[LOGO] State Street Research [PHOTO]
Investment Trust
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Semiannual Report to Shareholders
June 30, 1999
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In this Report
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75 Years
of Investing
Worth
Celebrating
[PHOTO]
plus
America Goes Shopping as the
U.S. Economy Sizzles
What's a Stock Worth?
Fund Portfolio and Financials
<PAGE>
Contents
2 6 Month Review
A look at the fund and its market
environment over the past 6 months
6 Performance in Perspective
The most recent performance in the
context of the fund's track record
8 The Fund in Detail
Portfolio holdings, financials and notes
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From the Chairman
75 Years Ago
State Street Research Investment Trust issued its first shares -- and became one
of America's two original mutual funds. Since then the fund has achieved an
unparalleled track record. Its strategy: disciplined investment management and
first-hand company research. Plus the fund has had the consistency of only five
managers whose management practices have had a profound influence. That's why we
chose to introduce our newly designed, simplified shareholder reports with this
special 75th anniversary review of State Street Research Investment Trust. We
think the educational format, lively graphics and plain English style will make
it easier to understand how your fund performed -- and why.
[PHOTO]
Ralph F. Verni
We're proud to recall -- and celebrate -- 75 years of State Street Research
Investment Trust. We thank you for your confidence, and we look forward to
continuing to help you work toward your financial goals in the future.
Sincerely,
/s/ Ralph F. Verni
Ralph F. Verni
Chairman, State Street Research
June 30, 1999
6 Month Review
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Management's Discussion of Fund Performance Part 1
How State Street Research Investment Trust Performed During a strong six-month
period for the stock market, the fund returned 10.47%. This performance was in
line with other growth and income funds.
Class A Shares(1)
[GRAPHIC]
10.47%
Reasons for the Fund's Performance With expectations for economic improvement
around the globe, investors looked beyond the large-company growth stocks that
have dominated the market for the past two years. The fund anticipated this
changing environment by shifting some investments to basic industry and energy
stocks. These moves helped performance. However, the fund's investments in drug,
consumer staples and selected financial stocks were hurt by the change in
investor sentiment. Financial stocks were also vulnerable to rising interest
rates.
S&P 500
Index(2)
[GRAPHIC]
12.38%
Lipper Average
Growth & Income Fund(3)
[GRAPHIC]
10.93%
How the Fund is Positioned for the Period Ahead We continue to focus on stocks
of high-quality companies that lead or dominate their markets, especially
media/entertainment companies and energy companies. We reduced the fund's
exposure to health care and technology stocks.
Our Outlook We are optimistic that American companies will report higher
profits in 1999 and that the global economic picture could improve. If interest
rates remain tame, the markets could respond favorably. That said, we believe
investors should expect continued volatility. The fund's balance of growth and
cyclical stocks should make it easier to respond to a changing environment.
More Management's Discussion of Fund Performance on page 6. |_|
"The fund's balance of growth and cyclical stocks should make it easier to
respond to a changing environment."
[PHOTO]
John Wilson
Portfolio Manager,
State Street Research Investment Trust
Because financial markets and mutual fund strategies are constantly evolving,
it's possible that the fund's holdings, market stance, outlook for various
industries or securities and other matters discussed in this report have changed
since this information was prepared. Portfolio changes should not be considered
recommendations for action by individual investors.
2 State Street Research Investment Trust
<PAGE>
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[PHOTO] The Fund at a Glance as of 6/30/99
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State Street Research Investment Trust seeks to provide long-term
growth of capital and, secondarily, long-term growth of income.
Ticker Symbols
Class A: SITAX
Class B(1): SITPX
Class B: SITBX
Class C: SITDX
Class S: STSTX
Total net assets: $3.1 billion
Top 10 Holdings
Issuer/security % of fund assets
1 Bank of America 3.7%
2 Tyco International 3.5%
3 Chase Manhattan 3.1%
4 General Electric 2.7%
5 MCI WorldCom 2.7%
6 Total Fina 2.5%
7 Dow Chemical 2.5%
8 Citigroup 2.4%
9 CBS 2.3%
10 McDonald's 2.0%
See page 11 for more detail.
Performance
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Class A See page 7 for data on other share classes.
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Year-to-date(1) as of 6/30/99: 10.47%
Fund average annual total return(6)
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1 Year 5 Years 10 Years
- ------ ------- --------
12.15% 23.21% 16.40%
- ------ ------- --------
S&P 500(2)
- ------ ------- --------
1 Year 5 Years 10 Years
- ------ ------- --------
22.76% 27.86% 18.76%
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- -------------------------------
Top 5 Industries
- -------------------------------
% of fund assets
Multi-Sector Companies 10.0%
Drugs & Biotechnology 7.7%
Telecommunications 6.8%
Miscellaneous Financial 6.8%
Banks & Savings & Loans 6.7%
America Goes Shopping as the U.S. Economy Sizzles
Two consecutive quarters of strong economic growth wiped out any early concerns
that American companies might not be able to generate profits above 1998's
anemic levels. Retail and home sales were strong in most parts of the country,
reflecting higher personal income and rising consumer confidence. However, the
personal savings rate turned negative late last year and stood at -1.2% in June.
Inflation has remained tame despite a tight labor market. Not even rising energy
prices were able to send the Consumer Price Index up by more than a fraction of
one percent. Nevertheless, the Federal Reserve Board of Governors raised
short-term interest rates by one-quarter percent on June 30. The stock market
interpreted the move as good news, because the increase was in line with
consensus expectations.
Leadership began to broaden in the second half of the period, as small company
stocks outpaced large-company growth stocks. However, inflation worries continue
to plague the bond market, and most bonds lost ground during the period.
Stocks Soar Bonds Stumble
[LINE GRAPH] [LINE GRAPH]
The Dow Jones Industrial Average(4) soared past 10,000 while the yield of the
30-year U.S. Treasury bond, a bellwether for sentiment among bond investors,
rose above 6.0% as the total return of Lehman Brothers Long Government Bond
Index fell.(5)
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(1) Does not reflect sales charge.
(2) The S&P 500 (officially, the "Standard & Poor's 500 Composite Stock Price
Index") is an unmanaged index of 500 U.S. stocks. The index does not take
transaction charges into consideration. It is not possible to invest
directly in the index.
(3) The Lipper Growth & Income Fund Average shows the performance of a category
of mutual funds with similar goals. The Lipper average shows you how well
the fund has done compared with competing funds.
(4) The Dow Jones Industrial Average is a weighted and adjusted average of 30
industrial stocks listed on the New York Stock Exchange. The Dow Jones
Industrial Average is used as a common indicator of general market trends.
(5) The Lehman Brothers Long Government Bond Index is an unmanaged index of
fixed rate U.S. Treasury and agency issues with 20 years or more to
maturity. The index does not take transaction charges into consideration. It
is not possible to invest directly in the index.
(6) At maximum applicable sales charge.
3
<PAGE>
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The Way We Think
75 Years of
Investment Performance
Worth Celebrating
When State Street Research launched one of America's first mutual funds in the
summer of 1924, the firm's founders were single-minded about their goal: Achieve
a first-rate performance -- and let the world beat a path to your door. They
were different from their lone competitor, which focused its energies on an
aggressive sales campaign. But State Street Research's goal suited Paul Cabot,
the fund's first manager, and rewarded its shareholders with an outstanding
record of performance. Seventy-five years and four portfolio managers later,
performance still rules. The firm's emphasis on research continues, as does its
uncompromising commitment to its customers.
Consistent Performance Over Time When the stock market is rising at a
remarkable clip, it's easy to look like a genius. But the history of the
American mutual fund is one of hazards as well as opportunities; of booming
business cycles, punctuated by recession; of friendly, falling interest rates
followed by periods of inflation. State Street Research Investment Trust has
flourished through these changing environments.
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The year was 1924, and America was full of promise: The economy was robust. The
financial markets were rising. Technology was changing the way Americans lived,
worked and traveled. Paul Cabot, just 26 years old, signed on Richard Paine and
Richard Saltonstall to help him launch State Street Research Investment Trust.
And the rest, as they say, is history...
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The fund's lifetime cumulative return is more than an astonishing 1,000,000%.
