<PAGE>
STANDARD AND POOR'S DEPOSITARY RECEIPTS-TM- ("SPDRS")-TM-
SPDR TRUST SERIES 1
A UNIT INVESTMENT TRUST
ANNUAL REPORT
DECEMBER 31, 1995
"S&P", "S&P 500", "Standard & Poor's", "Standard & Poor's Depositary
Receipts", and "SPDRs" are trademarks of McGraw-Hill, Inc. and have been
licensed for use by PDR Services Corporation and the American Stock Exchange,
Inc. The Trust, however, is not sponsored by or affiliated with Standard &
Poor's Corporation or McGraw-Hill, Inc.
<PAGE>
SPDR TRUST SERIES 1
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1995
<TABLE>
<CAPTION>
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COMMON STOCKS SHARES VALUE
- - ------------------------------------------------------------------
<S> <C> <C>
Abbott Laboratories...................... 173,061 $ 7,225,297
Advanced Micro Devices, Inc.............. 22,820 376,530
Aetna Life & Casualty Co................. 24,891 1,723,702
Ahmanson (H.F.) & Co..................... 25,819 684,204
Air Products & Chemicals, Inc............ 24,428 1,288,577
Airtouch Communications Inc. *........... 108,303 3,059,560
Alberto-Culver Co., Class B.............. 6,164 211,888
Albertson's Inc.......................... 55,404 1,821,407
Alcan Aluminum Ltd....................... 49,168 1,530,354
Alco Standard Corp....................... 24,374 1,112,064
Alexander & Alexander Services, Inc...... 9,546 181,374
Allergan Pharmaceuticals, Inc............ 13,358 434,135
Allied Signal, Inc....................... 61,934 2,941,865
Allstate Corp............................ 97,926 4,027,207
Alltel Corp.............................. 41,205 1,215,548
Aluminum Co. of America.................. 39,037 2,064,081
Alza Corp., Class A *.................... 17,497 433,051
Amdahl Corp. *........................... 26,175 222,488
Amerada Hess Corp........................ 20,450 1,083,850
American Brands, Inc..................... 39,645 1,769,158
American Electric Power Co., Inc......... 40,659 1,646,690
American Express Co...................... 105,702 4,373,420
American General Corp.................... 44,601 1,555,460
American Greetings Corp., Class A........ 16,364 452,056
American Home Products Corp.............. 67,831 6,579,607
American International Group, Inc........ 103,587 9,581,798
American Stores Co....................... 32,835 878,336
Ameritech Corp........................... 120,894 7,132,746
Amgen Inc. *............................. 58,010 3,444,344
Amoco Corp............................... 108,288 7,783,200
AMP Inc.................................. 46,808 1,796,257
AMR Corp. *.............................. 16,368 1,215,324
Andrew Corp. *........................... 8,569 327,764
Anheuser-Busch Cos., Inc................. 55,861 3,735,704
Apple Computer, Inc...................... 26,626 848,704
Applied Materials Inc.................... 38,670 1,522,631
Archer-Daniels-Midland Co................ 115,688 2,082,384
Armco Inc. *............................. 23,861 140,183
Armstrong World Industries, Inc.......... 8,192 507,904
ASARCO, Inc.............................. 9,078 290,496
Ashland Inc.............................. 13,863 486,938
AT & T Corp.............................. 347,491 22,500,042
Atlantic Richfield Co.................... 35,166 3,894,635
Autodesk, Inc............................ 10,420 356,885
Automatic Data Processing, Inc........... 31,462 2,336,054
Avery Dennison Corp...................... 11,878 595,385
Avon Products, Inc....................... 15,042 1,133,791
Baker Hughes, Inc........................ 31,093 757,892
Ball Corp................................ 6,645 182,738
Bally Entertainment Group *.............. 10,663 149,282
Baltimore Gas & Electric Co.............. 32,510 926,535
Banc One Corp............................ 85,361 3,222,378
Bank of Boston Corp...................... 24,570 1,136,363
</TABLE>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Bank of New York Inc..................... 43,672 $2,129,010
BankAmerica Corp......................... 80,797 5,231,606
Bankers Trust Co. (N.Y.)................. 17,291 1,149,852
Bard (C.R.) Inc.......................... 12,123 390,967
Barnett Banks Inc........................ 21,400 1,262,600
Barrick Gold Corp........................ 77,323 2,039,394
Bausch & Lomb, Inc....................... 12,593 498,998
Baxter International, Inc................ 60,431 2,530,548
Becton, Dickinson & Co................... 14,483 1,086,225
Bell Atlantic Corp....................... 95,240 6,369,175
BellSouth Corp........................... 216,989 9,439,022
Bemis Co., Inc........................... 11,195 286,872
Beneficial Corp.......................... 11,646 542,995
Bethlehem Steel Corp. *.................. 21,982 307,748
Beverly Enterprises Inc. *............... 19,004 201,918
Biomet, Inc. *........................... 25,351 453,149
Black & Decker Corp...................... 18,924 667,071
Block (H&R) Inc.......................... 23,042 933,201
Boatmen's Bancshares, Inc................ 27,794 1,136,080
Boeing Co................................ 74,878 5,868,563
Boise Cascade Corp....................... 9,754 337,732
Boston Scientific Corp. *................ 35,255 1,727,495
Briggs & Stratton Corp................... 6,466 280,463
Bristol-Myers Squibb Co.................. 110,604 9,498,119
Brown Group, Inc......................... 3,959 56,416
Brown-Forman Corp., Class B.............. 15,167 553,596
Browning-Ferris Industries, Inc.......... 45,940 1,355,230
Brunswick Corp........................... 21,015 504,360
Burlington Northern Santa Fe............. 30,816 2,403,648
Burlington Resources, Inc................ 27,913 1,095,585
Cabletron Systems Inc. *................. 15,615 1,264,815
Campbell Soup Co......................... 54,601 3,276,060
Capital Cities/ABC, Inc.................. 33,634 4,149,595
Carolina Power & Light Co................ 34,127 1,177,382
Caterpillar, Inc......................... 43,096 2,531,890
Centex Corp.............................. 6,188 215,033
Central & South West Corp................ 42,273 1,178,360
Ceridian Corp. *......................... 14,458 596,393
Champion International Corp.............. 20,410 857,220
Charming Shoppes, Inc.................... 23,349 67,128
Chase Manhattan Corp..................... 38,321 2,323,211
Chemical Banking Corp.................... 54,545 3,204,519
