<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
Two World Trade Center
New York, New York 10048
DEAR SHAREHOLDER:
- --------------------------------------------------------------------------------
For the six-month period ended July 31, 1996, TCW/DW Emerging Markets
Opportunities Trust registered a total return of -2.89 percent, based on net
asset value (NAV) with dividends reinvested. Based on the Trust's market price
on the New York Stock Exchange, the Trust's total return was -17.00 percent. The
Trust's NAV performance exceeded that of the International Finance Corporation
(IFC) Investable Emerging Markets Total Return Index, which registered a total
return of -3.35 percent.
MARKET OVERVIEW
The emerging markets posted mixed results for the period under review,
attributable primarily to concerns over the direction of U.S. interest rates.
While the Latin America region outperformed both the Asia-Pacific region and the
overall emerging markets composite, significant gains were also posted by
countries outside Latin America, including India, Taiwan, Portugal, Russia and
the Czech Republic.
SECTORS
ASIA
The emerging Asia-Pacific markets (in which approximately 49 percent of the
Trust's total assets are invested) declined nearly eight percent overall for the
period, as capital inflows fell from the high levels experienced in January,
when easing global liquidity conditions appeared favorable and price/earnings
ratios reached seven-year lows. The Asian equity markets were affected by both
external and internal factors as risk of an increase in U.S. interest rates
reduced the attractiveness of equities and as regional export growth continued
to moderate, particularly in Singapore and Thailand. Furthermore, the weakening
of the Japanese yen produced mixed results in the region, positively impacting
those companies with yen-dominated debt, but hurting the export competitiveness
of some countries. On the upside, the Trust's investment adviser, TCW Funds
Management, Inc. (TCW), believes that the economic acceleration in China and
Japan, coupled with a synchronized global economic recovery in 1997, should
strengthen prospects for Asian export growth.
LATIN AMERICA
The Latin American equity markets (approximately 38 percent of the Trust's
total assets) rose a modest one percent overall for the period, according to the
IFC Investable Latin America Total Return Index. Over the first six months of
the year, Latin American stock markets rallied nearly 16 percent, with a
particularly strong showing in January. In July, however, these markets
experienced substantial profit taking, in concert with the correction in the
U.S. stock market. The strong capital inflows and renewed investor interest in
the region in 1996 are the result of an improved earnings growth outlook.
Corporate earnings growth has been robust, with growth rates in the high teens
expected this year. Also, a large number of Latin American companies have been
able to sell their stock in the international markets. The attractiveness of
these companies is evidenced by the strong interest among managers of mutual
funds that are not dedicated to the emerging markets.
EUROPE/AFRICA
The European emerging markets (approximately seven percent of the Trust's
total assets) also posted mixed results over the past six months. The equity
markets in Russia, the Czech Republic and Portugal rose 99 percent, 19 percent
and 12 percent, respectively, on positive political and economic news, while the
markets in Greece and Turkey posted declines of four percent and five percent,
respectively. The South African equity
<PAGE>
market fell 23 percent on concerns that the anticipated relaxation of foreign
exchange controls may trigger capital outflows -- thus putting pressure on that
nation's currency, the rand.
THE PORTFOLIO
The Trust's portfolio is overweighted in Southeast Asia because of the
investment adviser's expectation of a soft-landing for most countries in this
region. Exposure to cyclical and export sectors in Asia has also been increased
as the economies of China and Japan have accelerated.
The Trust benefited from its largest country allocation, Malaysia, where
equities rose nearly four percent over the six-month period ended July 31, 1996.
The investment adviser has also increased the Trust's exposure to the
Philippines, where years of fiscal prudence, deregulation and limited monetary
expansion are yielding encouraging economic results. The Trust's holdings there
are currently focused on the banking sector. Structural and political concerns
have led the investment adviser to underweight investments in Thailand and
Indonesia.
The investment adviser continues to be optimistic regarding the potential
for further gains by Latin American equities. With economic recovery and
attractive valuations expected, the Trust remains overweighted in Mexico. The
Trust's second largest position in Latin America is Brazil, where the Trust
invests primarily in state-owned companies. Tariff adjustments, industry
deregulation and in some instances, privatization has substantially improved the
outlook for these companies. The Trust has gradually increased its exposure to
Chile on the basis of attractive earnings growth -- nearly 20 percent in
U.S.-dollar terms. The Trust is also optimistic about Peru, where the investment
adviser believes an economic slowdown may have bottomed and prospects for a
rebound later this year and early in 1997 are improving. The investment adviser
is neutral in Colombia, where ongoing political difficulties could result in a
deterioration of economic fundamentals.
In the emerging European markets, the investment adviser has increased the
Trust's holdings in Greece and Turkey, and has entered the Russian and Czech
markets. The Trust has reduced its exposure to South African equities (to less
than 2 percent of total assets from approximately 10 percent), as the
government's strategy with respect to easing foreign exchange controls has
undermined the stability of the country's currency.
OUTLOOK
Despite a lackluster second quarter, Asian corporate earnings are expected
to recover in the second half of 1996, and the investment adviser believes the
coming year will see a synchronized global economic recovery. The investment
adviser expects investors will continue taking profits in Malaysia, leading to
further near-term market consolidation. Although there may be a short-term rise
in the Thai equity market, the investment adviser is more cautious over the
medium- and longer-term as political and economic uncertainties continue and as
corporate earnings remain below expectations. Despite robust corporate earnings
in Indonesia, political uncertainties in the run-up to next year's parliamentary
elections and the presidential election in 1998 may dampen long-term performance
and, as a result, capital inflows. On the upside, despite some concerns over
tax-related issues, the investment adviser remains cautiously optimistic about
the outlook for Philippine equities given the country's strong economic
fundamentals. Going forward, some emphasis will likely be placed on Northeast
Asia, as the Taiwanese government begins to take measures to stimulate the
economy, and as valuations in Korea become attractive. Further, the investment
adviser is paying close attention to the China-Hong Kong situation, and believes
that the transition in Hong Kong will be more successful than expected.
The investment adviser believes that the already-improving economic
fundamentals throughout much of Latin America may gain further momentum in the
second half of 1996. The investment adviser continues to focus on Mexico, as
signs that an economic recovery is underway continue to grow. Overall Latin
American
<PAGE>
earnings growth rates continue to improve and market multiples expand as
investors regain confidence in this region.
After several years of declining economic growth, many of the Eastern
European economies are beginning to rebound, which is expected to translate into
strong gains in corporate earnings. Although the investment adviser does not
foresee any further declines in South African equity prices, they do expect the
equity market to underperform the bond market in the near term, as slower
economic growth results in decelerating corporate earnings, and as market
multiples -- that is, the price investors pay for a company's earning power --
remain high.
