe
offer superior investment potential due to strong earnings growth and solid
management. They include: Telecom Italia Mobilare, Italy's major cellular
service provider, and Swiss-based Novartis AG, the world's second largest
pharmaceutical company. Novartis AG is the result of a 1996 merger between
Sandoz and Ciba Geigy

OUTLOOK
- --------------------------------------------------------------------------------

Given the strong performance registered by U.S. equities over the last
two and one half years, we continue to believe their valuations are high
compared to other global markets. Moreover, if the U.S. remains stronger than
expected, interest rates may move higher, which would be a negative for U.S.
equity prices. We remain convinced that some of the better investment
opportunities can be found in Europe and that prevailing economic and market
conditions there will serve as an excellent foundation for further gains for
stocks on the Continent. Japan's long bear market does not appear to be
coming to an end, though a sustained pickup in economic growth could serve as
the trigger for higher stock prices later this year. While we don't believe
the handover of Hong Kong to China in July will pose any significant risk to
markets in the region, we will maintain a somewhat neutral stance until this
development unfolds.

Thank you for your investment in PaineWebber Global Equity Fund. We
remain committed to providing you with quality service and look forward to
helping you achieve your financial goals.

Sincerely,

/s/ Margo N. Alexander /s/ Ralph Layman

MARGO N. ALEXANDER RALPH LAYMAN
President, Portfolio Manager,
Mitchell Hutchins PaineWebber Global Equity Fund
Asset Management Inc.

<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

PERFORMANCE RESULTS--(UNAUDITED)

<TABLE>
<CAPTION>
TOTAL RETURN1
NET ASSET VALUE ---------------------------------
-------------------------------- 12 MONTHS ENDED SIX MONTHS
04/30/97 10/31/96 04/30/96 04/30/97 ENDED 04/30/97
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------
Class A Shares $17.55 $17.43 $17.16 5.65% 4.01%
- -----------------------------------------------------------------------------------------------------
Class B Shares 16.97 16.93 16.74 4.83 3.65
- -----------------------------------------------------------------------------------------------------
Class C Shares 16.97 16.93 16.73 4.89 3.65
- -----------------------------------------------------------------------------------------------------
</TABLE>

PERFORMANCE SUMMARY CLASS A SHARES
<TABLE>
<CAPTION>
NET ASSET VALUE
---------------------- CAPITAL GAINS DIVIDENDS TOTAL
PERIOD COVERED BEGINNING ENDING DISTRIBUTED PAID RETURN1
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
11/14/91-12/31/91 $12.00 $ 12.29 -- -- 2.42%
- ------------------------------------------------------------------------------------------------
1992 12.29 12.45 $ 0.1610 $ 0.0800 3.26
- ------------------------------------------------------------------------------------------------
1993 12.45 16.07 0.2100 -- 30.77
- ------------------------------------------------------------------------------------------------
1994 16.07 14.43 1.2530 -- (2.38)
- ------------------------------------------------------------------------------------------------
1995 14.43 15.81 0.5743 -- 13.54
- ------------------------------------------------------------------------------------------------
1996 15.81 17.57 0.5784 -- 14.80
- ------------------------------------------------------------------------------------------------
01/01/97-04/30/97 17.57 17.55 -- -- (0.11)
- ------------------------------------------------------------------------------------------------
Total: $ 2.7767 $ 0.0800
- ------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 04/30/97: 75.76%
- ------------------------------------------------------------------------------------------------

PERFORMANCE SUMMARY CLASS B SHARES

NET ASSET VALUE
---------------------- CAPITAL GAINS DIVIDENDS TOTAL
PERIOD COVERED BEGINNING ENDING DISTRIBUTED PAID RETURN1
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
08/25/95-12/31/95 $15.83 $ 15.46 $ 0.5743 -- 1.29%
- ------------------------------------------------------------------------------------------------
1996 15.46 17.03 0.5784 -- 13.91
- ------------------------------------------------------------------------------------------------
01/01/97-04/30/97 17.03 16.97 -- -- (0.35)
- ------------------------------------------------------------------------------------------------
Total: $ 1.1527 $ 0.0000
- ------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 04/30/97: 14.96%
- ------------------------------------------------------------------------------------------------

PERFORMANCE SUMMARY CLASS C SHARES
<CAPTION>

NET ASSET VALUE
---------------------- CAPITAL GAINS DIVIDENDS TOTAL
PERIOD COVERED BEGINNING ENDING DISTRIBUTED PAID RETURN1
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
05/10/93-12/31/93 $13.80 $ 15.99 $ 0.2100 -- 17.39%
- ------------------------------------------------------------------------------------------------
1994 15.99 14.23 1.2530 -- (3.12)
- ------------------------------------------------------------------------------------------------
1995 14.23 15.46 0.5743 -- 12.67
- ------------------------------------------------------------------------------------------------
1996 15.46 17.03 0.5784 -- 13.91
- ------------------------------------------------------------------------------------------------
01/01/97-04/30/97 17.03 16.97 -- -- (0.35)
- ------------------------------------------------------------------------------------------------
Total: $ 2.6157 $ 0.0000
- ------------------------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN AS OF 04/30/97: 45.46%
- ------------------------------------------------------------------------------------------------
</TABLE>

(1) Figures assume reinvestment of all dividends and capital gain distributions
at net asset value on the payable dates and do not include sales charges;
results for each class would be lower if sales charges were included.

Note: The Fund offers Class Y shares to a limited group of eligible investors,
including the trustee of the PaineWebber Savings Investment Plan, and INSIGHT
Investment Advisory Program Participants. For the six months ended April 30,
1997, and since inception, May 10, 1993 through April 30, 1997, Class Y shares
have a total return of 4.26% and 51.72%, respectively. Class Y shares do not
have initial or contingent deferred sales charges or ongoing distribution and
service fees.

The data above represents past performance of the Fund's shares, which is no
guarantee of future results. The principal value of an investment in the Fund
will fluctuate, so that an investor's shares, when redeemed, may be worth more
or less than their original cost.

3
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

PERFORMANCE RESULTS--(UNAUDITED) (CONCLUDED)

AVERAGE ANNUAL TOTAL RETURN

<TABLE>
<CAPTION>
% RETURN WITHOUT % RETURN AFTER
SALES DEDUCTING
CHARGE MAXIMUM SALES CHARGE
--------------------- ---------------------
CLASS A* B** C*** A* B** C***
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------
Twelve Months Ended 03/31/97 8.89% 7.99% 7.99% 4.01% 2.99% 6.99%
- ---------------------------------------------------------------------------------
Five Years Ended 03/31/97 11.59% N/A N/A 10.58% N/A N/A
- ---------------------------------------------------------------------------------
Commencement of Operations
Through 03/31/97+ 11.03% 9.07% 10.09% 10.07% 6.68% 10.09%
- ---------------------------------------------------------------------------------
</TABLE>

* Maximum sales charge for Class A shares is 4.5% of the public offering price.
Class A shares bear ongoing 12b-1 service fees.

