<PAGE>
TCW/DW CORE EQUITY TRUST Two World Trade Center, New York, New York 10048
LETTER TO THE SHAREHOLDERS March 31, 1997
DEAR SHAREHOLDER:
The equity market posted strong returns for the second consecutive year
during the twelve-month period ended March 31, 1997. Led by technology,
financial and energy-related stocks, the Standard & Poor's 500 Composite
Stock Price Index (S&P 500) appreciated 19.84 percent during this period.
Throughout much of this period, economic data presented a confusing picture
that increased market volatility, which is typical of a business expansion
that is over six years old. Despite little evidence of inflationary pressure,
the strengthening economy continued to concern the Federal Reserve Board and
ultimately led to its tightening of short-term interest rates in late March.
This action resulted in the S&P 500 losing most of the gains it had achieved
in early 1997.
PERFORMANCE AND PORTFOLIO STRATEGY
Against this backdrop, TCW/DW Core Equity Trust posted a total return of 8.31
percent for the twelve-month period ended March 31, 1997. This compares to
the previously mentioned return of 19.84 percent for the S&P 500 and a return
of 12.03 percent for the Lipper Growth Funds Index. The accompanying chart
illustrates the growth of a hypothetical $10,000 investment in the Fund from
inception (May 29, 1992) through March 31, 1997, versus a similar investment
in the issues that comprise the S&P 500 and the Lipper Growth Funds Index.
The Fund invests in companies that lead their respective fields in the
development of innovative services or products. Technology has been a
dominant theme in the portfolio, with a weighting of 25 percent on March 31,
1997. The secular growth of technology worldwide is staggering, even as most
European and Asian countries struggle with economic growth. Intel Corp. and
Microsoft Corp. are prime examples of current Fund technology holdings that
couple excellent management with market dominance.
Other themes in the portfolio reflect the sustainable recovery in airlines
and the upturn in the commercial aerospace cycle, an ongoing trend
<PAGE>
TCW/DW CORE EQUITY TRUST
LETTER TO THE SHAREHOLDERS March 31, 1997, continued
toward corporate outsourcing and the aging of the population, which requires
more sophisticated financial services. The commercial aerospace holdings
include Boeing Co., United Technologies Corp. and Honeywell, Inc., while
Citicorp, Associates First Capital Corp. and Marsh McLennan Companies, Inc.
are representative of the Fund's financial services holdings.
[THE NARRATIVE AND/OR TABULAR INFORMATION BELOW IS A FAIR AND
ACCURATE DESCRIPTION OF GRAPHIC OR IMAGE MATERIAL OMITTED FOR
THE PURPOSE OF EDGAR FILING.]
TCW/DW CORE EQUITY TRUST
GROWTH OF $10,000
DATE FUND S&P LIPPER
- -------------------------------------------------------------------------------
May 29, 1992 $10000 $10000 $10000
- -------------------------------------------------------------------------------
March 31, 1993 $11260 $11140 $11158
- -------------------------------------------------------------------------------
March 31, 1994 $12100 $11303 $11771
- -------------------------------------------------------------------------------
March 31, 1995 $12110 $13061 $12806
- -------------------------------------------------------------------------------
March 31, 1996 $15100 $17252 $16556
- -------------------------------------------------------------------------------
March 31, 1997 $16154 (3) $20672 $18549
===============================================================================
AVERAGE ANNUAL TOTAL RETURNS (FUND)
1 YEAR LIFE OF FUND
===========================================================
8.31% (1) 10.70% (1)
-----------------------------------------------------------
3.31% (2) 10.42% (2)
===========================================================
==============================================================================
Fund S&P 500 (4) LIPPER (5)
------- ------- -------
==============================================================================
Past performance is not predictive of future returns.
- ---------------------------------------------------
(1) Figure shown does not reflect the deduction of any sales charges.
(2) Figure shown assumes the deduction of the maximum applicable contingent
deferred sales charge (CDSC) (1 year-5%, since inception-2%). See the
Fund's current prospectus for complete details on fees and sales
charges.