Chevron Corp............................. 142,199 7,465,448
Chrysler Corp............................ 83,590 4,628,796
Chubb Corp............................... 18,973 1,835,638
CIGNA Corp............................... 15,934 1,645,186
Cincinnati Milacron Inc.................. 7,467 196,009
CINergy Corp............................. 34,365 1,052,428
Circuit City Stores Inc.................. 21,301 588,440
Cisco Systems Inc. *..................... 59,416 4,433,919
Citicorp................................. 92,780 6,239,455
Clorox Co................................ 11,418 817,814
Coastal Corp............................. 23,139 861,928
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
1
<PAGE>
SPDR TRUST SERIES 1
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 1995
<TABLE>
<CAPTION>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Coca Cola Co............................. 273,734 $ 20,324,750
Colgate-Palmolive Co..................... 31,748 2,230,297
Columbia / HCA Healthcare Corp........... 96,995 4,922,496
Columbia Gas Systems, Inc. *............. 11,117 487,758
Comcast Corp., Class A................... 51,901 943,949
Comerica Incorporated.................... 24,328 976,161
Community Psychiatric Centers............ 9,928 121,618
Compaq Computer Corp. *.................. 57,890 2,778,720
Computer Associates International Inc.... 52,610 2,992,194
Computer Sciences Corp. *................ 11,892 835,413
ConAgra, Inc............................. 52,016 2,145,660
Conrail Inc.............................. 17,280 1,209,600
Consolidated Edison Co. of N.Y., Inc..... 51,440 1,646,080
Consolidated Freightways, Inc............ 8,759 232,114
Consolidated Natural Gas Co.............. 20,205 916,802
Cooper Industries Inc.................... 23,770 873,548
Cooper Tire & Rubber Co.................. 18,410 453,346
Coors (Adolph) Co., Class B.............. 8,591 190,076
CoreStates Financial Corp................ 30,703 1,162,876
Corning Inc.............................. 50,125 1,604,000
CPC International Inc.................... 31,995 2,195,657
Crane Co................................. 6,894 254,216
Cray Research, Inc. *.................... 5,974 147,857
Crown Cork & Seal Co., Inc. *............ 19,814 827,235
CSX Corp................................. 46,116 2,104,043
Cuc International Inc. *................. 38,076 1,299,344
Cummins Engine Co., Inc.................. 7,957 294,409
Cyprus Amax Minerals Co.................. 20,357 531,827
Dana Corp................................ 21,716 635,193
Darden Restaurants Inc................... 35,037 416,064
Data General Corp........................ 7,938 109,148
Dayton-Hudson Corp....................... 15,737 1,180,275
Dean Witter Discover & Co................ 36,858 1,732,326
Deere & Co............................... 57,163 2,014,996
Delta Air Lines Inc...................... 11,227 829,395
Deluxe Corp.............................. 17,692 513,068
Detroit Edison Co........................ 31,808 1,097,376
Dial Corp................................ 19,671 582,753
Digital Equipment Corp. *................ 32,143 2,061,170
Dillard Department Stores, Inc., Class A. 24,945 710,933
Disney (Walt) Co. (The).................. 113,902 6,720,218
Dominion Resources Inc................... 38,088 1,571,130
Donnelley (R.R.) & Sons Co............... 33,685 1,326,347
Dover Corp............................... 25,031 923,018
Dow Chemical Co.......................... 57,100 4,018,413
Dow Jones & Co., Inc..................... 21,225 846,347
Dresser Industries Inc................... 38,846 946,871
DSC Communications Corp.................. 25,126 926,521
Du Pont (E.I.) de Nemours & Co., Inc..... 121,049 8,458,299
Duke Power Co............................ 44,694 2,117,378
Dun & Bradstreet Corp.................... 37,138 2,404,686
</TABLE>
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<CAPTION>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Eastern Enterprises...................... 4,469 $ 157,532
Eastman Chemical Co...................... 17,868 1,118,984
Eastman Kodak Co......................... 74,502 4,991,634
Eaton Corp............................... 17,130 918,596
Echlin, Inc.............................. 13,316 486,034
Echo Bay Mines Ltd....................... 25,202 261,471
Ecolab Inc............................... 14,114 423,420
EG & G Inc............................... 10,546 255,741
Emerson Electric Co...................... 49,081 4,012,372
Engelhard Corp........................... 30,878 671,597
Enron Corp............................... 54,569 2,080,443
ENSERCH Corp............................. 15,257 247,926
Entergy Corp............................. 49,096 1,436,058
Exxon Corp............................... 270,891 21,705,141
Federal Express Corp. *.................. 12,274 906,742
Federal Home Loan Mortgage Corp.......... 39,585 3,305,348
Federal National Mortgage Assn........... 59,502 7,385,686
Federal Paper Board Co., Inc............. 9,865 511,747
Federated Department Stores Inc. *....... 44,304 1,218,360
First Bank Systems Inc................... 28,308 1,404,785
First Chicago NBD Corporation............ 69,334 2,738,693
First Data Corp.......................... 48,206 3,223,776
First Fidelity Bancorp................... 17,464 1,316,349
First Interstate Bancorp................. 16,590 2,264,535
First Union Corp......................... 37,535 2,087,884
Fleet Financial Group Inc................ 53,702 2,188,357
Fleetwood Enterprises Inc................ 10,321 265,766
Fleming Cos., Inc........................ 8,374 172,714
Fluor Corp............................... 18,102 1,194,732
FMC Corp. *.............................. 8,123 549,318
Ford Motor Co............................ 234,243 6,793,047
Foster Wheeler Corp...................... 8,294 352,495
FPL Group, Inc........................... 40,342 1,870,860
Freeport McMoran Copper & Gold........... 44,764 1,258,988
Fruit of the Loom Inc. *................. 14,898 363,139
Gannett Co., Inc......................... 30,626 1,879,671
Gap Inc. (The)........................... 31,378 1,317,876
General Dynamics Corp.................... 13,880 820,655
General Electric Co...................... 364,696 26,258,112
General Mills, Inc....................... 34,582 1,997,111