Its average annual return of over 13% for all share classes is also impressive.
The success of State Street Research Investment Trust has been aided by strong
growth periods in the stock market. Despite the Great Depression, dozens of
recessions, and a half-dozen wars and military conflicts, the fund has grown
steadily.
Inspired Thinking, Disciplined Investment Management State Street Research
pioneered growth stock investing. Methods introduced by Cabot and his colleagues
during the fund's early years have become standard in the industry today. For
example, Cabot favored in-house research over Wall Street research. He
encouraged analysts to meet with companies face-to-face. He understood the
importance of investing in management that had demonstrated the ability to
control costs, boost margins and promote products. Cabot also looked for
companies that were increasing their profits, or
[LINE GRAPH]
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1920s
- -----
Dow
at
248
$10,000
invested in 1924(2)
1924 The inception of one of the nation's two original mutual funds, State
Street Research Investment Trust.
1927 Formation of Merck & Co.'s predecessor, which becomes the nation's leading
pharmaceutical firm.
[PHOTO]
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1930s
- -----
Dow
at
150
[PHOTO]
1935 Douglas Aircraft builds the DC-3, the first passenger plane to fly
profitably.
[PHOTO]
1939 DuPont(R) introduces nylon fabric, an important breakthrough in the apparel
industry.
- -----
1940s
- -----
Dow
at
200
1943 Sir Alexander Fleming receives Nobel Prize for the discovery and
development of Penicillin.
[PHOTO]
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1950s
- -----
Dow
at
679
[PHOTO]
1953 IBM(R) introduces its first computer, the 701, enabling businesses to take
advantage of the power of computers.
[PHOTO]
1955 The entertainment industry gains momentum. ABC declares first profit of $6
million.
- -----
1960s
- -----
Dow
at
800
[PHOTO]
1964 Lee Iacocca introduces the Ford Mustang, paving the way for tremendous
growth in the auto industry.
[PHOTO]
1969 The aerospace industry emerges. Astronauts land on the Moon.
(1) Keep in mind that past performance is no guarantee of future results. The
investment return and principal value of an investment made in the fund will
fluctuate and shares, when redeemed, may be worth more or less than their
original cost. Results assume reinvestment of capital gain distributions and
income dividends at net asset value. Performance includes periods prior to the
creation of share classes, which resulted in new 12b-1 fees which will reduce
subsequent performance. Performance reflects maximum 5.75% Class A share
front-end sales charge, or 5% Class B(1) or B share or 1% Class C share
contingent deferred sales charge, where applicable. During the periods prior to
1990 that shares of the fund were not offered to the general public, the fund
was not subject to the cash inflows and higher redemptions and expenses that
have occurred during the fund's current continuous public offering. (2) The
investment results are based on an assumed $10,000 investment at the maximum
Class A share sales charge of
4 State Street Research Investment Trust
<PAGE>
earnings, faster than their competitors. He has been credited with originating
the idea of measuring the value of a company on the basis of both its current
and projected price/earnings ratio -- a radical departure from the conventional
wisdom of the day, which focused on a stock's yield.
Only four managers have followed Cabot at the helm of State Street Research
Investment Trust during the past 75 years: George Bennett (1958-1985); his son,
Peter Bennett (1985-1996), now Executive Vice President and Equity Department
Head; and John Wilson, who became manager in 1996, after the untimely death of
Steven Somes, who managed the fund for just one year (1995).
A Continuing Commitment to Share holders State Street Research has always been
committed to providing shareholders with the services they need and the
information they want to keep up with their investments. As early as 1927, we
were one of the first firms to provide candid commentary on fund performance. In
recent years, we have been recognized as a leader in shareholder education,
prospectus simplification and plain-English communications. Proven Performance.
Commitment to Investors: It's a tall order for most funds -- but a track record
of accomplishment for State Street Research Investment Trust -- one of the
nation's two original mutual funds.
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Average Annual Total Returns as of 6/30/99(1)
Life of Fund
Since
7/29/1924 10 Years 5 Years 1 Year
Class A 13.32% 16.40% 23.21% 12.15%
Class B(1) 13.34% 16.57% 23.58% 13.15%
Class B 13.34% 16.57% 23.58% 13.15%
Class C 13.34% 16.56% 23.73% 16.99%
Class S 13.43% 17.30% 25.02% 19.33%
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[LINE GRAPH]
- -----
1970s
- -----
Dow
at
839
1971 Federal Express challenges fast delivery of products and information.
[PHOTO]
1972 Hewlett-Packard pioneers the era of personal computing with the first
scientific handheld calculator.
- -----
1980s
- -----
Dow
at
2,753
[PHOTO]
1984 Breakup of AT&T leads to an explosion of competition in the
telecommunications industry.
[PHOTO]
1988 Time Warner Inc.(R) marks a new stage in the evolution of the media
industry.
- -----
1990s
- -----
Dow
hits
10,000
[PHOTO]
1996 The automotive industry pushes forward. General Motors introduces the
electric car.
With all distributions reinvested
---------------
$117,829,529(3)
---------------
With only capital gains distributions reinvested
--------------
$12,253,179(4)
--------------
5.75%. The net amount invested was $9,425. No adjustment has been made for
income taxes payable by shareholders on income dividends or capital gain
distributions. (3) Total value, including reinvested dividends and capital gain
distributions taken in shares, from 7/29/24-6/30/99. (4) Total value, assuming
dividends taken in cash and capital gains reinvested, from 7/29/24-6/30/99.
The companies listed above are for illustration only, and there is no guarantee
that the fund currently invests or has invested in such companies' securities.
All trademarks are the property of their respective owners.
A Closer Look [GRAPHIC]
The Price/ Earnings Ratio
What's a Stock Worth?
Can you tell whether a company's stock price is 1) fair, 2) a bargain, or 3) a
premium? One way investment professionals determine value is by looking at a
company's stock price in relationship to its earnings per share, i.e. its price/
earnings ratio or p/e. If a stock's p/e is lower than its competitors or its own
historical average, the company may be headed down -- or it could be a bargain
if management turns the company around. Conversely, if the stock's p/e is higher
than its competitors, it may be wildly expensive or it may have a product or
brand name with growth potential that could justify its premium price. The
price/earnings ratio isn't magic, but many professional and individual invest
ors today use it to help determine whether to buy or sell a stock.
5
<PAGE>
[GRAPHIC] A Closer Look
12b-1 fees
So-called 12b-1 fees are named after the SEC rule that permits them.
The fund pays 12b-1 fees to cover service and distribution costs. The fees cover
personal services and the maintenance of shareholder accounts. The fees also
cover selling and marketing expenditures for the sale of fund shares.
The fund pays 12b-1 fees out of its assets, so shareholders see them as an
indirect charge rather than a direct charge.
[GRAPHIC]
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Performance in Perspective
- -----------
Management's Discussion of Fund Performance Part 2
Ten-Year Performance Figures as of June 30, 1999
These two pages focus on the fund's long-term track record. While a mutual
fund's past performance is never a guarantee of future results, long-term
returns can serve as an important context for evaluating recent performance.
Three ways of measuring long-term performance are cumulative returns, average
annual returns and the change in value over time of a given investment.
Information about these measures follows, while the share class boxes contain
the results of these measures for each share class.
Cumulative Total Return
This represents the total percentage you would have earned or lost if you had
invested a lump sum in the fund and left it there until the end of the period
indicated. Performance would be lower if sales charges were reflected.
Average Annual Total Return
Average annual total return is the rate you would have had to earn during each
year of a given time period -- say, five years -- in order to end up with the
fund's actual cumulative return for those five years.
In reality, of course, fund performance varies from year to year. Because of
this, a fund's actual performance for a given year may be higher or lower than
an average annual performance figure.
$10,000 Over Ten Years
This example is similar to cumulative total return, but uses dollars rather than
percentages, and assumes that the lump sum you invested was $10,000. It also
compares fund performance to the performance of a market index.
All of the performance figures on these pages assume reinvestment of dividends
and distributions.
The average annual total returns for the fund also include the effects of any
fees and sales charges that would apply for each share class.
The fund's returns include performance from before the creation of share
classes. If this performance reflected the share classes' current 12b-1 fees,
the fund's returns may have been lower..