(3) Closing value after the deduction of a 2% CDSC, assuming a complete
redemption on March 31, 1997.
(4) The Standard & Poor's 500 Composite Stock Price Index (S&P 500) is a
broad-based index, the performance of which is based on the average
performance of 500 widely held common stocks. The Index does not
include any expenses, fees or charges. The Index is unmanaged and
should not be considered an investment.
(5) The Lipper Growth Funds Index is an equally-weighted performance index
of the largest qualifying funds (based on net assets)in the Lipper
Growth Funds objective. The Index, which is adjusted for capital gains
distributions and income dividends, is unmanaged and should not be
considered an investment. There are currently 30 funds represented in
this index.
LOOKING AHEAD
As the Fund enters its next fiscal year, investors in general are concerned
with the possibility of future Federal Reserve Board tightening. Until
investors can become more comfortable with the Federal Reserve's policy,
markets are likely to be somewhat volatile over the near term. TCW Funds
Management, Inc. (TCW), the Fund's investment adviser, believes the economy
should continue to experience moderate growth, with inflation remaining in
check and continued good corporate earnings growth. This should benefit the
market and the Fund going forward. TCW cautions that the spectacular returns
of the markets over the past two years should not be expected to continue,
however, returns should tend to be more in line with earnings growth.
We appreciate your support of TCW/DW Core Equity Trust and look forward to
continuing to serve your investment needs and objectives.
Very truly yours,
/s/ Charles A. Fiumefreddo
CHARLES A. FIUMEFREDDO
Chairman of the Board
<PAGE>
TCW/DW CORE EQUITY TRUST
PORTFOLIO OF INVESTMENTS March 31, 1997
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- -------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS (99.7%)
Air Transport (6.1%)
57,800 AMR Corp.* ..................................................... $ 4,768,500
291,100 Delta Air Lines, Inc. .......................................... 24,488,787
233,900 UAL Corp.* ..................................................... 15,145,025
--------------
44,402,312
--------------
Aircraft & Aerospace (8.1%)
283,100 Boeing Co. ..................................................... 27,920,737
413,900 United Technologies Corp. ...................................... 31,145,975
--------------
59,066,712
--------------
Auto Parts -Original Equipment (4.4%)
512,900 Lear Corp.* .................................................... 17,118,037
Magna International, Inc.
294,400 (Class A)(Canada) ............................................... 14,609,600
--------------
31,727,637
--------------
Automobiles (4.1%)
666,200 Chrysler Corp. ................................................. 19,986,000
309,600 Ford Motor Co. ................................................. 9,713,700
--------------
29,699,700
--------------
Banks -Money Center (3.7%)
250,600 Citicorp ........................................................ 27,127,450
--------------
Beverages -Soft Drinks (2.3%)
516,800 PepsiCo, Inc. .................................................. 16,860,600
--------------
Brokerage (2.1%)
176,000 Merrill Lynch & Co., Inc. ...................................... 15,114,000
--------------
Business Services (2.2%)
476,100 Green Tree Financial Corp. ..................................... 16,068,375
--------------
Commercial Services (1.6%)
484,700 Corrections Corp. of America* ................................... 11,753,975
--------------
Communications -Equipment &
Software (4.0%)
187,700 Cascade Communications Corp.* .................................. 4,950,587
504,906 Cisco Systems, Inc. * ........................................... 24,298,601
--------------
29,249,188
--------------
Computer Equipment (2.1%)
385,000 Storage Technology Corp.* ...................................... 15,111,250
--------------
Computer Services (2.4%)
286,500 Computer Sciences Corp.* ....................................... 17,691,375
--------------
Computer Software (3.9%)
309,200 Microsoft Corp.* ............................................... 28,330,450
--------------
Drugs (1.9%)
