-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, gPcXNuXFE5hfNI2oAL/pnt8CwVqpR/HVAs1iM/NBQHYPaNOASh/Fem8ZpMDSzbKg Ez4gmN3bSIAwdxFLQopzdw== 0000820027-95-000349.txt : 19950622 0000820027-95-000349.hdr.sgml : 19950622 ACCESSION NUMBER: 0000820027-95-000349 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19950430 FILED AS OF DATE: 19950621 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: IDS STOCK FUND INC CENTRAL INDEX KEY: 0000052423 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 410839317 STATE OF INCORPORATION: MN FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-00498 FILM NUMBER: 95548358 BUSINESS ADDRESS: STREET 1: 80 SOUTH 8TH STREET STREET 2: T33/52 CITY: MINNEAPOLIS STATE: MN ZIP: 55440 BUSINESS PHONE: 6126712727 FORMER COMPANY: FORMER CONFORMED NAME: INVESTORS STOCK FUND INC DATE OF NAME CHANGE: 19831221 N-30D 1 PAGE IDS Stock Fund 1995 semiannual report The goals of IDS Stock Fund, Inc. are current income and growth of capital. The fund invests primarily in common stocks and securities convertible into common stock. Distributed by American Express Financial Advisors Inc. Big names, big business These are the names you know. They are the movers and shakers of today's business world. Whether representing established U.S. firms or companies that have made their mark overseas, the securities found in IDS Stock Fund make up a veritable who's who in the financial market place. These stocks offer a dual benefit of ongoing growth potential along with a steady stream of dividend income. And as we move toward a more global economy, these blue chip, multi-national companies are well-positioned to prosper in the 21st century. Contents From the president 3 From the portfolio manager 3 Ten largest holdings 5 Financial statements 6 Notes to financial statements 9 Investments in securities 19 Directors and officers 24 IDS mutual funds 25 To our shareholders William R. Pearce President of the fund Richard H. Warden Portfolio manager From the president As I indicated in the fund's annual report, new agreements between the fund and American Express Financial Corporation were approved by share- holders in November 1994. The new agreements became effective when the fund began offering multiple classes of shares on March 20, 1995. The advantage of offering more than a single class of shares is that investors may choose how they wish to pay sales charges. These charges compensate your American Express financial advisor (formerly called your IDS planner), who is committed to providing you with outstanding services. Adding new classes of mutual fund shares does make the presentation of financial information in this report more complex. However, we will continue our effort to make the reports easier to read and understand. Meanwhile, your advisor is available to answer your questions. I also want to introduce the new manager of this fund, Dick Warden, who assumed his duties in January 1995. His review of the past period follows this letter. William R. Pearce From the portfolio manager The volatility that has characterized the stock market for the past couple of years continued during the past six months. This time, though, the upturns far exceeded the downturns. IDS Stock Fund took advantage of the more positive trend to post a healthy gain during the first half of the fiscal year - November 1994 through April 1995. (Please note that the decline in net asset value reflected a substantial capital gain paid to shareholders last December. The distribution reduced the net asset value by the same amount.) The rising-interest-rate trend that had kept the stock market off balance almost all of 1994 was still in force when the period began last November. Although long-term rates had actually begun to level off by then, concern about a potential run-up spawned a round of stock-selling that pushed the market down some 3.5% for the month. The fund's performance was similarly affected. Rally begins But investors' perceptions can change quickly, and by mid-December concern about high interest rates began to dissipate as the focus shifted more toward the generally strong profits companies were reporting. Investors reacted positively to the profit trend which, when subsequently combined with declining long-term interest rates, lent some much-awaited support to stocks. From that point, it didn't take long for the stock