** Maximum contingent deferred sales charge for Class B shares is 5.0% and is
reduced to 0% after 6 years. Class B shares bear ongoing 12b-1 distribution
and service fees.

*** Maximum contingent deferred sales charge for Class C shares is 1% and is
reduced to 0% after 1 year. Class C shares bear ongoing 12b-1 distribution
and service fees.

+ Commencement of operations dates are November 14, 1991, August 25, 1995 and
May 10, 1993 for Class A, Class B and Class C, respectively.

Note: The Fund offers Class Y shares to certain eligible investors, including
the trustee of the PaineWebber Savings Investment Plan, and INSIGHT Investment
Advisory Program Participants. For the twelve months ended March 31, 1997, and
since inception, May 10, 1993 through March 31, 1997, Class Y shares have had an
average annual total return of 9.30% and 11.25%, respectively. Class Y shares do
not have initial or contingent deferred sales charges or ongoing distribution
and service fees.

4
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

PORTFOLIO OF INVESTMENTS APRIL 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
COMMON STOCKS--96.88%
AUSTRALIA--1.72%
BEVERAGES--0.54%
245,352 Coca Cola Amatil Ltd. ........ $ 2,804,816
--------------
FOOD--1.18%
3,748,782 Burns, Philip & Co., Ltd. .... 6,227,018
--------------
Total Australia Common Stocks.................. 9,031,834
--------------
AUSTRIA--1.84%
ENGINEERING SERVICES--1.56%
52,854 VA Technologie AG............. 8,213,249
--------------
SERVICES--0.28%
36,181 Flughafen Wein AG............. 1,499,808
--------------
Total Austria Common Stocks.................... 9,713,057
--------------
CANADA--1.04%
ENERGY--0.48%
91,042 Renaissance Energy Ltd.*...... 2,522,065
--------------
MACHINERY (DIVERSIFIED)--0.56%
146,202 Bombardier Inc................ 2,961,716
--------------
Total Canada Common Stocks..................... 5,483,781
--------------
CROATIA--0.26%
PHARMACEUTICAL--0.26%
84,184 Pliva D.D. GDR*............... 1,380,618
--------------
FINLAND--2.29%
FINANCIAL SERVICES--0.38%
613,579 Merita Ltd.................... 1,993,978
--------------
MANUFACTURING--0.90%
280,514 Valmet Corp. (1).............. 4,741,401
--------------
MULTI-LINE INSURANCE--1.01%
58,749 Sampo Vakuutusosak............ 5,309,597
--------------
Total Finland Common Stocks.................... 12,044,976
--------------
FRANCE--6.89%
AUTOMOTIVE--1.92%
87,809 Michelin...................... 4,906,111
83,953 Valeo SA...................... 5,178,288
--------------
10,084,399
--------------
FRANCE--(CONCLUDED)

<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
ENERGY--1.83%
116,231 Total S.A. (Class B).......... $ 9,638,620
--------------
FINANCIAL SERVICES--0.48%
41,272 AXA........................... 2,539,326
--------------
FOOD--1.57%
13,247 Carrefour S.A................. 8,270,722
--------------
OIL-FIELD SERVICES--1.09%
213,528 Coflexip S.A. ADR*............ 5,765,256
--------------
Total France Common Stocks..................... 36,298,323
--------------
GERMANY--4.67%
CHEMICALS--0.57%
77,469 BASF AG (1)................... 2,988,180
--------------
ENERGY--1.16%
118,159 Veba AG (1)................... 6,086,028
--------------
MACHINERY (DIVERSIFIED)--1.52%
20,361 Mannesmann AG................. 8,006,606
--------------
MEDICAL EQUIPMENT--0.47%
28,478 Fresenius Medical AG*......... 2,494,579
--------------
PHARMACEUTICAL--0.95%
75,119 Gehe AG....................... 4,996,945
--------------
Total Germany Common Stocks.................... 24,572,338
--------------
GREECE--0.68%
BANKING--0.68%
40,552 Alpha Credit Bank............. 2,881,092
10,138 Alpha Credit Bank (Bonus
Shares)..................... 720,273
--------------
3,601,365
--------------
HONG KONG--4.27%
BROADCASTING--0.50%
637,000 Television Broadcasting
Ltd......................... 2,614,936
--------------
FINANCIAL SERVICES--3.13%
414,000 Cheung Kong Holdings Ltd...... 3,634,157
507,200 HSBC Holdings plc (1)......... 12,833,047
--------------
16,467,204
--------------
RETAIL--0.64%
6,277,000 Giordano Holdings Ltd......... 3,403,266
--------------
Total Hong Kong Common Stocks.................. 22,485,406
--------------
</TABLE>

5
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
COMMON STOCKS--(CONTINUED)

INDONESIA--1.40%
AUTOMOTIVE--1.40%
1,442,000 P.T. Astra International...... $ 5,281,399
2,116,000 P.T. Steady Safe.............. 2,068,107
--------------
7,349,506
--------------
ISRAEL--0.81%
COMPUTER SOFTWARE & SERVICES--0.27%
55,236 Technomatix Technologies
Ltd. ....................... 1,415,423
--------------
TELECOMMUNICATIONS--0.54%
129,201 ECI Telecommunications
Ltd. ....................... 2,826,272
--------------
Total Israel Common Stocks..................... 4,241,695
--------------
ITALY--3.89%
ENERGY--0.60%
592,597 Edison (1).................... 3,142,658
--------------
FURNITURE/HOME APPLIANCES--1.00%
236,605 Industrie Natuzzi SPA ADR..... 5,264,461
--------------
TELECOMMUNICATIONS--2.29%
3,837,814 Telecom Italia Mobilare....... 12,070,395
--------------
Total Italy Common Stocks...................... 20,477,514
--------------
JAPAN--9.62%
AUTOMOTIVE--1.80%
183,000 Honda Motor Co................ 5,680,230
358,000 Suzuki Motor Corp., Ltd....... 3,807,460
--------------
9,487,690
--------------
COMPUTER SOFTWARE & SERVICES--0.97%
175 NTT Data Corp. (1)............ 5,114,823
--------------
ELECTRONICS--2.98%
366,000 Canon Inc..................... 8,678,930
96,400 Sony Corp. ................... 7,017,261
--------------
15,696,191
--------------
EQUIPMENT--1.06%
72,000 Rohm Co. ..................... 5,581,439
--------------
FINANCIAL SERVICES--1.07%
294,085 Credit Saison Co., Ltd. (1)... 5,653,030
--------------
TELECOMMUNICATIONS--1.74%
1,378 DDI Corp Inc. ................ 9,151,566
--------------
Total Japan Common Stocks...................... 50,684,739
--------------

