LETTER TO SHAREHOLDERS
Dear Shareholder:
The Growth Portfolio of Dreyfus Asset Allocation Fund, Inc.
completed its latest semi-annual fiscal period October 31, 1995. In this
letter we report the results for the six months and explain some of the
major portfolio changes. To place the half-year period in its broader
setting, we also provide an analysis of economic and market conditions
that prevailed.
ECONOMIC ENVIRONMENT
The much-desired soft landing for the U.S. economy that the Federal
Reserve Board has been striving to attain appears to have occurred.
This is the result of more than a year of moves by the Fed to tighten
interest rates, followed by a token loosening of the reins last summer.
Now that some steam has been let out of the economic boiler, the
central bank must concern itself with the possibility that the economy
might slow down more than would be desirable. However, the latest
economic statistics do not contain convincing evidence of that
happening. The housing industry is doing well. Industrial orders
continue to expand and gross domestic product keeps on growing, albeit
at a reduced rate.
In the meantime, the rate of inflation appears to be under firm
control. Consumer prices have advanced only at a very moderate pace,
and average wages have barely inched ahead. Unemployment is not getting
out of hand, and hovers near the so-called full employment level.
Retail spending has simmered down, in part because consumers are
carrying large debit balances in mortgage and credit card debts. To
what extent this will affect holiday shopping remains to be seen. The
industrial sector of the economy, however, appears to be forging ahead.
MARKET ENVIRONMENT
As your Fund reached the end of its reporting period, October 31,
1995, stocks were not far below the record levels they had reached
earlier in the fall.
Among the factors accounting for this market strength were good
corporate profits and low interest rates. Third quarter profit reports
from leading corporations, while not universally favorable, were better
than earlier quarters. The extensive lean and mean corporate
reorganizations of the past few years appear to be paying off. Even
though the pricing environment for most corporate products is extremely
competitive, manufacturers and service providers appear able to squeeze
out improved profits.
How long that continuing improvement will last is an open question.
Many economists think that profit levels may flatten out over the coming
months. The recent record on that score, however, has been encouraging.
Interest rates also have buoyed stock prices and sustained the bond
market. As the cost of borrowing has steadily decreased, many
corporations have benefitted.
Another factor in market strength has been the relentless advance of
technology, which has virtually forced corporations -- and now
individual households as well -- to reequip in order to keep up with
technical progress. The obvious result has been seen in record prices
commanded during the year by high technology stocks. While some
disillusionment may set in, the market clearly takes a very optimistic
view of the long-range outlook for these companies.
In addition, all equities have been favorably affected by the very
large inflow of investment money, on a regular basis, from 401(k) and
other retirement plans. To be sure, money managers could at some point
turn off the spigot, and divert this cash flow into bonds or money
market instruments. During the past year, however, equity purchases by
pension funds and other retirement investors have provided a supportive
background for stock prices.
However, there are some concerns. One of the most significant has
been the wrangling between Congress and the White House over how to
reduce Government spending and cut the burden of the Government's
perennial deficit. Hopefully, this impasse will be settled soon,
perhaps by the time this letter reaches its readers. In the meantime,
the uncertainties in Washington have been a source of worry to
investors.
The fading value of the U.S. dollar has also been a question mark.
Yet, after hitting a low last spring, the dollar has gradually recovered
some lost ground. This dollar rebound reflects weakness in the
economies of Western Europe and Japan, but also the strengthening of
economic activity here at home.
PORTFOLIO OVERVIEW
For the six-month fiscal period, the Growth Portfolio produced a
total return of 9.65%.* This compares with a total return of 15.27% for
the Wilshire 5000 index, which is the benchmark index used for the
Portfolio for evaluating performance.**
Three stock groups were primarily responsible for the fact that the
Portfolio's performance lagged the Wilshire 5000 Index. Cable stocks,
which we owned during the period, were affected by the long delay in
action by the U.S. Congress on the pending telecommunications bill. In
our view, the atmosphere of uncertainty that this created weakened cable
industry issues. Also during the period, consumer stocks in the
Portfolio reflected the nationwide slump in retail sales. We reduced
our exposure in Process Industry and Producer Manufacturing. Many of
these companies are in the midst of restructurings and in some cases,
their value has already been recognized. We continue to hold
investments in companies such as Crown Cork & Seal, duPont (I.E.) de
Nemours and Grace (W.R.). In retrospect, however, we believe that we
were ahead of the market cycle with some of the investments in the
Process and Producer groups. Stocks that we sold included Roper
Industries, disposed of at a profit, and CBI at a loss.