We would like to remind you that the Trustees have approved a procedure
whereby the Trust, when appropriate, may purchase shares in the open market or
in privately negotiated transactions at a price not above market value or net
asset value, whichever is lower at the time of purchase. During the six-month
period ended July 31, 1996, the Trust purchased and retired 42,500 shares of
common stock at a weighted average market discount of 18.15 percent.
CONCLUSION
Even though the story of emerging markets is about longer-term economic
growth, rather than short-term volatility, it must be acknowledged that 1996 has
been a difficult year thus far. For the first time in several years, the
sustainability of strong economic growth in Asia has been questioned. However,
despite the recent slowdown, Asia remains the fastest-growing region in the
emerging markets arena. On the upside, the implementation of orthodox economic
policies has resulted in sound economic growth in Latin America and Eastern
Europe. TCW believes that relatively strong growth will be maintained in the
emerging markets as economic growth in Japan and the developed countries of
Europe progresses.
In closing, we are pleased to report that in July Terence F. Mahony joined
the Trust's portfolio management team. Mr. Mahony joined TCW this year to head
up its emerging markets equity strategies group. He was most recently Chief
Investment Officer for Global Emerging Markets at HSBC Asset Management. Prior
to that he was a Director at Baring Asset Management, where he was responsible
for Latin American equities.
We appreciate your support of TCW/DW Emerging Markets Opportunities Trust
and look forward to continuing to serve your investment needs and objectives.
Very truly yours,
[SIG]
Charles A. Fiumefreddo
CHAIRMAN OF THE BOARD
<PAGE>
On June 27, 1996, an annual meeting of the Trust's shareholders was held for the
purpose of voting on five separate matters, the results of which were as
follows:
(1) ELECTION OF TRUSTEES:
<TABLE>
<S> <C>
John R. Haire
For.......................................................... 11,445,394
Withheld..................................................... 357,805
Dr. Manuel H. Johnson
For.......................................................... 11,447,201
Withheld..................................................... 355,998
John L. Schroeder
For.......................................................... 11,447,247
Withheld..................................................... 355,952
Marc I. Stern
For.......................................................... 11,446,850
Withheld..................................................... 356,349
</TABLE>
The following Trustees were not standing for reelection at this meeting:
John C. Argue, Richard M. DeMartini, Charles A. Fiumefreddo, Paul Kolton,
Thomas E. Larkin, Jr. and Michael E. Nugent.
(2) CONTINUANCE OF THE CURRENTLY EFFECTIVE INVESTMENT ADVISORY AGREEMENT WITH
TCW FUNDS MANAGEMENT, INC.:
<TABLE>
<S> <C>
For.......................................................... 11,273,827
Against...................................................... 314,264
Abstain...................................................... 215,108
</TABLE>
(3)APPROVAL OF A PROPOSED SUB-ADVISORY AGREEMENT BETWEEN TCW FUNDS MANAGEMENT,
INC. AND TCW LONDON INTERNATIONAL, LIMITED:
<TABLE>
<S> <C>
For.......................................................... 11,281,194
Against...................................................... 310,988
Abstain...................................................... 211,017
</TABLE>
(4)APPROVAL OF A PROPOSED SUB-ADVISORY AGREEMENT BETWEEN TCW FUNDS MANAGEMENT,
INC. AND TCW ASIA LIMITED:
<TABLE>
<S> <C>
For.......................................................... 11,279,255
Against...................................................... 303,598
Abstain...................................................... 220,346
</TABLE>
(5) RATIFICATION OF PRICE WATERHOUSE LLP AS INDEPENDENT ACCOUNTANTS:
<TABLE>
<S> <C>
For.......................................................... 11,354,481
Against...................................................... 274,319
Abstain...................................................... 174,399
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
COMMON AND PREFERRED STOCKS, BONDS AND WARRANTS
(95.4%)
ARGENTINA (3.8%)
AUTOMOTIVE
39,800 Ciadea S.A.*....................... $ 224,877
--------------
BANKS
31,300 Banco de Galicia y Buenos Aires
S.A. de C.V...................... 168,399
25,278 Banco de Galicia y Buenos Aires
S.A. de C.V. (ADR)............... 543,477
17,985 Banco Frances del Rio de la Plata
S.A. (ADR)....................... 429,392
--------------
1,141,268
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
16,000 Bagley S.A. (Class B).............. 35,361
88,917 Molinos Rio de la Plata S.A. (Class
B)*.............................. 287,211
--------------
322,572
--------------
MULTI-INDUSTRY
530,797 Perez Companc S.A. (Class B)....... 3,052,174
--------------
OIL & GAS
528,814 Astra Compania Argentina de
Petroleo S.A..................... 793,245
23,840 Transportadora de Gas del Sur S.A.
(ADR)............................ 280,120
--------------
1,073,365
--------------
OIL RELATED
60,050 Yacimentos Petroliferos Fiscales
S.A. (ADR)....................... 1,261,050
--------------
REAL ESTATE
125,798 Inversiones y Representacion S.A... 367,341
--------------
STEEL
20,450 Siderar S.A. (A Shares) (ADR)* -
144A**........................... 396,219
415,500 Siderca S.A. (Class A)............. 511,080
--------------
907,299
--------------
TELECOMMUNICATIONS
64,900 Telecom Argentina Stet - France
Telecom S.A...................... 244,680
19,760 Telecom Argentina Stet - France
Telecom S.A. (ADR)............... 750,880
29,000 Telefonica de Argentina S.A.
(ADR)............................ 677,875
--------------
1,673,435
--------------
TOTAL ARGENTINA.................... 10,023,381
--------------
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
BRAZIL (11.0%)
BANKING
257,997,804 Banco Bradesco S.A. (Pref.)........ $ 2,037,495
1,500,840 Banco Itau S.A. (Pref.)............ 582,261
1,690,000 Uniao de Bancos Brasileiros S.A.
(Pref.).......................... 42,625
--------------
2,662,381
--------------
BREWERY
5,253,202 Companhia Cervejaria Brahma
(Pref.)*......................... 3,210,002
--------------
BUILDING MATERIALS
1,039,000 Companhia Cimento Portland Itau
(Pref.).......................... 253,340
--------------
FINANCIAL SERVICES
363,000 Itausa Investimentos Itau S.A.
(Pref.).......................... 279,506
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
1,343,000 Brasmotor S.A. (Pref.)............. 477,275
--------------
MACHINERY - DIVERSIFIED
588,200 Confab Industrial S.A. (Pref.)..... 226,454
--------------
METALS & MINING
70,480 Companhia Vale do Rio Doce S.A.