General Motors Corp...................... 163,322 8,635,651
General Public Utilities Corp............ 25,085 852,890
General Reinsurance Corp................. 17,978 2,786,590
General Signal Corp...................... 10,078 326,275
Genuine Parts Co......................... 26,592 1,090,272
Georgia-Pacific Corp..................... 19,714 1,352,873
Giant Foods, Inc., Class A............... 13,053 411,170
Giddings & Lewis, Inc.................... 7,518 124,047
Gillette Co.............................. 96,952 5,053,623
Golden West Financial Corp............... 12,902 712,835
Goodrich (B.F.) Co....................... 5,820 396,488
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
2
<PAGE>
SPDR TRUST SERIES 1
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 1995
<TABLE>
<CAPTION>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Goodyear Tire & Rubber Co. (The)......... 33,539 $ 1,521,832
Grace (W.R.) & Co........................ 20,736 1,226,016
Grainger (W.W.) Inc...................... 10,901 722,191
Great Atlantic & Pacific Tea Co., Inc.... 8,772 201,756
Great Lakes Chemical Corp................ 14,269 1,027,368
Great Western Financial Corp............. 30,099 767,524
GTE Corp................................. 211,642 9,312,248
Halliburton Co........................... 25,198 1,275,649
Handleman Co............................. 7,675 44,131
Harcourt General, Inc.................... 16,081 673,392
Harland (John H.) Co..................... 6,777 141,470
Harnischfeger Industries, Inc............ 10,336 343,672
Harrahs Entertainment Inc. *............. 22,599 548,026
Harris Corp.............................. 8,569 468,082
Hasbro Inc............................... 19,323 599,013
Heinz (H.J.) Co.......................... 79,895 2,646,522
Helmerich & Payne Inc.................... 5,651 168,117
Hercules, Inc............................ 24,312 1,370,589
Hershey Foods Corp....................... 17,105 1,111,825
Hewlett Packard Co....................... 111,627 9,348,761
Hilton Hotels Corp....................... 10,645 654,667
Home Depot, Inc. (The)................... 103,887 4,973,590
Homestake Mining Co...................... 30,358 474,344
Honeywell, Inc........................... 28,005 1,361,743
Household International, Inc............. 21,061 1,245,232
Houston Industries Inc................... 57,510 1,394,617
Humana Inc. *............................ 34,476 943,780
Illinois Tool Works Inc.................. 25,420 1,499,780
Inco, Ltd................................ 25,667 853,428
Ingersoll Rand Co........................ 23,399 821,890
Inland Steel Industries Inc.............. 10,055 252,632
Intel Corp............................... 179,589 10,191,676
Intergraph Corp. *....................... 10,631 167,438
International Business Machines Corp..... 124,009 11,377,826
International Flavors & Fragrances, Inc.. 24,362 1,169,376
International Paper Co................... 55,609 2,106,191
Interpublic Group of Cos., Inc........... 17,002 737,462
ITT Corporation.......................... 25,316 1,341,748
ITT Hartford Group Inc................... 25,316 1,224,662
ITT Industries Inc....................... 25,316 607,584
James River Corp. of Virginia............ 18,094 436,518
Jefferson-Pilot Corp..................... 15,662 728,260
Johnson & Johnson........................ 141,401 12,107,461
Johnson Controls Inc..................... 9,049 622,119
Jostens, Inc............................. 8,528 206,804
K Mart Corp.............................. 98,716 715,691
Kaufman & Broad Home Corp................ 7,721 114,850
Kellogg Co............................... 47,453 3,665,744
Kerr-McGee Corp.......................... 11,266 715,391
Keycorp.................................. 49,865 1,807,606
Kimberly-Clark Corp...................... 61,086 5,054,866
King World Productions Inc. *............ 8,070 313,721
</TABLE>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Knight Ridder Inc........................ 10,462 $ 653,875
Kroger Co. *............................. 26,991 1,012,162
Laidlaw Inc.............................. 58,333 597,913
Lilly (Eli) & Co......................... 120,494 6,777,787
Limited Inc. (The)....................... 78,128 1,357,474
Lincoln National Corp.................... 22,874 1,229,477
Liz Claiborne, Inc....................... 16,245 450,799
Lockheed Martin Corp..................... 43,833 3,462,807
Loews Corp............................... 25,831 2,024,505
Longs Drug Stores Corp................... 4,683 224,199
Loral Corp............................... 37,522 1,327,341
Louisiana Land & Exploration Co.......... 6,832 292,922
Louisiana Pacific Corp................... 23,770 576,422
Lowes Cos., Inc.......................... 34,724 1,163,254
LSI Logic Corporation *.................. 27,914 914,184
Luby's Cafeterias Inc.................... 5,160 114,810
Mallinckrodt Group Inc................... 16,935 616,011
Manor Care, Inc.......................... 13,229 463,015
Marriot International, Inc............... 26,594 1,017,220
Marsh & McLennan Companies, Inc.......... 15,828 1,404,735
Masco Corp............................... 34,585 1,085,104
Mattel, Inc.............................. 48,664 1,496,418
May Department Stores Co................. 54,440 2,300,090
Maytag Corp.............................. 23,685 479,621
MBNA Corp................................ 32,740 1,207,287
McDermott International Inc.............. 11,997 263,934
McDonald's Corp.......................... 151,503 6,836,573
McDonnell Douglas Corp................... 24,637 2,266,604
McGraw-Hill Inc.......................... 10,998 958,201
MCI Communications Corp.................. 147,792 3,861,066
Mead Corp................................ 11,792 616,132
Medtronic Inc............................ 50,188 2,804,254
Mellon Bank Corp......................... 30,863 1,658,886
Melville Corp............................ 22,332 686,709
Mercantile Stores Co., Inc............... 7,759 358,854
Merck & Co. Inc.......................... 269,717 17,733,893
Meredith Corp............................ 6,090 255,019
Merrill Lynch & Co., Inc................. 38,539 1,965,489
Micron Technology Inc.................... 45,216 1,791,684
Microsoft Corp. *........................ 129,303 11,346,338
Millipore Corp........................... 9,953 409,317