<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
MALAYSIA--0.76%
BANKING--0.76%
599,000 AMMB Holdings Berhad (1)...... $ 3,984,109
--------------
MEXICO--0.84%
BANKING--0.27%
206,950 Grupo Financiero Bancomer
ADR*+ (1)................... 1,422,781
--------------
FOOD--0.11%
116,881 Gruma S.A. de C.V*............ 563,335
--------------
TELECOMMUNICATIONS--0.46%
347,587 Grupo Carso, S.A. de C.V.
(Series A).................. 2,007,707
35,990 Grupo Carso, S.A. de C.V.
ADR......................... 429,181
--------------
2,436,888
--------------
Total Mexico Common Stocks..................... 4,423,004
--------------
NETHERLANDS--2.69%
ENTERTAINMENT--0.80%
85,443 Polygram N.V.................. 4,188,168
--------------
FINANCIAL SERVICES--1.89%
254,178 Internationale Nederlanden
Groep N.V................... 9,980,299
--------------
Total Netherlands Common Stocks................ 14,168,467
--------------
NORWAY--0.95%
COMMERCIAL SERVICES--0.95%
127,663 Petroleum Geo-Services ASA*
(1)......................... 4,983,755
--------------
PAKISTAN--0.00%
BANKING--0.00%
2,970 Bank Commerce Al-Habib,
Ltd.*....................... 2,327
600 Soneri Bank*.................. 373
--------------
2,700
--------------
PANAMA--1.30%
AGRICULTURE, FOOD & BEVERAGES--0.89%
161,327 Panamerican Beverages,
Inc. ....................... 4,678,483
--------------
BANKING--0.41%
47,326 Banco Latinoamericano de
Exportaciones, S.A. ADR..... 2,171,080
--------------
Total Panama Common Stocks..................... 6,849,563
--------------
PERU--1.25%
TELECOMMUNICATIONS--1.25%
274,300 Telefonica Del Peru S.A.
ADR......................... 6,583,200
--------------
</TABLE>

6
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
COMMON STOCKS--(CONTINUED)

PHILIPPINES--0.85%
BREWERY--0.76%
1,399,658 San Miguel Corp. ............. $ 4,033,903
--------------
TELECOMMUNICATIONS--0.09%
956,700 Philippino Telephone*......... 453,498
--------------
Total Philippines Common Stocks................ 4,487,401
--------------
PORTUGAL--0.51%
SERVICES--0.51%
31,418 Telecel Comunicacoes
Pessoai*.................... 2,705,364
--------------
SOUTH AFRICA--0.68%
STEEL--0.68%
5,155,354 South African Iron & Steel
Industrial Corp. ........... 3,571,009
--------------
SPAIN--1.72%
BANKING--0.58%
40,857 Banco Santander S.A. ......... 3,073,951
--------------
OIL & GAS--1.14%
142,671 Repsol S.A.................... 5,981,828
--------------
Total Spain Common Stocks...................... 9,055,779
--------------
SWEDEN--1.38%
AUTOMOTIVE MANUFACTURING--1.38%
199,946 Autoliv Ab `B' Free........... 7,276,834
--------------
SWITZERLAND--7.54%
DRUGS & MEDICINE--2.91%
11,622 Novartis AG................... 15,310,986
--------------
INSURANCE--1.22%
5,560 Schw Ruckversicherungs........ 6,434,679
--------------
MANUFACTURING--1.42%
6,174 ABB AG........................ 7,476,148
--------------
PHARMACEUTICAL--1.06%
661 Roche Holdings AG............. 5,582,695
--------------
SPECIALTY RETAIL--0.93%
34,732 Tag Heuer* (1)................ 4,877,229
--------------
Total Switzerland Common Stocks................ 39,681,737
--------------
THAILAND--0.42%
BANKING--0.42%
367,186 Thai Farmers Bank plc (1)..... 2,220,897
--------------

<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
UNITED KINGDOM--7.26%
AUTOMOTIVE--0.71%
1,231,193 Lucas Varity plc.............. $ 3,731,493
--------------
CAPITAL GOODS--1.35%
479,789 Siebe plc..................... 7,099,633
--------------
DRUGS & MEDICINE--1.19%
1,287,362 Medeva plc.................... 6,280,323
--------------
ENTERTAINMENT--2.07%
559,975 Granada Group plc............. 8,086,511
1,020,162 Thorn plc..................... 2,794,285
--------------
10,880,796
--------------
PUBLISHING--1.33%
380,973 Reed International plc........ 7,020,523
--------------
RAILROADS--0.61%
430,162 Railtrack Group plc........... 3,234,930
--------------
Total United Kingdom Common Stocks............. 38,247,698
--------------
UNITED STATES--29.35%
BANKING--1.89%
88,558 Citicorp...................... 9,973,845
--------------
CHEMICALS--3.69%
354,350 Airgas Inc.*.................. 5,270,956
149,792 Allied-Signal Inc............. 10,822,472
90,828 Avery Dennison Corp........... 3,337,929
--------------
19,431,357
--------------
COMPUTER HARDWARE--0.43%
98,515 Zebra Technologies Corp.*
(Class A)................... 2,265,845
--------------
DRUGS & MEDICINE--1.27%
144,821 R.P. Scherer Corp.*........... 6,661,766
--------------
ELECTRICAL EQUIPMENT--3.30%
195,811 Harman International
Industries Inc.............. 7,489,771
235,737 UCAR International Inc.*...... 9,900,954
--------------
17,390,725
--------------
ELECTRONICS--1.06%
36,412 Intel Corp. .................. 5,575,587
--------------
FINANCIAL SERVICES--1.97%
186,890 The Travelers Group, Inc...... 10,349,034
--------------
HOUSEHOLD PRODUCTS--1.06%
50,225 Colgate-Palmolive Co. ........ 5,574,975
--------------
INDUSTRIAL SERVICES & SUPPLIES--2.03%
262,224 Ecolab Inc.................... 10,685,628
--------------
COMMON STOCKS--(CONCLUDED)
UNITED STATES--(CONCLUDED)
</TABLE>

7
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>
INFORMATION & COMPUTER SERVICES--4.62%
346,886 Electronic Data Systems Corp.
(1)......................... $ 11,577,320
370,075 First Data Corp............... 12,767,588
--------------
24,344,908
--------------
MANUFACTURING-GENERAL--0.75%
65,170 Tyco International Ltd........ 3,975,370
--------------
MANUFACTURING-HIGH TECNOLOGY--0.76%
268,358 Sensormatic Electronics
Corp........................ 4,025,370
--------------
SPECIALTY RETAIL--3.41%
111,524 Home Depot Inc. .............. 6,468,392
182,126 Sears Roebuck & Co. (1)....... 8,742,048
96,173 Toys 'R' Us, Inc.*............ 2,740,930
--------------
17,951,370
--------------
TELECOMMUNICATIONS--3.11%
331,878 Airtouch Communications
Inc.*....................... 8,462,889
137,899 Motorola Inc.................. 7,894,718
--------------
16,357,607
--------------
Total United States Common Stocks.............. 154,563,387
--------------
Total Common Stocks (cost--$445,041,015)....... 510,170,056
--------------