Looking to the future, we believe the Portfolio will benefit from
other significant changes that we made during the period. First,
reflecting our belief that technology is becoming more prevalent in
everyday life, we have significantly increased the weighting in the
Technology sector. We have added new positions in Gartner Group,
Hewlett-Packard and Safeguard Scientifics as well as adding to our
positions in Bay Networks and Cisco Systems. We further believe that
content will be very important for the development of the Information
Superhighway. To this end, we have added positions in Disney (Walt),
Liberty Media Group, Cl.A and Viacom Cl.A.
We have reduced our weighting in the Energy sector, taking a profit
on a significant portion of our holdings. Our remaining stocks in this
area are Amerada Hess and ENSCO.
Thank you for investing with Dreyfus. We look forward to continuing
to serve your investment needs.
Sincerely,
Signature
Ernest G. Wiggins
Portfolio Manager
Signature
Paul Kandel
Assistant Portfolio Manager
November 22, 1995
New York, N.Y.
*Total return includes reinvestment of dividends and any capital gains
paid.
**SOURCE: WILSHIRE ASSOCIATES, INC.-- Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions.
The Wilshire 5000 Index consists of all publicly traded stocks in The
United States, and is a widely accepted unmanaged index of overall
stock market performance.
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<CAPTION>
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
STATEMENT OF INVESTMENTS OCTOBER 31, 1995 (UNAUDITED)
COMMON STOCKS--91.4% SHARES VALUE
------ ----------
<S> <C> <C>
COMMERCIAL SERVICES--2.3% Gartner Group.......................... 1,000 (a) $ 43,625
----------
CONSUMER DURABLES--3.4% General Motors......................... 450 19,688
Mattel................................. 737 21,189
Sierra On-Line......................... 625 (a) 23,281
----------
64,158
----------
CONSUMER NON-DURABLES--5.3% CPC International...................... 500 33,187
PepsiCo................................ 570 30,068
Seagram................................ 1,000 36,000
----------
99,255
----------
CONSUMER SERVICES--9.7% Disney (Walt).......................... 400 23,050
Liberty Media Group, Cl. A............. 850 20,931
Mirage Resorts......................... 1,000 (a) 32,750
Tele-Communications, Cl. A............. 1,400 (a) 23,800
Time Warner............................ 1,000 36,500
Viacom, Cl. A.......................... 900 (a) 44,775
----------
181,806
----------
ELECTRONIC TECHNOLOGY--15.6% Applied Materials...................... 600 (a) 30,075
Bay Networks........................... 500 (a) 33,125
cisco Systems.......................... 400 (a) 31,000
DSC Communications..................... 700 (a) 25,900
Hewlett-Packard........................ 350 32,419
Intel.................................. 400 27,950
Micron Technology...................... 500 35,312
Rohr................................... 2,000 (a) 29,750
Texas Instruments...................... 300 20,475
Thiokol................................ 800 27,700
----------
293,706
----------
ENERGY--1.8% Amerada Hess........................... 740 33,393
----------
FINANCE--9.9% ACE.................................... 650 22,100
Allstate............................... 463 17,015
Chemical Banking....................... 400 22,750
CorVel................................. 1,100 (a) 35,200
EXEL................................... 575 30,763
First Union............................ 450 22,331
Reliance Group Holdings................ 4,800 35,400
----------
185,559
----------
HEALTH SERVICES--2.3% McKesson............................... 480 22,920
On-Gard Systems........................ 2,500 (a) 19,688
----------
42,608
----------
HEALTH TECHNOLOGY--10.2% Bristol-Myers Squibb................... 300 22,875
Guidant................................ 1,200 38,400
Johnson & Johnson...................... 400 32,600
Lilly (Eli)............................ 266 25,702
Mentor................................. 1,200 26,400