Minnesota Mining & Manufacturing Co...... 91,810 6,082,412
Mobil Corp............................... 86,302 9,665,824
Monsanto Co.............................. 25,241 3,092,022
Moore Corp., Ltd......................... 22,252 414,443
Morgan (J.P.) & Co., Inc................. 41,064 3,295,386
Morgan Stanley Group Inc................. 16,748 1,350,307
Morton International Inc................. 32,384 1,161,776
Motorola, Inc............................ 128,695 7,335,615
Nacco Industries Inc., Class A........... 1,950 108,225
Nalco Chemical Co........................ 14,992 451,634
National City Corp....................... 32,163 1,065,399
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
SPDR TRUST SERIES 1
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 1995
<TABLE>
<CAPTION>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
National Semiconductor Corp. *........... 27,296 $ 607,336
National Service Industries, Inc......... 10,632 344,211
NationsBank Corp......................... 58,940 4,103,697
Navistar International Corp. *........... 16,117 169,228
New York Times Co. (The), Class A........ 20,717 613,741
Newell Co................................ 34,949 904,305
Newmont Mining Corp...................... 19,150 866,537
Niagara Mohawk Power Corp................ 32,306 310,945
NICOR Inc................................ 10,811 297,302
Nike Inc., Class B....................... 31,406 2,186,643
Noram Energy Corp........................ 28,004 248,535
Nordstrom Inc............................ 17,882 724,221
Norfolk Southern Corp.................... 28,362 2,251,234
Northern States Power Co................. 14,983 736,040
Northern Telecom Ltd..................... 55,349 2,380,007
Northrop Corp............................ 10,676 683,264
Norwest Corp............................. 76,704 2,531,232
Novell Inc. *............................ 79,492 1,132,761
Nucor Corp............................... 19,280 1,101,370
NYNEX Corp............................... 93,318 5,039,172
Occidental Petroleum Corp................ 68,930 1,473,379
Ogden Corp............................... 10,452 223,411
Ohio Edison Co........................... 33,686 791,621
ONEOK Inc................................ 6,098 139,492
Oracle Systems Corp. *................... 94,717 4,013,633
Oryx Energy Co. *........................ 22,597 302,235
Outboard Marine Corp..................... 4,426 90,180
Owens-Corning Fiberglass Corp. *......... 11,129 499,414
P P & L Resources Inc.................... 33,618 840,450
PACCAR Inc............................... 8,519 358,863
Pacific Enterprises...................... 18,499 522,597
Pacific Gas & Electric Co................ 92,907 2,636,236
Pacific Telesis Group.................... 93,822 3,154,765
PacifiCorp............................... 61,926 1,315,927
Pall Corp................................ 24,822 667,091
Panhandle Eastern Corp................... 31,483 877,589
Parker-Hannifin Corp..................... 16,273 557,350
Peco Energy Co........................... 48,769 1,469,166
Penney (J.C.) Co., Inc................... 49,318 2,348,770
Pennzoil Co.............................. 9,937 419,838
Peoples Energy Corp...................... 7,936 251,968
Pep Boys-Manny Moe & Jack................ 13,327 341,504
PepsiCo Inc.............................. 171,783 9,598,375
Perkin-Elmer Corp........................ 9,363 353,453
Pfizer, Inc.............................. 137,817 8,682,471
Pharmacia & Upjohn Inc................... 110,039 4,264,011
Phelps Dodge Corp........................ 15,327 954,106
Philip Morris Companies Inc.............. 183,179 16,577,699
Phillips Petroleum Co.................... 56,746 1,936,457
Pioneer Hi Bred International Inc........ 18,522 1,030,286
Pitney Bowes Inc......................... 33,351 1,567,497
Pittston Co.............................. 8,881 278,641
</TABLE>
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COMMON STOCKS SHARES VALUE
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<S> <C> <C>
Placer Dome Inc.......................... 52,586 $ 1,268,637
PNC Financial Corp....................... 69,172 2,230,797
Polaroid Corp............................ 9,806 464,559
Potlatch Corp............................ 6,429 257,160
PPG Industries Inc....................... 42,749 1,955,767
Praxair, Inc............................. 30,680 1,031,615
Premark International Inc................ 13,603 688,652
Price-Costco Inc. *...................... 41,627 634,812
Procter & Gamble Co...................... 149,923 12,443,609
Providian Corp........................... 20,944 853,468
Public Service Enterprise Inc............ 52,890 1,619,756
Pulte Corp............................... 5,792 194,756
Quaker Oats Co........................... 29,498 1,017,681
Ralston Purina Co........................ 22,385 1,396,264
Raychem Corp............................. 9,578 544,749
Raytheon Co.............................. 53,384 2,522,394
Reebok International Ltd................. 17,251 487,341
Republic New York Corp................... 11,775 731,522
Reynolds Metals Co....................... 13,909 787,597
Rite Aid Corp............................ 18,426 631,090
Roadway Services, Inc.................... 8,557 418,223
Rockwell International Corp.............. 47,099 2,490,360
Rohm & Haas Co........................... 14,862 956,741
Rowan Companies, Inc. *.................. 18,528 182,964
Royal Dutch Petroleum Co. (a)............ 116,893 16,496,525
Rubbermaid Inc........................... 34,752 886,176
Russell Corp............................. 8,395 232,961
Ryans Family Steak Houses, Inc. *........ 12,174 85,218
Ryder Systems, Inc....................... 17,451 431,912
SAFECO Corp.............................. 27,817 959,686
Safety-Kleen Corp........................ 13,192 206,125
Salomon Inc.............................. 23,485 833,717
Santa Fe Energy Resources Inc. *......... 20,466 196,985
Santa Fe Pacific Gold Corp............... 27,556 334,116
Sara Lee Corp............................ 105,124 3,350,827
SBC Communications Inc................... 132,855 7,639,162
SCE Corp................................. 97,994 1,739,393
Schering-Plough Corp..................... 80,238 4,393,030
Schlumberger Ltd......................... 52,908 3,663,879
Scientific-Atlanta Inc................... 16,830 252,450