market to turn a moderate advance into a robust rally that continued through the end of the period. To provide some perspective on the strength of the run-up, this portfolio gained more than 8% from February through April. Helping our performance during those months was our decision to reduce the level of cash reserves (to about 5% of portfolio assets) and put more money to work in stocks. We also shifted the focus of the portfolio more toward stocks of large, well-established domestic companies ("blue chips"), especially those in the technology area. Thies strategy also proved to be productive as those companies were often at the forefront of the market's advance. Outlook generally positive As for the rest of the fiscal year, stocks continue to have some key factors in their favor: the economy appears able to maintain a positive, though slower, growth rate; because of well-behaved inflation, interest rates are unlikely to rise substantially; and the strength of corporate profits remains encouraging. On the other hand, as of this writing (May) the stock market has experienced an exhilarating run this year, and history shows that such surges are often followed by the market taking a breather or making a temporary retreat. Should that happen, we would consider it a healthy event that would allow the market to gather itself for the possibility of additional gain later this year. Richard H. Warden Class A 6-month performance (All figures per share) Net asset value (NAV) April 30, 1995 $ 18.43 Oct. 31, 1994 $ 19.48 Decrease $(1.05) Distributions Nov. 1, 1994 - April 30, 1995 From income $ 0.49 From capital gains $ 1.29 Total distributions $ 1.78 Total return** 4.5% Class B March 20, 1995 - April 30, 1995 (All figures per share) Net asset value (NAV) April 30, 1995 $18.42 March 20, 1995* $18.02 Increase $ 0.40 Distributions March 20, 1995* - April 30, 1995 From income $ 0.12 From capital gains $ -- Total distributions $ 0.12 Total return** 2.9% Class Y March 20, 1995 - April 30, 1995 (All figures per share) Net asset value (NAV) April 30, 1995 $18.43 March 20, 1995* $18.02 Increase $ 0.41 Distributions March 20, 1995* - April 30, 1995 From income $ 0.12 From capital gains $ -- Total distributions $ 0.12 Total return** 2.9% *Commencement of operations. **The prospectus discusses the effect of the sales charge on the various classes. PAGE
IDS Stock Fund, Inc. Your fund's ten largest holdings (Pie chart) The ten holdings listed here make up 12.65% of the fund's net assets _____________________________________________________________________________________ Percent Value fund's net assets)(as of April 30, 1995) _____________________________________________________________________________________ First Chicago 1.55% $ 38,675,000 A bank holding company whose main business is commercial banking, but with retail banking and credit card operation as well. BankAmerica 1.43 35,575,650 A holding company that owns Bank of America (one of the world's largest banks) and Seattle-First National Bank. U S WEST 1.25 31,031,250 U S WEST provides telecommunications services to more than 40% of the United States in 14 western states. Royal Dutch Petroleum 1.25 31,000,000 Royal Dutch Petroleum Co., which includes Royal Dutch (the Dutch version) and Shell Transport (the English version) is a major oil company. Goodyear Tire & Rubber 1.22 30,400,000 One of the largest manufacturers of tires in the world. Illinois Tool Works 1.21 30,075,000 Illinois Tool Works is a highly-regarded industrial manufacturer, with a broad, leading-edge base of capital goods and consumer component products. Minnesota Mining & Manufacturing 1.20 29,812,500 Minnesota Mining & Manufacturing (3M) is a diversified Manufacturer of industrial, commercial and consumer products, including tapes, adhesives, coatings and sealants. Pitney Bowes 1.19 29,700,000 Pitney Bowes holds strong positions in several segments of the office equipment market including mailing equipment and services, facsimile and copier products, and dictation equipment. General Electric 1.18 29,400,000 General Electric is a diversified company with interest in manufacturing, broadcasting (NBC), financial services and technology. United Technologies 1.17 29,250,000 United Technologies is a leading worldwide manufacturer of jet engines, helicopters, heating/air conditioning equipment, and elevators and escalators.
