<PAGE> PAGE 1
000 A000000 06/30/98
000 C000000 0000898745
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0.a
000 J000000 U
001 A000000 PRINCIPAL SPECIAL MARKETS FUND, INC.
001 B000000 811-07572
001 C000000 5152475476
002 A000000 THE PRINCIPAL FINANCIAL GROUP
002 B000000 DES MOINES
002 C000000 IA
002 D010000 50392
002 D020000 0200
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 4
007 C010100 1
007 C020100 INTERNATIONAL SMALLCAP PORTFOLIO
007 C030100 N
007 C010200 2
007 C020200 INTERNATIONAL EMERGING MARKETS PORTFOLIO
007 C030200 N
007 C010300 3
007 C020300 INTERNATIONAL SECURITIES PORFOLIO
007 C030300 N
007 C010400 4
007 C020400 MORTGAGE-BACKED SECURITIES PORTFOLIO
007 C030400 N
018 00AA00 Y
019 A00AA00 Y
019 B00AA00 41
019 C00AA00 PRINCORGRP
020 A000001 MERRILL LYNCH
020 B000001 13-5674085
020 C000001 37
020 A000002 MORGAN STANLEY & CO
020 B000002 13-2655998
020 C000002 32
020 A000003 ROBERT FLEMING
020 B000003 13-3298866
020 C000003 31
020 A000004 CREDIT LYONNAIS SECURITIES
020 B000004 13-2602298
020 C000004 29
<PAGE> PAGE 2
020 A000005 JAMES CAPPEL INC.
020 B000005 52-1348224
020 C000005 25
020 A000006 VICKERS BALLAS INC.
020 B000006 13-3743951
020 C000006 23
020 A000007 CARNEGIE INC.
020 B000007 13-3392829
020 C000007 20
020 A000008 ABN AMRO SECURITIES
020 B000008 13-3227945
020 C000008 19
020 A000009 GOLDMAN SACHS CO.
020 B000009 13-5108880
020 C000009 19
020 A000010 CREDIT SUISSE FIRST BOSTON
020 B000010 13-5659485
020 C000010 19
021 000000 535
022 A000001 FIRST CHICAGO CAPITAL MARKETS
022 B000001 36-3595942
022 C000001 1504026
022 D000001 0
022 A000002 ASSOCIATES CORP. OF NORTH AMERICA
022 B000002 74-1494554
022 C000002 130958
022 D000002 0
022 A000003 GENERAL ELECTRIC CAPITAL CORP.
022 B000003 13-1500700
022 C000003 107629
022 D000003 0
022 A000004 GENERAL ELECTRIC CO.
022 B000004 42-1192999
022 C000004 14031
022 D000004 0
022 A000005 MERRILL LYNCH MONEY MARKET SEC.
022 B000005 13-2761776
022 C000005 12259
022 D000005 0
022 A000006 FORD MOTOR CREDIT CO.
022 B000006 38-1612444
022 C000006 7970
022 D000006 0
022 A000007 AMERICAN EXPRESS CREDIT CORP.
022 B000007 11-1988350
022 C000007 6332
022 D000007 0
022 A000008 CREDIT SUISSE FIRST BOSTON CORP.
022 B000008 13-5659485
022 C000008 4308
022 D000008 1115
<PAGE> PAGE 3
022 A000009 LEHMAN BROTHERS
022 B000009 13-2501865
022 C000009 3782
022 D000009 1394
022 A000010 MERRILL LYNCH
022 B000010 13-5674085
022 C000010 4089
022 D000010 720
023 C000000 1827678
023 D000000 8162
027 000000 Y
077 A000000 N
028 A010100 0
028 A020100 0
028 A030100 0
028 A040100 0
028 B010100 15000
028 B020100 65
028 B030100 0
028 B040100 0
028 C010100 16000
028 C020100 0
028 C030100 0
028 C040100 0
028 D010100 10024
028 D020100 0
028 D030100 0
028 D040100 0
028 E010100 9000
028 E020100 0
028 E030100 0
028 E040100 0
028 F010100 0
028 F020100 0
028 F030100 0
028 F040100 0
028 G010100 50024
028 G020100 65
028 G030100 0
028 G040100 0
028 H000100 0
055 A000100 N
055 B000100 N
062 A000100 N
062 B000100 0.0
062 C000100 0.0
062 D000100 0.0
062 E000100 0.0
062 F000100 0.0
062 G000100 0.0
062 H000100 0.0
<PAGE> PAGE 4
062 I000100 0.0
062 J000100 0.0
062 K000100 0.0
062 L000100 0.0
062 M000100 0.0
062 N000100 0.0
062 O000100 0.0
062 P000100 0.0
062 Q000100 0.0
062 R000100 0.0
066 A000100 Y
066 B000100 N
066 C000100 N
066 D000100 Y
066 E000100 N
066 F000100 N
066 G000100 N
067 000100 N
068 A000100 N
068 B000100 Y
069 000100 N
071 A000100 70598
071 B000100 20065