Seagram Co. Ltd. (The)................... 81,672 2,827,893
Sears, Roebuck & Co...................... 85,269 3,325,491
Service Corp. International.............. 22,825 1,004,300
Shared Medical System.................... 5,200 282,750
Sherwin-Williams Co...................... 18,755 764,266
Shoney's Inc. *.......................... 9,355 95,889
Sigma Aldrich Corp....................... 10,961 542,569
Silicon Graphics Inc. *.................. 34,647 952,792
Snap On, Inc............................. 8,837 399,874
Sonat, Inc............................... 19,157 682,468
Southern Co.............................. 144,845 3,566,808
Southwest Airlines Co.................... 31,295 727,609
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
SPDR TRUST SERIES 1
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 1995
<TABLE>
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COMMON STOCKS SHARES VALUE
- - ------------------------------------------------------------------
<S> <C> <C>
Springs Industries, Inc.................. 4,148 $ 171,623
Sprint Corp.............................. 76,347 3,044,337
St. Jude Medical Center, Inc. *.......... 15,396 662,028
St. Paul Companies, Inc.................. 18,413 1,024,223
Stanley Works (The)...................... 9,835 506,502
Stone Container Corp..................... 20,196 290,317
Stride Rite Corp......................... 11,467 86,002
Sun Co., Inc............................. 16,675 456,478
Sun Microsystems, Inc. *................. 42,022 1,917,254
Suntrust Banks Inc....................... 24,955 1,709,417
Supervalu, Inc........................... 14,818 466,767
Sysco Corp............................... 40,126 1,304,095
Tandem Computers Inc. *.................. 25,810 274,231
Tandy Corp............................... 14,342 595,193
Tektronix, Inc........................... 7,131 350,310
Tele-Communications Inc. *............... 142,613 2,834,433
Teledyne Inc............................. 11,960 306,475
Tellabs Inc. *........................... 19,366 716,542
Temple-Inland, Inc....................... 12,421 548,077
Tenet Healthcare Corp. *................. 43,941 911,776
Tenneco Inc.............................. 38,929 1,931,852
Texaco Inc............................... 56,941 4,469,868
Texas Instruments, Inc................... 41,172 2,130,651
Texas Utilities Co....................... 49,425 2,032,603
Textron, Inc............................. 18,705 1,262,587
Thomas & Betts Corp...................... 4,284 315,945
Time Warner Inc.......................... 84,462 3,198,998
Times Mirror Co. Class A................. 24,790 839,761
Timken Co................................ 7,073 270,542
TJX Companies Inc. (The)................. 16,487 311,192
Torchmark Corp........................... 15,881 718,615
Toys R Us Co. *.......................... 60,672 1,319,616
Transamerica Corp........................ 15,065 1,097,862
Travelers Inc............................ 69,993 4,400,810
Tribune Co............................... 14,293 873,660
Trinova Corp............................. 6,426 183,944
TRW, Inc................................. 13,952 1,081,280
Tyco Laboratories, Inc................... 32,934 1,173,274
U.S. Bancorp............................. 25,745 865,676
U.S. Surgical Corp....................... 12,752 272,574
Unicom Corp.............................. 46,846 1,534,206
Unilever N. V. (a)....................... 35,003 4,926,672
Union Camp Corp.......................... 15,157 721,852
</TABLE>
<TABLE>
<CAPTION>
- - ------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
- - ------------------------------------------------------------------
<S> <C> <C>
Union Carbide Corp....................... 30,243 $ 1,134,112
Union Electric Co........................ 22,390 934,782
Union Pacific Corp....................... 45,023 2,971,518
Unisys Corp. *........................... 37,389 210,313
United Healthcare Corp................... 37,686 2,468,433
United States Healthcare Inc............. 33,586 1,561,749
United States West Inc................... 102,885 1,954,815
United Technologies Corp................. 26,893 2,551,473
Unocal Corp.............................. 54,229 1,579,420
Unum Corp................................ 15,889 873,895
US West, Inc............................. 103,051 3,684,073
USAir Group, Inc. *...................... 12,917 171,150
USF&G Corp............................... 24,449 412,577
USLIFE Corp.............................. 7,726 230,814
UST Inc.................................. 42,102 1,405,154
USX-Marathon Group....................... 62,727 1,223,176
USX-U. S. Steel Group.................... 18,109 556,852
V.F. Corp................................ 14,067 742,034
Varity Corp. *........................... 8,297 308,026
Viacom Inc. *............................ 78,566 3,722,064
Wachovia Corp............................ 37,031 1,694,168
Wal-Mart Stores, Inc..................... 500,959 11,208,958
Walgreen Co.............................. 53,790 1,606,976
Warner-Lambert Co........................ 29,562 2,871,209
Wells Fargo & Co......................... 10,575 2,284,200
Wendy's International, Inc............... 22,580 479,825
Western Atlas Inc. *..................... 11,503 580,901
Westinghouse Electric Corp............... 85,665 1,413,473
Westvaco Corp............................ 22,312 619,158
Weyerhaeuser Co.......................... 44,032 1,904,384
Whirlpool Corp........................... 16,173 861,212
Whitman Corp............................. 23,226 540,005
Willamette Industries Inc................ 12,122 681,863
Williams Companies, Inc. (The)........... 22,351 980,650
Winn-Dixie Stores, Inc................... 33,071 1,219,493
WMX Technologies, Inc.................... 106,047 3,168,154
Woolworth Corp........................... 29,193 379,509
Worthington Industries, Inc.............. 19,635 408,653
Wrigley (Wm) Jr. Co...................... 25,445 1,335,863
Xerox Corp............................... 23,459 3,213,883
Yellow Corp.............................. 6,438 79,670
--------------
Total Investments - (Cost $827,188,930) $1,001,211,658
--------------
--------------
</TABLE>
(a) An American Depository Receipt (ADR) is a certficate issued by a
U.S. Bank representing the right to receive securities of the foreign issuer
described above.