PAGE Financial statements Statement of assets and liabilities IDS Stock Fund, Inc. April 30, 1995
_____________________________________________________________________________________________________________ Assets _____________________________________________________________________________________________________________ (Unaudited) Investments in securities, at value (Note 1): Investments in securities of unaffiliated issuers (identified cost $2,407,883,553) $2,587,315,973 Investments in securities of affiliated issuers (identified cost $35,481,140) 33,400,000 Dividends and accrued interest receivable 5,476,615 Receivable for investment securities sold 33,079,249 _____________________________________________________________________________________________________________ Total assets 2,659,271,837 _____________________________________________________________________________________________________________ Liabilities _____________________________________________________________________________________________________________ Disbursements in excess of cash on demand deposit 30,820,618 Payable for investment securities purchased 66,782,957 Payable upon return of securities loaned (Note 5) 71,130,900 Accrued investment management services fee 10,611 Accrued distribution and service fees 12,281 Accrued transfer agency fee 16,247 Accrued administrative services fee 4,358 Other accrued expenses 323,084 _____________________________________________________________________________________________________________ Total liabilities 169,101,056 _____________________________________________________________________________________________________________ Net assets applicable to outstanding capital stock $2,490,170,781 _____________________________________________________________________________________________________________ Represented by _____________________________________________________________________________________________________________ Capital stock -- authorized 10,000,000,000 shares of $.01 par value; $ 1,350,996 Additional paid-in capital 2,262,641,105 Undistributed net investment income 3,871,424 Accumulated net realized gain (Note 1) 44,955,976 Unrealized appreciation 177,351,280 _____________________________________________________________________________________________________________ Total -- representing net assets applicable to outstanding capital stock $2,490,170,781 _____________________________________________________________________________________________________________ Net assets applicable to outstanding shares: Class A $1,840,322,512 Class B $ 4,355,288 Class Y $ 645,492,981 Net asset value per share of outstanding capital stock: Class A shares 99,845,884 $ 18.43 Class B shares 236,461 $ 18.42 Class Y shares 35,017,279 $ 18.43 _____________________________________________________________________________________________________________ See accompanying notes to financial statements. PAGE Financial statements Statement of operations IDS Stock Fund, Inc. Six months ended April 30, 1995 _____________________________________________________________________________________________________________ Investment income _____________________________________________________________________________________________________________ (Unaudited) Income: Dividends (net of foreign taxes withheld of $61,165) $ 29,957,196 Dividends earned on affiliated issuers 387,500 Interest 11,069,453 _____________________________________________________________________________________________________________ Total income 41,414,149 _____________________________________________________________________________________________________________ Expenses (Note 2): Investment management service fee 5,795,647 Distribution fee - Class A 442,174 Transfer agency fee 1,420,723 Service fee 282,678 Administrative services fee 86,164 Compensation of directors 14,358 Compensation of officers 8,270 Custodian fees 168,797 Postage 129,104 Registration fees 106,652 Reports to shareholders 142,950 Audit fees 15,000 Administrative 11,742 Other 26,746 _____________________________________________________________________________________________________________ Total expenses 8,651,005 _____________________________________________________________________________________________________________ Investment income -- net 32,763,144 _____________________________________________________________________________________________________________ Realized and unrealized gain -- net _____________________________________________________________________________________________________________ Net realized gain on security and foreign currency transactions (including loss of $24,195 from foreign currency transactions) (Note 3) 41,421,089 Net realized gain on sale of affiliated security 899,240 Net realized gain on closed or expired option contracts written (Note 6) 2,538,054 _____________________________________________________________________________________________________________ Net realized gain on investments and foreign currency 44,858,383 Net change in unrealized appreciation or depreciation 29,136,898 _____________________________________________________________________________________________________________ Net gain on investments and foreign currency 73,995,281 _____________________________________________________________________________________________________________ Net increase in net assets resulting from operations $106,758,425 _____________________________________________________________________________________________________________ See accompanying notes to financial statements. /TABLE PAGE
Financial statements Statements of changes in net assets IDS Stock Fund, Inc. _____________________________________________________________________________________________________________ Operations and distributions April 30, 1995 Oct. 31, 1994 _____________________________________________________________________________________________________________ Six months ended Year ended (Unaudited) Investment income -- net $ 32,763,144 $ 65,435,636 Net realized gain on investments and foreign currency 44,858,383 184,211,972 Net change in unrealized appreciation or depreciation 29,136,898 (163,987,803) _____________________________________________________________________________________________________________ Net increase in net assets resulting from operations 106,758,425 85,659,805 _____________________________________________________________________________________________________________ Distributions to shareholders from: Net investment income Class A (29,172,925) (66,287,242) Class B (8,041) -- Class Y (4,237,706) -- Net realized gain Class A (184,130,266) (189,047,838) _____________________________________________________________________________________________________________ Total distributions (217,548,938) (255,335,080) _____________________________________________________________________________________________________________ Capital share transactions (Note 4) _____________________________________________________________________________________________________________ Proceeds from sales Class A shares (Note 2) 210,895,300 517,092,765 Class B shares 4,327,127 -- Class Y shares 643,903,532 -- Reinvestment of distributions at net asset value Class A shares 193,648,844 226,574,033 Class B shares 7,726 -- Class Y shares 3,768,090 -- Payments for redemptions Class A shares (806,584,687) (265,338,433) Class B shares (Note 2) (36,648) -- Class Y shares (16,718,383) -- _____________________________________________________________________________________________________________ Increase in net assets from capital share transactions 233,210,901 478,328,365 _____________________________________________________________________________________________________________ Total increase in net assets 122,420,388 308,653,090 Net assets at beginning of period 2,367,750,393 2,059,097,303 _____________________________________________________________________________________________________________ Net assets at end of period (including undistributed net investment income of $3,871,424 and $4,526,952) $2,490,170,781 $2,367,750,393 _____________________________________________________________________________________________________________ See accompanying notes to financial statements.