071 C000100 61344
071 D000100 33
072 A000100 6
072 B000100 166
072 C000100 680
072 D000100 0
072 E000100 0
072 F000100 324
072 G000100 0
072 H000100 0
072 I000100 0
072 J000100 0
072 K000100 0
072 L000100 0
072 M000100 0
072 N000100 0
072 O000100 0
072 P000100 0
072 Q000100 0
072 R000100 0
072 S000100 0
072 T000100 0
072 U000100 0
072 V000100 0
072 W000100 0
072 X000100 324
072 Y000100 0
072 Z000100 522
<PAGE> PAGE 5
072AA000100 0
072BB000100 1116
072CC010100 10486
072CC020100 0
072DD010100 5
072DD020100 0
072EE000100 61
073 A010100 0.0015
073 A020100 0.0000
073 B000100 0.0189
073 C000100 0.0000
074 A000100 14
074 B000100 0
074 C000100 4882
074 D000100 0
074 E000100 0
074 F000100 87988
074 G000100 0
074 H000100 0
074 I000100 0
074 J000100 340
074 K000100 0
074 L000100 105
074 M000100 0
074 N000100 93329
074 O000100 1370
074 P000100 0
074 Q000100 0
074 R010100 0
074 R020100 0
074 R030100 0
074 R040100 75
074 S000100 0
074 T000100 91884
074 U010100 7482
074 U020100 0
074 V010100 12.28
074 V020100 0.00
074 W000100 0.0000
074 X000100 2
074 Y000100 0
075 A000100 0
075 B000100 65483
076 000100 0.00
028 A010200 0
028 A020200 0
028 A030200 0
028 A040200 0
028 B010200 30000
028 B020200 85
028 B030200 0
<PAGE> PAGE 6
028 B040200 0
028 C010200 15000
028 C020200 0
028 C030200 0
028 C040200 0
028 D010200 10000
028 D020200 0
028 D030200 0
028 D040200 0
028 E010200 10000
028 E020200 0
028 E030200 0
028 E040200 0
028 F010200 0
028 F020200 0
028 F030200 0
028 F040200 0
028 G010200 65000
028 G020200 85
028 G030200 0
028 G040200 0
028 H000200 0
055 A000200 N
055 B000200 N
062 A000200 N
062 B000200 0.0
062 C000200 0.0
062 D000200 0.0
062 E000200 0.0
062 F000200 0.0
062 G000200 0.0
062 H000200 0.0
062 I000200 0.0
062 J000200 0.0
062 K000200 0.0
062 L000200 0.0
062 M000200 0.0
062 N000200 0.0
062 O000200 0.0
062 P000200 0.0
062 Q000200 0.0
062 R000200 0.0
066 A000200 Y
066 B000200 N
066 C000200 N
066 D000200 Y
066 E000200 N
066 F000200 N
066 G000200 N
067 000200 N
068 A000200 N
<PAGE> PAGE 7
068 B000200 Y
069 000200 N
070 A010200 Y
070 A020200 N
070 B010200 Y
070 B020200 N
070 C010200 Y
070 C020200 N
070 D010200 Y
070 D020200 N
070 E010200 Y
070 E020200 N
070 F010200 Y
070 F020200 N
070 G010200 Y
070 G020200 N
070 H010200 Y
070 H020200 N
070 I010200 N
070 I020200 N
070 J010200 Y
070 J020200 Y
070 K010200 Y
070 K020200 N
070 L010200 Y
070 L020200 Y
070 M010200 Y
070 M020200 N
070 N010200 Y
070 N020200 N
070 O010200 Y
070 O020200 N
070 P010200 N
070 P020200 N
070 Q010200 N
070 Q020200 N
070 R010200 Y
070 R020200 N
071 A000200 69424
071 B000200 6762
071 C000200 63497
071 D000200 11
072 A000200 6
072 B000200 190
072 C000200 971
072 D000200 0
072 E000200 0
072 F000200 405
072 G000200 0
072 H000200 0
072 I000200 0
<PAGE> PAGE 8
072 J000200 0
072 K000200 0
072 L000200 0
072 M000200 0
072 N000200 0
072 O000200 0
072 P000200 0
072 Q000200 0
072 R000200 0
072 S000200 0
072 T000200 0
072 U000200 0
072 V000200 0
072 W000200 0
072 X000200 405
072 Y000200 0
072 Z000200 756
072AA000200 0
072BB000200 115
072CC010200 0
072CC020200 11556
072DD010200 23
072DD020200 0
072EE000200 62
073 A010200 0.0072
073 A020200 0.0000
073 B000200 0.0194
073 C000200 0.0000
074 A000200 18
074 B000200 0
074 C000200 7407
074 D000200 0
074 E000200 7471
074 F000200 71539
074 G000200 0
074 H000200 0
074 I000200 0
074 J000200 0
074 K000200 0
074 L000200 223
074 M000200 0
074 N000200 86657
074 O000200 0
074 P000200 0
074 Q000200 0
074 R010200 0
074 R020200 0
074 R030200 0
