<PAGE> 1
TABLE OF CONTENTS
<TABLE>
<S> <C>
Letter to Shareholders........................... 1
Glossary of Terms................................ 5
Performance Results.............................. 7
Portfolio of Investments......................... 8
Statement of Assets and Liabilities.............. 11
Statement of Operations.......................... 12
Statement of Changes in Net Assets............... 13
Financial Highlights............................. 14
Notes to Financial Statements.................... 15
Dividend Reinvestment Plan....................... 19
</TABLE>
VKL SAR 6/98
<PAGE> 2
LETTER TO SHAREHOLDERS
May 22, 1998
Dear Shareholder,
The Taxpayer Relief Act of 1997,
signed into law by President Clinton
last year, was created to fill the need
for a broad variety of tax-advantaged
investments to promote asset growth. We [PHOTO]
are pleased that you selected our Trust
as a vehicle to provide the potential
for tax-free income within your
investment portfolio. As you are aware,
dividends distributed by the Trust are DENNIS J. MCDONNELL AND DON G. POWELL
generally free from federal income
taxes, and often from state and local
taxes as well. At Van Kampen American Capital, we strive not only for a high
level of current income, but total return performance as well.
ECONOMIC OVERVIEW
After nearly seven years of continuous growth, the economy remained buoyant
with few signs of accelerating inflation. Wholesale prices in the first quarter
plummeted at an annual rate of 4.2 percent, while consumer prices inched up 0.2
percent and employment costs rose just 0.7 percent. However, inflationary
pressures were eased by factors such as lower oil prices, increasing
productivity, and a pending budget surplus. The Asian financial crisis led to a
stronger dollar and a decline in the prices of Asian imports, which in turn has
discouraged price increases on competing U.S. goods.
To date, Asia's slowdown has had a modest impact on U.S. economic growth. In
the first quarter, the U.S. economy grew at a 4.2 percent annual rate, its
fastest pace in the past year. Strong consumer spending and inventory buildup by
manufacturers offset a decrease in exports to Asia. Despite the economy's
strength, the Federal Reserve Board refrained from raising interest rates, given
the lack of domestic inflationary pressure and concerns about Asia's economic
future.
MARKET OVERVIEW
Against the backdrop of benign inflation and no action by the Fed, U.S. bond
prices rose during the past six months, although they ended the reporting period
below the highs reached in early January.
The yield of the 30-year Treasury bond, which moves in the opposite
direction of its price, fell from 6.15 percent on October 31 to 5.95 percent on
April 30. Bond prices hit a record high as yields reached 5.69 percent in early
January amidst expectations that the Fed would cut interest rates, but the yield
went back to 6.00 percent in early March after the Fed chose not to act. Yields
were volatile for the rest of the reporting period, as
Continued on page two
1
<PAGE> 3
foreign investors sold U.S. Treasury holdings and investors began to fear that
the Fed was leaning toward a rate hike.
Municipal bond yields generally moved in unison with Treasuries but did not
gain nearly as much in price. By the end of the reporting period, the average
yield of AAA-rated, 30-year generic general obligation bonds was 5.14 percent,
two basis points above the yield posted on October 31 of last year. The
underperformance of municipal bonds can be attributed in part to heavy supply
that outpaced demand. Supply increased as state and local governments took
advantage of low interest rates by issuing bonds to refinance outstanding issues
with higher interest rates, as well as to fund new projects. In the first
quarter, long-term municipal issuance totaled $71 billion, up from $40 billion a
year earlier.
More than half of the new issue volume was AAA-rated and insured, which
significantly diminished the amount of uninsured, higher-yielding securities
available in the marketplace. The dominance of insured volume and the high
demand for uninsured paper created an imbalance that compressed the yields
between higher-quality and lower-quality bonds.
[CREDIT QUALITY GRAPH]
Portfolio Composition by Credit Quality
as of April 30, 1998*
<TABLE>
<S> <C>
AAA............ 57.4%
AA............. 14.4%
A.............. 12.7%
BBB............ 8.6%
BB............. 4.1%
B.............. 1.5%
Non-Rated...... 1.3%
</TABLE>
*As a Percentage of Long-Term Investments
Based upon the highest credit quality ratings as issued by Standard & Poor's
or Moody's.
TRUST STRATEGY
We used the following strategies to manage the Trust during the period:
We maintained a portfolio consisting primarily of high-quality bonds with a
heavy emphasis on AAA-rated securities. These bonds tend to generally have
performed better than lower-rated securities when interest rates are falling,
which was the case for most of the reporting period. However, they generally pay
lower yields than lesser-quality bonds.
Overall, we limited the number of acquisitions because current market yields
were below the average yield of bonds in the Trust. Most purchases focused on
enhancing the Trust's dividends, which is one of the primary investment
objectives of the Trust. We sold some AAA-rated insured bonds and bought A-rated
and AA-rated bonds, which typically paid higher yields. Some of the A-rated
bonds were insured by American Capital Access, a
Continued on page three
2
<PAGE> 4
new municipal bond insurer that backs lower-rated securities. Without this
insurance, the bonds would have been rated BBB.
We favored long-term current coupon bonds, priced at face value, because of
their relatively long durations. As a result of these purchases, which included
housing, hospital, and gaming bonds, we extended the call protection of the
Trust.
The duration of the Trust matched or exceeded its benchmark during the
reporting period. As of April 30, the duration of the Trust was 7.59 years,
compared with 7.76 years for the Lehman Brothers Municipal Bond Index. Because
of the longer-term nature of the Trust, the calculation of this index's duration
has been adjusted to eliminate bonds with maturities of five years or less.