The S&P 500 (officially, the "Standard & Poor's 500 Composite Stock Price
Index") is an unmanaged index of 500 U.S. stocks. The index does not take
transaction charges into consideration. It is not possible to invest directly in
the index.
- --------------------------------------------------------------------------------
Class A Front Load
- -------
o Initial sales charge of 5.75% or less, with lower sales charges for larger
investments (see a prospectus for details)
o Lower annual expenses than Class B(1) or Class C shares because of lower
distribution/ service (12b-1) fee of 0.25%
Life of Fund
Cumulative Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(does not reflect 18.99% 201.28% 384.43% 1,250,389.89%
sales charge)
Life of Fund
Average Annual Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(at maximum applicable 12.15% 23.21% 16.40% 13.32%
sales charge)
$10,000 Over Ten Years
[The following table was represented as a line graph in the printed material.]
Class A S & P 500
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"89" 9425 10000
"90" 11592 11645
"91" 12041 12503
"92" 13384 14177
"93" 15170 16106
"94" 15154 16332
"95" 18102 20582
"96" 22665 25930
"97" 29601 34922
"98" 38370 45459
"99" 45658 55806
6 State Street Research Investment Trust
<PAGE>
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Class B(1) Back Load for accounts opened after 1/1/99
- ----------
o No initial sales charge
o Deferred sales charge of 5% or less on shares you sell within six years
o Annual distribution/service (12b-1) fee of 1.00%
o Automatic conversion to Class A shares after eight years, reducing future
annual expenses
Life of Fund
Cumulative Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(does not reflect 18.15% 190.21% 363.14% 1,195,433.38%
sales charge)
Life of Fund
Average Annual Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(at maximum applicable 13.15% 23.58% 16.57% 13.34%
sales charge)
$10,000 Over Ten Years
[The following table was represented as a line graph in the printed material.]
Class B(1) S & P 500
---------- ---------
"89" 9999 10000
"90" 12299 11645
"91" 12776 12503
"92" 14201 14177
"93" 16097 16106
"94" 15959 16332
"95" 18912 20582
"96" 23510 25930
"97" 30467 34922
"98" 39200 45459
"99" 46314 55806
- --------------------------------------------------------------------------------
Class B Back Load for accounts opened before 1/1/99
- -------
o No initial sales charge
o Deferred sales charge of 5% or less on shares you sell within five years
o Annual distribution/service (12b-1) fee of 1.00%
o Automatic conversion to Class A shares after eight years, reducing future
annual expenses
Life of Fund
Cumulative Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(does not reflect 18.15% 190.21% 363.15% 1,195,443.22%
sales charge)
Life of Fund
Average Annual Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(at maximum applicable 13.15% 23.58% 16.57% 13.34%
sales charge)
$10,000 Over Ten Years
[The following table was represented as a line graph in the printed material.]
Class B(1) S & P 500
---------- ---------
"89" 9999 10000
"90" 12299 11645
"91" 12776 12503
"92" 14201 14177
"93" 16097 16106
"94" 15959 16332
"95" 18912 20582
"96" 23510 25930
"97" 30467 34922
"98" 39200 45459
"99" 46314 55806
- --------------------------------------------------------------------------------
Class C Level Load
- -------
o No initial sales charge
o Deferred sales charge of 1%, paid if you sell shares within one year of
purchase
o Lower deferred sales charge than Class B(1) shares
o Annual distribution/service (12b-1) fee of 1.00%
o No conversion to Class A shares after eight years, so annual expenses do not
decrease
Life of Fund
Cumulative Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(does not reflect 17.99% 190.03% 362.96% 1,194,964.32%
sales charge)
Life of Fund
Average Annual Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(at maximum applicable 16.99% 23.73% 16.56% 13.34%
sales charge)
$10,000 Over Ten Years
[The following table was represented as a line graph in the printed material.]
Class C S & P 500
------- ---------
"89" 9999 10000
"90" 12299 11645
"91" 12776 12503
"92" 14201 14177
"93" 16109 16106
"94" 15963 16332
"95" 18928 20582
"96" 23533 25930
"97" 30475 34922
"98" 39237 45459
"99" 46296 55806
- --------------------------------------------------------------------------------
Class S Special Programs
- -------
o Available through certain retirement accounts, advisory accounts of the
investment manager and other programs that usually involve special conditions
and separate fees (see a prospectus for details)
o No sales charges of any kind
o No distribution/service (12b-1) fees; annual expenses are lower than for
other share classes
Life of Fund
Cumulative Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(does not reflect 19.33% 205.38% 392.99% 1,272,483.77%
sales charge)
Life of Fund
Average Annual Total Return 1 Year 5 Years 10 Years (7/29/24)
-----------------------------------------------
(at maximum applicable 19.33% 25.02% 17.30% 13.43%
sales charge)
$10,000 Over Ten Years
[The following table was represented as a line graph in the printed material.]
Class S S & P 500
------- ---------
"89" 9999 10000
"90" 12299 11645
"91" 12776 12503
"92" 14201 14177
"93" 16139 16106
"94" 16143 16332
"95" 19347 20582
"96" 24294 25930
"97" 31800 34922
"98" 41312 45459
"99" 49299 55806
- --------------------------------------------------------------------------------
7
<PAGE>
[GRAPHIC]
- ------------------
The Fund in Detail
- --------
The following pages describe the fund in detail as of the date of this report.
They provide a "snapshot" of the fund's holdings at one moment in time (the
report date), describe the financial dimensions of its operations for the six
months leading up to the report date and give a summary of operations on a per
share basis for the past five fiscal years. There's also an overview of the fund
and its business structure, as well as information on the accounting policies
the fund uses in arriving at the figures it presents here.
[GRAPHIC]
Together, the words and numbers in this section offer a comprehensive picture of
the fund and its recent activities. In fact, the text and notes in this section
are an integral part of the portfolio and financial information, which wouldn't
be complete without them.
A glossary with definitions of many of the more technical accounting terms
appears at the end of this section.
Keep in mind that in annual reports, the portfolio holdings and financial
statements are audited, while in semiannual reports they are unaudited.
8 State Street Research Investment Trust
<PAGE>
About the Fund
- --------------------------------------------------------------------------------
Business structure
State Street Research Investment Trust is a mutual fund. A mutual fund allows
shareholders to pool their assets for investment in a portfolio of securities.
This fund is a series of State Street Research Master Investment Trust, a
Massachusetts business trust that was organized in February of 1989 as a
successor to State Street Investment Corporation and is an open-end management
investment company.
Four entities administer the fund's main business functions:
o The board of trustees oversee the fund with its shareholders' interests in
mind and have ultimate responsibility for the fund's activities (see
sidebar for trustee information).
o The investment manager, State Street Research & Management Company, is
responsible for the fund's investment and business activities and receives
the management fee as compensation.
o The distributor, State Street Research Investment Services, Inc., sells
shares of the fund, handles investor inquiries and transaction orders and
provides other shareholder services.
o The custodian, State Street Bank and Trust Company, holds fund securities,
provides data on their market value and handles related services.
The investment manager and the distributor are subsidiaries of Metropolitan Life
Insurance Company, better known as MetLife. State Street Bank and Trust Company
is not affiliated with MetLife (the similarity between its name and the names of
the investment manager and distributor is coincidental). A majority of the
trustees consists of people who are not affiliated with MetLife or any of its
subsidiaries. The distributor pays a portion of its fees to MetLife for services
it provides, including maintaining the accounts of some investors who hold
shares through their firm's employee benefit plans and other sponsored
arrangements.
Goal and strategy
The fund seeks to provide long-term growth of capital and secondarily, long-term
growth of income. In managing its portfolio, the fund generally attempts to
identify the industries that over the long term will grow faster than the
economy as a whole.
Share classes
The fund offers five share classes, each with its own sales charge and expense
structure.
For more information about the fund's strategies, risks and expenses, check the
fund's prospectus; you'll need to read it before making any investments. The
prospectus also has more details on the fund's share classes and its policies
for shareholder accounts. To get a copy of any State Street Research prospectus,
see the back cover of this report.