074 R040200 84
074 S000200 0
074 T000200 86573
<PAGE> PAGE 9
074 U010200 9525
074 U020200 0
074 V010200 9.09
074 V020200 0.00
074 W000200 0.0000
074 X000200 3
074 Y000200 0
075 A000200 0
075 B000200 68893
076 000200 0.00
028 A010300 170
028 A020300 0
028 A030300 0
028 A040300 22
028 B010300 678
028 B020300 170
028 B030300 0
028 B040300 0
028 C010300 6482
028 C020300 0
028 C030300 0
028 C040300 14
028 D010300 245
028 D020300 0
028 D030300 0
028 D040300 544
028 E010300 52
028 E020300 0
028 E030300 0
028 E040300 0
028 F010300 15
028 F020300 0
028 F030300 0
028 F040300 0
028 G010300 7642
028 G020300 170
028 G030300 0
028 G040300 580
028 H000300 0
055 A000300 N
055 B000300 N
062 A000300 N
062 B000300 0.0
062 C000300 0.0
062 D000300 0.0
062 E000300 0.0
062 F000300 0.0
062 G000300 0.0
062 H000300 0.0
062 I000300 0.0
062 J000300 0.0
<PAGE> PAGE 10
062 K000300 0.0
062 L000300 0.0
062 M000300 0.0
062 N000300 0.0
062 O000300 0.0
062 P000300 0.0
062 Q000300 0.0
062 R000300 0.0
066 A000300 Y
066 B000300 N
066 C000300 N
066 D000300 Y
066 E000300 N
066 F000300 N
066 G000300 N
067 000300 N
068 A000300 N
068 B000300 Y
069 000300 N
071 A000300 14024
071 B000300 6124
071 C000300 42580
071 D000300 14
072 A000300 6
072 B000300 96
072 C000300 628
072 D000300 0
072 E000300 0
072 F000300 205
072 G000300 0
072 H000300 0
072 I000300 0
072 J000300 0
072 K000300 0
072 L000300 0
072 M000300 0
072 N000300 0
072 O000300 0
072 P000300 0
072 Q000300 0
072 R000300 0
072 S000300 0
072 T000300 0
072 U000300 0
072 V000300 0
072 W000300 0
072 X000300 205
072 Y000300 0
072 Z000300 519
072AA000300 623
072BB000300 0
<PAGE> PAGE 11
072CC010300 4063
072CC020300 0
072DD010300 0
072DD020300 0
072EE000300 274
073 A010300 0.0000
073 A020300 0.0000
073 B000300 0.1045
073 C000300 0.0000
074 A000300 11
074 B000300 0
074 C000300 1895
074 D000300 0
074 E000300 195
074 F000300 47621
074 G000300 0
074 H000300 0
074 I000300 0
074 J000300 32
074 K000300 0
074 L000300 132
074 M000300 0
074 N000300 49886
074 O000300 0
074 P000300 0
074 Q000300 0
074 R010300 0
074 R020300 0
074 R030300 0
074 R040300 37
074 S000300 0
074 T000300 49849
074 U010300 3068
074 U020300 0
074 V010300 16.25
074 V020300 0.00
074 W000300 0.0000
074 X000300 19
074 Y000300 9504
075 A000300 0
075 B000300 45776
076 000300 0.00
028 A010400 0
028 A020400 0
028 A030400 0
028 A040400 0
028 B010400 0
028 B020400 72
028 B030400 0
028 B040400 0
028 C010400 0
<PAGE> PAGE 12
028 C020400 71
028 C030400 0
028 C040400 0
028 D010400 0
028 D020400 72
028 D030400 0
028 D040400 0
028 E010400 0
028 E020400 75
028 E030400 0
028 E040400 0
028 F010400 0
028 F020400 147
028 F030400 0
028 F040400 0
028 G010400 0
028 G020400 437
028 G030400 0
028 G040400 0
028 H000400 0
055 A000400 N
055 B000400 N
062 A000400 Y
062 B000400 0.0
062 C000400 1.5
062 D000400 0.0
062 E000400 0.0
062 F000400 0.0
062 G000400 0.0
062 H000400 0.0
062 I000400 0.0
062 J000400 0.0
062 K000400 0.0
062 L000400 0.0
062 M000400 0.0
062 N000400 99.3
062 O000400 0.0
062 P000400 0.0
062 Q000400 0.0
062 R000400 -0.8
063 A000400 0
063 B000400 25.6
064 A000400 Y
064 B000400 N
066 A000400 N
067 000400 N
068 A000400 N
068 B000400 N
069 000400 N
071 A000400 1266
071 B000400 812
<PAGE> PAGE 13
071 C000400 13865
071 D000400 6
072 A000400 6
072 B000400 468
072 C000400 0
072 D000400 0
072 E000400 0
072 F000400 31
072 G000400 0
072 H000400 0
072 I000400 0
072 J000400 0
072 K000400 0
072 L000400 0
072 M000400 0
072 N000400 0
072 O000400 0