<CAPTION>
NUMBER OF
SHARES VALUE
- ------------- --------------
<C> <S> <C>

PREFERRED STOCKS--2.43%
BRAZIL--1.79%
TELECOMMUNICATIONS--1.79%
33,261,332 Telecomunicacoes de Sao
Paolo-S.A.*................. $ 9,445,155
--------------
GERMANY--0.64%
MEDICAL EQUIPMENT--0.64%
46,521 Fresenius Medical AG*......... 3,344,419
--------------
Total Preferred Stocks (cost--$12,379,165)..... 12,789,574
--------------

STOCK RIGHTS--0.06%
GREECE--0.06%
BANKING--0.06%
40,552 Alpha Credit Bank, rights
expiring 05/09/97
(cost--$0).................. 298,502
--------------

INVESTMENTS OF CASH COLLATERAL FOR SECURITIES LOANED--8.29%
18,246,212 Liquid Assets Portfolio....... 18,246,212
34,794 Prime Portfolio............... 34,794
24,210,715 TempCash Portfolio............ 24,210,715
1,169,387 TempFund Portfolio............ 1,169,387
--------------
Total Investments of Cash Collateral for
Securities
Loaned (cost--$43,661,108)................... 43,661,108
--------------
</TABLE>

<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT MATURITY INTEREST
(000) DATE RATE
- ---------- -------- --------
<C> <S> <C> <C> <C>
REPURCHASE AGREEEMENT--0.76%
$ 4,030 Repurchase Agreement dated 04/30/97 with
State Street Bank & Trust Company,
collateralized by $4,113,192 U.S.
Treasury Notes, 8.875% due 02/15/19;
proceeds: $4,030,588
(cost--$4,030,000).................... 05/01/97 5.250% 4,030,000
------------
Total Investments (cost--$505,111,288)--108.42%.........................
570,949,240
Liabilities in excess of other assets--(8.42)%..........................
(44,329,411)
------------
Net Assets--100.00%..................................................... $526,619,829
------------
------------
</TABLE>

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

* Non-income producing security

+ Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.

ADR American Depositary Receipts

GDR Global Depositary Receipts

(1) Security, or a portion thereof, was loaned at April 30, 1997.

See accompanying notes to financial statements

8
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1997 (UNAUDITED)

<TABLE>
<S> <C>
ASSETS
Investments, at value (cost--$505,111,288)...................................... $570,949,240
Cash............................................................................ 1,486,155
Cash denominated in foreign currencies, at value (cost--$2,244,683)............. 2,227,928
Receivable for investments sold................................................. 254,645
Dividends and interest receivable............................................... 1,730,690
Receivable for shares of beneficial interest sold............................... 245,004
Other assets.................................................................... 221,143
------------
Total assets.................................................................... 577,114,805
------------

LIABILITIES
Collateral for securities loaned................................................ 43,650,507
Payable for shares of beneficial interest repurchased........................... 3,220,087
Payable for investments purchased............................................... 2,814,953
Payable to affiliate............................................................ 561,265
Accrued expenses and other liabilities.......................................... 248,164
------------
Total liabilities............................................................... 50,494,976
------------
NET ASSETS
Beneficial interest shares of $0.001 par value outstanding (unlimited amount
authorized)................................................................... 456,472,045
Accumulated net investment loss................................................. (959,868)
Accumulated net realized gains from investments................................. 5,306,656
Net unrealized appreciation of investments and other assets and liabilities
denominated in foreign currencies............................................. 65,800,996
------------
Net assets...................................................................... $526,619,829
------------
------------
CLASS A:
Net assets...................................................................... $300,395,918
------------
Shares outstanding.............................................................. 17,113,030
------------
Net asset and redemption value per share........................................ $17.55
------------
------------
Maximum offering price per share (net asset value plus sales charge of 4.50% of $18.38
offering price)............................................................... ------------
------------
CLASS B:
Net assets...................................................................... $102,247,413
------------
Shares outstanding.............................................................. 6,026,206
------------
Net asset value and offering price per share.................................... $16.97
------------
------------
CLASS C:
Net assets...................................................................... $ 61,350,783
------------
Shares outstanding.............................................................. 3,615,288
------------
Net asset value and offering price per share.................................... $16.97
------------
------------
CLASS Y:
Net assets...................................................................... $ 62,625,715
------------
Shares outstanding.............................................................. 3,524,281
------------
Net asset value, offering price and redemption value per share.................. $17.77
------------
------------
</TABLE>

See accompanying notes to financial statements

9
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED
APRIL 30,
1997
(UNAUDITED)
------------

<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $426,868)........................ $ 3,882,293
Interest........................................................................ 430,064
------------
4,312,357
------------

EXPENSES:
Investment advisory and administration fees..................................... 2,324,746
Service fees--Class A........................................................... 385,394
Service and distribution fees--Class B.......................................... 546,958
Service and distribution fees--Class C.......................................... 332,330
Custody and accounting.......................................................... 335,151
Transfer agency fees and expenses............................................... 325,236
Reports and notices to shareholders............................................. 68,033
Legal and audit................................................................. 62,600
State registration fees......................................................... 30,648
Trustees' fees and expenses..................................................... 7,810
Amortization of organizational expenses......................................... 6,257
Other expenses.................................................................. 1,637
------------
4,426,800
------------
Net investment loss............................................................. (114,443)
------------

REALIZED AND UNREALIZED GAINS (LOSSES) FROM INVESTMENT TRANSACTIONS:
Net realized gains (losses) from:
Investment transactions....................................................... 23,542,043
Foreign currency transactions................................................. (596,229)
Net change in unrealized appreciation/depreciation of:
Investments................................................................... (362,976)
Other assets and liabilities denominated in foreign currencies................ 84,560
------------
NET REALIZED AND UNREALIZED GAINS FROM INVESTMENT TRANSACTIONS.................. 22,667,398
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............................ $22,552,955
------------
------------
</TABLE>