TOP FIVE PORTFOLIO SECTORS AS OF APRIL 30, 1998*
Health Care....................... 17.5%
Transportation.................... 12.5%
Single Family Housing............. 11.5%
Higher Education.................. 11.0%
Airport........................... 8.0%
*As a Percentage of Long-Term Investments
PERFORMANCE SUMMARY
For the six-month period ended April 30, 1998, the Trust generated a total
return of 5.09 percent(1). This reflects a gain in market price per common share
from $11.750 on October 31, 1997, to $12.000 on April 30, 1998, plus
reinvestment of all dividends. The Trust had a tax-exempt distribution rate of
6.00 percent(3), based on the closing price of its common shares. Because income
from the Trust is exempt from federal income taxes, this distribution rate is
equivalent to a yield of 9.38 percent(4) on a taxable investment for investors
in the 36 percent federal income tax bracket.
As a result of an increase in Trust earnings, the Board of Trustees approved
an increase in its monthly dividend from $0.0575 to $0.0600 per common share,
first payable December 31, 1997. Please refer to the chart on page seven for
additional performance numbers.
Continued on page four
3
<PAGE> 5
[DIVIDEND HISTORY GRAPH]
Six-month Dividend History
For the Period Ended April 30, 1998
<TABLE>
<CAPTION>
Distribution per Common Share
<S> <C>
Nov 1997................ $.0575
Dec 1997................ $.0600
Jan 1998................ $.0600
Feb 1998................ $.0600
Mar 1998................ $.0600
Apr 1998................ $.0600
</TABLE>
The dividend history represents past performance of the Trust and does not
predict the Trust's future distributions.
ECONOMIC OUTLOOK
We expect the economy to slow from its brisk first-quarter pace, although
the extent of the slowdown depends on the continued effects of Asia's crisis and
on Fed policy. We believe the Fed is biased toward raising rates, given concerns
about the economy's increasing strength. If economic strength ignites
inflationary pressures, then we believe the Fed will raise interest rates later
this year. As a result, the yield of the 30-year Treasury bond could top 6.25
percent.
We will continue to track market developments and their effects on the
Trust. When appropriate, we will make adjustments to the portfolio. As we
mentioned earlier, our goal remains a high level of current income for
investors, plus gains in total return. Thank you for your continued support and
confidence in Van Kampen American Capital and the management of your Trust.
Sincerely,
[SIG]
Don G. Powell
Chairman
Van Kampen American Capital
Investment Advisory Corp.
[SIG]
Dennis J. McDonnell
President
Van Kampen American Capital
Investment Advisory Corp.
Please see footnotes on page seven
4
<PAGE> 6
GLOSSARY OF TERMS
BASIS POINT: A measure used in quoting bond yields. One hundred basis points is
equal to one percent. For example, if a bond's yield changes from 7.00 to 6.65
percent, it is a 35 basis point move.
CALL FEATURE: Allows the issuer to buy back a bond on specific call dates before
maturity. Call dates and prices are set when the bond is issued. To compensate
the bond holder for loss of income and ownership, the call price is usually
higher than the face value of the bond. Bonds are usually called when interest
rates drop so significantly that the issuer can save money by issuing new bonds
at lower rates.
A callable bond is "priced to call" when it is selling at a premium, because it
is assumed that the issuer will redeem the bond at its call date, rather than at
maturity.
COUPON RATE: The stated rate of interest a bond pays until maturity, expressed
as a percentage of its face value.
CREDIT RATING: An evaluation of an issuer's credit history and capability of
repaying obligations. Standard & Poor's and Moody's Investor Services are two
companies that assign bond ratings. Standard & Poor's ratings range from a high
of AAA to a low of D; Moody's ratings range from a high of Aaa to a low of D.
CREDIT SPREAD: The difference in yield between higher-quality issues and
lower-quality issues. Normally, lower-quality issues provide higher yields than
higher-quality issues in order to compensate investors for the additional credit
risk.
DISCOUNT BOND: A bond whose market price is lower than its face value (or "par
value"). Because bonds usually mature at face value, a discount bond has more
potential to appreciate in price than a par bond.
DURATION: A measure of the sensitivity of a bond's price to changes in interest
rates, expressed in years. Each year of duration represents an expected
one-percent change in the price of the bond for every one-percent change in
interest rates. The longer a fund's duration, the greater the effect of interest
rate movements on net asset value. Typically, funds with shorter durations have
performed better in rising rate environments, while funds with longer durations
have performed better when rates decline.
FEDERAL RESERVE BOARD (THE FED): A group that meets eight times a year to
establish monetary policy and monitor the economic pulse of the United States.
GENERAL OBLIGATION BONDS: Bonds backed by the full faith and credit (taxing
authority) of the issuer for timely payment of interest and principal. These
bonds are issued to finance essential government projects, such as highways and
schools.
5
<PAGE> 7
INFLATION: An economic situation in which money supply and business activity
dramatically increase, accompanied by sharply rising prices. Inflation is widely
measured by the Consumer Price Index, an economic indicator that measures the
change in the cost of purchased goods and services.
INSURED BOND: A bond that is insured against default by the municipal bond
insurer. If the issuer defaults, the insurance company will step in and take
over payments of interest and principal. As a result of this protection against
credit risk, most municipal bonds are AAA-rated. Insurance on the bonds does not
relate to mutual fund shares, which will fluctuate in price.
INVESTMENT GRADE BONDS: Securities rated BBB and above by Standard & Poor's or
Baa and above by Moody's Investor Services. Bonds rated below BBB or Baa are
noninvestment grade.