PAGE Notes to financial statements IDS Stock Fund, Inc. (Unaudited as to April 30, 1995) ______________________________________________________________________________ 1. Summary of significant accounting policies The fund is registered under the Investment Company Act of 1940 (as amended) as a diversified, open-end management investment company. The fund offers Class A, Class B and Class Y shares. Class A shares are sold with a front-end sales charge. Class B shares, which the fund began offering on March 20, 1995, may be subject to a contingent deferred sales charge and such shares automatically convert to Class A after eight years. Class Y shares, which the fund also began offering on March 20, 1995, have no sales charge and are offered only to qualifying institutional investors. All classes of shares have identical voting, dividend, liquidation and other rights, and the same terms and conditions, except that the level of distribution fee, transfer agency fee and service fee (class specific expenses) differ among classes. Income, expenses (other than class specific expenses) and realized and unrealized gains or losses on investments are allocated to each class of shares based upon its relative net assets. Significant accounting policies followed by the fund are summarized below: Valuation of securities All securities are valued at the close of each business day. Securities traded on national securities exchanges or included in national market systems are valued at the last quoted sales price; securities for which market quotations are not readily available are valued at fair value according to methods selected in good faith by the board of directors. Determination of fair value involves, among other things, reference to market indexes, matrixes and data from independent brokers. Short-term securities maturing in more than 60 days from the valuation date are valued at the market price or approximate market value based on current interest rates; those maturing in 60 days or less are valued at amortized cost. Options transactions In order to produce incremental earnings, protect gains, and facilitate buying and selling of securities for investment purposes, the fund may buy or write options traded on any U.S. or foreign exchange or in the over-the-counter market where the completion of the obligation is dependent upon the credit standing of the other party. The fund also may buy and sell put and call options and write covered call options on portfolio securities and may write cash-secured put options. The risk in writing a call option is that the fund gives up the opportunity of profit if the market price of the security increases. The risk in writing a put option is that the fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that the fund pays a premium whether or not the option is exercised. The fund also has the additional risk of not being able to enter into a closing transaction if a liquid secondary market does not exist. Option contracts are valued daily at the closing prices on their primary exchanges and unrealized appreciation or depreciation is recorded. The fund will realize a gain or loss upon expiration or closing of the option transaction. When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option or the cost of a security for a purchased put or call option is adjusted by the amount of premium received or paid. Futures transactions In order to gain exposure to or protect itself from changes in the market, the fund may buy and sell stock index futures contracts traded on any U.S. or foreign exchange. The fund also may buy or write put and call options on these futures contracts. Risks of entering into futures contracts and related options include the possibility that there may be an illiquid market and that a change in the value of the contract or option may not correlate with changes in the value of the underlying securities. Upon entering into a futures contract, the fund is required to deposit either cash or securities in an amount (initial margin) equal to a certain percentage of the contract value. Subsequent payments (variation margin) are made or received by the fund each day. The variation margin payments are equal to the daily changes in the contract value and are recorded as unrealized gains and losses. The fund recognizes a realized gain or loss when the contract is closed or expires. Foreign currency translations and foreign currency contracts Securities and other assets and liabilities denominated in foreign currencies are translated daily into U.S. dollars at the closing rate of exchange. Foreign currency amounts related to the purchase or sale of securities and income and expenses are translated at the exchange rate on the transaction date. The effect of changes in foreign exchange rates on realized and unrealized security gains and losses is reflected as a component of such gains or losses. In the statement of operations, net realized gains or losses from foreign currency transactions may arise from sales of foreign currency, closed forward contracts, exchange gains or losses realized between the trade date and settlement dates on securities transactions, and other translation gains or losses on dividends, interest income and foreign withholding taxes. The fund may enter into forward foreign currency exchange contracts for operational purposes and to protect against adverse exchange rate fluctuation. The net U.S. dollar value of foreign currency underlying all contractual commitments held by the fund and the resulting unrealized appreciation or depreciation are determined using foreign currency exchange rates from an independent pricing service. The fund is subject to the credit risk that the other party will not complete the obligations of the contract. Federal taxes Since the fund's policy is to comply with all sections of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to shareholders, no provision for income or excise taxes is required. Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of the deferral of losses on certain futures contracts, the recognition of certain foreign currency gains (losses) as ordinary income (loss) for tax purposes, and losses deferred due to "wash sale" transactions. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. Also, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains (losses) were recorded by the fund. Dividends to shareholders Dividends from net investment income, declared and paid each calendar quarter, are reinvested in additional shares of the fund at net asset value or payable in cash. Capital gains, when available, are distributed along with the last income dividend of the calendar year. Other Security transactions are accounted for on the date securities are purchased or sold. Dividend income is recognized on the ex-dividend date and interest income, including level-yield amortization of premium and discount, is accrued daily. ______________________________________________________________________________ 2. Expenses and sales charges Under terms of a prior agreement that ended March 19, 1995, the fund paid American Express Financial Corporation a fee for managing its investments, recordkeeping and other specified services. The fee was a percentage of the fund's average daily net assets consisting of a group asset charge in reducing percentages from 0.46% to 0.32% annually on the combined net assets of all non-money market funds in the IDS MUTUAL FUND GROUP and an individual annual asset charge of 0.14% of average daily net assets. The fee was adjusted upward or downward by a performance incentive adjustment based on the fund's average daily net assets over a rolling 12-month period as measured against the change in the Lipper Growth and Income Fund Index. The maximum adjustment was 0.08% of the fund's average daily net assets after deducting 1% from the performance difference. If the performance difference was less than 1%, the adjustment would have been zero. The adjustment decreased the fee by $215,017 for the six months ended April 30, 1995. Also under terms of the prior agreement, the fund paid American Express Financial Corporation a distribution fee at an annual rate of $6 per shareholder account and a transfer agency fee at an annual rate of $15 per shareholder account. The transfer agency fee was reduced by earnings on monies pending shareholder redemptions. Effective March 20, 1995, when the fund began offering multiple classes of shares, the fund entered into agreements with American Express Financial Corporation for managing it's portfolio, providing administrative services and serving as transfer agent as follows: Under its Investment Management Services Agreement, American Express Financial Corporation determines which securities will be purchased, held or sold. The management fee is a percentage of the fund's average daily net assets in reducing percentages from 0.53% to 0.4% annually. The performance incentive adjustment remains unchanged from the prior agreement. Under an Administrative Services Agreement, the fund pays American Express Financial Corporation for administration and accounting services at a percentage of the fund's average daily net assets in reducing percentages from 0.04% to 0.02% annually. Under a separate Transfer Agency Agreement, American Express Financial Corporation maintains shareholder accounts and records. The fund pays American Express Financial Corporation an annual fee per shareholder account for this service as follows: o Class A $15 o Class B $16 o Class Y $15 Also effective March 20, 1995, the fund entered into agreements with American Express Financial Advisors Inc. for distribution and shareholder servicing- related services as follows: Under the Distribution Agreement, the fund pays a distribution fee at an annual rate of 0.75% of the fund's average daily net assets attributable to Class B shares for distribution-related services. Under a Shareholder Service Agreement, the fund pays a fee for service provided to shareholders by financial advisors and other servicing agents. The fee is calculated at a rate of 0.175% of the fund's average daily net assets attributable to Class A and Class B shares. American Express Financial Corporation will assume and pay any expenses (except taxes and brokerage commissions) that exceed the most restrictive applicable state expense limitation. Sales charges by American Express Financial Advisors Inc. for distributing fund shares were $1,539,293 for Class A and $20 for Class B for the six months ended April 30, 1995. The fund also pays custodian fees to American Express Trust Company, an affiliate of American Express Financial Corporation. The fund has a retirement plan for its independent directors. Upon retirement, directors receive monthly payments equal to one-half of the retainer fee for as many months as they served as directors up to 120 months. There are no death benefits. The plan is not funded but the fund recognizes the cost of payments during the time the directors serve on the board. The retirement plan expense amounted to $5,408 for the six months ended April 30, 1995. ______________________________________________________________________________ 3. Securities transactions Cost of purchases and proceeds from sales of securities (other than short-term obligations) aggregated $1,034,734,746 and $754,353,021, respectively, for the six months ended April 30, 1995. Realized gains and losses are determined on an identified cost basis. Brokerage commissions paid to brokers affiliated with American Express Financial Corporation were $302,267 for the six months ended April 30, 1995. 4. Capital share transactions Transactions in shares of capital stock for the periods indicated were as follows:
_______________________________________________________________________________________ Six months ended April 30, 1995 Year ended 10/31/94 Class A Class B* Class Y* Class A _______________________________________________________________________________________ Sold 11,749,273 238,046 35,730,041 26,559,784 Issued for reinvested distributions 11,323,775 426 207,597 11,576,290 Redeemed (44,776,825) (2,011) (920,359) (13,522,239) _______________________________________________________________________________________ Net increase (decrease) (21,703,777) 236,461 35,017,279 24,613,835 _______________________________________________________________________________________ *Commencement of operations was March 20, 1995.