Merck & Co............................. 500 28,750
Pfizer................................. 300 17,212
----------
191,939
----------
INDUSTRIAL SERVICES--2.9% ENSCO.................................. 675 (a) 11,390
Schlumberger........................... 700 43,575
----------
54,965
----------
PROCESS INDUSTRIES--4.8% Crown Cork & Seal...................... 800 (a) 27,900
duPont (E.I.) deNemours................ 300 18,713
Grace (W.R.)........................... 800 44,600
----------
91,213
----------
PRODUCER MANUFACTURING--6.6% AlliedSignal........................... 850 36,125
Cooper Industries...................... 1,278 43,132
Raychem................................ 500 23,188
Thermo Electron........................ 480 (a) 22,080
----------
124,525
----------
RETAIL TRADE--5.1% Harcourt General....................... 500 19,812
Home Shopping Network.................. 2,500 (a) 20,313
May Department Stores.................. 400 15,700
Talbots................................ 310 7,517
Wal-Mart Stores........................ 1,500 32,438
----------
95,780
----------
TECHNOLOGY SERVICES--3.5% Microsoft.............................. 300 (a) 30,000
Safeguard Scientifics.................. 800 (a) 36,000
66,000
TRANSPORTATION--3.8% Burlington Northern Santa Fe........... 250 20,969
CSX.................................... 200 16,750
Tidewater.............................. 1,300 34,287
72,006
UTILITIES--4.2% Frontier............................... 1,150 31,050
MCI Communications..................... 1,000 24,937
SBC Communications..................... 430 24,026
----------
80,013
----------
TOTAL COMMON STOCKS
(cost $1,619,354).................... $1,720,551
==========
PRINCIPAL
SHORT-TERM INVESTMENTS--7.3% AMOUNT VALUE
---------- ----------
U.S. TREASURY BILLS: 5.17%, 12/21/95........................ $ 84,000 $ 83,394
5.15%, 12/28/95........................ 55,000 54,547
----------
TOTAL SHORT-TERM INVESTMENTS
(cost $137,950)...................... $ 137,941
==========
TOTAL INVESTMENTS (cost $1,757,304)........................................ 98.7% $1,858,492
====== ==========
CASH AND RECEIVABLES (NET)................................................. 1.3% $ 24,135
====== ==========
NET ASSETS................................................................. 100.0% $1,882,627
====== ==========
NOTE TO STATEMENT OF INVESTMENTS;
(a) Non-income producing.
See independent accountants' review report and notes to financial statements.
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1995 (UNAUDITED)
ASSETS:
Investments in securities, at value
(cost $1,757,304)--see statement..................................... $1,858,492
Receivable for investment securities sold.............................. 130,761
Dividends receivable................................................... 758
Prepaid expenses....................................................... 5,993
Due from The Dreyfus Corporation....................................... 7,082
----------
2,003,086
LIABILITIES:
Due to Distributor..................................................... $ 392
Payable for investment securities purchased............................ 93,033
Accrued expenses and other liabilities................................. 27,034 120,459
------- ----------
NET ASSETS................................................................. $1,882,627
==========
REPRESENTED BY:
Paid-in capital........................................................ $1,664,243
Accumulated undistributed investment income--net....................... 44,297
Accumulated undistributed net realized gain on investments............. 72,899
Accumulated net unrealized appreciation on investments--Note 3......... 101,188
----------
NET ASSETS at value applicable to 130,502 outstanding shares of
Common Stock, equivalent to $14.43 per share
(100 million shares of $.001 par value authorized)..................... $1,882,627
==========
See independent accountants' review report and notes to financial statements.