MARKET PRICE: The price of a share of a closed-end fund trading on a stock
exchange. When the price is less than a fund's NAV, the fund is trading at a
discount. When the price is more than the NAV, the fund is trading at a premium.
MUNICIPAL BOND: A debt security issued by a state, municipality, or other
governmental entity to finance capital expenditures such as the construction of
highways or public works.
NET ASSET VALUE (NAV): The value of a fund share, calculated by deducting a
fund's liabilities from its total assets and dividing this amount by the number
of shares outstanding.
PREREFUNDING: A process whereby new bonds are issued to refinance an outstanding
bond issue. This typically occurs when interest rates decline and an issuer
replaces its higher-yielding bonds with current lower-yielding issues.
PREMIUM BOND: A bond whose market price is above its face value (or "par
value"). Because bonds usually mature at face value, a premium bond has less
potential to appreciate in price than a par bond.
YIELD SPREAD: The difference between the yields of distinct bonds, due to
variant credit ratings or maturities. When yield spreads between bonds of
different credit quality are narrow, there is less incentive to own the
lower-quality bond. When yield spreads between bonds of different maturities are
narrow, there is less incentive to own the bond with the longer maturity. In
both cases, the investor is not being compensated for the additional risk.
ZERO COUPON BONDS: A corporate or municipal debt security that trades at a deep
discount to face value and pays no interest. It may be redeemed at maturity for
full face value.
6
<PAGE> 8
PERFORMANCE RESULTS FOR THE PERIOD ENDED APRIL 30, 1998
VAN KAMPEN AMERICAN CAPITAL SELECT SECTOR MUNICIPAL TRUST
(AMEX TICKER SYMBOL--VKL)
COMMON SHARE TOTAL RETURNS
<TABLE>
<S> <C>
Six-month total return based on market price(1)........... 5.09%
Six-month total return based on NAV(2).................... 2.99%
DISTRIBUTION RATES
Distribution rate as a % of closing common stock
price(3)................................................ 6.00%
Taxable-equivalent distribution rate as a % of closing
common stock price(4)................................... 9.38%
SHARE VALUATIONS
Net asset value........................................... $ 13.66
Closing common stock price................................ $ 12.000
Six-month high common stock price (01/13/98).............. $ 13.125
Six-month low common stock price (11/03/97)............... $11.6875
Preferred share (Series A) rate(5)........................ 3.690%
Preferred share (Series B) rate(5)........................ 3.500%
</TABLE>
(1) Total return based on market price assumes an investment at the market price
at the beginning of the period indicated, reinvestment of all distributions for
the period in accordance with the Trust's dividend reinvestment plan, and sale
of all shares at the closing common stock price at the end of the period
indicated.
(2) Total return based on net asset value (NAV) assumes an investment at the
beginning of the period indicated, reinvestment of all distributions for the
period, and sale of all shares at the end of the period, all at NAV.
(3) Distribution rate represents the monthly annualized distributions of the
Trust at the end of the period and not the earnings of the Trust.
(4) The taxable-equivalent distribution rate is calculated assuming a 36%
federal income tax bracket.
(5) See "Notes to Financial Statements" footnote #5, for more information
concerning Preferred Share reset periods.
A portion of the interest income may be taxable for those investors subject to
the federal alternative minimum tax (AMT).
Past performance does not guarantee future results. Investment return, stock
price and net asset value will fluctuate with market conditions. Trust shares,
when sold, may be worth more or less than their original cost.
7
<PAGE> 9
PORTFOLIO OF INVESTMENTS
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL BONDS 102.1%
ALASKA 1.5%
$1,500 Alaska St Hsg Fin Corp Ser A Rfdg............... 5.000% 12/01/18 $ 1,454,910
-----------
CALIFORNIA 8.8%
3,000 Los Angeles, CA Regl Arpts Impt Corp Lease Rev
Los Angeles Intl Arpt (FSA Insd)................ 6.700 01/01/22 3,238,800
3,900 Los Angeles Cnty, CA Metro Tran Auth Sales Tax
Rev Ser A Rfdg (FGIC Insd)...................... 5.000 07/01/21 3,739,632
1,500 Orange Cnty, CA Recovery Ctfs Partn Ser A (MBIA
Insd)........................................... 6.000 07/01/07 1,650,840
-----------
8,629,272
-----------
COLORADO 5.9%
1,000 Castle Rock, CO Multi-Family Rev Hsg Pines at
Castle Rock Ser A (FSA Insd).................... 6.100 12/01/16 1,042,670
1,871 Colorado Hsg Fin Auth Single Family Prog Sr
Ser E........................................... 8.125 12/01/24 2,055,658
2,500 Meridian Metro Dist CO Rfdg..................... 7.000 12/01/01 2,691,025
-----------
5,789,353
-----------
CONNECTICUT 1.1%
1,000 Connecticut St Dev Auth Wtr Fac Rev Bridgeport
Hydraulic....................................... 6.150 04/01/35 1,073,030
-----------
HAWAII 1.1%
1,000 Hawaii St Arpts Sys Rev (FGIC Insd) (b)......... 7.000 07/01/10 1,080,480
-----------
ILLINOIS 2.0%
1,000 Illinois Hlth Fac Auth Rev Ravenswood Hosp Med
Cent Ser A Rfdg................................. 8.800 06/01/06 1,017,990
2,500 Will Cnty, IL Cmnty Unit Sch Dist No 365U Vly
View Ser B (FSA Insd)........................... * 11/01/16 922,725
-----------
1,940,715
-----------
INDIANA 5.3%
3,450 Indiana Hlth Fac Fin Auth Hosp Rev Comm Hosp of