______________________________________________________________________________ 5. Lending of portfolio securities At April 30, 1995, securities valued at $68,957,694 were on loan to brokers. For collateral, the fund received $71,130,900 in cash. Income from securities lending amounted to $412,322 for the six months ended April 30, 1995. The risk to the fund of securities lending are that the borrow may not provide additional collateral when required or return the securities when due. ______________________________________________________________________________ 6. Option contracts written The number of contracts and premium amounts associated with option contracts written is as follows:
Six months ended April 30, 1995 ______________________________________________________ Puts Calls Contracts Premium Contracts Premium ______________________________________________________________________________ Balance Oct. 31, 1994 16,075 $941,712 13,750 $ 848,471 Opened 8,590 442,321 24,616 1,296,712 Closed (4,000) (191,993) (12,750) (733,600) Expired (15,840) (836,055) (23,891) (1,231,467) Exercised (4,825) (355,985) (1,725) (180,116) ______________________________________________________________________________ Balance April 30, 1995 -- $ -- -- $ -- ______________________________________________________________________________ /TABLE PAGE
7. Financial highlights The table below shows certain important financial information for evaluating the fund's results. Fiscal period ended Oct. 31, Per share income and capital changes* 1995** 1994 1993 1992 1991 1990 Classes A B Y Net asset value, $19.48 $18.02 $18.02 $21.24 $20.05 $20.02 $17.26 $20.76 beginning of period Income from investment operations: Net investment income .29 .01 .04 .58 .55 .64 .68 .83 Net gains (losses) .44 .51 .49 .21 2.93 1.11 4.02 (.87) (both realized and unrealized) Total from investment .73 .52 .53 .79 3.48 1.75 4.70 (.04) operations Less distributions: Dividends from net (.26) (.12) (.12) (.60) (.53) (.63) (.74) (.85) investment income Distributions from (1.52) -- -- (1.95) (1.76) (1.09) (1.20) (2.61) realized gains Total distributions (1.78) (.12) (.12) (2.55) (2.29) (1.72) (1.94) (3.46) Net asset value, $18.43 $18.42 $18.43 $19.48 $21.24 $20.05 $20.02 $17.26 end of period Ratios/supplemental data 1995** 1994 1993 1992 1991 1990 Classes A B Y Net assets, end of period $1,840 $4 $645 $2,368 $2,059 $1,658 $1,513 $1,213 (in millions) Ratio of expenses to .76%*** 1.62%*** .65%*** .76% .73% .72% .65% .63% average daily net assets Ratio of net income to 2.90%*** 1.33%*** 2.11%*** 2.99% 2.75% 3.21% 3.59% 4.32% average daily net assets Portfolio turnover rate 35% 35% 35% 75% 76% 77% 58% 26% (excluding short-term securities) Total return+ 4.5%++ 2.9% 2.9% 3.9% 18.8% 9.4% 29.0% (0.9%) *For a share outstanding throughout the period. Rounded to the nearest cent. **Six months ended April 30, 1995 for Class A and commencement of operations March 20, 1995 for Class B and Y (Unaudited). ***Adjusted to an annual basis. +Total return does not reflect payment of a sales charge. ++For the fiscal period ended April 30, 1995, the annualized total return is 9.2%. /TABLE PAGE
Investments in securities IDS Stock Fund, Inc. (Percentages represent value of April 30, 1995 (Unaudited) investments compared to net assets) Investments in securities of unaffiliated issuers _____________________________________________________________________________________________________________________________ Common stocks (84.5%) _____________________________________________________________________________________________________________________________ Issuer Shares Value(a) _____________________________________________________________________________________________________________________________ Aerospace & defense (2.4%) General Motors Cl H 312,500 $ 12,226,563 Raytheon 250,000 18,187,500 United Technologies 400,000 29,250,000 ______________ Total 59,664,063 _____________________________________________________________________________________________________________________________ Automotive & related (3.1%) Dana 