072 P000400 0
072 Q000400 0
072 R000400 0
072 S000400 0
072 T000400 0
072 U000400 0
072 V000400 0
072 W000400 0
072 X000400 31
072 Y000400 0
072 Z000400 437
072AA000400 0
072BB000400 0
072CC010400 71
072CC020400 0
072DD010400 437
072DD020400 0
072EE000400 0
073 A010400 0.3211
073 A020400 0.0000
073 B000400 0.0000
073 C000400 0.0000
074 A000400 2
074 B000400 0
074 C000400 215
074 D000400 14209
074 E000400 0
074 F000400 0
074 G000400 0
074 H000400 0
074 I000400 0
074 J000400 0
074 K000400 0
074 L000400 76
<PAGE> PAGE 14
074 M000400 0
074 N000400 14502
074 O000400 194
074 P000400 0
074 Q000400 0
074 R010400 0
074 R020400 0
074 R030400 0
074 R040400 5
074 S000400 0
074 T000400 14303
074 U010400 1386
074 U020400 0
074 V010400 10.32
074 V020400 0.00
074 W000400 0.0000
074 X000400 1
074 Y000400 3724
075 A000400 0
075 B000400 13997
076 000400 0.00
SIGNATURE A S FILEAN
TITLE VICE PRES/SECRETARY
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 97,613,359
<INVESTMENTS-AT-VALUE> 86,416,409
<RECEIVABLES> 223,032
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 17,815
<TOTAL-ASSETS> 86,657,256
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 83,677
<TOTAL-LIABILITIES> 83,677
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 97,144,766
<SHARES-COMMON-STOCK> 9,525,354
<SHARES-COMMON-PRIOR> 3,204,730
<ACCUMULATED-NII-CURRENT> 750,264
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (119,058)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (11,202,393)
<NET-ASSETS> 86,573,579
<DIVIDEND-INCOME> 970,955
<INTEREST-INCOME> 190,595
<OTHER-INCOME> 0
<EXPENSES-NET> (405,182)
<NET-INVESTMENT-INCOME> 756,368
<REALIZED-GAINS-CURRENT> (115,027)
<APPREC-INCREASE-CURRENT> (11,555,808)
<NET-CHANGE-FROM-OPS> (10,914,467)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (23,074)
<DISTRIBUTIONS-OF-GAINS> (62,172)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 6,311,934
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 8,690
<NET-CHANGE-IN-ASSETS> 54,073,332
<ACCUMULATED-NII-PRIOR> 16,970
<ACCUMULATED-GAINS-PRIOR> 58,141
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 405,182
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 405,182
<AVERAGE-NET-ASSETS> 71,653,671
<PER-SHARE-NAV-BEGIN> 10.14
<PER-SHARE-NII> .08
<PER-SHARE-GAIN-APPREC> (1.10)
<PER-SHARE-DIVIDEND> (.01)
<PER-SHARE-DISTRIBUTIONS> (.02)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 9.09
<EXPENSE-RATIO> 1.15
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 39,708,140
<INVESTMENTS-AT-VALUE> 49,710,770
<RECEIVABLES> 164,117
<ASSETS-OTHER> 109
<OTHER-ITEMS-ASSETS> 10,709
<TOTAL-ASSETS> 49,885,705
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 37,007
<TOTAL-LIABILITIES> 37,007
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 38,701,669
<SHARES-COMMON-STOCK> 3,067,583
<SHARES-COMMON-PRIOR> 2,608,123
<ACCUMULATED-NII-CURRENT> 544,913
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 598,989
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 10,003,127
<NET-ASSETS> 49,848,698
<DIVIDEND-INCOME> 627,763
<INTEREST-INCOME> 96,516
<OTHER-INCOME> 0
<EXPENSES-NET> (204,935)
<NET-INVESTMENT-INCOME> 519,344
<REALIZED-GAINS-CURRENT> 623,454
<APPREC-INCREASE-CURRENT> 4,063,348
<NET-CHANGE-FROM-OPS> 5,206,146
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> (273,638)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 483,035
<NUMBER-OF-SHARES-REDEEMED> (35,070)
<SHARES-REINVESTED> 11,495