IN (MBIA Insd).................................. 6.850 07/01/22 3,773,438
1,460 Indiana Univ Revs Student Fee Ser L (a)......... 5.000 08/01/17 1,409,134
-----------
5,182,572
-----------
IOWA 1.5%
1,500 Des Moines, IA Aviation Sys Rev Ser B (FSA Insd)
(a)............................................. 5.125 07/01/28 1,425,975
-----------
KENTUCKY 5.5%
1,280 Kenton Cnty, KY Arpt Brd Arpt Rev
Cincinnati/Nrthn KY Intl Ser A Rfdg (MBIA
Insd)........................................... 6.100 03/01/07 1,400,512
4,000 Louisville & Jefferson Cnty, KY Metro Swr Dist
Drainage Rev Rfdg (MBIA Insd)................... 5.300 05/15/19 3,984,840
-----------
5,385,352
-----------
LOUISIANA 5.9%
1,750 Saint Charles Parish, LA Environmental Impt Rev
LA Pwr & Lt Co Proj A (AMBAC Insd).............. 6.875 07/01/24 1,949,973
3,500 Saint Charles Parish, LA Pollutn Ctl Rev LA Pwr
& Lt Co Proj A (FSA Insd) (b)................... 7.500 06/01/21 3,830,470
-----------
5,780,443
-----------
</TABLE>
See Notes to Financial Statements
8
<PAGE> 10
PORTFOLIO OF INVESTMENTS (CONTINUED)
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MAINE 4.2%
$4,000 Maine Muni Bond Bk Ser A Rfdg................... 5.375% 11/01/08 $ 4,156,080
-----------
MASSACHUSETTS 2.9%
1,495 Massachusetts St Hlth & Edl Fac Auth Rev Saint
Mem Med Cent Ser A.............................. 6.000 10/01/23 1,496,674
1,235 Massachusetts St Indl Fin Agy Rev (b)........... 6.750 12/01/20 1,349,620
-----------
2,846,294
-----------
MICHIGAN 5.6%
1,580 Michigan Higher Edl Fac Auth Ltd Oblig Rev Hope
College Rfdg (Connie Lee Insd).................. 7.000 10/01/13 1,769,584
1,000 Michigan St Hosp Fin Auth Rev Ref Hosp
Genesys......................................... 5.500 10/01/27 997,060
2,500 Michigan St Strategic Fund Ltd Oblig Rev Detroit
Edison Co College Rfdg (FGIC Insd).............. 6.950 09/01/21 2,712,000
-----------
5,478,644
-----------
MISSOURI 5.6%
3,855 Missouri St Hlth & Edl Fac Auth Hlth Fac Rev SSM
Hlthcare Ser AA Rfdg (MBIA Insd)................ 6.400 06/01/10 4,417,367
1,000 St Charles Cnty, MO Indl Dev Auth Indl Rev Dev
Westchester Vlg Apts Ser A Rfdg (FNMA Insd)..... 6.150 02/01/27 1,050,770
-----------
5,468,137
-----------
MONTANA 1.0%
1,000 Crow Fin Auth MT Tribal Purp Rev................ 5.650 10/01/17 1,002,450
-----------
NEVADA 1.9%
1,755 Nevada Hsg Div Single Family Prog Ser E (FHA
Gtd)............................................ 6.900 10/01/14 1,878,201
-----------
NEW JERSEY 4.5%
2,845 East Orange, NJ Brd of Educ Ctfs Partn Cap
Apprec (FSA Insd)............................... * 08/01/22 796,458
1,340 New Jersey Econ Dev Auth Dist Heating & Cooling
Rev Trigen Trenton Proj Ser A................... 6.200 12/01/10 1,415,308
2,000 New Jersey Hlthcare Fac Fin Auth Rev Genl Hosp
Cent at Passaic (FSA Insd) (b).................. 6.000 07/01/14 2,196,120
-----------
4,407,886
-----------
NEW YORK 14.5%
2,000 New York City, NY Hsg Dev Corp Mtg Rev
Multi-Family Ser A Rfdg (FHA Gtd)............... 6.550 10/01/15 2,126,200
865 New York City, NY Ser H (Prerefunded @ 02/01/02)
(FSA Insd)...................................... 7.000 02/01/21 957,019
135 New York City, NY Ser H (FSA Insd).............. 7.000 02/01/21 147,598
1,000 New York, NY Adj-SubSer A-1 (Embedded Swap)..... 5.225 08/01/12 1,020,640
4,000 New York St Dorm Auth Rev City Univ Ser F....... 5.000 07/01/14 3,824,440
2,500 New York St Dorm Auth Rev St Univ Edl Fac Ser B
Rfdg............................................ 5.250 05/15/09 2,566,350
3,100 New York St Med Care Fac Fin Agy Rev NY Hosp Ser
A (Prerefunded @ 02/15/05) (AMBAC Insd)......... 6.800 08/15/24 3,557,064
-----------
14,199,311
-----------
</TABLE>
See Notes to Financial Statements
9
<PAGE> 11
PORTFOLIO OF INVESTMENTS (CONTINUED)
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OHIO 2.4%
$1,500 Akron, OH Ctfs Partn Akron Muni Baseball Stad
Proj (c)........................................ 0/6.900% 12/01/16 $ 1,325,205
1,000 Cleveland, OH Airport Spl Rev Ref - Continental
Airlines, Inc (a)............................... 5.700 12/01/19 977,480
-----------
2,302,685
-----------
OKLAHOMA 2.3%
2,000 Oklahoma Hsg Fin Agy Single Family Mtg Rev
Homeownership Ln Pgm Ser A (GNMA
Collateralized)................................. 7.050 09/01/26 2,221,300
-----------
TEXAS 8.9%
3,000 Houston, TX Apts Sys Rev Spl Facs Continental
Airls Ser B..................................... 6.125 07/15/27 3,131,550
1,425 Tarrant Cnty, TX Jr College Dist................ 5.050 02/15/10 1,442,043
2,730 Texas Hsg Agy Res Dev Rev Mtg Ser D (GMNA
Collateralized)................................. 8.400 01/01/21 2,842,258
1,240 Texas St Higher Edl Coordinating Brd College
Student Ln Rev Sr Lien.......................... 7.700 10/01/25 1,330,036
-----------
8,745,887
-----------
VIRGINIA 3.1%
2,885 Fairfax Cnty, VA Econ Dev Auth Res Recovery Rev
Ogden Martin Sys Ser A.......................... 7.750 02/01/11 3,039,492
-----------
WISCONSIN 1.0%
940 Wisconsin Hsg & Econ Dev Auth Homeownership Rev
Ser F........................................... 7.550 07/01/26 1,010,848
-----------
PUERTO RICO 5.6%
4,800 Puerto Rico Comwlth Hwy & Tran Auth Hwy Rev Ser
Y (Embedded Cap) (FSA Insd)..................... 5.730 07/01/21 5,496,912
-----------
TOTAL INVESTMENTS 102.1%
(Cost $91,878,855).......................................................... 99,996,229
LIABILITIES IN EXCESS OF OTHER ASSETS (2.1%)................................. (2,023,189)
-----------
NET ASSETS 100.0%............................................................ $97,973,040