See accompanying notes to financial statements

10
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE
APRIL 30, FOR THE TWO YEAR ENDED
1997 MONTHS ENDED AUGUST 31,
(UNAUDITED) OCTOBER 31, 1996 1996
------------ ---------------- ------------
<S> <C> <C> <C>
FROM OPERATIONS:
Net investment loss............................... $ (114,443) $ (954,881) $ (744,913)
Net realized gains from investment transactions... 23,542,043 3,004,088 41,488,308
Net realized gains (losses) from foreign currency
transactions.................................... (596,229) 1,722 (510,978)
Net changes in unrealized
appreciation/depreciation of:
Investments..................................... (362,976) 18,083,725 4,746,601
Other assets and liabilities denominated in
foreign currencies.............................. 84,560 115,996 (320,015)
------------ ---------------- ------------
Net increase in net assets resulting from
operations...................................... 22,552,955 20,250,650 44,659,003
------------ ---------------- ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gains from investment
transactions--Class A........................... (10,195,197) -- (11,751,371)
Net realized gains from investment
transactions--Class B........................... (3,786,480) -- (4,530,984)
Net realized gains from investment
transactions--Class C........................... (2,275,485) -- (2,643,433)
Net realized gains from investment
transactions--Class Y........................... (2,076,082) -- (1,956,458)
------------ ---------------- ------------
(18,333,244) -- (20,882,246)
------------ ---------------- ------------
FROM BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from the sale of shares.............. 148,272,989 34,520,774 130,337,737
Cost of shares repurchased........................ (194,595,225) (50,077,173) (271,376,430)
Proceeds from dividends reinvested................ 17,254,508 -- 19,869,011
------------ ---------------- ------------
Net decrease in net assets from beneficial
interest transactions........................... (29,067,728) (15,556,399) (121,169,682)
------------ ---------------- ------------
Net increase (decrease) in net assets............. (24,848,017) 4,694,251 (97,392,925)
NET ASSETS:
Beginning of period............................... 551,467,846 546,773,595 644,166,520
------------ ---------------- ------------
End of period..................................... $526,619,829 $551,467,846 $546,773,595
------------ ---------------- ------------
------------ ---------------- ------------
</TABLE>

See accompanying notes to financial statements

11
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(unaudited)

ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

PaineWebber Global Equity Fund (the "Fund") is a diversified series of
PaineWebber Investment Trust (the "Trust"), which is registered with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, as an open-end management investment company. Organizational costs have
been deferred and are being amortized using the straight-line method over a
period not to exceed 60 months from the date the Fund commenced operations.

The Fund offers Class A, Class B, Class C and Class Y shares. Each class
represents interests in the same assets of the Fund, and the classes are
identical except for differences in their sales charge structures, ongoing
service, distribution charges and certain transfer agency expenses. In addition,
Class B shares and all corresponding dividend reinvested shares automatically
convert to Class A shares approximately six years after initial issuance. All
classes of shares have equal voting privileges, except that each class has
exclusive voting rights with respect to their service and/or distribution plan,
if any.

At a meeting held on December 13, 1995, the Trust's board of trustees elected
to change the Fund's fiscal year from August 31st to October 31st effective
October 31, 1996.

The preparation of financial statements in accordance with generally accepted
accounting principles requires the Trust's management to make estimates and
assumptions that affect the reported amounts and disclosures in the financial
statements. Actual results could differ from those estimates. The following is a
summary of significant accounting policies:

VALUATION OF INVESTMENTS--Securities which are listed on U.S. and foreign
stock exchanges are valued at the last sale price on the day the securities are
being valued or, lacking any sales on such day, at the last available bid price.
In cases where securities are traded on more than one exchange, the securities
are generally valued on the exchange designated as the primary market by
Mitchell Hutchins Asset Management Inc. ("Mitchell Hutchins"), a wholly owned
subsidiary of PaineWebber Incorporated ("PaineWebber") and investment adviser
and administrator of the Fund, or GE Investment Management Incorporated
("GEIM"), the sub-adviser to the Fund. Securities traded in the over-the-counter
("OTC") market and listed on The Nasdaq Stock Market, Inc. ("Nasdaq") are valued
at the last trade price on Nasdaq prior to the time of valuation; other OTC
securities (other than short-term debt securities described below) are valued at
the last quoted bid price in the OTC market. The amortized cost method of
valuation, which approximates market value, is used to value short-term debt
instruments with 60 days or less remaining to maturity unless the Trust's board
of trustees determines that this does not represent fair value. Securities and
assets for which market quotations are not readily available (including
restricted securities subject to limitations as to their sale) are valued at
fair value as determined in good faith by or under the direction of the Trust's
board of trustees.

All investments quoted in foreign currencies are valued daily in U.S. dollars
on the basis of the foreign currency exchange rates prevailing at the time such
valuation is determined by the Fund's custodian, unless the board of trustees
determines that this does not represent fair value. Foreign

12
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(UNAUDITED)
currency exchange rates are generally determined prior to the close of trading
on the New York Stock Exchange ("NYSE"). Occasionally, events affecting the
value of foreign investments and such exchange rates occur between the time at
which they are determined and the close of trading on the NYSE, which will not
be reflected in a computation of the Fund's net asset value. If events
materially affecting the value of such investments or currency exchange rates
occur during such time period, the securities will be valued at their fair value
as determined in good faith by or under the direction of the Trust's board of
trustees.

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 of
default of the 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. The Fund occasionally participates in joint repurchase
agreement transactions with other funds managed by Mitchell Hutchins.

INVESTMENT TRANSACTIONS AND INVESTMENT INCOME--Investment transactions are
recorded on the trade date. Realized gains and losses from investment and
foreign exchange transactions are calculated using the identified cost method.
Dividend income is recorded on the ex-dividend date (except in the case of
certain foreign dividends which are recorded as soon after the ex-dividend as
the Fund using reasonable diligence becomes aware of such dividends). Interest
income is recorded on an accrual basis. Discounts are accreted and premiums are
amortized as adjustments to interest income and the identified cost of
investments.

Income, expenses (excluding class-specific expenses) and realized/unrealized
gains/losses are allocated proportionately to each class of shares based upon
the relative net asset value of outstanding shares (or the value of
dividend-eligible shares, as appropriate) of each class at the beginning of the
day (after adjusting for current capital share activity of the respective
classes). Class-specific expenses are charged directly to the applicable class
of shares.

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 and other assets and liabilities stated in foreign currencies are
translated at the exchange rates prevailing at the end of the period; and (2)
purchases, sales, income and expenses are translated at the rate of exchange
prevailing on the respective dates of such transactions. The resulting exchange
gains and losses are included in the Statement of Operations.

Although the net assets and the market values of the Fund are presented at the
foreign exchange rates at the end of the period, the Fund does not generally
isolate the effect of fluctuations in foreign exchange rates from the effect of
the changes in market prices of securities. However, the Fund does isolate the
effect of fluctuations in foreign exchange rates when determining the realized
gain or loss upon the sale or maturity of foreign currency denominated debt
obligations. Pursuant to

13
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(UNAUDITED)
federal income tax regulations, realized currency gain/loss on investment
transactions includes realized foreign exchange gains/losses from the sale of
portfolio debt securities, sales of foreign currencies, currency gains/losses
realized between trade and settlement dates on securities transactions, and the
difference between the amount of dividends, interest and foreign withholding
taxes recorded on the Fund's books and the U.S. dollar equivalent of the amounts
received or paid. Gains/losses from translating foreign currency denominated
assets and liabilities at the year-end exchange rates are included in change in
unrealized appreciation of other assets and liabilities denominated in foreign
currencies. Net realized foreign currency gain (loss) is treated as ordinary
income for income tax reporting purposes.