(Pref.).......................... 1,335,850
--------------
OIL & GAS
18,955,000 Petroleo Brasileiro S.A. (Pref.)... 2,123,783
--------------
PAPER & FOREST PRODUCTS
82,600 Aracruz Celulose S.A. (ADR)........ 702,100
292,386 Industrias Klabin de Papel e
Celulose S.A. (Pref.)............ 303,065
--------------
1,005,165
--------------
STEEL & IRON
490,000,000 Usinas Siderurgicas de Minas Gerais
S.A. (Pref.)..................... 522,409
--------------
TELECOMMUNICATIONS
7,050,000 Telecomunicacoes Brasileiras S.A... 424,462
57,900 Telecomunicacoes Brasileiras S.A.
(ADR)............................ 4,197,750
99,482,155 Telecomunicacoes Brasileiras S.A.
(Pref.).......................... 7,227,924
611,870 Telecomunicacoes de Sao Paulo
S.A.............................. 104,495
7,079,300 Telecomunicacoes de Sao Paulo S.A.
(Pref.)*......................... 1,397,690
--------------
13,352,321
--------------
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
UTILITIES - ELECTRIC
4,142,483 Centrais Electricas Brasileiras
S.A. (ADR)....................... $ 1,145,010
5,732,677 Centrais Electricas Brasileiras
S.A. (Pref.)..................... 1,663,778
16,191 Companhia Energetica de Minas
Gerais S.A. (ADR) - 144A**....... 443,229
2,660,000 Light Participacoes S.A............ 449,942
--------------
3,701,959
--------------
TOTAL BRAZIL....................... 29,150,445
--------------
CHILE (7.1%)
BANKS
52,100 Banco BHIF (ADR)*.................. 989,900
7,450 Banco O'Higgins (ADR).............. 179,731
--------------
1,169,631
--------------
BUILDING & CONSTRUCTION
41,450 Madeco S.A. (ADR).................. 1,056,975
36,000 Maderas y Sinteticos Sociedad
Anonima Masisa (ADR)............. 612,000
--------------
1,668,975
--------------
CHEMICALS
12,660 Sociedad Quimica y Minera de Chile
S.A. (ADR)....................... 694,717
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
30,000 Compania Cervecerias Unidas S.A.
(ADR)............................ 712,500
45,020 Embotelladora Andina S.A. (ADR).... 1,665,740
--------------
2,378,240
--------------
INVESTMENT COMPANIES
36,300 Genesis Chile Fund Ltd............. 1,456,538
695,600 The Five Arrows Chile Investment
Trust Ltd........................ 1,954,636
--------------
3,411,174
--------------
SUPERMARKETS
43,120 Santa Isabel S.A. (ADR)............ 1,164,240
--------------
TELECOMMUNICATIONS
42,681 Compania de Telecommunicaciones de
Chile S.A. (ADR)................. 4,145,392
--------------
UTILITIES - ELECTRIC
13,000 Chilectra S.A. (ADR) - 144A**...... 745,875
20,750 Chilgener S.A. (ADR)............... 492,813
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
43,590 Empresa Nacional de Electricidad
Chile S.A. (ADR)................. $ 888,146
62,060 Enersis S.A. (ADR)................. 1,892,830
--------------
4,019,664
--------------
TOTAL CHILE........................ 18,652,033
--------------
COLOMBIA (0.8%)
BANKING
98,546 Banco de Bogota.................... 499,925
24,265 Banco Industrial Colombiano S.A.
(ADR)............................ 379,141
--------------
879,066
--------------
BUILDING & CONSTRUCTION
33,765 Cementos Diamante S.A. (ADR) -
144A**........................... 356,660
44,138 Compania de Cementos Argos S.A..... 234,376
--------------
591,036
--------------
FINANCIAL SERVICES
15,400 Compania Suramericana de Seguros
S.A.............................. 262,848
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
42,290 Compania Nacional de Chocolates
S.A.............................. 357,897
--------------
RETAIL
45,000 Almacenes Exito S.A................ 127,968
--------------
TOTAL COLOMBIA..................... 2,218,815
--------------
CZECH REPUBLIC (0.5%)
TOBACCO
5,400 Tabak AS........................... 1,375,066
--------------
GREECE (1.2%)
BANKING
29,600 Ergo Bank S.A...................... 1,649,698
--------------
BUILDING & CONSTRUCTION
148,650 Aegek.............................. 759,775
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
21,190 Hellenic Bottling Co. S.A.......... 726,099
--------------
TOTAL GREECE....................... 3,135,572
--------------
HONG KONG (6.0%)
BUILDING MATERIALS
281,000 Cheung Kong Infrastructure
Holdings......................... 443,309
--------------
CONGLOMERATES
570,000 Hutchison Whampoa, Ltd............. 3,405,317
--------------
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
REAL ESTATE
384,000 Cheung Kong (Holdings) Ltd......... $ 2,619,356
138,000 New World Development.............. 628,149
356,000 Sun Hung Kai Properties Ltd........ 3,360,575
--------------
6,608,080
--------------
TELECOMMUNICATIONS
601,000 Asia Satellite Telecommunications
Holdings Ltd..................... 1,771,944
--------------
TRANSPORTATION
7,706,000 The Guangshen Railway Co., Ltd..... 2,740,328
53,480 The Guangshen Railway Co., Ltd.