===========
</TABLE>
*Zero coupon bond
(a) Security purchased on a when issued or delayed delivery basis.
(b) Assets segregated as collateral for when issued or delayed delivery purchase
commitments.
(c) Security is currently a zero coupon bond which will convert to a coupon
paying bond at a predetermined date.
See Notes to Financial Statements
10
<PAGE> 12
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Total Investments (Cost $91,878,855)........................ $ 99,996,229
Cash........................................................ 337,800
Receivables:
Interest.................................................. 1,732,560
Investments Sold.......................................... 49,270
Unamortized Organizational Costs............................ 4,571
------------
Total Assets.......................................... 102,120,430
------------
LIABILITIES:
Payables:
Investments Purchased..................................... 3,838,415
Income Distributions -- Common and Preferred Shares....... 82,102
Investment Advisory and Administrative Fees............... 56,773
Affiliates................................................ 9,160
Trustees' Deferred Compensation and Retirement Plans........ 83,587
Accrued Expenses............................................ 77,353
------------
Total Liabilities..................................... 4,147,390
------------
NET ASSETS.................................................. $ 97,973,040
============
NET ASSETS CONSIST OF:
Preferred Shares ($.01 par value, authorized 100,000,000
shares, 1,360 issued with liquidation preference of
$25,000 per share)........................................ $ 34,000,000
------------
Common Shares ($.01 par value with an unlimited number of
shares authorized, 4,682,128 shares issued and
outstanding).............................................. 46,821
Paid in Surplus............................................. 64,532,602
Net Unrealized Appreciation................................. 8,117,374
Accumulated Undistributed Net Investment Income............. 415,371
Accumulated Net Realized Loss............................... (9,139,128)
------------
Net Assets Applicable to Common Shares................ 63,973,040
------------
NET ASSETS.................................................. $ 97,973,040
============
NET ASSET VALUE PER COMMON SHARE ($63,973,040 divided by
4,682,128 shares outstanding)............................. $ 13.66
============
</TABLE>
See Notes to Financial Statements
11
<PAGE> 13
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................... $ 2,768,179
-----------
EXPENSES:
Investment Advisory and Administrative Fees................. 342,622
Preferred Share Maintenance................................. 58,302
Trustees' Fees and Expenses................................. 15,710
Custody..................................................... 6,066
Legal....................................................... 5,792
Amortization of Organizational Costs........................ 3,966
Other....................................................... 47,606
-----------
Total Expenses.......................................... 480,064
-----------
NET INVESTMENT INCOME....................................... $ 2,288,115
===========
REALIZED AND UNREALIZED GAIN/LOSS:
Net Realized Gain........................................... $ 204,741
-----------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... 8,054,424
End of the Period:
Investments............................................. 8,117,374
-----------
Net Unrealized Appreciation During the Period............... 62,950
-----------
NET REALIZED AND UNREALIZED GAIN............................ $ 267,691
===========
NET INCREASE IN NET ASSETS FROM OPERATIONS.................. $ 2,555,806
===========
</TABLE>
See Notes to Financial Statements
12
<PAGE> 14
STATEMENT OF CHANGES IN NET ASSETS
For the Six Months Ended April 30, 1998 and
the Year Ended October 31, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1998 October 31, 1997
- --------------------------------------------------------------------------------------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.................................. $ 2,288,115 $ 4,591,904
Net Realized Gain...................................... 204,741 279,156
Net Unrealized Appreciation During the Period.......... 62,950 2,777,932
----------- -----------
Change in Net Assets from Operations................... 2,555,806 7,648,992
----------- -----------
Distributions from Net Investment Income:
Common Shares........................................ (1,673,801) (3,230,569)
Preferred Shares..................................... (609,878) (1,222,604)
----------- -----------
Total Distributions.................................... (2,283,679) (4,453,173)
----------- -----------
NET CHANGE IN NET ASSETS FROM INVESTMENT ACTIVITIES.... 272,127 3,195,819
NET ASSETS:
Beginning of the Period................................ 97,700,913 94,505,094
----------- -----------
End of the Period (Including accumulated undistributed
net investment income of $415,371 and $410,935,
respectively)........................................ $97,973,040 $97,700,913
=========== ===========
</TABLE>
See Notes to Financial Statements
13
<PAGE> 15
FINANCIAL HIGHLIGHTS
The following schedule presents financial highlights for one common share of
the Trust outstanding throughout the periods indicated. (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
November 26, 1993
(Commencement