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. Dividends and distributions that
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 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.

CONCENTRATION OF RISK

Investing in securities of foreign issuers and currency transactions may
involve certain considerations and risks not typically associated with
investments in the United States. These risks include revaluation of currencies,
adverse fluctuations in foreign currency values and possible adverse political,
social and economic developments, including those particular to a specific
industry, country or region, which could cause the securities and their markets
to be less liquid and prices more volatile than those of comparable U.S.
companies. These risks are greater with respect to securities of issuers located
in emerging market countries in which the Fund is authorized to invest. The
ability of the issuers of debt securities held by the Fund to meet their
obligations may be affected by economic and political developments in a specific
industry, country or region.

INVESTMENT ADVISER AND ADMINISTRATOR

The Trust's board of trustees has approved an investment advisory and
administration contract ("Advisory Contract") with Mitchell Hutchins, 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 0.85% of the Fund's average daily net assets up to and including $500
million, 0.83% of its average daily net assets over $500 million and up to and
including $1 billion and 0.805% of its average daily net assets over $1 billion.
At April 30, 1997, the Fund owed Mitchell Hutchins $365,020 in investment
advisory and administration fees.

14
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(UNAUDITED)

Under a separate contract with Mitchell Hutchins ("Sub-Advisory Contract"),
GEIM serves as the Fund's sub-adviser. Under the Sub-Advisory Contract, Mitchell
Hutchins (not the Fund) pays GEIM a fee, computed daily and paid monthly, at an
annual rate of 0.31% of the Fund's average daily net assets up to and including
$500 million, 0.29% of the Fund's average daily net assets over $500 million and
up to and including $1 billion and 0.265% of the Fund's average daily net assets
over $1 billion.

DISTRIBUTION PLAN

Mitchell Hutchins is the distributor of the Fund's shares and has appointed
PaineWebber as the exclusive dealer for the sale of those shares. Under separate
plans of distribution pertaining to Class A, Class B and Class C shares, the
Fund pays Mitchell Hutchins monthly service fees at the annual rate of 0.25% of
the average daily net assets of Class A, Class B and Class C shares and monthly
distribution fees at the annual rate of 0.75% of the average daily net assets of
Class B and Class C shares. At April 30, 1997, the Fund owed Mitchell Hutchins
$196,245 in service and distribution fees.

Mitchell Hutchins also receives the proceeds of the initial sales charges paid
by shareholders upon the purchase of Class A shares and the contingent deferred
sales charges paid by the shareholders upon certain redemptions of Class A,
Class B and Class C shares. Mitchell Hutchins has informed the Fund that for the
six months ended April 30, 1997, the two months ended October 31, 1996 and the
year ended August 31, 1996, it had earned approximately $211,000, $76,000 and
$837,000, respectively, in sales charges.

SECURITY LENDING

The Fund may lend up to 33 1/3% of its total assets to qualified institutions.
The loans are secured at all times by cash or U.S. government securities in an
amount at least equal to the market value of the securities loaned, plus accrued
interest and dividends, determined on a daily basis and adjusted accordingly.
The Fund will regain record ownership of loaned securities to exercise certain
beneficial rights, however, the Fund may bear the risk of delay in recovery of,
or even loss of rights in, the securities loaned should the borrower fail
financially. The Fund receives compensation for lending its securities from
interest earned on the cash or U.S. government securities held as collateral,
net of fee rebates paid to the borrower plus reasonable administrative and
custody fees. The Fund's lending agent is PaineWebber, who received $4,893 as
compensation from the Fund for the six months ended April 30, 1997.

As of April 30, 1997, the Fund's custodian held cash and cash equivalents
having an aggregate value of $43,650,507 as collateral for portfolio securities
loaned having a market value of $40,938,754.

15
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(UNAUDITED)

INVESTMENTS IN SECURITIES

For federal income tax purposes, the cost of securities owned at April 30,
1997 was substantially the same as the cost of securities for financial
statement purposes.

At April 30, 1997, the components of the net unrealized appreciation of
investments were as follows:

<TABLE>
<S> <C>
Gross appreciation (investments having an excess of value over cost)............ $ 90,258,150
Gross depreciation (investments having an excess of cost over value)............ (24,420,198)
------------
Net unrealized appreciation of investments...................................... $ 65,837,952
------------
------------
</TABLE>

For the six months ended April 30, 1997, aggregate purchases and sales of
portfolio securities, excluding short-term securities, were $193,212,392 and
$243,765,271, respectively.

FEDERAL INCOME TAX STATUS

The Fund intends to distribute substantially 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 a federal excise tax.

At October 31, 1996, the Fund has a net capital loss carryforward of
approximately $16,035,000. In subsequent years, this carryforward loss is
available as a reduction, to the extent provided in the regulations, of future
net realized capital gains and will expire by October 31, 2001.

16
<PAGE>
NOTES TO FINANCIAL STATEMENTS--(UNAUDITED)

SHARES OF BENEFICIAL INTEREST

There was an unlimited amount of $0.001 par value shares of beneficial interest
authorized. Transactions in shares of beneficial interest were as follows:

<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS Y
------------------------- ------------------------ ------------------------ ----------------------
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Six months ended
April 30, 1997:
Shares sold.............. 5,899,796 $ 103,840,826 245,800 $ 4,225,984 1,680,911 $ 28,720,874 642,469 $11,485,305
Shares repurchased....... (7,156,543) (126,707,769) (923,600) (15,848,566) (2,182,739) (37,281,424) (826,107) (14,757,466)
Shares converted from
Class B to Class A..... 195,317 3,428,571 (201,638) (3,428,571) -- -- -- --
Dividends reinvested..... 543,143 9,521,294 205,495 3,491,361 128,017 2,175,015 116,573 2,066,838
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
Net decrease............. (518,287) $ (9,917,078) (673,943) $(11,559,792) (373,811) $ (6,385,535) (67,065) $(1,205,323)
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
Two months ended
October 31, 1996:
Shares sold.............. 1,301,820 $ 22,362,041 63,198 $ 1,073,212 508,932 $ 8,584,402 142,315 $ 2,501,119
Shares repurchased....... (1,854,866) (32,308,134) (262,491) (4,423,837) (592,879) (10,027,798) (189,108) (3,317,404)
Shares converted from
Class B to Class A..... 24,859 427,610 (25,560) (427,610) -- -- -- --
Dividends reinvested..... -- -- -- -- -- -- -- --
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
Net decrease............. (528,187) $ (9,518,483) (224,853) $ (3,778,235) (83,947) $ (1,443,396) (46,793) $ (816,285)
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
Year ended
August 31, 1996:
Shares sold.............. 3,773,378 $ 63,129,065 996,490 $ 15,875,329 2,665,239 $ 42,738,539 518,809 $ 8,594,804
Shares repurchased....... (8,829,630) (146,403,118) (3,235,769) (51,584,942) (4,033,170) (64,638,426) (525,977) (8,749,944)
Shares converted from
Class B to Class A..... 136,369 2,251,844 (138,655) (2,251,844) -- -- -- --
Dividends reinvested..... 707,938 11,206,643 270,717 4,190,705 163,102 2,524,812 122,137 1,946,851
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
Net (increase)
decrease............... (4,211,945) $ (69,815,566) (2,107,217) $(33,770,752) (1,204,829) $(19,375,075) 114,969 $ 1,791,711
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
---------- ------------- ---------- ------------ ---------- ------------ --------- -----------
</TABLE>