Board of Trustees
Ralph F. Verni
Chairman of the Board, President,
Chief Executive Officer and Director,
State Street Research & Management Company
Bruce R. Bond
Chairman of the Board,
Chief Executive Officer and President,
PictureTel Corporation
Steve A. Garban
Former Senior Vice President
for Finance and Operations and Treasurer,
The Pennsylvania State University
Malcolm T. Hopkins
Former Vice Chairman of the Board
and Chief Financial Officer,
St. Regis Corp.
Dean O. Morton
Former Executive Vice President,
Chief Operating Officer and Director,
Hewlett-Packard Company
Susan M. Phillips
Dean, School of Business and Public Management,
George Washington University; former Member of
the Board of Governors of the Federal Reserve
System and Chairman and Commissioner of the
Commodity Futures Trading Commission
Toby Rosenblatt
President, Founders Investments Ltd.
President, The Glen Ellen Company
Michael S. Scott Morton
Jay W. Forrester Professor of Management,
Sloan School of Management,
Massachusetts Institute of Technology
9
<PAGE>
The Fund's Accounting Policies
- --------------------------------------------------------------------------------
In keeping with generally accepted accounting principles for mutual funds, the
fund has used the following policies in preparing the portfolio holdings and
financial statements in this report:
The fund values all portfolio securities as of the date of this report (or, if
that day wasn't a business day, then the most recent business day). The fund
uses the following methods for determining the values of various types of
securities:
o Listed securities -- The fund uses the price of the last sale on a
national securities exchange that was quoted before the close of the New
York Stock Exchange.
o Over-the-counter securities -- The fund uses the closing prices quoted on
the Nasdaq system. If a security hasn't traded that day, or if it is not
quoted on the Nasdaq system, the value is set at halfway between the
closing bid and asked quotations.
o Securities maturing within sixty days -- The fund adjusts the value of
these securities daily, moving them closer to the amount due on maturity
as the maturity date approaches.
The fund accounts for each purchase and sale of portfolio securities on the date
the transaction was executed. In calculating realized gains or losses, the fund
takes as its cost basis the total cost of a security as of its delivery to the
fund.
The fund records net investment income from portfolio securities as follows:
o Interest -- The fund accrues interest daily as it earns it.
o Cash dividends -- The fund accrues these on the ex-dividend date.
The fund accounts for income from the lending of its securities by including it
in interest income.
The fund distributes its net earnings to its shareholders. The fund calculates
these distributions using federal income tax regulations. As a result, they may
be different than if the fund used generally accepted accounting principles. The
fund distributes its earnings on the following schedule:
o Dividends from net investment income -- The fund ordinarily declares and
pays these quarterly, if any.
o Net realized capital gains -- The fund distributes these annually, if any,
and may make an additional distribution if tax regulations make it
necessary.
If the fund has no earnings to distribute, it won't make a distribution.
The fund does not pay federal income tax. This is because it is exempt from
taxes under Subchapter M of the Internal Revenue Code, in part because it makes
distributions as described above.
The fund has used certain estimates and assumptions in preparing this report.
Although they are necessary in order to follow generally accepted accounting
principles, these estimates and assumptions affect several key areas, including
statements of assets and liabilities and the reported amounts of income and
expenses. Actual results could differ from those estimates.
The fund's securities and investment practices carry certain risks. Some are
described in this report, but for a more complete discussion you should read the
fund's prospectus and its Statement of Additional Information.
10 State Street Research Investment Trust
<PAGE>
Portfolio Holdings June 30, 1999 (unaudited)
- --------------------------------------------------------------------------------
The listings that begin on this page detail the fund's investment holdings as of
the report date. We have grouped the holdings by asset class and by smaller
sub-groups as well. For example, we have grouped this fund's stocks by sector of
the economy, and then by specific industry within each sector.
The solid colored circles (1) show the fund's ten largest holdings, with the
number in the circle showing where the holding ranks in the top ten.
- --------------------------------------------------------------------------------
Notes about specific elements of the financials are called out in boxes such as
this.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
KEY TO SYMBOLS
* Denotes a security which has not paid a dividend during the last year.
+ Denotes an American Depositary Receipt, a form of ownership of foreign
securities that is traded in the United States and denominated in U.S.
dollars.
- --------------------------------------------------------------------------------
Market
Issuer Shares Value
========================================================================
Common Stocks 97.8% of net assets
Automobiles & Transportation
1.9% of net assets
========================================================================
Automotive Parts 0.2%
------------------------------------------------------------------------
Delphi Automotive Systems Corp. 354,777 $6,585,546
-----------
Automobiles 1.1%
------------------------------------------------------------------------
General Motors Corp. 507,600 33,501,600
-----------
Miscellaneous Transportation 0.6%
------------------------------------------------------------------------
Harley-Davidson Inc. 329,300 17,905,688
-----------
Total Automobiles & Transportation 57,992,834
-----------
Consumer Discretionary 18.9% of net assets
========================================================================
Advertising Agencies 1.2%
------------------------------------------------------------------------
Interpublic Group of Companies, Inc. 415,150 35,962,369
-----------
Casinos/Gambling 0.8%
------------------------------------------------------------------------
Mirage Resorts Inc.* 1,485,900 24,888,825
-----------
Commercial Services 1.7%
------------------------------------------------------------------------
Waste Management Inc. 961,100 51,659,125
-----------
Communications, Media & Entertainment 6.3%
------------------------------------------------------------------------
(9) CBS Corp. 1,672,400 72,644,875
TV/radio broadcasting network
------------------------------------------------------------------------
Fox Entertainment Group Inc. Cl. A * 915,700 24,666,669
------------------------------------------------------------------------
Time Warner Inc. 730,900 53,721,150
------------------------------------------------------------------------
Viacom Inc. Cl. B* 884,800 38,931,200
------------------------------------------------------------------------
Walt Disney Co. 121,896 3,755,920
------------------------------------------------------------------------
193,719,814
-----------
Consumer Products 0.9%
------------------------------------------------------------------------
Best Buy Company Inc.* 435,700 29,409,750
-----------
Household Furnishings 1.6%
------------------------------------------------------------------------
Black & Decker Corp. 778,900 49,168,063
-----------
Printing & Publishing 0.6%
------------------------------------------------------------------------
Reader's Digest Association Inc. Cl. A 452,800 17,998,800
-----------
Restaurants 2.0%
------------------------------------------------------------------------
(10) McDonald's Corp. 1,509,400 62,357,087
------------------------------------------------------------------------
Fast food restaurant franchiser
------------------------------------------------------------------------
11
<PAGE>
Portfolio Holdings June 30, 1999 CONTINUED
<TABLE>
<CAPTION>
Market
Issuer Shares Value
===============================================================================
<S> <C> <C> <C>
Retail 3.8%
-------------------------------------------------------------------------------
Dayton Hudson Corp. 661,200 $42,978,000
-------------------------------------------------------------------------------
Home Depot Inc. 195,100 12,571,756
-------------------------------------------------------------------------------
Staples Inc.* 946,600 29,285,438
-------------------------------------------------------------------------------
Wal-Mart Stores, Inc. 693,200 33,446,900
-------------------------------------------------------------------------------
118,282,094
-----------
Total Consumer Discretionary 583,445,927
-----------
Consumer Staples 7.4% of net assets
===============================================================================
Beverages 2.8%
-------------------------------------------------------------------------------
Anheuser-Busch Companies, Inc. 198,500 14,081,094
-------------------------------------------------------------------------------
Coca-Cola Enterprises Inc. 1,321,600 39,317,600
-------------------------------------------------------------------------------
PepsiCo Inc. 835,600 32,327,275
-----------
85,725,969
-----------
Drug & Grocery Store Chains 2.4%
-------------------------------------------------------------------------------
CVS Corp. 786,600 39,919,950
-------------------------------------------------------------------------------
Kroger Co.* 1,208,000 33,748,500
-------------------------------------------------------------------------------
73,668,450
-----------
Household Products 2.2%
-------------------------------------------------------------------------------
Colgate-Palmolive Co. 393,500 38,858,125
-------------------------------------------------------------------------------
Procter & Gamble Co. 327,300 29,211,525
-------------------------------------------------------------------------------
68,069,650
-----------
Total Consumer Staples 227,464,069
Financial Services 17.3% of net assets
===============================================================================