Six Months Year Ended October 31, of Investment
Ended ------------------------------------ Operations) to
April 30, 1998 1997 1996 1995 October 31, 1994
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning
of the Period (a)....... $13.605 $12.923 $12.828 $11.507 $13.783
------- ------- ------- ------- -------
Net Investment Income..... .489 .981 .983 .992 .894
Net Realized and
Unrealized Gain/Loss.... .057 .652 .068 1.391 (2.377)
------- ------- ------- ------- -------
Total from Investment
Operations.............. .546 1.633 1.051 2.383 (1.483)
------- ------- ------- ------- -------
Less Distributions from
Net Investment Income:
Paid to Common
Shareholders.......... .358 .690 .693 .774 .621
Common Share Equivalent
of Distributions Paid
to Preferred
Shareholders.......... .130 .261 .263 .288 .172
------- ------- ------- ------- -------
Total Distributions....... .488 .951 .956 1.062 .793
------- ------- ------- ------- -------
Net Asset Value, End of
the Period.............. $13.663 $13.605 $12.923 $12.828 $11.507
======= ======= ======= ======= =======
Market Price Per Share at
End of the Period....... $12.000 $11.750 $10.625 $10.750 $9.625
Total Investment Return at
Market Price (b)........ 5.09%* 17.46% 5.35% 19.87% (27.90%)*
Total Return at Net Asset
Value (c)............... 2.99%* 11.01% 6.29% 18.75% (14.18%)*
Net Assets at End of the
Period (In millions).... $98.0 $97.7 $94.5 $94.1 $87.9
Ratio of Expenses to
Average Net Assets
Applicable to Common
Shares**................ 1.50% 1.53% 1.55% 1.68% 1.58%
Ratio of Net Investment
Income to Average Net
Assets Applicable to
Common Shares (d)....... 5.23% 5.50% 5.62% 5.77% 6.06%
Portfolio Turnover........ 25%* 39% 47% 84% 224%*
* Non-Annualized
**Ratio of Expenses to
Average Net Assets
Including Preferred
Shares.................. .98% .99% .99% 1.05% 1.04%
</TABLE>
(a) Net Asset Value at November 26, 1993, is adjusted for common and preferred
share offering costs of $.317 per common share.
(b) Total Investment Return at Market Price reflects the change in market value
of the common shares for the period indicated with reinvestment of dividends
in accordance with the Trust's dividend reinvestment plan.
(c) Total Return at Net Asset Value (NAV) reflects the change in value of the
Trust's assets with reinvestment of dividends based upon NAV.
(d) Net Investment Income is adjusted for the common share equivalent of
distributions paid to preferred shareholders.
See Notes to Financial Statements
14
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen American Capital Select Sector Municipal Trust (the "Trust") is
registered as a non-diversified closed-end management investment company under
the Investment Company Act of 1940, as amended. The Trust's primary investment
objective is to provide a high level of current income exempt from federal
income tax, consistent with preservation of capital. The Trust will invest
primarily in a portfolio of municipal securities from those market sectors which
the Adviser feels will best meet the Trust's investment objective. The Trust
commenced investment operations on November 26, 1993.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. SECURITY VALUATION--Investments are stated at value using market quotations
or, if such valuations are not available, estimates obtained from yield data
relating to instruments or securities with similar characteristics in accordance
with procedures established in good faith by the Board of Trustees. Short-term
securities with remaining maturities of 60 days or less are valued at amortized
cost.
B. SECURITY TRANSACTIONS--Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when issued" or "delayed delivery"
basis with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
maintain, in a segregated account with its custodian, assets having an aggregate
value at least equal to the amount of the when issued or delayed delivery
purchase commitments until payment is made.
C. INVESTMENT INCOME--Interest income is recorded on an accrual basis. Bond
premium and original issue discount are amortized over the expected life of each
applicable security.
D. ORGANIZATIONAL COSTS--The Trust has reimbursed Van Kampen American Capital
Distributors, Inc. or its affiliates (collectively "VKAC") for costs incurred in
connection with
15
<PAGE> 17
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
the Trust's organization in the amount of $40,000. These costs are being
amortized on a straight line basis over the 60 month period ending November 25,
1998. Van Kampen American Capital Investment Advisory Corp. (the "Adviser") has
agreed that in the event any of the initial shares of the Trust originally
purchased by VKAC are redeemed during the amortization period, the Trust will be
reimbursed for any unamortized organizational costs in the same proportion as
the number of shares redeemed bears to the number of initial shares held at the
time of redemption.
E. FEDERAL INCOME TAXES--It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required.
The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At October 31, 1997, the Trust had an accumulated capital loss
carryforward for tax purposes of $9,343,869 which will expire between October
31, 2002 and October 31, 2003.
At April 30, 1998, for federal income tax purposes, cost of long-term
investments is $91,878,855; the aggregate gross unrealized appreciation is
$8,130,135 and the aggregate gross unrealized depreciation is $12,761, resulting
in net unrealized appreciation of $8,117,374.