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
STATEMENT OF OPERATIONS SIX MONTHS ENDED OCTOBER 31, 1995 (UNAUDITED)
INVESTMENT INCOME:
INCOME:
Cash dividends (net of $34 foreign taxes withheld at source)....... $ 12,447
Interest........................................................... 2,080
--------
TOTAL INCOME................................................... $ 14,527
EXPENSES:
Management fee--Note 2(a).......................................... 6,580
Registration fees.................................................. 14,094
Prospectus and shareholders' reports--Note 2(b).................... 11,296
Shareholder servicing costs--Note 2(b,c)........................... 7,411
Custodian fees..................................................... 2,395
Auditing fees...................................................... 1,968
Legal fees......................................................... 293
Directors' fees and expenses--Note 2(d)............................ 285
Miscellaneous...................................................... 396
--------
44,718
Less--expense reimbursement from Manager due to
undertakings, and expense limitation--Note 2(a).................... 30,226
--------
TOTAL EXPENSES................................................. 14,492
--------
INVESTMENT INCOME--NET......................................... 35
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments--Note 3............................... $153,388
Net unrealized (depreciation) on investments........................... (6,186)
--------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................ 147,202
--------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS....................... $147,237
========
See independent accountants' review report and notes to financial statements.
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
APRIL 30, OCTOBER 31, 1995
1995* (UNAUDITED)
---------- ----------------
OPERATIONS:
Investment income--net................................................. $ 46,798 $ 35
Net realized gain (loss) on investments................................ (80,489) 153,388
Net unrealized appreciation (depreciation) on investments
for the period..................................................... 107,374 (6,186)
---------- ----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... 73,683 147,237
---------- ----------
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income--net................................................. (2,536) --
---------- ----------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold.......................................... 1,789,201 581,825
Dividends reinvested................................................... 2,536 --
Cost of shares redeemed................................................ (494,560) (214,759)
---------- ----------
INCREASE IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS............. 1,297,177 367,066
---------- ----------
TOTAL INCREASE IN NET ASSETS....................................... 1,368,324 514,303
NET ASSETS:
Beginning of period.................................................... -- 1,368,324
---------- ----------
End of period (including undistributed investment
income--net of $44,262 and $44,297, respectively).................. $1,368,324 $1,882,627
========== ==========
SHARES SHARES
---------- ----------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................ 143,001 41,398
Shares issued for dividends reinvested................................. 207 --
Shares redeemed........................................................ (39,204) (14,900)
---------- ----------
NET INCREASE IN SHARES OUTSTANDING................................. 104,004 26,498
========== ==========
- ----------
* From October 18, 1994 (commencement of operations) to April 30, 1995.
See independent accountants' review report and notes to financial statements.
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share
of Common Stock outstanding, total investment return, ratios to average
net assets and other supplemental data for each period indicated. This
information has been derived from the Portfolio's financial statements.
YEAR ENDED SIX MONTHS ENDED
APRIL 30, OCTOBER 31, 1995
1995(1) (UNAUDITED)
---------- ----------------
PER SHARE DATA:
Net asset value, beginning of period................................... $12.50 $13.16
------ ------
INVESTMENT OPERATIONS:
Investment income--net................................................. .45 --(3)
Net realized and unrealized gain on investments........................ .24 1.27
------ ------
TOTAL FROM INVESTMENT OPERATIONS................................... .69 1.27
------ ------
DISTRIBUTIONS;
Dividends from investment income-net................................... (.03) --
------ ------
Net asset value, end of period......................................... $13.16 $14.43
====== ======
TOTAL INVESTMENT RETURN(2)................................................. 5.53% 9.65%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets(2)............................. 1.40% .83%
Ratio of net investment income to average net assets(2)................ 3.91% --
Decrease reflected in above expense ratios due to
undertaking by the Manager and expense limitation(2)............... 4.63% 1.73%
Portfolio Turnover Rate(2)............................................. 497.41% 124.43%
Net Assets, end of period (000's Omitted).............................. $1,368 $1,883
- ----------
(1) From October 18, 1994 (commencement of operations) to April 30, 1995.
(2) Not annualized.
(3) Based on an average of shares outstanding at each month end.
See independent accountants' review report and notes to financial statements.
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DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Asset Allocation Fund, Inc. (the "Fund") is registered under
the Investment Company Act of 1940 ("Act") as a non-diversified open-end
management investment company and currently offers three portfolios
including the Dreyfus Growth Portfolio (the "Portfolio"). Premier Mutual
Fund Services, Inc. (the "Distributor") acts as the distributor of the
Portfolio's shares, which are sold to the public without a sales load.