(ADR)*........................... 962,640
--------------
3,702,968
--------------
TOTAL HONG KONG.................... 15,931,618
--------------
INDIA (3.0%)
BUILDING & CONSTRUCTION
77,000 Larsen & Toubro Ltd. (GDR)......... 1,193,500
--------------
FINANCIAL SERVICES
77,300 Hindalco Industries Ltd. (GDR)*.... 2,550,900
--------------
INDUSTRIALS
$ 1,378K Mahindra & Mahindra Ltd. - 144A**
5.00% due 07/09/01 (Conv.)....... 1,426,230
--------------
UTILITIES - ELECTRIC
157,500 BSES Ltd. (GDR).................... 2,756,250
--------------
TOTAL INDIA........................ 7,926,880
--------------
INDONESIA (2.3%)
BANKING
985,178 PT Bank Internasional Indonesia.... 2,199,525
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
804,000 PT Gudang Garam.................... 2,889,135
239,285 PT Indofood Sukses Makmur.......... 981,969
--------------
3,871,104
--------------
TOTAL INDONESIA.................... 6,070,629
--------------
IRELAND (0.3%)
INVESTMENT COMPANIES
80,000 Central Asian Investment Company
Ltd.............................. 760,000
--------------
MALAYSIA (18.0%)
AUTOMOTIVE
514,000 Edaran Otomobil Nasional Berhad.... 4,965,288
--------------
CONGLOMERATES
688,000 Gadek Berhad....................... 4,936,348
344,000 Gadek Berhad
(Warrants due 12/19/00)*......... 985,891
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
1,978,000 Hicom Holdings Berhad.............. $ 5,193,162
371,250 Hicom Holdings Berhad (Warrants due
12/18/00)*....................... 425,595
483,000 Renong Berhad...................... 696,970
582,400 Renong Berhad (ICULS).............. 200,763
--------------
12,438,729
--------------
ENTERTAINMENT/GAMING & LODGING
663,000 Genting Berhad..................... 4,570,948
--------------
FINANCIAL SERVICES
841,000 Commerce Asset Holdings Berhad..... 4,753,126
1,916,000 DCB Holdings Berhad................ 5,836,780
--------------
10,589,906
--------------
PUBLISHING
1,100,000 New Straits Times Press Berhad..... 5,555,556
--------------
REAL ESTATE
1,672,000 Larut Consolidated Berhad.......... 2,091,005
--------------
TELECOMMUNICATIONS
490,000 Telekom Malaysia Berhad............ 3,967,452
--------------
RETAIL
440,000 Prime Utilities Berhad............. 2,733,686
238,000 Prime Utilities Berhad
(Warrants due 03/11/01)*......... 305,275
MYR 476K Prime Utilities Berhad
1.00% due 03/11/01 (Conv.)....... 125,926
--------------
3,164,887
--------------
TOTAL MALAYSIA..................... 47,343,771
--------------
MEXICO (12.5%)
AUTOMOTIVE
2,393,600 Industria Automotriz S.A.
(B Shares)*...................... 363,001
22,994 Sanluis Corporacion S.A. de C.V.
(Units)++........................ 134,634
--------------
497,635
--------------
BANKING
457,000 Grupo Financiero Inbursa S.A. de
C.V. (B Shares).................. 1,807,992
--------------
BUILDING & CONSTRUCTION
50,800 Empresas ICA Sociedad Controladora
S.A. de C.V. (ADR)*.............. 679,450
--------------
BUILDING MATERIALS
148,600 Apasco S.A. de C.V................. 829,910
797,300 Cemex S.A. de C.V. (B Shares)...... 2,849,378
127,900 Grupo Cementos de Chihuahua S.A. de
C.V. (B Shares)*................. 138,307
--------------
3,817,595
--------------
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
CONGLOMERATES
527,900 Grupo Carso S.A. de C.V.
(Series A1)*..................... $ 2,098,930
1,009,175 Grupo Industria Alfa S.A. de C.V.
(A Shares)....................... 4,019,133
--------------
6,118,063
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
70,500 Empresas la Moderna S.A. de C.V.
(ADR)............................ 1,224,937
353,100 Fomento Economico Mexicano S.A. de
C.V. (B Shares).................. 917,324
176,100 Grupo Industrial Bimbo S.A. de C.V.
(Series A)....................... 817,450
229,500 Grupo Industrial Maseca S.A. de
C.V. (B2 Shares)................. 260,280
67,100 Grupo Modelo S.A. de C.V. (Series
C)............................... 307,051
273,300 Jugos de Valle S.A. de C.V.
(B Shares)....................... 533,409
9,520 Panamerican Beverages, Inc. (Class
A)............................... 410,550
4,471,001
--------------
MEDIA GROUP
72,530 Grupo Televisa S.A. (GDR)*......... 1,922,045
--------------
METALS & MINING
27,000 Grupo Mexico S.A. (Series B)....... 87,413
114,600 Tubos de Acero de Mexico S.A. de
C.V. (ADR)*...................... 1,138,837
--------------
1,226,250
--------------
MULTI-INDUSTRY
162,700 DESC S.A. de C.V. (Series B)....... 772,412
2,041 DESC S.A. de C.V. (Series C)*...... 9,797
--------------
782,209
--------------
MULTI-LINE INSURANCE
527,900 Invercorporacion S.A.
(Series A1)*..................... 85,628
--------------
PAPER & FOREST PRODUCTS
169,900 Kimberly-Clark de Mexico S.A. de
C.V. (A Shares).................. 2,858,926
--------------
RETAIL
1,909,200 Cifra S.A. de C.V. (C Shares)*..... 2,588,234
--------------
TELECOMMUNICATIONS
183,585 Telefonos de Mexico S.A. de C.V.
(Series L) (ADR)................. 5,622,291
--------------
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
TRANSPORTATION
57,900 Transportacion Maritima Mexicana
S.A. de C.V. (Series A) (ADR).... $ 332,925
--------------
TOTAL MEXICO....................... 32,810,244
--------------
PAKISTAN (0.9%)
BANKING
89,583 Muslim Commercial Bank............. 82,513
--------------
TELECOMMUNICATIONS
23,680 Pakistan Telecommunications Corp.
(GDR)*........................... 2,202,240
--------------
TOTAL PAKISTAN..................... 2,284,753
--------------
PERU (2.5%)
BREWERY
652,134 Cerveceria Backus & Johnston S.A... 709,590
--------------
FINANCIAL SERVICES
65,922 Credicorp Ltd. (ADR)............... 1,310,200
--------------
METALS & MINING
86,801 Companhia de Minas Buenaventura
S.A. (A Shares).................. 747,130
37,000 Companhia de Minas Buenaventura
S.A. (ADR)*...................... 661,375
20,125 Companhia de Minas Buenaventura
S.A. (B Shares).................. 179,760
--------------
1,588,265
--------------
TELECOMMUNICATIONS
24,650 CPT Telefonica del Peru S.A.
(ADR)............................ 539,219
1,126,424 CPT Telefonica del Peru S.A.