<NET-CHANGE-IN-ASSETS> 12,164,687
<ACCUMULATED-NII-PRIOR> 25,569
<ACCUMULATED-GAINS-PRIOR> 249,173
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 204,935
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 204,935
<AVERAGE-NET-ASSETS> 46,238,453
<PER-SHARE-NAV-BEGIN> 14.45
<PER-SHARE-NII> .17
<PER-SHARE-GAIN-APPREC> 1.74
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (.11)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 16.25
<EXPENSE-RATIO> .90
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 82,527,551
<INVESTMENTS-AT-VALUE> 92,870,005
<RECEIVABLES> 444,867
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 13,960
<TOTAL-ASSETS> 93,328,832
<PAYABLE-FOR-SECURITIES> 1,369,723
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 74,971
<TOTAL-LIABILITIES> 1,444,694
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 82,140,018
<SHARES-COMMON-STOCK> 7,482,223
<SHARES-COMMON-PRIOR> 3,205,478
<ACCUMULATED-NII-CURRENT> 521,699
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,119,601)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 10,342,022
<NET-ASSETS> 91,884,138
<DIVIDEND-INCOME> 680,371
<INTEREST-INCOME> 166,057
<OTHER-INCOME> 0
<EXPENSES-NET> (324,331)
<NET-INVESTMENT-INCOME> 522,097
<REALIZED-GAINS-CURRENT> (1,116,152)
<APPREC-INCREASE-CURRENT> 10,486,436
<NET-CHANGE-FROM-OPS> 9,892,381
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (4,808)
<DISTRIBUTIONS-OF-GAINS> (60,584)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,270,347
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 6,398
<NET-CHANGE-IN-ASSETS> 59,916,477
<ACCUMULATED-NII-PRIOR> 4,410
<ACCUMULATED-GAINS-PRIOR> 57,135
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 324,331
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 324,331
<AVERAGE-NET-ASSETS> 66,099,877
<PER-SHARE-NAV-BEGIN> 9.97
<PER-SHARE-NII> .07
<PER-SHARE-GAIN-APPREC> 2.26
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (.02)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.28
<EXPENSE-RATIO> 1.00
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<INVESTMENTS-AT-COST> 14,047,608
<INVESTMENTS-AT-VALUE> 14,423,541
<RECEIVABLES> 76,627
<ASSETS-OTHER> 127
<OTHER-ITEMS-ASSETS> 2,052
<TOTAL-ASSETS> 14,502,347
<PAYABLE-FOR-SECURITIES> 193,634
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,261
<TOTAL-LIABILITIES> 198,895
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 15,005,580
<SHARES-COMMON-STOCK> 1,385,728
<SHARES-COMMON-PRIOR> 1,343,286
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,078,061)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 375,933
<NET-ASSETS> 14,303,452
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 468,202
<OTHER-INCOME> 0
<EXPENSES-NET> (31,124)
<NET-INVESTMENT-INCOME> 437,078
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 70,844
<NET-CHANGE-FROM-OPS> 507,922
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (437,078)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 42,442
<NET-CHANGE-IN-ASSETS> 507,922
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (1,078,061)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 31,124
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 31,124
<AVERAGE-NET-ASSETS> 14,027,713
<PER-SHARE-NAV-BEGIN> 10.27
<PER-SHARE-NII> .32
<PER-SHARE-GAIN-APPREC> .05
<PER-SHARE-DIVIDEND> (.32)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.32
<EXPENSE-RATIO> .45
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>