The Distributor, located at One Exchange Place, Boston, Massachusetts
02109, is a wholly-owned subsidiary of FDI Distribution Services, Inc.,
a provider of mutual fund administration services, which in turn is a
wholly-owned subsidiary of FDI Holdings, Inc., the parent company of
which is Boston Institutional Group, Inc. The Dreyfus Corporation
("Manager") serves as the Portfolio's investment adviser. The Manager is
a direct subsidiary of Mellon Bank, N.A.
As of October 31, 1995, Major Trading Corporation, a subsidiary of
Mellon Bank Investments Corporation, held 80,189 shares of Common Stock
of the Portfolio. Mellon Bank Investments Corporation is a subsidiary of
Mellon Bank.
The Fund accounts separately for the assets, liabilities and
operations of each portfolio. Expenses directly attributable to each
portfolio are charged to that portfolio's operations; expenses which are
applicable to all portfolios, are allocated among them.
(A) PORTFOLIO VALUATION: Investments in securities (including
options and financial futures) are valued at the last sales price on the
securities exchange on which such securities are primarily traded or at
the last sales price on the national securities market. Securities not
listed on an exchange or the national securities market, or securities
for which there were no transactions, are valued at the average of the
most recent bid and asked prices, except for open short positions, where
the asked price is used for valuation purposes. Bid price is used when
no asked price is available. Securities for which there are no such
valuations are valued at fair value as determined in good faith under
the direction of the Board of Directors. Investments denominated in
foreign currencies are translated to U.S. dollars at the prevailing
rates of exchange.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss
from securities transactions are recorded on the identified cost basis.
Dividend income is recognized on the ex-dividend date and interest
income, including, where applicable, amortization of discount on
investments, is recognized on the accrual basis.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-
dividend date. Dividends from investment income-net and dividends from
net realized capital gain, are normally declared and paid annually, but
the Portfolio may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code. To the
extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Portfolio not to distribute
such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Portfolio to
continue to qualify as a regulated investment company, if such
qualification is in the best interests of its shareholders, by complying
with the applicable provisions of the Internal Revenue Code, and to make
distributions of taxable income sufficient to relieve it from
substantially all Federal income and excise taxes.
NOTE 2--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the
Manager, the management fee is computed at the annual rate of .75 of 1%
of the average daily value of the Portfolio's net assets and is payable
monthly. The Agreement provides for an expense reimbursement from the
Manager should the Portfolio's aggregate expenses, exclusive of taxes,
brokerage, interest on borrowings and extraordinary expenses, exceed the
expense limitation of any state having jurisdiction over the Portfolio.
The most stringent state expense limitation applicable to the Portfolio
presently requires reimbursement of expenses in any full fiscal year
that such expenses (exclusive of certain expenses as described above)
exceed 2 1/2% of the first $30 million, 2% of the next $70 million and 1
1/2% of the excess over $100 million of the average value of the
Portfolio's net assets in accordance with California "blue sky"
regulations. However, the Manager had undertaken from May 1, 1995
through July 3, 1995 to waive receipt of the management, service and
distribution fees, and thereafter has currently undertaken through
December 31, 1995, to reduce the management fee paid by, or reimburse
such excess expenses of the Portfolio, to the extent that the
Portfolio's aggregate annual expenses (exclusive of certain expenses as
described above) exceed an annual rate of 1.25 of 1% of the average
daily value of the Portfolio's net assets. The expense reimbursement,
pursuant to the undertakings and expense limitation, amounted to $30,226
for the six months ended October 31, 1995.
The undertaking may be modified by the Manager from time to time,
provided that the resulting expense reimbursement would not be less than
the amount required pursuant to the Agreement.