(B Shares)....................... 2,446,759
--------------
2,985,978
--------------
TOTAL PERU......................... 6,594,033
--------------
PHILIPPINES (3.4%)
BANKING
78,300 Philippine National Bank........... 1,226,710
--------------
BUILDING & CONSTRUCTION
$ 2,150K Bacnotan Consolidated Industries
5.50% due 06/21/04 (Conv.)....... 1,978,000
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
455,620 San Miguel Corp. (Class B)......... 1,288,341
--------------
UTILITIES - ELECTRIC
607,880 Manila Electric Co. (B Shares)..... 4,459,800
--------------
TOTAL PHILIPPINES.................. 8,952,851
--------------
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
POLAND (0.1%)
BUILDING MATERIALS
5,000 Powszechne Swiadectwo Udzialowe.... $ 180,656
--------------
PORTUGAL (2.2%)
BUILDING & CONSTRUCTION
92,000 Sociedade de Construcoes Soares de
Costa S.A........................ 751,862
--------------
BUILDING MATERIALS
33,200 Cimentos de Portugal S.A........... 742,859
--------------
FINANCIAL SERVICES
77,400 Espirito Santo Financial Holdings
S.A. (ADR)....................... 919,125
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
100,687 Corticeira Amorim S.A.............. 1,028,569
--------------
FOREST PRODUCTS, PAPER & PACKAGING
29,950 Portucel Industrial Empresa S.A.... 193,442
--------------
TELECOMMUNICATIONS
41,000 Portugal Telecom S.A............... 1,052,495
--------------
TEXTILES
36,600 Sonae Investimentos Sociedade
Gestora de Participacoes Sociais
S.A.............................. 1,003,467
--------------
TOTAL PORTUGAL..................... 5,691,819
--------------
RUSSIA (0.8%)
OIL & GAS
28,410 Lukoil Holding Co. (ADR) -
144A**........................... 923,325
--------------
UTILITIES - ELECTRIC
50,400 Mosenergo (ADR) - 144A**........... 1,127,700
--------------
TOTAL RUSSIA....................... 2,051,025
--------------
SINGAPORE (1.5%)
BUILDING & CONSTRUCTION
398,000 Van Der Horst Ltd.................. 1,363,573
--------------
ENGINEERING & CONSTRUCTION
330,000 L & M Group Investments Ltd........ 378,424
--------------
FOOD, BEVERAGE, TOBACCO & HOUSEHOLD PRODUCTS
216,000 Fraser & Neave Ltd................. 2,171,162
--------------
TOTAL SINGAPORE.................... 3,913,159
--------------
SOUTH AFRICA (1.5%)
METALS & MINING
95,600 De Beers Consolidated Mines Ltd.
(ADR)............................ 2,879,950
14,000 Driefontein Consolidated Ltd.
(ADR)............................ 183,750
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
64,500 Kloof Gold Mining Co., Ltd.
(ADR)............................ $ 653,062
1,500 Vaal Reefs Exploration & Mining
Co., Ltd......................... 118,194
3,300 Vaal Reefs Exploration & Mining
Co., Ltd. (ADR).................. 25,988
--------------
TOTAL SOUTH AFRICA................. 3,860,944
--------------
SOUTH KOREA (4.7%)
CHEMICALS
56,200 L.G. Chemical Ltd. (GDR)........... 800,850
--------------
ELECTRONIC & ELECTRICAL EQUIPMENT
50 Daewoo Corp.
(Warrants due 11/08/96)*......... 250
9,000 Samsung Electronics Co............. 775,098
1,110 Samsung Electronics Co. (GDR)...... 26,085
11,150 Samsung Electronics Co. (GDR)...... 262,025
334 Samsung Electronics Co. (GDR)...... 7,849
37,000 Samsung Electronics Co. (GDS)...... 869,500
--------------
1,940,807
--------------
METALS & MINING
225,100 Pohang Iron & Steel Co., Ltd.
(ADR)............................ 5,289,850
--------------
UTILITIES - ELECTRIC
214,000 Korea Electric Power Corp. (ADR)... 4,414,820
--------------
TOTAL SOUTH KOREA.................. 12,446,327
--------------
TAIWAN (4.5%)
COMPUTERS
180,600 Acer Inc. (GDR).................... 1,182,930
--------------
ELECTRONIC & ELECTRICAL EQUIPMENT
$ 1,310K United Microelectronics - 144A**
1.25% due 06/08/04 (Conv.)....... 1,437,725
--------------
INVESTMENT COMPANIES
387,200 ROC Taiwan Fund.................... 4,162,400
295,466 The Taiwan Index Fund Ltd.......... 3,323,992
--------------
7,486,392
--------------
MERCHANDISING
$ 640K Far Eastern Department Stores
3.00% due 07/06/01 (Conv.)....... 632,000
--------------
STEEL & IRON
58,000 China Steel Corp. (GDS)............ 1,203,500
--------------
TOTAL TAIWAN....................... 11,942,547
--------------
</TABLE>
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
PORTFOLIO OF INVESTMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
THAILAND (5.0%)
BANKING
199,000 Bangkok Bank PCL................... $ 2,351,574
$ 1,220K Siam Commercial Bank Co. 3.25% due
01/24/04 (Conv.)................. 1,256,600
374,800 Thai Farmers Bank, Ltd............. 3,685,875
--------------
7,294,049
--------------
BUILDING & CONSTRUCTION
39,500 Siam Cement Co., Ltd............... 1,566,342
--------------
OIL RELATED
252,000 PTT Exploration & Production PCL... 3,157,744
--------------
REAL ESTATE
82,001 Land & House PCL................... 1,131,587
--------------
TOTAL THAILAND..................... 13,149,722
--------------
TURKEY (1.8%)
BANKING
27,000,000 Turkiye Garanti Bankasi AS......... 1,200,000
--------------
BREWERY
3,000,000 Ege Biracilik ve Malt Sanayii AS... 1,117,117
--------------
<CAPTION>
SHARES/PRINCIPAL
AMOUNT VALUE
- -------------- --------------
<C> <S> <C>
BUILDING MATERIALS
4,223,032 Cimentas AS........................ $ 773,588
6,607,000 Eczacibasi Yapi Gerecleri Sanayi ve
Ticaret AS....................... 460,308
--------------
1,233,896
--------------
METALS & MINING
9,150,000 Eregli Demir ve Celik Fabrikalari
T.A.S............................ 835,315
2,221,000 Koc Holdings AS.................... 446,868
--------------
1,282,183
--------------
TOTAL TURKEY....................... 4,833,196
--------------
TOTAL COMMON AND PREFERRED
STOCKS, BONDS AND WARRANTS
(IDENTIFIED COST
$245,235,884) (A)......... 95.4% 251,299,486
CASH AND OTHER ASSETS IN
EXCESS OF LIABILITIES..... 4.6 12,130,899
------ --------------
NET ASSETS.................. 100.0% $ 263,430,385
------ --------------
------ --------------
<FN>
- ------------------
ADR AMERICAN DEPOSITORY RECEIPT.
GDR GLOBAL DEPOSITORY RECEIPT.
GDS GLOBAL DEPOSITORY SHARES.
K IN THOUSANDS.
* NON-INCOME PRODUCING SECURITY.
** RESALE IS RESTRICTED TO QUALIFIED INSTITUTIONAL INVESTORS.
++ CONSISTS OF MORE THAN ONE CLASS OF SECURITIES TRADED TOGETHER AS A UNIT;
GENERALLY STOCKS WITH ATTACHED WARRANTS.
(A) THE AGGREGATE COST FOR FEDERAL INCOME TAX PURPOSES APPROXIMATES IDENTIFIED
COST. THE AGGREGATE GROSS UNREALIZED APPRECIATION WAS $32,779,548 AND THE
AGGREGATE GROSS UNREALIZED DEPRECIATION WAS $26,715,946, RESULTING IN NET
UNREALIZED APPRECIATION OF $6,063,602.