F. DISTRIBUTION OF INCOME AND GAINS--The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually on a pro rata basis to common and preferred
shareholders.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory and Administrative Agreement,
the Adviser will provide investment advice, administrative services and
facilities to the Trust for an annual fee payable monthly of .70% of the average
net assets of the Trust.
For the six months ended April 30, 1998, the Trust recognized expenses of
approximately $1,100 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom (Illinois), counsel to the Trust, of which a trustee of
the Trust is an affiliated person.
16
<PAGE> 18
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
For the six months ended April 30, 1998, the Trust recognized expenses of
approximately $6,000 representing VKAC's cost of providing accounting and legal
services to the Trust.
Certain officers and trustees of the Trust are also officers and directors
of VKAC. The Trust does not compensate its officers or trustees who are officers
of VKAC.
The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of VKAC. Under the deferred compensation plan,
trustees may elect to defer all or a portion of their compensation to a later
date. Benefits under the retirement plan are payable for a ten-year period and
are based upon each trustee's years of service to the Trust. The maximum annual
benefit per trustee under the plan is $2,500.
At April 30, 1998, VKAC owned 7,128 common shares of the Trust.
3. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $25,172,465 and $25,873,489,
respectively.
4. DERIVATIVE FINANCIAL INSTRUMENTS
A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
The Trust has a variety of reasons to use derivative instruments, such as to
attempt to protect the Trust against possible changes in the market value of its
portfolio and to manage the portfolio's effective yield, maturity and duration.
All of the Trust's portfolio holdings, including derivative instruments, are
marked to market each day with the change in value reflected in the unrealized
appreciation/depreciation. Upon disposition, a realized gain or loss is
recognized accordingly, except when taking delivery of a security underlying a
futures contract. In this instance, the recognition of gain or loss is postponed
until the disposal of the security underlying the futures contract.
The following types of indexed securities are identified in the portfolio of
investments. The price of these securities may be more volatile than the price
of a comparable fixed rate security.
A. EMBEDDED CAPS--These securities include a cap strike level such that the
coupon payment may be supplemented by cap payments if the floating rate index
upon which the cap is based rises above the strike level. The Trust invests in
these instruments as a hedge against a rise in the short term interest rates
which it pays on its preferred shares.
17
<PAGE> 19
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
B. EMBEDDED SWAPS--These securities include a swap component such that the fixed
coupon component of the underlying bond is adjusted by the difference between
the securities fixed swap rate and the floating swap index. The Trust invests in
these instruments as a hedge against a rise in the short-term interest rates
which it pays on its preferred shares.
5. PREFERRED SHARES
The Trust has outstanding 1,360 Auction Preferred Shares ("APS") in two series
of 680 shares each. Dividends are cumulative and the dividend rate is
periodically reset through an auction process. The dividend period for Series A
is 7 days while Series B is 28 days. The average rate in effect on April 30,
1998, was 3.595%. During the six months ended April 30, 1998, the rates ranged
from 3.100% to 4.250%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of Preferred Share Maintenance
expense.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
18
<PAGE> 20
DIVIDEND REINVESTMENT PLAN
The Trust offers a Dividend Reinvestment Plan (the "Plan") pursuant to which
Common Shareholders may elect to have dividends and capital gains distributions
automatically reinvested in Common Shares of the Trust.
If you decide to participate in the Plan, State Street Bank and Trust
Company, as your Plan Agent, will automatically invest your dividends and
capital gains distributions in Common Shares of the Trust for your account.
HOW TO PARTICIPATE
If you wish to participate and your shares are held in your own name, call
1-800-341-2929 for more information and a Plan brochure. If your shares are held
in the name of a brokerage firm, bank, or other nominee, you should contact your
nominee to see if it would participate in the Plan on your behalf. If you wish
to participate in the Plan, but your brokerage firm, bank or nominee is unable
to participate on your behalf, you should request that your shares be
re-registered in your own name which will enable your participation in the Plan.
HOW THE PLAN WORKS
State Street Bank and Trust Company, as your Plan Agent, serves as agent for the
Common Shareholders in administering the Plan. After the Trust declares a
dividend or determines to make a capital gains distribution, the Plan Agent
will, as agent for the participants, receive the cash payment and use it to buy
Common Shares in the open market, on the American Stock Exchange or elsewhere,
for the participants' accounts. The Trust will not issue any new Common Shares
in connection with the Plan. All reinvestments are in full and fractional Common
Shares, carried to three decimal places.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
change sent to all Common Shareholders of the Trust at least 90 days before the
record date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent by at least 90 days written notice to all Common
Shareholders of the Trust.
COSTS OF THE PLAN
The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. No other charges will be made to participants for reinvesting
dividends or capital gains distributions, except for certain brokerage
commissions, as described above.
TAX IMPLICATIONS
You will receive tax information annually for your personal records and to help
you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income tax
which may be payable on dividends or distributions.