(*) Denotes non-income producing security.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
SPDR Trust Series 1
Statement of Assets and Liabilities
December 31, 1995
- - ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ASSETS
Investments in securities, at value (cost $827,188,930) (Note 2) $1,001,211,658
Cash................................................................ 4,575,805
Receivable for investments sold..................................... 672,844
Dividends receivable (Note 2)....................................... 1,803,634
Deferred organization costs (Note 2)................................ 227,328
--------------
TOTAL ASSETS......................................................... 1,008,491,269
LIABILITIES
Payable for investments purchased................................... 742,868
Income distribution payable (Note 2)................................ 5,558,618
Due to Sponsor (Note 3)............................................. 373,462
Accrued trustee fees (Note 3)....................................... 287,793
Accrued expenses and other liabilities.............................. 297,743
--------------
TOTAL LIABILITIES.................................................... 7,260,484
--------------
NET ASSETS........................................................... $1,001,230,785
--------------
--------------
NET ASSETS REPRESENTED BY:
Paid in surplus relating to 16,251,356 units of fractional undivided interest
("SPDRs") outstanding; unlimited units authorized (Note 4).......... 828,483,453
Distribution in excess of net investment income..................... (1,122,255)
Accumulated net realized loss on investments........................ (153,141)
Net unrealized appreciation on investments.......................... 174,022,728
--------------
NET ASSETS........................................................... 1,001,230,785
--------------
--------------
NET ASSET VALUE PER SPDR ($1,001,230,785 / 16,251,356 SPDRs)......... $61.61
--------------
--------------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
SPDR Trust Series 1
Statement of Operations
- - ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994 DECEMBER 31, 1993*
----------------- ----------------- ------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Dividend income (Note 2).................................. $ 16,060,887(a) $ 13,330,201 $ 6,772,508
------------ ------------ -----------
EXPENSES
Trustee expense (Note 3).................................. 909,805 668,953 299,165
S & P License Fee......................................... 218,098 -- --
SEC registration expense.................................. 136,000 -- 156,250
Amortization of organization costs (Note 2)............... 110,000 110,000 102,172
Legal and audit services.................................. 80,000 174,823 65,498
Printing and postage expense.............................. 20,000 15,250 75,000
Miscellaneous expenses.................................... 1,000 3,992 10,000
------------ ------------ ------------
Total expenses............................................. 1,474,903 973,018 708,085
Rebate from Sponsor (Note 3).............................. (180,244) (27,593) (230,591)
------------ ------------ ------------
Net expenses............................................... 1,294,659 945,425 477,494
Trustee fees offset by earnings credit (Note 3)........... (107,356) -- --
------------ ------------ ------------
Net expenses after Trustee fees offset by earnings credit.. 1,187,303 945,425 477,494
------------ ------------ ------------
NET INVESTMENT INCOME...................................... 14,873,584 12,384,776 6,295,014
------------ ------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on investment transactions....... 6,289,657 (9,680,642) 202,429
Net increase (decrease) in unrealized appreciation........ 170,848,065 (10,145,765) 13,320,428
------------ ------------ -----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS..... 177,137,722 (19,826,407) 13,522,857
------------ ------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS...... $192,011,306 $(7,441,631) $19,817,871
------------ ------------ -----------
------------ ------------ -----------
</TABLE>
* The Trust commenced operations on January 22, 1993.