</TABLE>
FORWARD FOREIGN CURRENCY CONTRACTS OPEN AT JULY 31, 1996:
<TABLE>
<CAPTION>
UNREALIZED
CONTRACTS IN EXCHANGE DELIVERY APPRECIATION
TO RECEIVE FOR DATE (DEPRECIATION)
- ------------ ------------- --------- --------------
<S> <C> <C> <C>
$ 6,664 PTE 1,016,513 08/02/96 $ (36)
$ 20,227 PTE 3,071,408 08/05/96 (16)
$ 72,620 ZAR 325,122 08/06/96 659
---
Net unrealized appreciation........... $ 607
---
---
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
SUMMARY OF INVESTMENTS JULY 31, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY VALUE NET ASSETS
- ---------------------------------------- ------------ ----------
<S> <C> <C>
Automotive.............................. $ 5,687,800 2.2%
Banking................................. 19,001,934 7.2
Banks................................... 2,310,899 0.9
Brewery................................. 5,036,709 1.9
Building & Construction................. 10,552,512 4.0
Building Materials...................... 6,671,655 2.6
Chemicals............................... 1,495,567 0.6
Computers............................... 1,182,930 0.4
Conglomerates........................... 21,962,109 8.3
Electronic & Electrical Equipment....... 3,378,532 1.3
Engineering & Construction.............. 378,424 0.1
Entertainment/Gaming & Lodging.......... 4,570,948 1.7
Financial Services...................... 13,361,585 5.1
Food, Beverage, Tobacco & Household
Products.............................. 17,092,260 6.5
Forest Products, Paper & Packaging...... 193,442 0.1
Industrials............................. 1,426,230 0.5
Investment Companies.................... 11,657,566 4.4
Machinery - Diversified................. 226,454 0.1
Media Group............................. 1,922,045 0.7
Merchandising........................... 632,000 0.2
Metals & Mining......................... 14,583,342 5.5
Metals Non-Ferrous...................... 2,550,900 1.0
Multi-Industry.......................... 3,834,383 1.5
Multi-Line Insurance.................... 85,628 --
Oil & Gas............................... 4,120,474 1.6
Oil Related............................. 4,418,794 1.7
Paper & Forest Products................. 3,864,091 1.5
Publishing.............................. 5,555,556 2.1
Real Estate............................. 10,198,013 3.9
Retail.................................. 2,716,202 1.0
Steel................................... 907,299 0.3
Steel & Iron............................ 1,725,909 0.7
Supermarkets............................ 1,164,240 0.4
Telecommunications...................... 36,773,548 14.0
Textiles................................ 1,003,467 0.4
Tobacco................................. 1,375,066 0.5
Transportation.......................... 4,035,893 1.5
Utilities............................... 3,164,887 1.2
Utilities - Electric.................... 20,480,193 7.8
------------ ---
$251,299,486 95.4%
------------ ---
------------ ---
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
TYPE OF INVESTMENT VALUE NET ASSETS
- ---------------------------------------- ------------ ----------
<S> <C> <C>
Bonds................................... $ 6,856,481 2.6%
Common Stocks........................... 221,042,537 83.9
Preferred Stocks........................ 21,683,457 8.2
Warrants................................ 1,717,011 0.7
------------ ---
$251,299,486 95.4%
------------ ---
------------ ---
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
JULY 31, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $245,235,884)............. $ 251,299,486
Cash......................................... 11,699,498
Receivable for:
Investments sold........................... 2,716,661
Dividends.................................. 308,204
Interest................................... 106,641
Deferred organizational expenses............. 26,514
Prepaid expenses............................. 19,607
--------------
TOTAL ASSETS......................... 266,176,611
--------------
LIABILITIES:
Payable for:
Investments purchased...................... 1,965,201
Management fee............................. 190,079
Investment advisory fee.................... 126,719
Accrued expenses............................. 464,227
--------------
TOTAL LIABILITIES.................... 2,746,226
--------------
NET ASSETS:
Paid-in-capital.............................. 301,127,398
Net unrealized appreciation.................. 6,057,530
Accumulated undistributed net investment
income..................................... 363,366
Accumulated net realized loss................ (44,117,909)
--------------
NET ASSETS........................... $ 263,430,385
--------------
--------------
NET ASSET VALUE PER SHARE, 20,857,733 shares
outstanding (unlimited shares authorized of
$.01 par value)............................
$12.63
--------------
--------------
</TABLE>
Statement of Operations
FOR THE SIX MONTHS ENDED JULY 31, 1996 (UNAUDITED)
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INCOME
Dividends (net of $379,771 foreign
withholding tax)....................... $ 3,084,041
Interest................................. 343,891
--------------
TOTAL INCOME......................... 3,427,932
--------------
EXPENSES
Management fee........................... 1,035,312
Investment advisory fee.................. 690,208
Custodian fees........................... 659,969
Transfer agent fees and expenses......... 131,602
Professional fees........................ 50,733
Shareholder reports and notices.......... 27,725
Trustees' fees and expenses.............. 18,935
Registration fees........................ 15,556
Organizational expenses.................. 5,005
Other.................................... 11,113
--------------
TOTAL EXPENSES....................... 2,646,158
--------------
NET INVESTMENT INCOME................ 781,774
--------------
NET REALIZED AND UNREALIZED GAIN (LOSS):
NET REALIZED GAIN (LOSS) ON:
Investments............................ 4,900,081
Foreign exchange transactions.......... (55,760)
--------------
TOTAL GAIN........................... 4,844,321
--------------
NET CHANGE IN UNREALIZED APPRECIATION/
DEPRECIATION ON:
Investments............................ (13,932,768)
Translation of forward foreign exchange
contracts, other assets and
liabilities denominated in foreign
currencies........................... (5,276)
--------------
TOTAL DEPRECIATION................... (13,938,044)
--------------
NET LOSS............................. (9,093,723)
--------------
NET DECREASE......................... $ (8,311,949)
--------------
--------------
</TABLE>
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE SIX MONTHS FOR THE YEAR
ENDED ENDED
JULY 31, 1996 JANUARY 31,
(UNAUDITED) 1996
------------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income.................... $ 781,774 $ 731,242
Net realized gain (loss)................. 4,844,321 (30,710,157)
Net change in unrealized
appreciation/depreciation.............. (13,938,044) 67,504,368
------------------- --------------
Net increase (decrease).................... (8,311,949) 37,525,453
Dividends from net investment income....... (963,188) (483,373)
Net decrease from transactions in shares of
beneficial interest....................... (466,867) (18,227,939)
------------------- --------------
Total increase (decrease)............ (9,742,004) 18,814,141
NET ASSETS:
Beginning of period........................ 273,172,389 254,358,248
------------------- --------------
END OF PERIOD (Including undistributed net
investment income of $363,366 and
$544,780, respectively)................... $ 263,430,385 $273,172,389
------------------- --------------
------------------- --------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
NOTES TO FINANCIAL STATEMENTS JULY 31, 1996 (UNAUDITED)
- --------------------------------------------------------------------------------
1. ORGANIZATION AND ACCOUNTING POLICIES--TCW/DW Emerging Markets Opportunities
Trust (the "Trust") is registered under the Investment Company Act of 1940, as
amended, as a non-diversified, closed-end management investment company. The
Trust's investment objective is to seek capital appreciation through investment
in equity securities of emerging market countries. The Trust was organized as a
Massachusetts business trust on December 22, 1993 and commenced operations on
March 30, 1994.