Banks & Savings & Loan 6.7%
-------------------------------------------------------------------------------
(1) Bank of America Corp. 1,549,409 113,591,047
Money center banks
-------------------------------------------------------------------------------
(3) Chase Manhattan Corp. 1,093,100 94,689,788
-----------
Banking 208,280,835
-----------
Financial Data Processing Services & Systems 1.3%
-------------------------------------------------------------------------------
First Data Corp. 822,000 40,226,625
-----------
Insurance 2.5%
-------------------------------------------------------------------------------
Ace Ltd. 1,312,400 37,075,300
-------------------------------------------------------------------------------
American International Group Inc. 353,600 41,393,300
-------------------------------------------------------------------------------
78,468,600
-----------
Miscellaneous Financial 6.8%
-------------------------------------------------------------------------------
American Express Co. 253,800 33,025,725
-------------------------------------------------------------------------------
American General Corp. 423,642 31,932,016
-------------------------------------------------------------------------------
Capital One Financial Corp. 336,300 18,727,706
-------------------------------------------------------------------------------
(8) Citigroup, Inc. 1,532,250 72,781,875
Financial services
-------------------------------------------------------------------------------
Household International Inc. 1,105,500 52,373,062
-------------------------------------------------------------------------------
208,840,384
-----------
Total Financial Services 535,816,444
-----------
Health Care 8.0% of net assets
===============================================================================
Drugs & Biotechnology 7.7%
-------------------------------------------------------------------------------
American Home Products Corp. 433,500 24,926,250
-------------------------------------------------------------------------------
Amgen Inc.* 640,900 39,014,787
-------------------------------------------------------------------------------
Baxter International Inc. 671,000 40,679,375
-------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 321,000 22,610,438
-------------------------------------------------------------------------------
Johnson & Johnson 309,900 30,370,200
-------------------------------------------------------------------------------
Pfizer Inc. 99,200 10,887,200
-------------------------------------------------------------------------------
Pharmacia & Upjohn Inc. 747,600 42,473,025
-------------------------------------------------------------------------------
Schering-Plough Corp. 514,100 27,247,300
-----------
238,208,575
-----------
Hospital Supply 0.3%
-------------------------------------------------------------------------------
Guidant Corp.* 198,500 10,210,344
-----------
Total Health Care 248,418,919
-----------
Integrated Oils 7.8% of net assets
===============================================================================
Integrated Domestic 1.3%
-------------------------------------------------------------------------------
Enron Corp. 480,600 39,289,050
-----------
Integrated International 6.5%
-------------------------------------------------------------------------------
BP Amoco PLC + 264,468 28,694,778
-------------------------------------------------------------------------------
Exxon Corp. 740,900 57,141,912
-------------------------------------------------------------------------------
Shell Transport & Trading PLC 810,500 37,586,938
-------------------------------------------------------------------------------
(6) Total Fina SA +* 1,213,708 78,208,309
-----------
Oil exploration 201,631,937
-----------
Total Integrated Oils 240,920,987
-----------
Materials & Processing 2.6% of net assets
===============================================================================
Chemicals 2.5%
-------------------------------------------------------------------------------
(7) Dow Chemical Co. 597,600 75,820,500
-----------
Chemicals
Diversified Manufacturing 0.1%
-------------------------------------------------------------------------------
Engelhard Corp. 154,700 3,500,087
-----------
Total Materials & Processing 79,320,587
-----------
</TABLE>
12 State Street Research Investment Trust
<PAGE>
<TABLE>
<CAPTION>
Market
Issuer Shares Value
============================================================================
Other 10.0% of net assets
============================================================================
<S> <C> <C> <C>
Multi-Sector 10.0%
----------------------------------------------------------------------------
AlliedSignal Inc. 877,800 $55,301,400
----------------------------------------------------------------------------
(4) General Electric Co. 752,300 85,009,900
Consumer & Industrial Products
----------------------------------------------------------------------------
Monsanto Co. 82,900 3,269,369
----------------------------------------------------------------------------
Raytheon Co. Cl. B 232,700 16,376,263
----------------------------------------------------------------------------
Seagram Ltd.* 813,900 41,000,212
----------------------------------------------------------------------------
(2) Tyco International Ltd. 1,155,200 109,455,200
-------------
Diversified manufacturer
Total Other 310,412,344
-------------
Other Energy 1.5% of net assets
============================================================================
Oil & Gas Producers 0.3%
----------------------------------------------------------------------------
Ocean Energy Inc.* 1,058,500 10,188,063
-------------
Oil Well Equipment & Services 1.2%
----------------------------------------------------------------------------
Schlumberger Ltd. 548,924 34,959,597
-------------
Total Other Energy 45,147,660
-------------
Producer Durables 2.0% of net assets
============================================================================
Production Technology Equipment 2.0%
----------------------------------------------------------------------------
Solectron Corp.* 341,800 22,793,788
----------------------------------------------------------------------------
Teradyne Inc.* 549,400 39,419,450
----------------------------------------------------------------------------
62,213,238
-------------
Total Producer Durables 62,213,238
-------------
Technology 12.4% of net assets
============================================================================
Communications Technology 1.5%
----------------------------------------------------------------------------
Lucent Technologies Inc. 674,600 45,493,338
-------------
Computer Software 1.8%
----------------------------------------------------------------------------
Microsoft Corp.* 621,000 56,006,437
-------------
Computer Technology 5.1%
----------------------------------------------------------------------------
Cisco Systems Inc.* 581,800 37,526,100
----------------------------------------------------------------------------
Electronic Data Systems Corp. 255,700 14,463,031
----------------------------------------------------------------------------
EMC Corp.* 209,000 11,495,000
----------------------------------------------------------------------------
Hewlett-Packard Co. 264,000 26,532,000
----------------------------------------------------------------------------
International Business Machines Corp. 476,000 61,523,000
----------------------------------------------------------------------------
Sun Microsystems Inc.* 98,200 6,763,525
----------------------------------------------------------------------------
158,302,656
-------------
Electronics 1.0%
----------------------------------------------------------------------------
Nokia Corp. + 334,500 30,627,656
-------------
Electronics: Semi-Conductors/Components 3.0%
----------------------------------------------------------------------------
Intel Corp. 635,400 37,806,300
----------------------------------------------------------------------------
Texas Instruments Inc. 391,100 56,709,500
----------------------------------------------------------------------------
94,515,800
-------------
Total Technology 384,945,887
----------------------------------------------------------------------------
Utilities 8.0% of net assets
============================================================================
Electrical 1.2%
----------------------------------------------------------------------------
FPL Group Inc. 172,800 9,439,200
----------------------------------------------------------------------------
Unicom Corp. 755,500 29,133,969
-------------
38,573,169
-------------
Telecommunications 6.8%
----------------------------------------------------------------------------
AT&T Corp. 604,300 33,727,494
----------------------------------------------------------------------------
Bell Atlantic Corp. 508,700 33,256,262
----------------------------------------------------------------------------
(5) MCI WorldCom Inc.* 967,200 83,239,650
Telecommunications services
----------------------------------------------------------------------------
MediaOne Group Inc.* 582,600 43,330,875
----------------------------------------------------------------------------
Qwest Communications
International Inc.* 478,200 15,810,487
-------------
209,364,768
-------------
Total Utilities 247,937,937
-------------
Total Common Stocks 3,024,036,833
-------------
</TABLE>
- -------------------------------------------------------------
The fund paid a total of $1,977,044,671 for these securities.
- -------------------------------------------------------------
13
<PAGE>
Portfolio Holdings June 30, 1999 CONTINUED
<TABLE>
<CAPTION>
Market
Issuer Shares Value
========================================================================================================================
<S> <C> <C>
Short-Term Investments 7.7% of net assets
- ------------------------------------------------------------------------------------------------------------------------
State Street Navigator Securities Lending Prime Portfolio 237,511,739 $237,511,739
--------------
Total Short-Term Investments 237,511,739
--------------
</TABLE>
- -----------------------------------------------------------
The fund paid a total of $237,511,739 for these securities.