(a) Net of withholding tax expense of $109,162
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
SPDR Trust Series 1
Statement of Changes in Net Assets
- - ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994 DECEMBER 31, 1993(*)
----------------- ----------------- --------------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income....................................... $ 14,873,584 $ 12,384,776 $ 6,295,014
Net realized gain (loss) on investment transactions......... 6,289,657 (9,680,642) 202,429
Net increase (decrease) in unrealized appreciation.......... 170,848,065 (10,145,765) 13,320,428
-------------- ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS........ 192,011,306 (7,441,631) 19,817,871
-------------- ------------ ------------
UNDISTRIBUTED NET INVESTMENT INCOME INCLUDED IN
PRICE OF UNITS ISSUED AND REDEEMED, NET..................... 325,692 374,852 672,224
-------------- ------------ ------------
DISTRIBUTIONS TO UNITHOLDERS FROM:
Net investment income....................................... (14,873,584) (12,844,467) (6,646,991)
In excess of net investment income.......................... (310,588) 0 0
Net realized gains.......................................... (128,321) 0 (202,429)
-------------- ------------ ------------
TOTAL DISTRIBUTIONS TO UNITHOLDERS........................... (15,312,493) (12,844,467) (6,849,420)
-------------- ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS FROM ISSUANCE
AND REDEMPTION OF SPDRS (NOTE 4)............................ 401,629,719 (19,069,514) 441,385,991
-------------- ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS DURING PERIOD.......... 578,654,224 (38,980,760) 455,026,666
NET ASSETS AT BEGINNING OF PERIOD............................ 422,576,561 461,557,321 6,530,655
-------------- ------------ ------------
NET ASSETS END OF PERIOD (including undistributed net
investment income (loss) of ($1,122,255), $235,408 and
$320,247, respectively)..................................... $1,001,230,785 $422,576,561 $461,557,321
-------------- ------------ ------------
-------------- ------------ ------------
</TABLE>
* The Trust commenced operations on January 22, 1993.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
8
<PAGE>
SPDR Trust Series 1
Financial Highlights
Selected data for a SPDR outstanding during the period
- - ------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994 DECEMBER 31, 1993 (1)
----------------- ----------------- ---------------------
<S> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD...................... $45.93 $46.62 $43.54
------ ------ ------
Investment Operations:
Net investment income (2)............................... 1.26 1.22 1.15
Net realized and unrealized gain (loss) on investments.. 15.70 (0.68) 3.06
------ ------ ------
Total from investment operations 16.96 0.54 4.21
------ ------ ------
Less distributions from:
Net investment income................................... (1.24) (1.23) (1.10)
In excess of net investment income...................... (0.03) -- --
Net realized gains...................................... (0.01) 0.00 (0.03)
------ ------ ------
Total distributions....................................... (1.28) (1.23) (1.13)
------ ------ ------
NET ASSET VALUE, END OF PERIOD............................ $61.61 $45.93 $46.62
------ ------ ------
------ ------ ------
TOTAL INVESTMENT RETURN................................... 37.35% 1.15% 9.78%
RATIOS AND SUPPLEMENTAL DATA
Ratio to average net assets:
Net expenses (2)........................................ 0.20% 0.20% 0.20% (3)
Net expenses after Trustee earnings credit (2).......... 0.19% 0.20% 0.20% (3)
Net investment income (2)............................... 2.35% 2.63% 2.62% (3)
Portfolio turnover rate (4)............................... 4.02% 4.07% 2.40%
NET ASSETS, END OF PERIOD (THOUSANDS)..................... $1,001,231 $422,577 $461,557
- - --------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The Trust commenced operations on January 22, 1993.
(2) Net of expenses reimbursed by the Sponsor. If the Trust had borne
all expenses, net investment income per unit would have decreased by
$0.01, $0.01 and $0.04 in 1995, 1994 and 1993, respectively, and the
ratio of total expenses to average net assets would have increased by
0.03%, 0.01% and 0.10% (on an annualized basis) in 1995, 1994 and 1993,
respectively.
(3) Annualized.
(4) Portfolio turnover ratio excludes securities received or delivered from
processing creations or redemptions of SPDRs.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
9
<PAGE>
SPDR TRUST SERIES 1
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995
- - ------------------------------------------------------------------------------
NOTE 1 -- ORGANIZATION
SPDR Trust Series 1 (the "Trust") is a unit investment trust created under
the laws of the State of New York and registered under the Investment Company
Act of 1940. The Trust was created to provide investors with the opportunity
to purchase a security representing a proportionate undivided interest in a
portfolio of securities consisting of substantially all of the common stocks,
in substantially the same weighting, which comprise the Standard & Poor's 500
Composite Price Index (the "S&P Index"). Each unit of fractional undivided
interest in the Trust is referred to as a Standard & Poor's Depositary
Receipt ("SPDR"). The Trust commenced operations on January 22, 1993 upon
the initial issuance of 150,000 SPDRs (equivalent to three "Creation Units" -
see Note 4) in exchange for a portfolio of securities assembled to reflect
the intended portfolio composition of the Trust.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that effect the reported amounts and disclosures in the financial statements.
Actual results could differ from these estimates. The following is a
summary of significant accounting policies followed by the Trust.
SECURITY VALUATION
Portfolio securities are valued based on the closing sale price on the
exchange which is deemed to be the principal market for the security. If no
closing sale price is available, then the security is valued at the closing
bid price on the exchange which is deemed to be the principal market for the
security. If there is no closing bid price available, valuation will be
determined by the Trustee in good faith based on available information.
INVESTMENT TRANSACTIONS
Investment transactions are recorded on the trade date. Realized gains and
losses from the sale or disposition of securities are recorded on the
identified cost basis. Dividend income is recorded on the ex-dividend date.
DISTRIBUTIONS TO UNITHOLDERS
The Trust declares and distributes dividends from net investment income to
its unitholders quarterly. The Trust will distribute net realized capital
gains, if any, at least annually.
10
<PAGE>
SPDR TRUST SERIES 1
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
- - ------------------------------------------------------------------------------
FEDERAL INCOME TAX
The Trust has qualified and intends to qualify for and elect treatment as a
"regulated investment company" under Subchapter M of the Internal Revenue
Code of 1986, as amended. By so qualifying, the Trust will not be subject to
federal income taxes to the extent it distributes its taxable income,
including any net realized capital gains, for each fiscal year. In addition,
by distributing during each calendar year substantially all of its net
investment income and capital gains, if any, the Trust will not be subject to
federal excise tax. The Trust has reclassified $5,687,578 of non-deductible
security gains realized in 1995 in the in-kind redemption of Creation Units
(Note 4) as an increase to paid in surplus in the Statement of Assets and
Liabilities. During the year ended December 31, 1995, 100% of the Trust's
dividends paid qualified for the dividends received deduction for corporate
shareholders. The Trust incurred net capital losses of $147,423 during the
period from November 1 through December 31, 1995. These losses will be used
to offset any net realized capital gains realized during 1996, any losses not
utilized in 1996 will be carried forward with an expiration date of December
31, 2004.
ORGANIZATION COSTS
The Trust incurred organization costs of $549,500, which have been
capitalized and are being charged to operations ratably over a period of 60
months from the commencement of operations.