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures. Actual results
could differ from those estimates. The following is a summary of significant
accounting policies:
A. VALUATION OF INVESTMENTS--(1) an equity security listed or traded on the
New York, American or other domestic or foreign stock exchange is valued at
its latest sale price on that exchange prior to the time when assets are
valued; if there were no sales that day, the security is valued at the
latest bid price (in cases where securities are traded on more than one
exchange; the securities are valued on the exchange designated as the
primary market by the Adviser); (2) all other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (3) when market
quotations are not readily available, including circumstances under which it
is determined by the Adviser that sale or bid prices are not reflective of a
security's market value, portfolio securities are valued at their fair value
as determined in good faith under procedures established by and under the
general supervision of the Trustees (valuation of debt securities for which
market quotations are not readily available may be based upon current market
prices of securities which are comparable in coupon, rating and maturity or
an appropriate matrix utilizing similar factors); (4) portfolio securities
may be valued by an outside pricing service approved by the Trustees. The
pricing service utilizes a matrix system incorporating security quality,
maturity and coupon as the evaluation model parameters, and/or research and
evaluation by its staff, including review of broker-dealer market price
quotations, if available, in determining what it believes is the fair
valuation of the portfolio securities valued by such pricing service; and
(5) short-term debt securities having a maturity date of more than sixty
days at time of purchase are valued on a mark-to-market basis until sixty
days prior to maturity and thereafter at amortized cost based on their value
on the 61st day. Short-term debt securities having a maturity date of sixty
days or less at the time of purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS--Security transactions are accounted for on
the trade date (date the order to buy or sell is executed). Realized gains
and losses on security transactions are determined by the identified cost
method. Discounts are accreted over the life of the respective securities.
Dividend income and other distributions are recorded on the ex-dividend date
except for certain dividends on foreign securities which are recorded as
soon as the Trust is informed after the ex-dividend date. Interest income is
accrued daily.
C. FOREIGN CURRENCY TRANSLATION--The books and records of the Trust are
maintained in U.S. dollars as follows: (1) the foreign currency market value
of investment securities, other assets and liabilities and forward contracts
are translated at the exchange rates prevailing at the end of the period;
and (2) purchases, sales, income and expenses are translated at the exchange
rates prevailing on the respective dates of such transactions. The resultant
exchange gains and losses are included in the Statement of Operations as
realized and unrealized gain/loss on foreign exchange transactions. Pursuant
to U.S. Federal income tax regulations, certain foreign exchange
gains/losses included in realized and unrealized gain/loss are included in
or are a reduction of ordinary income for federal income tax purposes. The
Trust does not isolate that
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
NOTES TO FINANCIAL STATEMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
portion of the results of operations arising as a result of changes in the
foreign exchange rates from the changes in the market prices of the
securities.
D. FORWARD FOREIGN CURRENCY CONTRACTS--The Trust may enter into forward
foreign currency contracts as a hedge against fluctuations in foreign
exchange rates. Forward contracts are valued daily at the appropriate
exchange rates. The resultant exchange gains and losses are included in the
Statement of Operations as unrealized gain/loss on foreign exchange
transactions. The Trust records realized gains or losses on delivery of the
currency or at the time the forward contract is extinguished (compensated)
by entering into a closing transaction prior to delivery.
E. FEDERAL INCOME TAX STATUS--It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
F. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS--The Trust records dividends
and distributions to its shareholders on the ex-dividend date. The amount of
dividends and distributions from net investment income and net realized
capital gains are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such
amounts are reclassified within the capital accounts based on their federal
tax-basis treatment; temporary differences do not require reclassification.
Dividends and distributions which exceed net investment income and net
realized capital gains for financial reporting purposes but not for tax
purposes are reported as dividends in excess of net investment income or
distributions in excess of net realized capital gains. To the extent they
exceed net investment income and net realized capital gains for tax
purposes, they are reported as distributions of paid-in-capital.
G. ORGANIZATIONAL EXPENSES--Dean Witter InterCapital Inc., an affiliate of
Dean Witter Services Company Inc. (the "Manager") paid the organizational
expenses of the Trust in the amount of approximately $50,000 which have been
reimbursed for the full amount thereof. Such expenses have been deferred and
are being amortized on the straight-line method over a period not to exceed
five years from the commencement of operations.
2. MANAGEMENT AGREEMENT--Pursuant to a Management Agreement, the Trust pays the
Manager a management fee, calculated weekly and payable monthly, by applying the
annual rate of 0.75% to the Trust's average weekly net assets.
Under the terms of the Management Agreement, the Manager maintains certain
of the Trust's books and records and furnishes, at its own expense, office
space, facilities, equipment, clerical, bookkeeping and certain legal services
and pays the salaries of all personnel, including officers of the Trust who are
employees of the Manager. The Manager also bears the cost of telephone services,
heat, light, power and other utilities provided to the Trust.
3. INVESTMENT ADVISORY AGREEMENT--Pursuant to an Investment Advisory Agreement
with TCW Funds Management, Inc. (the "Adviser"), the Trust pays the Advisor an
advisory fee, calculated weekly and payable monthly, by applying the annual rate
of 0.50% to the Trust's average weekly net assets.
Under the terms of the Investment Advisory Agreement, the Trust has retained
the Adviser to invest the Trust's assets, including placing orders for the
purchase and sale of portfolio securities. The Adviser obtains
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
NOTES TO FINANCIAL STATEMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
and evaluates such information and advice relating to the economy, securities
markets, and specific securities as it considers necessary or useful to
continuously manage the assets of the Trust in a manner consistent with its
investment objective. In addition, the Adviser pays the salaries of all
personnel, including officers of the Trust, who are employees of the Adviser.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES--The cost of
purchases and proceeds from sales of portfolio securities, excluding short-term
investments, for the six months ended July 31, 1996 aggregated $88,478,005 and
$92,578,158, respectively.