241,200 Amgen, Inc.* ................................................... 13,477,050
--------------
<PAGE>
Electrical Equipment (3.6%)
224,400 Honeywell, Inc. ................................................ $15,231,150
608,011 Westinghouse Electric Corp. .................................... 10,792,195
--------------
26,023,345
--------------
Electronics -Semiconductors/
Components (6.4%)
337,100 Intel Corp. .................................................... 46,856,900
--------------
Entertainment (1.3%)
453,800 Mirage Resorts, Inc.* .......................................... 9,643,250
--------------
Financial Services (2.1%)
357,000 Associates First Capital Corp. (Class A) ....................... 15,351,000
--------------
Healthcare -Diversified (4.6%)
215,700 Johnson & Johnson ............................................... 11,405,138
149,300 United Healthcare Corp. ........................................ 7,110,413
172,000 Warner-Lambert Co. ............................................. 14,878,000
--------------
33,393,551
--------------
Healthcare -Drugs (1.8%)
157,200 Lilly (Eli) & Co. .............................................. 12,929,700
--------------
Household Appliances (3.0%)
490,300 American Standard Companies, Inc.* ............................. 22,063,500
--------------
Insurance (1.6%)
103,200 Marsh & McLennan Companies, Inc. ............................... 11,687,400
--------------
Machinery -Construction &
Materials (2.8%)
258,400 Caterpillar, Inc. .............................................. 20,736,600
--------------
Office Equipment & Supplies (3.2%)
256,700 Hewlett-Packard Co. ............................................ 13,669,275
163,600 Xerox Corp. .................................................... 9,304,750
--------------
22,974,025
--------------
Oil -Exploration & Production (1.2%)
372,500 Canadian Natural Resources Ltd. (Canada)* ....................... 9,009,928
--------------
Oil Integrated -International (1.1%)
93,900 Amoco Corp. .................................................... 8,134,088
--------------
Railroads (2.6%)
253,097 Burlington Northern Santa Fe Corp. ............................. 18,729,178
--------------
Restaurants (1.2%)
284,500 Boston Chicken, Inc.* .......................................... 8,641,688
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
PORTFOLIO OF INVESTMENTS March 31, 1997, continued
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE
- ------------------------------------------------------------------------------------------
<S> <C> <C>
Retail-Specialty (3.1%)
422,700 Home Depot, Inc. ............................................... $ 22,614,450
-------------
Soap & Household Products (5.6%)
153,600 Kimberly-Clark Corp. ........................................... 15,264,000
221,100 Procter & Gamble Co. ........................................... 25,426,500
-------------
40,690,500
-------------
Telecommunications (2.6%)
242,700 Ascend Communications, Inc.* ................................... 9,890,025
166,700 Lucent Technologies, Inc. ...................................... 8,793,425
-------------
18,683,450
-------------
Tobacco (3.0%)
194,500 Philip Morris Companies, Inc. .................................. 22,197,313
-------------
TOTAL COMMON STOCKS
(Identified Cost $512,931,010) ................................. 726,039,940
-------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN
THOUSANDS VALUE
- ----------- ---------------------------------------------------------------- -------------
SHORT-TERM INVESTMENT (0.4%)
<S> <C> <C>
$2,554 REPURCHASE AGREEMENT
The Bank of New York
5.375% due 04/01/97
(dated 03/31/97; proceeds $2,554,302; collateralized by
$1,086,566 U.S. Treasury Note 5.75% due 10/31/00 valued at
$1,081,048 and $1,530,005 U.S. Treasury Note 6.00% due 08/15/99
valued at $1,523,951)
(Identified Cost $2,553,921) .................................... $2,553,921
-------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
TOTAL INVESTMENTS
(Identified Cost $515,484,931)(a) . 100.1% 728,593,861
LIABILITIES IN EXCESS OF OTHER
ASSETS............................. (0.1) (1,065,831)
-------- -------------
NET ASSETS......................... 100.0% $727,528,030
======== =============
</TABLE>
- ------------
* Non-income producing security.