NOTE 3 -- TRANSACTIONS WITH THE TRUSTEE AND SPONSOR
In accordance with the Trust Agreement, State Street Bank and Trust Company
(the "Trustee") maintains the Trust's accounting records, acts as custodian
and transfer agent to the Trust, and provides administrative services,
including filing of all required regulatory reports. The Trustee is also
responsible for determining the composition of the portfolio of securities
which must be delivered in exchange for the issuance of Creation Units of the
Trust, and for adjusting the composition of the Trust's portfolio from time
to time to conform to changes in the composition and/or weighting structure
of the S&P Index. For these services, the Trustee receives a fee at the
following annual rates:
<TABLE>
<CAPTION>
NET ASSET VALUE OF THE TRUST FEE AS A PERCENTAGE OF NET ASSET VALUE OF THE TRUST
---------------------------- ---------------------------------------------------
<S> <C>
$0 - $499,999,999 15/100 of 1% per annum plus or minus the Adjustment Amount
$500,000,000 - $999,999,999 13/100 of 1% per annum plus or minus the Adjustment Amount
$1,000,000,000 - and above 11/100 of 1% per annum plus or minus the Adjustment Amount
</TABLE>
The Adjustment Amount is the sum of (a) the excess or deficiency of
transaction fees received by the Trustee, less the expenses incurred in
processing orders for creation and redemption of SPDRs and (b) the amounts
earned by the Trustee with respect to the cash held by the Trustee for the
benefit of the Trust. During the year ended December 31, 1995 the Adjustment
amount reduced the Trustee's fee by $114,926, of which $107,356 resulted from
amounts earned by the Trustee with respect to cash held in the Trust.
For the fiscal year ended December 31, 1995, PDR Services Corporation (the
"Sponsor", a wholly-owned subsidiary of the American Stock Exchange, Inc.)
agreed to reimburse the Trust for, or assume, the ordinary operating expenses
of the Trust which exceeded 20/100 of 1% for the period January 1, 1995
through November 1, 1995 and 19/100 of 1% for the period November 2, 1995
through December 31, 1995 per annum of the daily net asset value of the
Trust. The amount of such reimbursement for the year ended December 31, 1995
was $180,244.
11
<PAGE>
SPDR TRUST SERIES 1
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1995
- - ------------------------------------------------------------------------------
NOTE 4 -- TRUST TRANSACTIONS IN SPDRs
Transactions in SPDRs were as follows:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1995 DECEMBER 31, 1994
SPDRS AMOUNT SPDRS AMOUNT
----- ------ ----- ------
<S> <C> <C> <C> <C>
SPDRs sold 11,700,000 $640,975,632 8,750,000 $407,202,862
Dividend reinvestment SPDRs issued 1,291 69,292 65 3,079
SPDRs redeemed (4,650,000) (239,089,513) (9,450,000) (425,900,603)
Net income equalization received -- (325,692) -- (374,852)
---------- ------------ ---------- ------------
Net increase (decrease) 7,051,291 $401,629,719 (699,935) $(19,069,514)
---------- ------------ ---------- ------------
---------- ------------ ---------- ------------
PERIOD ENDED
DECEMBER 31, 1993
SPDRS AMOUNT
----- ------
<S> <C> <C>
SPDRs sold 9,750,000 $442,058,215
Dividend reinvestment SPDRs issued -- --
SPDRs redeemed -- --
Net income equalization received -- (672,224)
--------- ------------
Net increase (decrease) 9,750,000 $441,385,991
--------- -------------
--------- -------------
</TABLE>
Except for under the Trust's dividend reinvestment plan, SPDRs are issued and
redeemed by the Trust only in Creation Unit size aggregations of 50,000
SPDRs. Such transactions are only permitted on an in-kind basis, with a
separate cash payment which is equivalent to the undistributed net investment
income per SPDR (income equalization) and a balancing cash component to
equate the transaction to the net asset value per unit of the Trust on the
transaction date. Transaction fees at scheduled amounts ranging from $250 to
$1,500 per Creation Unit are charged to those persons creating or redeeming
Creation Units. Transaction fees are received by the Trustee and used to
offset the expense of processing orders. Throughout the period ended
December 31, 1995, the Trustee voluntarily reduced or waived its fee for
creations of Creation Units through the SPDR clearing process. The Trustee,
in its sole discretion, may terminate such reductions or waivers, or modify
its transaction fee schedule, subject to certain limitations.
NOTE 5 -- INVESTMENT TRANSACTIONS
For the year ended December 31, 1995, the Trust had in-kind contributions,
redemptions, purchases and sales of investment securities of $639,954,540,
$238,394,112, $25,728,012 and $25,720,467, respectively. At December 31,
1995, the cost of investments for federal income tax purposes was
substantially the same as the cost for financial reporting purposes.
Accordingly, gross unrealized appreciation was $183,265,156 and gross
unrealized depreciation was $9,242,428, resulting in net unrealized
appreciation of $174,022,728.
12
<PAGE>
SPDR TRUST SERIES 1
REPORT OF INDEPENDENT ACCOUNTANTS
- - ------------------------------------------------------------------------------
To the Trustee and Unitholders of
SPDR Trust Series 1
In our opinion, the accompanying statement of assets and liabilities,
including the schedule 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 SPDR Trust Series
1 (the "Trust") at December 31, 1995 and the results of its operations, the
changes in its net assets and the financial highlights for the periods
indicated, in conformity with generally accepted accounting principles.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Trust'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 investments owned at December 31, 1995 by correspondence with
the custodian and brokers, provide a reasonable basis for the opinion
expressed above.
Price Waterhouse LLP
Boston, Massachusetts
February 16, 1996
13
<PAGE>
SPDR TRUST SERIES 1
- - ------------------------------------------------------------------------------
SPONSOR
PDR Services Corporation
c/o American Stock Exchange, Inc.
86 Trinity Place
New York, NY 10006
TRUSTEE
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
DISTRIBUTOR
PDR Distributors, Inc. (a wholly-owned subsidiary
of Signature Financial Group, Inc.)
6 St. James Avenue
Boston, MA 02116
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
160 Federal Street
Boston, MA 02110
LEGAL COUNSEL
Orrick, Herrington & Sutcliffe
666 Fifth Aveue
New York, NY 10103