RIGHT TO WITHDRAW
Plan participants may withdraw at any time by calling 1-800-341-2929 or by
writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA
02266-8200. If you withdraw, you will receive, without charge, a share
certificate issued in your name for all full Common Shares credited to your
account under the Plan and a cash payment will be made for any fractional Common
Share credited to your account under the Plan. You may again elect to
participate in the Plan at any time by calling 1-800-341-2929 or writing to the
Trust at:
Van Kampen American Capital
Attn: Closed-End Funds
2800 Post Oak Blvd.
Houston, TX 77056
19
<PAGE> 21
FUNDS DISTRIBUTED BY VAN KAMPEN AMERICAN CAPITAL
EQUITY FUNDS
Domestic
MS Aggressive Equity
VKAC Aggressive Growth
MS American Value
VKAC Comstock
VKAC Emerging Growth
VKAC Enterprise
VKAC Equity Income
VKAC Growth
VKAC Growth and Income
VKAC Harbor
VKAC Pace
VKAC Real Estate Securities
MS U.S. Real Estate
VKAC Utility
MS Value
International/Global
MS Asian Growth
MS Emerging Markets
MS Global Equity
MS Global Equity Allocation
VKAC Global Managed Assets
MS International Magnum
MS Latin American
FIXED-INCOME FUNDS
Income
VKAC Corporate Bond
MS Global Fixed Income
VKAC Global Government Securities
VKAC Government Securities
VKAC High Income Corporate Bond
MS High Yield
VKAC High Yield
VKAC Short-Term Global Income
VKAC Strategic Income
VKAC U.S. Government
VKAC U.S. Government Trust for Income
MS Worldwide High Income
Tax Exempt Income
VKAC California Insured Tax Free
VKAC Florida Insured Tax Free Income
VKAC High Yield Municipal
VKAC Insured Tax Free Income
VKAC Intermediate Term Municipal Income
VKAC Municipal Income
VKAC New York Tax Free Income
VKAC Pennsylvania Tax Free Income
VKAC Tax Free High Income
Capital Preservation
VKAC Limited Maturity Government
VKAC Prime Rate Income Trust
VKAC Reserve
VKAC Senior Floating Rate
VKAC Tax Free Money
To find out more about any of these funds, ask your financial adviser for a
prospectus, which contains more complete information, including sales
charges, risks, and expenses. Please read it carefully before you invest or
send money.
To view a current Van Kampen American Capital or Morgan Stanley fund
prospectus or to receive additional fund information, choose from one of the
following:
- visit our web site at WWW.VKAC.COM -- to view prospectuses, select
Investors' Place, then Download a Prospectus
- call us at 1-800-341-2911 weekdays from 7:00 a.m. to 7:00 p.m. Central time
(Telecommunications Device for the Deaf users, call 1-800-421-2833)
- e-mail us by visiting WWW.VKAC.COM and selecting Investors' Place
20
<PAGE> 22
VAN KAMPEN AMERICAN CAPITAL SELECT SECTOR MUNICIPAL TRUST
BOARD OF TRUSTEES
DAVID C. ARCH
ROD DAMMEYER
HOWARD J KERR
DENNIS J. MCDONNELL*--Chairman
STEVEN MULLER
THEODORE A. MYERS
DON G. POWELL*
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN*
OFFICERS
DENNIS J. MCDONNELL*
President
RONALD A. NYBERG*
Vice President and Secretary
EDWARD C. WOOD, III*
Vice President and Chief Financial Officer
CURTIS W. MORELL*
Vice President and Chief Accounting Officer
JOHN L. SULLIVAN*
Treasurer
TANYA M. LODEN*
Controller
PETER W. HEGEL*
Vice President
INVESTMENT ADVISER
VAN KAMPEN AMERICAN CAPITAL
INVESTMENT ADVISORY CORP.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
CUSTODIAN AND TRANSFER AGENT
STATE STREET BANK
AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02105
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM (ILLINOIS)
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT ACCOUNTANTS
KPMG PEAT MARWICK LLP
Peat Marwick Plaza
303 East Wacker Drive
Chicago, Illinois 60601
* "Interested" persons of the Trust, as defined in
the Investment Company Act of 1940.
(C) Van Kampen American Capital Distributors, Inc., 1998
All rights reserved.
(SM) denotes a service mark of
Van Kampen American Capital Distributors, Inc.
21
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 11
<NAME> SELECT SECTOR MUNICIPAL TRUST
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-START> NOV-01-1997
<PERIOD-END> APR-30-1998
<INVESTMENTS-AT-COST> 91,878,855
<INVESTMENTS-AT-VALUE> 99,996,229
<RECEIVABLES> 1,781,830
<ASSETS-OTHER> 4,571
<OTHER-ITEMS-ASSETS> 337,800
<TOTAL-ASSETS> 102,120,430
<PAYABLE-FOR-SECURITIES> 3,838,415
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 308,975
<TOTAL-LIABILITIES> 4,147,390
<SENIOR-EQUITY> 34,000,000
<PAID-IN-CAPITAL-COMMON> 64,579,423
<SHARES-COMMON-STOCK> 4,682,128
<SHARES-COMMON-PRIOR> 4,682,128
<ACCUMULATED-NII-CURRENT> 415,371
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (9,139,128)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 8,117,374
<NET-ASSETS> 97,973,040
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 2,768,179
<OTHER-INCOME> 0
<EXPENSES-NET> (480,064)
<NET-INVESTMENT-INCOME> 2,288,115
<REALIZED-GAINS-CURRENT> 204,741
<APPREC-INCREASE-CURRENT> 62,950
<NET-CHANGE-FROM-OPS> 2,555,806
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,283,679)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 272,127
<ACCUMULATED-NII-PRIOR> 410,935
<ACCUMULATED-GAINS-PRIOR> (9,343,869)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 267,328
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 480,064
<AVERAGE-NET-ASSETS> 98,703,277
<PER-SHARE-NAV-BEGIN> 13.605
<PER-SHARE-NII> 0.489
<PER-SHARE-GAIN-APPREC> 0.057
<PER-SHARE-DIVIDEND> (0.488)
<PER-SHARE-DISTRIBUTIONS> 0.000
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 13.663
<EXPENSE-RATIO> 1.50
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