- -----------------------------------------------------------
<TABLE>
<CAPTION>
Coupon Maturity Amount of
Rate Date Principal
========================================================================================================================
<S> <C> <C> <C> <C>
Commercial Paper 2.2% of net assets
- ------------------------------------------------------------------------------------------------------------------------
American Express Credit Corp. 5.25% 7/01/1999 $5,560,000 5,560,000
- ------------------------------------------------------------------------------------------------------------------------
American Express Credit Corp. 4.94% 7/06/1999 10,000,000 10,000,000
- ------------------------------------------------------------------------------------------------------------------------
Chevron U.S.A. Inc. 5.10% 7/08/1999 9,977,000 9,977,000
- ------------------------------------------------------------------------------------------------------------------------
Chevron U.S.A. Inc. 5.00% 7/12/1999 6,316,000 6,316,000
- ------------------------------------------------------------------------------------------------------------------------
Ford Motor Credit Co. 5.20% 7/12/1999 12,000,000 12,000,000
- ------------------------------------------------------------------------------------------------------------------------
General Electric Capital Corp. 4.93% 7/08/1999 8,214,000 8,214,000
- ------------------------------------------------------------------------------------------------------------------------
General Electric Capital Corp. 5.25% 7/08/1999 4,836,000 4,836,000
- ------------------------------------------------------------------------------------------------------------------------
Household Finance Corp. 4.93% 7/06/1999 13,019,000 13,019,000
--------------
Total Commercial Paper 69,922,000
--------------
</TABLE>
- ----------------------------------------------------------
The fund paid a total of $69,922,000 for these securities.
- ----------------------------------------------------------
<TABLE>
<CAPTION>
% of
Net Assets
========================================================================================================================
<S> <C> <C>
Summary of Portfolio Assets
- ------------------------------------------------------------------------------------------------------------------------
Investments 107.7% $3,331,470,572
- ------------------------------------------------------------------------------------------------------------------------
Cash and Other Assets, Less Liabilities (7.7%) (239,573,911)
----- --------------
- ------------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $3,091,896,661
===== ==============
</TABLE>
- -------------------------------------------------------------
The fund paid a total of $2,284,478,410 for these securities.
- -------------------------------------------------------------
14 State Street Research Investment Trust
<PAGE>
State Street Research Investment Trust
- -----------------------------------------
Report on Special Meeting of Shareholders
A Special Meeting of Shareholders of State Street Research Investment Trust
("Trust"), a series of State Street Research Master Investment Trust ("Master
Trust"), was convened on April 6, 1999 ("Meeting"). The results of the Meeting
are set forth below.
Action on Proposal Votes (millions of shares)
For Withheld
-------------------------
The following persons were elected as Trustees:
Bruce R. Bond--------------------------------------- 118.3 1.5
Susan M. Phillips----------------------------------- 118.3 1.4
- --------------------------------------------------------------------------------
Federal Income Tax Information
At June 30, 1999, the net unrealized appreciation of
investments based on cost for federal income tax purposes
$2,284,769,143 was as follows:
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $1,075,711,257
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (29,009,828)
--------------
$1,046,701,429
==============
- --------------------------------------------------------------------------------
15
<PAGE>
Statement of
Assets and Liabilities June 30, 1999 (unaudited)
- --------------------------------------------------------------------------------
This is the fund's balance sheet as of the report date. It shows the fund's
total assets, its liabilities and, by subtraction, its net assets. It also shows
the share price for each share class as of the report date.
Assets
Investments, at market value $3,331,470,572
- -------------------------------------------------------------
The fund paid a total of $2,284,478,410 for these securities.
- -------------------------------------------------------------
Cash 1,034
Receivable for fund shares sold 4,747,148
Dividends and interest receivable 2,082,363
Other assets 349,458
--------------
3,338,650,575
Liabilities
Payable for collateral received on
securities loaned 237,511,739
Accrued management fee 3,508,217
- --------------------------------------------------------------------------------
The management fee is 0.55% of the first $500 million of fund assets, annually,
0.50% of the next $500 million, and 0.45% of any amount over $1 billion and
amounted to $6,655,708 for the report period.
- --------------------------------------------------------------------------------
Payable for securities purchased 2,132,278
Payable for fund shares redeemed 1,628,521
Accrued distribution and service fees 1,208,417
Accrued transfer agent and
shareholder services 362,123
Dividends payable 227,380
Accrued trustees' fees 25,338
Other accrued expenses 149,901
--------------
246,753,914
--------------
Net Assets $3,091,896,661
==============
Net Assets consist of:
Distribution in excess of net investment income $(1,505,529)
Unrealized appreciation of investments 1,046,992,162
Accumulated net realized gain 162,132,765
Paid-in capital 1,884,277,263
--------------
$3,091,896,661
==============
- --------------------------------------------------------------------------------
Net Asset Value (NAV) of Each Share Class
Except where noted, the NAV is the offering and the redemption price for each
class.
Net Assets / Number of Shares = NAV
A $715,970,069 53,037,463 $13.50*
B(1) $151,690,358 11,368,148 $13.34**
B $1,040,220,349 77,981,747 $13.34**
C $78,363,953 5,854,664 $13.38**
S $1,105,651,932 81,487,754 $13.57
* Maximum offering price per share $14.32
** When you sell Class B(1), Class B or Class C shares, you receive the net
asset value minus deferred sales charge
- --------------------------------------------------------------------------------
16 State Street Research Investment Trust
<PAGE>
Statement of
Operations For the six months ended June 30, 1999 (unaudited)
- --------------------------------------------------------------------------------
This shows what the fund earned and lost over the report period, and what its
expenses were.
Investment Income
Dividends, net of foreign taxes $13,359,507
- ----------------------------------------
The fund paid foreign taxes of $148,157.
- ----------------------------------------
Interest 2,359,418
- --------------------------------------------------------------------------------
Includes $150,321 in income from the lending of portfolio securities. As of the
report date, the fund had a total of $220,979,478 of securities out on loan and
was holding a total of $237,511,739 in collateral related to those loans.
- --------------------------------------------------------------------------------
------------
15,718,925
Expenses
Management fee 6,655,708
- --------------------------------------------------------------------------------
The management fee is 0.55% of the first $500 million of fund assets, annually,
0.50% of the next $500 million, and 0.45% of any amount over $1 billion.
- --------------------------------------------------------------------------------
Transfer agent and shareholder services 1,607,063
- --------------------------------------------------------------------------------
Includes a total of $564,005 paid to the distributor for the services it
provided and to MetLife for similar services it provided, including maintaining
the accounts of some investors who hold shares through that firm's employee
benefit plans and other sponsored arrangements.
- --------------------------------------------------------------------------------
Service fee-Class A 791,281
Distribution and service fees-Class B(1) 344,085
Distribution and service fees-Class B 4,899,568
Distribution and service fees-Class C 329,169
- --------------------------------------------------------------------------------
Payments made to the distributor under the fund's 12b-1 plans. The fees cover
personal services and the maintenance of shareholder accounts. The fees also
cover distribution and marketing expenditures for the sale of fund shares.
- --------------------------------------------------------------------------------
Custodian fee 184,170
Reports to Shareholders 162,560
Registration fees 111,142
Audit fee 15,748
Trustees' fees 13,276
- --------------------------------------------------------------------------------
Paid only to trustees who aren't currently affiliated with the adviser (the fund
doesn't pay trustees fees to affiliated trustees).
- --------------------------------------------------------------------------------
Legal fees 9,008
Miscellaneous 15,084
------------
15,137,862
Fees paid indirectly (160,087)
- -----------------------------------------------------------------------
Represents transfer agent credits earned from uninvested cash balances.
- -----------------------------------------------------------------------
------------
14,977,775
------------
Net investment income 741,150
------------
Realized and Unrealized Gain
on Investments
Net realized gain on investments 167,051,376
- --------------------------------------------------------------------------------
To earn this, the fund sold $1,027,515,443 of securities. During this same
period, the fund also bought $1,228,399,175 worth of securities. These figures
don't include short-term obligations or U.S. government securities.
- --------------------------------------------------------------------------------
Net unrealized appreciation of investments 112,855,872
------------
Net gain on investments 279,907,248
------------
Net increase in net assets resulting
from operations $280,648,398
============
17
<PAGE>
Statement of
Changes in Net Assets
- --------------------------------------------------------------------------------
This shows how the fund's size changed over the report period, including changes
that resulted from investment performance as well as those that resulted from
shareholders buying and selling fund shares.