17
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

FINANCIAL HIGHLIGHTS

Selected data for a share of beneficial interest outstanding throughout each
period is presented below:

<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------------------------------------------------
FOR THE FOR THE
SIX MONTHS TWO MONTHS FOR THE PERIOD
ENDED ENDED FOR THE YEARS ENDED NOVEMBER 14,
APRIL 30, OCTOBER AUGUST 31, 1991+ TO
1997 31, ------------------------------------------------ AUGUST 31,
(UNAUDITED) 1996 1996 1995 1994 1993 1992
----------- ---------- --------- --------- --------- --------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period...................... $ 17.43 $ 16.81 $ 16.12 $ 16.98 $ 14.55 $ 12.87 $ 12.00
----------- ---------- --------- --------- --------- --------- --------------
Net investment income
(loss)...................... 0.02 (0.02) 0.02 0.02 0.01 0.03 0.09
Net realized and unrealized
gains (losses) from
investments and foreign
currency transactions....... 0.68 0.64 1.24 0.37 2.63 1.89 0.78
----------- ---------- --------- --------- --------- --------- --------------
Net increase (decrease) from
investment operations....... 0.70 0.62 1.26 0.39 2.64 1.92 0.87
----------- ---------- --------- --------- --------- --------- --------------
Dividends from net investment
income...................... -- -- -- -- -- (0.08) --
Distributions from net
realized gains.............. (0.58) -- (0.57) (1.25) (0.21) (0.16) --
----------- ---------- --------- --------- --------- --------- --------------
Total dividends and
distributions............... (0.58) 0.00 (0.57) (1.25) (0.21) (0.24) 0.00
----------- ---------- --------- --------- --------- --------- --------------
Net asset value, end of
period...................... $ 17.55 $ 17.43 $ 16.81 $ 16.12 $ 16.98 $ 14.55 $ 12.87
----------- ---------- --------- --------- --------- --------- --------------
----------- ---------- --------- --------- --------- --------- --------------
Total investment return (1)... 4.01% 3.69% 8.06% 3.24% 18.23% 15.24% 7.25%
----------- ---------- --------- --------- --------- --------- --------------
----------- ---------- --------- --------- --------- --------- --------------
Ratios/Supplemental Data:
Net assets, end of period
(000's)..................... $300,396 $307,267 $ 305,218 $ 360,652 $ 185,493 $ 156,451 $113,070
Expenses to average net
assets...................... 1.40%* 1.53%* 1.48% 1.71%(2) 1.58% 1.53% 1.68%*
Net investment income (loss)
to average net assets....... 0.18%* (0.80)%* 0.10% 0.09%(2) 0.07% 0.22% 0.93%*
Portfolio turnover............ 36% 3% 33% 40% 51% 56% 30%
Average commission rate paid
(3)......................... $ 0.0034 $ 0.0069 $ 0.0120 -- -- -- --
</TABLE>

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

* Annualized

+ Commencement of operations

++ Commencement of offering of shares

(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends and other
distributions, if any, at net asset value on the payable dates and a sale at
net asset value on the last day of each period reported. The figures do not
include sales charges; results for each class would be lower if sales
charges were included. Total investment returns for periods of less than a
year have not been annualized.

(2) These ratios include non-recurring acquisition expenses of 0.06%, 0.00% and
0.06% for Class A, Class B and Class C shares, respectively.

(3) Effective for fiscal years beginning on or after September 1, 1995, the Fund
is required to disclose the average commission rate paid per share of common
stock investments purchased or sold.

18
<PAGE>
<TABLE>
<CAPTION>
CLASS B
--------------------------------------------------
FOR THE
FOR THE FOR THE PERIOD
SIX MONTHS TWO MONTHS FOR THE AUGUST 25,
ENDED ENDED YEAR 1995++
APRIL 30, OCTOBER ENDED TO AUGUST
1997 31, AUGUST 31, 31,
(UNAUDITED) 1996 1996 1995
----------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net asset value, beginning of
period....................... $ 16.93 $ 16.35 $ 15.82 $ 15.83
----------- ---------- ---------- ----------
Net investment income
(loss)....................... (0.07) (0.05) (0.12) 0.00
Net realized and unrealized
gains (losses) from
investments and foreign
currency transactions........ 0.69 0.63 1.22 (0.01)
----------- ---------- ---------- ----------
Net increase (decrease) from
investment operations........ 0.62 0.58 1.10 (0.01)
----------- ---------- ---------- ----------
Dividends from net investment
income....................... -- -- -- --
Distributions from net
realized gains............... (0.58) -- (0.57) --
----------- ---------- ---------- ----------
Total dividends and
distributions................ (0.58) 0.00 (0.57) 0.00
----------- ---------- ---------- ----------
Net asset value, end of
period....................... $ 16.97 $ 16.93 $ 16.35 $ 15.82
----------- ---------- ---------- ----------
----------- ---------- ---------- ----------
Total investment return (1)... 3.65% 3.55% 7.18% (0.06)%
----------- ---------- ---------- ----------
----------- ---------- ---------- ----------
Ratios/Supplemental Data:
Net assets, end of period
(000's)...................... $102,247 $113,445 $113,235 $142,880
Expenses to average net
assets....................... 2.23%* 2.34%* 2.25% 2.17%*(2)
Net investment income (loss)
to average net assets........ (0.67)%* (1.61)%* (0.68)% (1.92)%*(2)
Portfolio turnover............ 36% 3% 33% 40%
Average commission rate paid
(3).......................... $ 0.0034 $ 0.0069 $ 0.0120 --