Dean Witter Trust Company, an affiliate of the Manager, is the Trust's
transfer agent. At July 31, 1996, the Trust had transfer agent fees and expenses
payable of approximately $28,000.
5. SHARES OF BENEFICIAL INTEREST--Transactions in shares of beneficial interest
were as follows:
<TABLE>
<CAPTION>
CAPITAL PAID
IN EXCESS OF
SHARES PAR VALUE PAR VALUE
-------------- -------------- --------------
<S> <C> <C> <C>
Balance, January 31, 1995.................... 22,757,533 $ 227,575 $ 319,527,933
Treasury shares purchased and retired
(weighted average discount 15.96%)*......... (1,857,300) (18,573) (18,209,366)
-------------- -------------- --------------
Balance, January 31, 1996.................... 20,900,233 209,002 301,318,567
Treasury shares purchased and retired
(weighted average discount 18.15%)*......... (42,500) (425) (466,442)
-------------- -------------- --------------
Balance, July 31, 1996....................... 20,857,733 $ 208,577 $ 300,852,125
-------------- -------------- --------------
-------------- -------------- --------------
</TABLE>
- ------------
* THE TRUSTEES HAVE VOTED TO RETIRE THE SHARES PURCHASED.
6. FEDERAL INCOME TAX STATUS--At January 31, 1996, the Trust had a net capital
loss carryover of approximately $40,262,000 which will be available through
January 31, 2004 to offset future capital gains to the extent provided by
regulations.
Capital and foreign currency losses incurred after October 31 ("post-October
losses") within the taxable year are deemed to arise on the first business day
of the Trust's next taxable year. The Trust incurred and will elect to defer net
capital and foreign currency losses of approximately $6,707,000 and $55,000,
respectively, during fiscal 1996.
As of January 31, 1996, the Trust had temporary book/tax differences
primarily attributable to post-October losses, capital loss deferrals on wash
sales and income from the mark-to-market of passive foreign investment companies
("PFICs"). The Trust had permanent book/tax differences primarily attributable
to foreign currency losses and tax adjustments of PFICs sold by the Trust.
7. PURPOSES OF AND RISKS RELATING TO CERTAIN FINANCIAL INSTRUMENTS--The Trust
may enter into forward foreign currency contracts ("forward contracts") to
facilitate settlement of foreign currency denominated portfolio transactions or
to manage foreign currency exposure associated with foreign currency denominated
securities.
At July 31, 1996, the Trust had outstanding forward contracts to facilitate
settlement of foreign currency denominated portfolio transactions.
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
NOTES TO FINANCIAL STATEMENTS JULY 31, 1996 (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
Forward contracts involve elements of market risk in excess of the amounts
reflected in the Statement of Assets and Liabilities. The Trust bears the risk
of an unfavorable change in foreign exchange rates underlying the forward
contracts. Risks may also arise upon entering into these contracts from the
potential inability of the counterparties to meet the terms of their contracts.
At July 31, 1996, the Trust's cash balance consisted principally of interest
bearing deposits with Chase Manhattan N.A., the Trust's custodian.
<PAGE>
TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
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FOR THE SIX FOR THE YEAR FOR THE PERIOD
MONTHS ENDED ENDED MARCH 30, 1994*
JULY 31, 1996 JANUARY 31, THROUGH
--------------- 1996 JANUARY 31,
-------------- 1995++
(UNAUDITED) ---------------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of
period........................... $13.07 $11.18 $14.02
--------------- -------------- ---------------
Net investment income.............. 0.04 0.04 0.11
Net realized and unrealized gain
(loss)........................... (0.43) 1.73 (2.89)
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Total from investment operations... (0.39) 1.77 (2.78)
--------------- -------------- ---------------
Offering costs charged against
capital.......................... -- -- (0.02)
--------------- -------------- ---------------
Less dividends and distributions
from:
Net investment income............ (0.05) (0.02) (0.09)
Net realized gain................ -- -- (0.01)
--------------- -------------- ---------------
Total dividends and
distributions.................... (0.05) (0.02) (0.10)
--------------- -------------- ---------------
Anti-dilutive effect of acquiring
treasury shares.................. -- 0.14 0.06
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Net asset value, end of period..... $12.63 $13.07 $11.18
--------------- -------------- ---------------
--------------- -------------- ---------------
Market value, end of period........ $10.13 $12.25 $9.875
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--------------- -------------- ---------------
TOTAL INVESTMENT RETURN+........... (17.00)%(1) 24.28% (33.52)%(1)
RATIOS TO AVERAGE NET ASSETS:
Expenses........................... 1.92%(2) 1.69% 1.73%(2)
Net investment income.............. 0.57%(2) 0.28% 0.94%(2)
SUPPLEMENTAL DATA:
Net assets, end of period, in
thousands........................ $263,430 $273,172 $254,358
Portfolio turnover rate............ 33%(1) 66% 61%(1)
Average commission rate paid....... $0.0007 -- --
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* COMMENCEMENT OF OPERATIONS.
++ RESTATED FOR COMPARATIVE PURPOSES.
+ TOTAL INVESTMENT RETURN IS BASED UPON THE CURRENT MARKET VALUE ON THE LAST DAY OF EACH PERIOD REPORTED.
DIVIDENDS AND DISTRIBUTIONS ARE ASSUMED TO BE REINVESTED AT THE PRICES OBTAINED UNDER THE TRUST'S DIVIDEND
REINVESTMENT PLAN. TOTAL INVESTMENT RETURN DOES NOT REFLECT BROKERAGE COMMISSIONS.
(1) NOT ANNUALIZED.
(2) ANNUALIZED.
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SEE NOTES TO FINANCIAL STATEMENTS
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TRUSTEES
John C. Argue
Richard M. DeMartini
Charles A. Fiumefreddo
John R. Haire
Dr. Manuel H. Johnson
Thomas E. Larkin, Jr.
Michael E. Nugent
John L. Schroeder
Marc I. Stern
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Thomas E. Larkin, Jr.
President
Sheldon Curtis
Vice President, Secretary and
General Counsel
Shaun C.K. Chan
Vice President
Michael P. Reilly
Vice President
Terence F. Mahony
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Dean Witter Trust Company
Harborside Financial Center -- Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
MANAGER
Dean Witter Services Company Inc.
ADVISER
TCW Funds Management, Inc.
The financial statements included herein have been taken from the records of
the Fund without examination by the independent accountants and accordingly
they do not express an opinion thereon.
TCW/DW
EMERGING
MARKETS
OPPORTUNITIES
TRUST
SEMIANNUAL REPORT
JULY 31, 1996