(B) Prior to September 1, 1995, the Portfolio had a Distribution
Plan (the "Plan") adopted pursuant to Rule 12b-1 under the Act, which
provided that the Portfolio (a) reimburse the Distributor for payments
to certain Service Agents for distributing the Portfolio's shares and
(b) pay the Manager, Dreyfus Service Corporation or any affiliate of
either of them (collectively "Dreyfus") for advertising and marketing
relating to the Portfolio and servicing shareholder accounts, at an
aggregate annual rate of .50 of 1% of the value of the Portfolio's
average daily net assets. Each of the Distributor and Dreyfus could pay
Service Agents (a securities dealer, financial institution, or other
industry professional) a fee in respect of the Portfolio's shares owned
by shareholders with whom the Service Agent had a servicing relationship
or for whom the Service Agent was the dealer or holder of record. Each
of the Distributor and Dreyfus determined the amounts to be paid to
Service Agents to which it made payments and the basis on which such
payments were made. The Plan also separately provided for the Portfolio
to bear the costs of preparing, printing and distributing certain of the
Portfolio's prospectuses and statements of additional information and
costs associated with implementing and operating the Plan, not to exceed
the greater of $100,000 or .005 of 1% of the Portfolio's average daily
net assets for any full fiscal year. During the period May 1, 1995
through August 31, 1995, the Portfolio was charged $4,088 pursuant to
the Plan. Effective September 1, 1995 the Plan was terminated.
(C) Pursuant to the Portfolio's Shareholder Services Plan, the
Portfolio pays the Distributor at an annual rate of .25 of 1% of the
value of the Portfolio's average daily net assets for the provision of
certain services. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder
inquiries regarding the Portfolio and providing reports and other
information, and services related to the maintenance of shareholder
accounts. The Distributor may make payments to Service Agents in respect
of these services. The Distributor determines the amounts to be paid to
Service Agents. For the six months ended October 31, 1995, $2,193 was
charged to the Portfolio pursuant to the Shareholder Services Plan.
(D) Each director who is not an "affiliated person" as defined in
the Act receives from the Fund an annual fee of $1,000 and an attendance
fee of $250 per meeting. The Chairman of the Board receives an
additional 25% of such compensation.
NOTE 3--SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment
securities, excluding short-term securities, during the six months ended
October 31, 1995, amounted to $2,334,707 and $2,066,004, respectively.
At October 31, 1995, accumulated net unrealized appreciation on
investments was $101,188, consisting of $149,954 gross unrealized
appreciation and $48,766 gross unrealized depreciation.
At October 31, 1995, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of investments).
DREYFUS ASSET ALLOCATION FUND, INC., Dreyfus Growth Portfolio
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS GROWTH PORTFOLIO
We have reviewed the accompanying statement of assets and
liabilities, including the statement of investments, of Dreyfus Growth
Portfolio (one of the Series constituting the Dreyfus Asset Allocation
Fund, Inc.) as of October 31, 1995, and the related statements of
operations and changes in net assets and financial highlights for the
six month period ended October 31, 1995. These financial statements and
financial highlights are the responsibility of the Fund's management.
We conducted our review in accordance with standards established by
the American Institute of Certified Public Accountants. A review of
interim financial information consists principally of applying
analytical procedures to financial data, and making inquiries of persons
responsible for financial and accounting matters. It is substantially
less in scope than an audit conducted in accordance with generally
accepted auditing standards, which will be performed for the full year
with the objective of expressing an opinion regarding the financial
statements and financial highlights taken as a whole. Accordingly, we do
not express such an opinion.
Based on our review, we are not aware of any material modifications
that should be made to the interim financial statements and financial
highlights referred to above for them to be in conformity with generally
accepted accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets and financial
highlights for the period from October 18, 1994 (commencement of
operations) to April 30, 1995 and in our report dated June 2, 1995, we
expressed an unqualified opinion on such statement of changes in net
assets and financial highlights.
Ernst & Young LLP signature
New York, New York
December 1, 1995
Dreyfus Lion Logo
DREYFUS ASSET ALLOCATION FUND, INC.
DREYFUS GROWTH PORTFOLIO
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
First Data Investor Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained in the Prospectus,
which must precede or accompany this report.
Printed in U.S.A. 554SA9510
Dreyfus Logo
Asset Allocation
Fund, Inc.
Dreyfus
Growth Portfolio
Semi-Annual Report
October 31, 1995