CLASS C
-------------------------------------------------------------------------------
FOR THE FOR THE
SIX MONTHS TWO MONTHS FOR THE
ENDED ENDED FOR THE YEARS ENDED PERIOD
APRIL 30, OCTOBER AUGUST 31, MAY 10, 1993++
1997 31, ------------------------------------ TO AUGUST 31,
(UNAUDITED) 1996 1996 1995 1994 1993
---------- ---------- --------- --------- --------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period....................... $ 16.93 $ 16.35 $ 15.82 $ 16.81 $ 14.52 $ 13.80
---------- ---------- --------- --------- --------- -------
Net investment income
(loss)....................... (0.08) (0.05) (0.13) (0.11) (0.07) (0.02)
Net realized and unrealized
gains (losses) from
investments and foreign
currency transactions........ 0.70 0.63 1.23 0.37 2.57 0.74
---------- ---------- --------- --------- --------- -------
Net increase (decrease) from
investment operations........ 0.62 0.58 1.10 0.26 2.50 0.72
---------- ---------- --------- --------- --------- -------
Dividends from net investment
income....................... -- -- -- -- -- --
Distributions from net
realized gains............... (0.58) -- (0.57) (1.25) (0.21) --
---------- ---------- --------- --------- --------- -------
Total dividends and
distributions................ (0.58) 0.00 (0.57) (1.25) (0.21) 0.00
---------- ---------- --------- --------- --------- -------
Net asset value, end of
period....................... $ 16.97 $ 16.93 $ 16.35 $ 15.82 $ 16.81 $ 14.52
---------- ---------- --------- --------- --------- -------
---------- ---------- --------- --------- --------- -------
Total investment return (1)... 3.65% 3.55% 7.18% 2.46% 17.29% 5.22%
---------- ---------- --------- --------- --------- -------
---------- ---------- --------- --------- --------- -------
Ratios/Supplemental Data:
Net assets, end of period
(000's)...................... $ 61,351 $ 67,530 $ 66,585 $ 83,485 $ 31,837 $ 10,807
Expenses to average net
assets....................... 2.15%* 2.30%* 2.27% 2.48%(2) 2.33% 2.28%*
Net investment income (loss)
to average net assets........ (0.60)%* (1.57)%* (0.70)% (0.68)%(2) (0.68)% (0.53)%*
Portfolio turnover............ 36% 3% 33% 40% 51% 56%
Average commission rate paid
(3).......................... $ 0.0034 $ 0.0069 $ 0.0120 -- -- --
</TABLE>

19
<PAGE>
PAINEWEBBER GLOBAL EQUITY FUND

FINANCIAL HIGHLIGHTS--(CONCLUDED)

Selected data for a share of beneficial interest outstanding throughout each
period is presented below:

<TABLE>
<CAPTION>
CLASS Y
------------------------------------------------------------------------
FOR THE FOR THE
SIX MONTHS TWO MONTHS FOR THE
ENDED ENDED FOR THE YEARS ENDED PERIOD
APRIL 30, OCTOBER AUGUST 31, MAY 10, 1993+
1997 31, ----------------------------- TO AUGUST 31,
(UNAUDITED) 1996 1996 1995 1994 1993
----------- ---------- ------- -------- ------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period........................... $ 17.60 $ 16.97 $ 16.22 $ 17.03 $ 14.56 $ 13.80
----------- ---------- ------- -------- ------- -------
Net investment income (loss)....... 0.05 (0.01) 0.07 0.07 0.05 0.02
Net realized and unrealized gains
from
investments and foreign currency
transactions..................... 0.70 0.64 1.25 0.37 2.63 0.74
----------- ---------- ------- -------- ------- -------
Net increase from investment
operations....................... 0.75 0.63 1.32 0.44 2.68 0.76
----------- ---------- ------- -------- ------- -------
Dividends from net investment
income........................... -- -- -- -- -- --
Distributions from net realized
gains............................ (0.58) -- (0.57) (1.25) (0.21) --
----------- ---------- ------- -------- ------- -------
Total dividends and
distributions.................... (0.58) 0.00 (0.57) (1.25) (0.21) 0.00
----------- ---------- ------- -------- ------- -------
Net asset value, end of period..... $ 17.77 $ 17.60 $ 16.97 $ 16.22 $ 17.03 $ 14.56
----------- ---------- ------- -------- ------- -------
----------- ---------- ------- -------- ------- -------
Total investment return (1)........ 4.26% 3.71% 8.39% 3.54% 18.49% 5.51%
----------- ---------- ------- -------- ------- -------
----------- ---------- ------- -------- ------- -------
Ratios/Supplemental Data:
Net assets, end of period
(000's).......................... $62,626 $63,225 $61,736 $ 57,150 $28,390 $19,098
Expenses to average net assets..... 1.05%* 1.18%* 1.17% 1.46%(2) 1.33% 1.28%*
Net investment income (loss) to
average net
assets........................... 0.53%* (0.45)%* 0.46% 0.36%(2) 0.32% 0.47%*
Portfolio turnover................. 36% 3% 33% 40% 51% 56%
Average commission rate paid (3)... $0.0034 $0.0069 $0.0120 -- -- --
</TABLE>

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

* Annualized

+ Commencement of offering of shares

(1) Total investment return is calculated assuming a $1,000 investment on the
first day of each period reported, reinvestment of all dividends and other
distributions, if any, at net asset value on the payable dates and a sale at
net asset value on the last day of each period reported. Total investment
returns for periods of less than a year have not been annualized.

(2) These ratios include non-recurring acquisition expenses of 0.06% for Class Y
shares.

(3) Effective for fiscal years beginning on or after September 1, 1995, the Fund
is required to disclose the average commission rate paid per share of common
stock investments purchased or sold.

20
<PAGE>

TRUSTEES

E. Garrett Bewkes, Jr. Mary C. Farrell
CHAIRMAN
Meyer Feldberg
Margo N. Alexander
George W. Gowen
Richard Q. Armstrong
Frederic V. Malek
Richard R. Burt
Carl W. Schafer

PRINCIPAL OFFICERS

Margo N. Alexander Dianne E. O'Donnell
PRESIDENT VICE PRESIDENT AND SECRETARY

Victoria E. Schonfeld Paul H. Schubert
VICE PRESIDENT VICE PRESIDENT AND TREASURER

INVESTMENT ADVISER,
ADMINISTRATOR AND DISTRIBUTOR

Mitchell Hutchins Asset Management Inc.
1285 Avenue of the Americas
New York, New York 10019

INVESTMENT SUB-ADVISOR

GE Investment Management Incorporated
3003 Summer Street
Stamford, Connecticut 06904

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.

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.

THE FINANCIAL INFORMATION INCLUDED HEREIN IS TAKEN FROM THE RECORDS OF THE
FUND WITHOUT EXAMINATION BY INDEPENDENT ACCOUNTANTS WHO DO NOT EXPRESS AN
OPINION THEREON.

<PAGE>

- -----
PaineWebber offers a family of 22 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
- - Capital Appreciation Fund
- - Financial Services Growth Fund
- - Growth Fund
- - Growth and Income Fund
- - Small Cap 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

PAINEWEBBER MONEY MARKET FUND

FPO

SEMIANNUAL REPORT

GLOBAL EQUITY
FUND