<PAGE> PAGE 1
000 A000000 12/31/97
000 C000000 908940
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0
000 J000000 U
001 A000000 THE DIVERSIFIED PORTFOLIO
001 B000000 811-7860
001 C000000 8099451824
002 A000000 PO BOX 2494
002 B000000 GEORGETOWN
002 E010000 GRAND CAYMAN
002 E020000 E9
003 000000 N
004 000000 N
005 000000 N
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008 A000001 MORGAN GUARANTY TRUST CO. OF N.Y.
008 B000001 A
008 C000001 801-999999
008 D010001 NEW YORK
008 D020001 NY
008 D030001 10036
010 A000001 FUNDS DISTRIBUTOR, INC.
010 B000001 8-420518
010 C010001 BOSTON
010 C020001 MA
010 C030001 02116
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010 B000002 8-49999999
010 C010002 NEW YORK
010 C020002 NY
010 C030002 10036
010 A000003 PIERPONT GROUP, INC,
010 C010003 NEW YORK
010 C020003 NY
<PAGE> PAGE 2
010 C030003 10017
011 A000001 FUNDS DISTRIBUTOR,INC.
011 B000001 8-420518
011 C010001 BOSTON
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011 C030001 02116
012 A000001 STATE STREET BANK AND TRUST CO.
012 B000001 85-50003
012 C010001 BOSTON
012 C020001 MA
012 C030001 02101
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012 B000002 84-9999999
012 C010002 NEW YORK
012 C020002 NY
012 C030002 10036
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013 B010001 NEW YORK
013 B020001 NY
013 B030001 10036
014 A000001 JP MORGAN SECURITIES, INC.
014 B000001 8-99999999
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014 B000002 8-99999999
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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<PAGE> PAGE 5
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<PAGE> PAGE 6
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<PAGE> PAGE 7
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<PAGE> PAGE 8
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<PAGE> PAGE 9
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SIGNATURE RICHARD W. INGRAM
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial data extracted from the semi-annual
report dated 12/31/97 for the Diversified Portfolio and is qualified in its
entirety by reference to such annual report.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> DEC-31-1997
<INVESTMENTS-AT-COST> 326581
<INVESTMENTS-AT-VALUE> 382493
<RECEIVABLES> 3978
<ASSETS-OTHER> 2613
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 389084
<PAYABLE-FOR-SECURITIES> 1238
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 571
<TOTAL-LIABILITIES> 1809
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 387275
<DIVIDEND-INCOME> 1703
<INTEREST-INCOME> 4994
<OTHER-INCOME> 0
<EXPENSES-NET> 1130
<NET-INVESTMENT-INCOME> 5567
<REALIZED-GAINS-CURRENT> 7986
<APPREC-INCREASE-CURRENT> 7184
<NET-CHANGE-FROM-OPS> 20737
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 956
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 1260
<AVERAGE-NET-ASSETS> 344883
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> .65
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
TRANSACTIONS SUBJECT TO RULE 10F-3 PROCEDURES
Portfolio: 6160 THE DIVERSIFIED FUND Security Description: COMMON STOCK
Issuer: ISPAT INTERNATIONAL
<TABLE>
<CAPTION>
IN COMPLIANCE
REQUIRED INFORMATION APPLICABLE RESTRICTION (YES/NO)
- ---- ------------------------------------------ ---------------- -------------------------------------- -----------------
<S> <C> <C> <C>
1. Offering Date AUG 7, 1997 None N/A
2. Trade Date AUG 7, 1997 Must be the same as #1 YES
3. Unit Price of Offering $ 27 None N/A
4. Price Paid per Unit $ 27 Must not exceed #3 YES
5. Years of Issuer's Operations 8 Must be at least three years * YES
Underwriting Type FIRM Must be firm YES
6.
Underwriting Spread $1.215 Investment Adviser determination to
7. be made YES
Total Price paid by Portfolio $12,879 None N/A
8.
Total Size of Offering 675,000,000 None N/A
9.
Total Price Paid by Portfolio plus Total If less than $500,000, must not
10. Price Paid for same securities purchased exceed #8x10% (N/A), otherwise must YES
by the same investment adviser for other not exceed #8x4% ($27,000,000)
investment companies $851,796
Underwriters from whom Portfolio
11. purchased (attach a list of ALL CREDIT SUISSE Must not include Investment Adviser YES
syndicate members) FIRST BOSTON affiliates ***
YES
12. If the affiliate was lead or co-lead Must be "Yes" or "N/A"
manager, confirm the instruction given N/A
below ****
- ---- ------------------------------------------ ---------------- -------------------------------------- -----------------
The Investment Adviser has no reasonable cause to believe that the underwriting
commission, spread or profit is NOT reasonable and fair compared to
underwritings of similar securities during a comparable period of time. In
determining which securities are comparable, the Investment Adviser has
considered the factors set forth in the Portfolio's 10f-3 procedures.
/S/ BARRY MULLEN
------------------
Investment Adviser
* Not applicable to munis. In the case of munis, (i) the issue must have
one investment grade rating or (ii) if the issuer or the revenue source
has been in operation for less than three years, the issue must have
one of the three highest ratings. Circle (i) or (ii), whichever is met.
*** For munis purchased from syndicate manager, check box to confirm that the purchase was not designated as
a group sale. [ ]
**** No credit for the purchase made for the Portfolio can be credited to the Investment Adviser's affiliate.
</TABLE>