Six months ended
Year ended June 30, 1999
December 31, 1998 (unaudited)
Increase (Decrease) in Net Assets
Operations:
Net investment income $10,333,698 $741,150
Net realized gain
on investments 170,998,002 167,051,376
Net unrealized appreciation
of investments 377,577,808 112,855,872
---------------------------------
Net increase resulting
from operations 558,909,508 280,648,398
---------------------------------
Dividends from net investment income:
Class A (2,587,460) (594,273)
Class S (7,493,736) (2,063,972)
---------------------------------
(10,081,196) (2,658,245)
---------------------------------
Distributions from net realized gains:
Class A (39,822,904) (6,647,367)
Class B(1) -- (689,095)
Class B (65,309,613) (10,485,973)
Class C (3,824,821) (702,447)
Class S (76,915,562) (10,971,820)
---------------------------------
(185,872,900) (29,496,702)
---------------------------------
Net increase from fund
share transactions 395,671,890 238,883,274
---------------------------------
Total increase in net assets 758,627,302 487,376,725
---------------------------------
Net Assets
Beginning of period 1,845,892,634 2,604,519,936
---------------------------------
End of period $2,604,519,936 $3,091,896,661
=================================
- --------------------------------------------------------------------------------
Includes undistributed (overdistributed) net investment income of $411,566 and
$(1,505,529), respectively.
- --------------------------------------------------------------------------------
18 State Street Research Investment Trust
<PAGE>
- --------------------------------------------------------------------------------
These transactions break down by share class as follows:
<TABLE>
<CAPTION>
Year ended Six months ended
December 31, 1998 June 30, 1999 (unaudited)
==============================================================
Class A Shares Amount Shares Amount
==========================================================================================================
<S> <C> <C> <C> <C>
Shares sold 15,387,705 $179,548,411 10,955,217 $140,855,410*
Issued upon reinvestment of:
Distributions from net realized gains 3,305,725 38,989,534 506,311 6,495,967
Dividends from net investment income 208,775 2,431,646 45,865 588,068
Shares redeemed (7,738,830) (89,464,550) (4,970,599) (64,111,167)
--------------------------------------------------------------
Net increase 11,163,375 $131,505,041 6,536,794 $83,828,278
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
<CAPTION>
Class B(1)(a) Shares Amount Shares Amount
==========================================================================================================
<S> <C> <C> <C> <C>
Shares sold -- -- 11,604,116 $148,308,953**
Issued upon reinvestment of
distribution from net realized gains -- -- 53,120 643,395
Shares redeemed -- -- (289,088) (3,738,381)***
--------------------------------------------------------------
Net increase -- -- 11,368,148 $145,213,967
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
<CAPTION>
Class B Shares Amount Shares Amount
==========================================================================================================
<S> <C> <C> <C> <C>
Shares sold 28,941,723 $335,668,941 6,784,398 $86,111,579**
Issued upon reinvestment of
distributions from net realized gains 5,418,219 63,334,450 803,973 10,209,469
Shares redeemed (11,279,857) (129,650,410) (6,693,677) (85,391,289)***
--------------------------------------------------------------
Net increase 23,080,085 $269,352,981 894,694 $10,929,759
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
<CAPTION>
Class C Shares Amount Shares Amount
==========================================================================================================
<S> <C> <C> <C> <C>
Shares sold 1,707,702 $19,923,326 1,728,169 $22,119,789
Issued upon reinvestment of
distributions from net realized gains 306,530 3,595,984 51,492 655,996
Shares redeemed (1,015,775) (11,590,128) (420,488) (5,365,727)****
--------------------------------------------------------------
Net increase 998,457 $11,929,182 1,359,173 $17,410,058
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
<CAPTION>
Class S Shares Amount Shares Amount
==========================================================================================================
<S> <C> <C> <C> <C>
Shares sold 2,501,260 $29,464,708 1,257,375 $16,251,586
Issued upon reinvestment of:
Distributions from net realized gains 3,427,990 40,551,340 448,069 5,775,610
Dividends from net investment income 285,270 3,357,017 64,079 839,823
Shares redeemed (7,808,814) (90,488,379) (3,200,110) (41,365,807)
--------------------------------------------------------------
Net decrease (1,594,294) $(17,115,314) (1,430,587) $(18,498,788)
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
The trustees have the authority to issue an unlimited number of fund
shares, with a $.001 par value per share.
* Includes $407,895 and $2,464,779 in sales charges collected by the
distributor and MetLife.
** Like all broker-dealers, MetLife received commissions that were calculated
as a percentage of these sales but the commissions of $1,042,039 and
$1,889,148 for Class B(1) and Class B, were paid by the distributor, not
the fund.
*** Includes $59,079 and $870,339 in deferred sales charges collected by the
distributor for Class B(1) and Class B.
**** Includes $3,170 in deferred sales charges collected by the distributor.
(a) January 1, 1999 (commencement of share class) to June 30, 1999.
- --------------------------------------------------------------------------------
19
<PAGE>
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
=======================================================================
Years ended December 31
-------------------------------------------------- Six months ended
June 30,1999
Per Share Data 1994 1995(a) 1996(a) 1997(a) 1998(a) (unaudited)(a)
============================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ($) 8.69 7.74 9.16 9.07 10.41 12.36
----- ----- ----- ----- ----- -----
Net investment income (loss) ($) 0.11 0.14 0.12 0.10 0.07 0.02
Net realized and unrealized gain (loss)
on investments ($) (0.44) 2.39 1.80 2.54 2.89 1.26
----- ----- ----- ----- ----- -----
Total from investment operations ($) (0.33) 2.53 1.92 2.64 2.96 1.28
----- ----- ----- ----- ----- -----
Dividends from net investment income ($) (0.12) (0.13) (0.13) (0.10) (0.06) (0.01)
Distributions from net realized gains ($) (0.50) (0.98) (1.87) (1.20) (0.95) (0.13)
Distribution in excess of net realized gains ($) -- -- (0.01) -- -- --
----- ----- ----- ----- ----- -----
Total distributions ($) (0.62) (1.11) (2.01) (1.30) (1.01) (0.14)
----- ----- ----- ----- ----- -----
Net asset value, end of period ($) 7.74 9.16 9.07 10.41 12.36 13.50
===== ===== ===== ===== ===== =====
Total return (%)(b) (3.84) 32.85 21.03 28.91 29.12 10.47(d)
Ratios/Supplemental Data
============================================================================================================================
Net assets at end of period ($ thousands) 92,137 135,676 223,868 367,759 574,858 715,970
Ratio of operating expenses to
average net assets (%) 0.89 0.78 0.75 0.76 0.85 0.88(e)
Ratio of net investment income (loss)
to average net assets (%) 1.26 1.54 1.17 0.90 0.63 0.26(e)
Portfolio turnover rate (%) 33.08 39.21 73.51 75.21 66.32 37.29
<CAPTION>
Class B(1)
=================
Six months ended
June 30,1999
Per Share Data (unaudited)(a)(c)
=======================================================================
<S> <C>
Net asset value, beginning of period ($) 12.25
-------
Net investment income (loss) ($) (0.03)
Net realized and unrealized gain (loss)
on investments ($) 1.25
-------
Total from investment operations ($) 1.22
-------
Dividends from net investment income ($) --
Distributions from net realized gains ($) (0.13)
Distribution in excess of net realized gains ($) --
-------
Total distributions ($) (0.13)
-------
Net asset value, end of period ($) 13.34
=======
Total return (%)(b) 10.05(d)
Ratios/Supplemental Data
==========================================================================
Net assets at end of period ($ thousands) 151,690
Ratio of operating expenses to
average net assets (%) 1.63(e)
Ratio of net investment income (loss)
to average net assets (%) (0.47)(e)
Portfolio turnover rate (%) 37.29
</TABLE>