(a) The aggregate cost for federal income tax purposes approximates
identified cost. The aggregate gross unrealized appreciation is
$237,346,226 and the aggregate gross unrealized depreciation is
$24,237,296, resulting in net unrealized appreciation of $213,108,930.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
March 31, 1997
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $515,484,931)....................................... $728,593,861
Receivable for:
Dividends........................................................... 789,837
Shares of beneficial interest sold.................................. 346,389
Deferred organizational expenses...................................... 6,681
Prepaid expenses and other assets..................................... 49,671
--------------
TOTAL ASSETS........................................................ 729,786,439
--------------
LIABILITIES:
Payable for:
Shares of beneficial interest repurchased........................... 1,045,692
Plan of distribution fee............................................ 475,502
Management fee...................................................... 334,885
Investment advisory fee............................................. 223,257
Accrued expenses...................................................... 179,073
--------------
TOTAL LIABILITIES................................................... 2,258,409
--------------
NET ASSETS:
Paid-in-capital ...................................................... 455,058,838
Net unrealized appreciation........................................... 213,108,930
Accumulated undistributed net realized gain........................... 59,360,262
--------------
NET ASSETS.......................................................... $727,528,030
==============
NET ASSET VALUE PER SHARE,
48,217,917 shares outstanding (unlimited shares authorized of $.01
par value)........................................................... $ 15.09
==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
FINANCIAL STATEMENTS, continued
STATEMENT OF OPERATIONS
For the year ended March 31, 1997
<TABLE>
<CAPTION>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $51,765 foreign withholding
tax).............................................. $ 7,379,844
Interest........................................... 125,839
--------------
TOTAL INCOME..................................... 7,505,683
--------------
EXPENSES
Plan of distribution fee .......................... 5,711,981
Management fee..................................... 3,918,537
Investment advisory fee............................ 2,612,358
Transfer agent fees and expenses................... 686,285
Professional fees.................................. 82,401
Shareholder reports and notices.................... 62,903
Custodian fees..................................... 48,319
Registration fees.................................. 40,492
Organizational expenses............................ 39,979
Trustees' fees and expenses........................ 33,530
Other.............................................. 62,740
--------------
TOTAL EXPENSES .................................. 13,299,525
--------------
NET INVESTMENT LOSS.............................. (5,793,842)
--------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain.................................. 90,999,031
Net change in unrealized appreciation.............. (22,753,082)
--------------
NET GAIN......................................... 68,245,949
--------------
NET INCREASE....................................... $ 62,452,107
==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
FINANCIAL STATEMENTS, continued
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MARCH 31, 1997 MARCH 31, 1996
- ------------------------------------------------------ -------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment loss.................................... $ (5,793,842) $ (5,429,759)
Net realized gain...................................... 90,999,031 68,877,185
Net change in unrealized appreciation.................. (22,753,082) 100,384,305
-------------- --------------
NET INCREASE......................................... 62,452,107 163,831,731
Distributions from net realized gain................... (61,217,104) --
Net decrease from transactions in shares of beneficial
interest.............................................. (40,876,663) (94,012,499)
-------------- --------------
NET INCREASE (DECREASE)................................ (39,641,660) 69,819,232
NET ASSETS:
Beginning of period.................................... 767,169,690 697,350,458
-------------- --------------
END OF PERIOD ...................................... $727,528,030 $767,169,690
============== ==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1997
1. ORGANIZATION AND ACCOUNTING POLICIES
TCW/DW Core Equity Trust (the "Fund") is registered under the Investment
Company Act of 1940, as amended, as a non-diversified, open-end management
investment company. The Fund's investment objective is long-term growth of
capital. The Fund seeks to achieve its objective by investing primarily in
common stocks and securities convertible into common stocks issued by
domestic and foreign companies. The Fund was organized as a Massachusetts
business trust on January 31, 1992 and commenced operations on May 29, 1992.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the 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; (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
TCW Funds Management, Inc. (the "Adviser") that sale or 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.
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. Discounts are accreted over the life of the respective
securities. Interest income is accrued daily.