<TABLE>
<CAPTION>
Class B
=====================================================================
Years ended December 31
--------------------------------------------------- Six months ended
June 30,1999
Per Share Data 1994 1995(a) 1996(a) 1997(a) 1998(a) (unaudited)(a)
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ($) 8.66 7.72 9.13 9.03 10.34 12.25
----- ----- ----- ----- ----- -----
Net investment income (loss) ($) 0.06 0.07 0.04 0.02 (0.01) (0.03)
Net realized and unrealized gain (loss)
on investments ($) (0.44) 2.38 1.80 2.51 2.87 1.25
----- ----- ----- ----- ----- -----
Total from investment operations ($) (0.38) 2.45 1.84 2.53 2.86 1.22
----- ----- ----- ----- ----- -----
Dividends from net investment income ($) (0.06) (0.06) (0.06) (0.02) -- --
Distributions from net realized gains ($) (0.50) (0.98) (1.87) (1.20) (0.95) (0.13)
Distribution in excess of net realized gains ($) -- -- (0.01) -- -- --
----- ----- ----- ----- ----- -----
Total distributions ($) (0.56) (1.04) (1.94) (1.22) (0.95) (0.13)
----- ----- ----- ----- ----- -----
Net asset value, end of period ($) 7.72 9.13 9.03 10.34 12.25 13.34
===== ===== ===== ===== ===== =====
Total return (%)(b) (4.43) 31.86 20.15 27.80 28.26 10.05(d)
Ratios/Supplemental Data
===========================================================================================================================
Net assets at end of period ($ thousands) 113,301 183,446 315,766 558,568 944,388 1,040,220
Ratio of operating expenses to
average net assets (%) 1.64 1.53 1.50 1.51 1.60 1.63(e)
Ratio of net investment income (loss)
to average net assets (%) 0.51 0.79 0.41 0.15 (0.12) (0.49)(e)
Portfolio turnover rate (%) 33.08 39.21 73.51 75.21 66.32 37.29
</TABLE>
20 State Street Research Investment Trust
<PAGE>
<TABLE>
<CAPTION>
Class C
===================================================================
Years ended December 31
------------------------------------------------ Six months ended
June 30,1999
Per Share Data 1994 1995(a) 1996(a) 1997(a) 1998(a) (unaudited)(a)
========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ($) 8.68 7.74 9.15 9.05 10.38 12.29
----- ----- ----- ----- ----- -----
Net investment income (loss) ($) 0.05 0.07 0.04 0.02 (0.01) (0.03)
Net realized and unrealized gain (loss)
on investments ($) (0.43) 2.38 1.79 2.53 2.87 1.25
----- ----- ----- ----- ----- -----
Total from investment operations ($) (0.38) 2.45 1.83 2.55 2.86 1.22
----- ----- ----- ----- ----- -----
Dividends from net investment income ($) (0.06) (0.06) (0.05) (0.02) -- --
Distributions from net realized gains ($) (0.50) (0.98) (1.87) (1.20) (0.95) (0.13)
Distribution in excess of net realized gains ($) -- -- (0.01) -- -- --
----- ----- ----- ----- ----- -----
Total distributions ($) (0.56) (1.04) (1.93) (1.22) (0.95) (0.13)
----- ----- ----- ----- ----- -----
Net asset value, end of period ($) 7.74 9.15 9.05 10.38 12.29 13.38
===== ===== ===== ===== ===== =====
Total return (%)(b) (4.45) 31.75 20.09 27.93 28.15 10.02(d)
Ratios/Supplemental Data
========================================================================================================================
Net assets at end of period ($ thousands) 11,707 16,841 25,658 36,290 55,263 78,364
Ratio of operating expenses to average
net assets (%) 1.64 1.53 1.50 1.51 1.60 1.63(e)
Ratio of net investment income (loss)
to average net assets (%) 0.51 0.79 0.42 0.15 (0.13) (0.49)(e)
Portfolio turnover rate (%) 33.08 39.21 73.51 75.21 66.32 37.29
</TABLE>
<TABLE>
<CAPTION>
Class S
======================================================================
Years ended December 31
------------------------------------------------ Six months ended
June 30,1999
Per Share Data 1994 1995(a) 1996(a) 1997(a) 1998(a) (unaudited)(a)
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ($) 8.70 7.76 9.18 9.11 10.45 12.42
----- ----- ----- ----- ----- -----
Net investment income (loss) ($) 0.13 0.16 0.14 0.12 0.10 0.03
Net realized and unrealized gain (loss)
on investments ($) (0.43) 2.39 1.82 2.54 2.91 1.28
----- ----- ----- ----- ----- -----
Total from investment operations ($) (0.30) 2.55 1.96 2.66 3.01 1.31
----- ----- ----- ----- ----- -----
Dividends from net investment income ($) (0.14) (0.15) (0.15) (0.12) (0.09) (0.03)
Distributions from net realized gains ($) (0.50) (0.98) (1.87) (1.20) (0.95) (0.13)
Distribution in excess of net realized gains ($) -- -- (0.01) -- -- --
----- ----- ----- ----- ----- -----
Total distributions ($) (0.64) (1.13) (2.03) (1.32) (1.04) (0.16)
----- ----- ----- ----- ----- -----
Net asset value, end of period ($) 7.76 9.18 9.11 10.45 12.42 13.57
===== ===== ===== ===== ===== =====
Total return (%)(b) (3.47) 33.07 21.48 29.08 29.51 10.61(d)
Ratios/Supplemental Data
===========================================================================================================================
Net assets at end of period ($ thousands) 627,551 738,649 780,627 883,276 1,030,011 1,105,652
Ratio of operating expenses to average
net assets (%) 0.65 0.54 0.50 0.51 0.60 0.63(e)
Ratio of net investment income (loss)
to average net assets (%) 1.54 1.81 1.44 1.17 0.88 0.50(e)
Portfolio turnover rate (%) 33.08 39.21 73.51 75.21 66.32 37.29
</TABLE>
(a) Per-share figures have been calculated using the average shares method.
(b) Does not reflect any front-end or contingent deferred sales charges.
(c) January 1, 1999 (commencement of share class) to June 30, 1999.
(d) Not annualized.
(e) Annualized.
21
<PAGE>
Glossary
12b-1 fees -- Fees paid from mutual fund assets for personal services and
for the maintenance of shareholder accounts and distribution and marketing
expenses. The fees are named after the SEC rule that permits them.
average shares method -- The practice of basing a fund's calculations for
a given period on the average number of shares that were outstanding
during that period.
bid and asked quotations -- The prices for buyers and sellers of a given
security. With most "over the counter" stocks, the price a buyer pays is
slightly higher than the price the seller receives (some of the difference
is retained by the broker who is primarily responsible for the security
being traded). Most transactions in stocks that are traded over the
counter take place at a price somewhere between the bid and asked
quotations.
Nasdaq -- The stock price quotation system operated by the National
Association of Securities Dealers. The Nasdaq system operates as a
clearing house for transaction data about stocks that are traded "over the
counter" around the U.S.
New York Stock Exchange -- The largest stock exchange in the United
States, and the place where many of the largest company stocks are listed.
Unlike the Nasdaq system, the NYSE is a physical exchange, with all
trading occurring on the exchange's trading floor on Wall Street.
Principal Amount -- With bonds and certain other debt securities, the
amount of the underlying principal of the security. When the security
matures, the issuer is obligated to repay this amount to the holder of the
security. Also called "face value" or "par value".
22 State Street Research Investment Trust
<PAGE>
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Spectrum of Funds
Growth Funds
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FYI
o USA TODAY recently published an article on State Street Research
Investment Trust. For a complimentary copy, call us.
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$treet Week With Louis Rukeyser in July.
o Now available: State Street Research Investment Trust prospectus and fact
sheet in Chinese and Spanish translations.
--------------------------------------------
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DALBAR
HONORS COMMITMENT TO:
INVESTORS
--------------------------------------------
for Excellence in Shareholder Service
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This report must be accompanied or preceded by a current State Street Research
Investment Trust prospectus. When used after September 30, 1999, this report
must be accompanied by a current Quarterly Performance Update.
The Dalbar awards recognize quality shareholder service and should not be
considered a rating of fund performance. The survey included mutual fund
complexes that volunteered or were otherwise selected to participate and was not
industry-wide.
Control Number:(exp0800)SSR-LD IT-015G-0899