<PAGE>
TCW/DW CORE EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1997 continued
C. 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.
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends
and distributions to its shareholders on the ex-dividend 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 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 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.
E. ORGANIZATIONAL EXPENSES -- Dean Witter InterCapital Inc. ("InterCapital"),
an affiliate of Dean Witter Services Company Inc. (the "Manager"), paid the
organizational expenses of approximately $202,000 which have been reimbursed,
exclusive of $2,000 which has been absorbed by InterCapital. Such expenses
have been deferred and are being amortized on the straight-line method over a
period not to exceed five years from the commencement of operations.
2. MANAGEMENT AGREEMENT
Pursuant to a Management Agreement, the Fund pays the Manager a management
fee, accrued daily and payable monthly, by applying the following annual
rates to the Fund's daily net assets determined at the close of each business
day: 0.51% to the portion of daily net assets not exceeding $750 million;
0.48% to the portion of daily net assets exceeding $750 million but not
exceeding $1.5 billion; and 0.45% to the portion of daily net assets
exceeding $1.5 billion.
Under the terms of the Management Agreement, the 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 Manager. The Manager also bears the cost of telephone
services, heat, light, power and other utilities provided to the Fund.
<PAGE>
TCW/DW CORE EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1997 continued
3. INVESTMENT ADVISORY AGREEMENT
Pursuant to an Investment Advisory Agreement, the Fund pays the Adviser an
advisory fee, accrued daily and payable monthly, by applying the following
annual rates to the Fund's daily net assets determined at the close of each
business day: 0.34% to the portion of daily net assets not exceeding $750
million; 0.32% to the portion of daily net assets exceeding $750 million but
not exceeding $1.5 billion; and 0.30% to the portion of daily net assets
exceeding $1.5 billion.
Under the terms of the Investment Advisory Agreement, the Fund has retained
the Adviser to invest the Fund's assets, including placing orders for the
purchase and sale of portfolio securities. The Adviser obtains and evaluates
such information and advice relating to the economy, securities markets, and
specific securities as it considers necessary or useful to continuously
manage the assets of the Fund in a manner consistent with its investment
objective. In addition, the Adviser pays the salaries of all personnel,
including officers of the Fund, who are employees of the Adviser.
4. PLAN OF DISTRIBUTION
Shares of the Fund are distributed by Dean Witter Distributors Inc. (the
"Distributor"), an affiliate of the 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 Manager and Distributor, and other employees or selected
broker-dealers 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 literature and advertising
materials. In addition, the Distributor may be compensated under the Plan for
its opportunity costs in advancing such amounts, which compensation would be
in the form of a carrying charge on any unreimbursed expenses incurred by the
Distributor.
<PAGE>
TCW/DW CORE EQUITY TRUST
NOTES TO FINANCIAL STATEMENTS March 31, 1997 continued
Provided that the Plan continues in effect, any cumulative expenses incurred
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 $21,584,533 at March 31, 1997.
The Distributor has informed the Fund that for the year ended March 31, 1997,
it received approximately $1,579,000 in contingent deferred sales charges
from certain redemptions of the Fund's shares.
5. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales of portfolio securities,
excluding short-term investments, for the year ended March 31, 1997
aggregated $340,647,512 and $443,667,096, respectively.
For the year ended March 31, 1997, the Fund incurred $53,710 in brokerage
commissions with DWR for portfolio transactions executed on behalf of the
Fund.
Dean Witter Trust Company, an affiliate of the Manager and Distributor, is
the Fund's transfer agent. At March 31, 1997, the Fund had transfer agent
fees and expenses payable of approximately $110,000.
6. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MARCH 31, 1997 MARCH 31, 1996
----------------------------- ------------------------------
SHARES AMOUNT SHARES AMOUNT
------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
Sold 3,329,142 $ 52,606,423 4,293,001 $ 60,014,162
Reinvestment of distributions 3,693,581 57,173,675 -- --
------------- --------------- -------------- ---------------
7,022,723 109,780,098 4,293,001 60,014,162
Repurchased (9,631,148) (150,656,761) (11,052,750) (154,026,661)
------------- --------------- -------------- ---------------
Net decrease (2,608,425) $ (40,876,663) (6,759,749) $ (94,012,499)
============= =============== ============== ===============
</TABLE>
7. FEDERAL INCOME TAX STATUS
As of March 31, 1997, the Fund had temporary book/tax differences
attributable to capital loss deferrals on wash sales and permanent book/tax
differences attributable to a net operating loss. To reflect
reclassifications arising from the permanent difference, paid-in-capital was
charged and net investment loss was credited $5,793,842.
<PAGE>
TCW/DW CORE EQUITY TRUST
FINANCIAL HIGHLIGHTS
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED MARCH 31, FOR THE PERIOD
MAY 29, 1992*
------------------------------------------- THROUGH
1997 1996 1995 1994 MARCH 31, 1993
---------- ---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ...... $ 15.09 $ 12.11 $ 12.10 $ 11.26 $ 10.00
---------- ---------- ---------- ---------- --------------
Net investment loss ....................... (.12) (0.11) (0.06) (0.06) (0.01)
Net realized and unrealized gain .......... 1.39 3.09 0.07 0.90 1.27
---------- ---------- ---------- ---------- --------------
Total from investment operations .......... 1.27 2.98 0.01 0.84 1.26
---------- ---------- ---------- ---------- --------------
Less distributions from net realized gain (1.27) -- -- -- --
---------- ---------- ---------- ---------- --------------
Net asset value, end of period ............ $ 15.09 $ 15.09 $ 12.11 $ 12.10 $ 11.26
========== ========== ========== ========== ==============
TOTAL INVESTMENT RETURN+................... 8.31% 24.69% 0.08% 7.46% 12.60%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses .................................. 1.73% 1.82% 1.96% 1.93% 2.07%(2)
Net investment loss ....................... (0.75)% (0.72)% (0.48)% (0.59)% (0.14)%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands .. $727,528 $767,170 $697,350 $707,069 $486,829
Portfolio turnover rate ................... 45% 48% 38% 35% 26%(1)
Average commission rate paid .............. $ 0.0590 $ 0.0595 -- -- --
</TABLE>
- ------------
* Commencement of operations.
+ Does not reflect the deduction of sales charge. Calculated based on the
net asset value as of last business day of the period.
(1) Not annualized.
(2) Annualized.
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW CORE EQUITY TRUST
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND TRUSTEES
OF TCW/DW CORE EQUITY TRUST
In our opinion, the accompanying statement of assets and liabilities,
including the portfolio of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of TCW/DW Core
Equity Trust (the "Fund") at March 31, 1997, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended and the financial highlights for each of the
four years in the period then ended and for the period May 29, 1992
(commencement of operations) through March 31, 1993, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fund's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted
our audits of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits, which included confirmation of securities at March
31, 1997 by correspondence with the custodian, provide a reasonable basis for
the opinion expressed above.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
May 9, 1997
1997 FEDERAL TAX NOTICE (unaudited)
During the year ended March 31, 1997, the Fund paid to its shareholders
$1.27 per share from long-term capital gains.
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TRUSTEES
John C. Argue
Richard M. DeMartini
Charles A. Fiumefreddo
John R. Haire
Dr. Manuel H. Johnson
Thomas E. Larkin, Jr.
Michael E. Nugent
John L. Schroeder
Marc I. Stern
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Thomas E. Larkin, Jr.
President
Barry Fink
Vice President, Secretary and
General Counsel
Robert M. Hanisee
Vice President
James A. Tilton
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
MANAGER
Dean Witter Services Company Inc.
ADVISER
TCW Funds Management, Inc.
This report is submitted for the general information of shareholders of the
Fund. For more detailed information about the Fund, its offices 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.
TCW/DW
CORE EQUITY TRUST
ANNUAL REPORT
MARCH 31, 1997