1,050,000 27,037,500 Genuine Parts 500,000 19,375,000 Goodyear Tire & Rubber 800,000 30,400,000 ______________ Total 76,812,500 _____________________________________________________________________________________________________________________________ Banks and savings & loans (6.8%) Ahmanson (HF) 1,000,000 21,000,000 Bank of Boston 500,000 16,750,000 BankAmerica 718,700 35,575,650 First Chicago 700,000 38,675,000 Morgan (JP) 400,000 26,250,000 NationsBank 400,000 20,000,000 Signet Banking 500,000 10,625,000 ______________ Total 168,875,650 _____________________________________________________________________________________________________________________________ Beverages & tobacco (2.0%) Philip Morris 400,000 27,100,000 UST 800,000 22,500,000 ______________ Total 49,600,000 _____________________________________________________________________________________________________________________________ Chemicals (1.4%) Dow Chemical 300,000 20,850,000 Nalco Chemical 400,000 14,000,000 ______________ Total 34,850,000 _____________________________________________________________________________________________________________________________ See accompanying notes to investments in securities. Communications equipment (1.6%) Ericsson (LM) ADR 9,000,000 (b) 19,687,500 General Instrument 600,000 (c) 20,475,000 ______________ Total 40,162,500 _____________________________________________________________________________________________________________________________ Computers & office equipment (3.6%) Amer Power Conversion 600,000 (c,d) 10,200,000 Cisco Systems 300,000 11,962,500 COMPAQ Computer 450,000 17,100,000 Pitney Bowes 800,000 29,700,000 Solectron 300,000 (c,d) 8,812,500 Sterling Software 200,000 (c) 6,800,000 Wall Data 300,000 (c,d) 5,775,000 ______________ Total 90,350,000 _____________________________________________________________________________________________________________________________ Electronics (1.8%) Applied Materials 200,000 (c) 12,325,000 Arrow Electronics 300,000 (c) 13,950,000 Intel 175,000 17,915,625 ______________ Total 44,190,625 _____________________________________________________________________________________________________________________________ Energy (6.9%) Amoco 400,000 26,250,000 British Petro ADR 200,000 (b) 17,225,000 Exxon 400,000 27,850,000 Repsol ADR 800,000 (b) 25,600,000 Royal Dutch Petroleum 250,000 (b) 31,000,000 TOTAL Cl B 500,000 (c) 15,687,500 YPF Sociedad Anonima ADR 1,340,000 (b) 27,135,000 ______________ Total 170,747,500 _____________________________________________________________________________________________________________________________ Energy equipment & services (1.0%) Schlumberger 400,000 (b) 25,150,000 _____________________________________________________________________________________________________________________________ Financial services (5.5%) Block (H&R) 400,000 16,850,000 Crown Amer 400,000 5,000,000 Equity Residential 200,000 5,350,000 Mutual Risk Management 500,000 15,375,000 Simon Property Group 500,000 11,875,000 State Street Boston 800,000 25,400,000 Student Loan Mtge Assn 700,000 28,350,000 Travelers 700,000 28,962,500 ______________ Total 137,162,500 _____________________________________________________________________________________________________________________________ Food (0.2%) ConAgra 130,600 4,342,450 _____________________________________________________________________________________________________________________________ Health care (6.2%) Abbott Laboratories 300,000 11,812,500 Amer Home Products 200,000 15,425,000 Glaxo ADR 1,000,000 (b,d) 23,625,000 Johnson & Johnson 400,000 26,000,000 Merck 600,000 25,725,000 Pfizer 300,000 25,987,500 Schering-Plough 325,000 24,496,875 ______________ Total 153,071,875 _____________________________________________________________________________________________________________________________ Health care services (1.6%) Columbia Healthcare 372,500 15,645,000 Omega Healthcare Investors 200,000 4,775,000 Physician Corp of Amer 500,000 8,937,500 Service Corp Intl 400,000 11,300,000 ______________ Total 40,657,500 _____________________________________________________________________________________________________________________________ Industrial equipment & services (5.5%) Caterpillar 225,000 13,162,500 Deere 175,000 14,350,000 General Signal 700,000 25,987,500 Giddings & Lewis 1,490,000 27,006,250 Illinois Tool Works 600,000 30,075,000 Stewart & Stevenson 700,000 26,250,000 ______________ Total 136,831,250 _____________________________________________________________________________________________________________________________ Industrial transportation (2.3%) Norfolk Southern 425,000 28,634,375 Union Pacific 500,000 27,437,500 ______________ Total 56,071,875 _____________________________________________________________________________________________________________________________ Insurance (2.5%) Amer Intl Group 200,000 21,350,000 Lincoln Natl 500,000 20,375,000 Unum 500,000 21,437,500 ______________ Total 63,162,500 _____________________________________________________________________________________________________________________________ Media (4.7%) Amer Greetings Cl A 902,100 24,582,225 Bell Cablemedia 200,000 (c) 3,325,000 McGraw-Hill 270,000 20,148,750 Reader's Digest Assn 470,000 18,506,250 Tele-Communications Cl A 500,000 (c) 9,562,500 Time Warner 525,000 19,228,125 Viacom Cl B 300,000 (c) 13,762,500 Videotron Holdings ADR 570,000 (b,c) 8,906,250 ______________ Total 118,021,600 _____________________________________________________________________________________________________________________________ Metals (2.9%) Aluminum Co Amer 312,800 14,036,900 Cyprus Amax Minerals 600,000 16,725,000 Freeport-McMoRan Cooper & Gold Cl A 411,250 8,584,844 Santa Fe Pacific Gold 1,800,000 (c) 22,725,000 SGL Carbon 250,000 (b,c,e) 9,970,250 ______________ Total 72,041,994 _____________________________________________________________________________________________________________________________ Multi-industry conglomerates (3.7%) General Electric 525,000 29,400,000 Grupo Carso ADR 275,000 (b,c,d) 2,940,685 Hanson ADR 1,350,000 (b) 25,650,000 Madeco ADR 175,000 (b,d) 5,096,875 Minnesota Mining & Mfg 500,000 29,812,500 ______________ Total 92,900,060 _____________________________________________________________________________________________________________________________ Paper & packaging (3.2%) Crown Cork & Seal 600,000 (c) 25,650,000 Kimberly-Clark 500,000 28,312,500 Union Camp 500,000 25,062,500 ______________ Total 79,025,000 _____________________________________________________________________________________________________________________________ Retail (3.7%) Gap 750,000 23,906,250 Home Depot 493,700 20,611,975 OfficeMax 650,000 (c) 16,656,250 Penney (JC) 550,000 24,062,500 Pep Boy Manny Moe & Jack 300,000 7,725,000 ______________ Total 92,961,975 _____________________________________________________________________________________________________________________________ Soaps & cosmetics (2.5%) Colgate-Palmolive 64,000 4,496,000 Duracell 500,000 22,000,000 Gillette 300,000 24,600,000 Procter & Gamble 145,600 10,173,800 ______________ Total 61,269,800 _____________________________________________________________________________________________________________________________ Utilities - electric (2.0%) Central Puerto ADR 500,000 (b,c) 9,937,500 National Power 850,000 (b,c,d) 9,668,750 Powergen 775,000 (c,d) 9,881,250 Veba 57,000 (b) 21,211,581 ______________ Total 50,699,081 _____________________________________________________________________________________________________________________________ Utilities - natural gas (1.1%) Enron 157,500 5,355,000 Tenneco 500,000 22,937,500 ______________ Total 28,292,500 _____________________________________________________________________________________________________________________________ Utilities - telephone (6.3%) AirTouch Communications 900,000 (c) 24,187,500 BellSouth 330,400 20,237,000 General Cable 935,000 (b,c,d) 13,148,437 MFS Communications 365,000 (c) 13,048,750 Millicom Intl Cellular 500,000 (b,c) 12,437,500 Pacific Telesis Group 850,000 26,243,750 Southwestern Bell 393,000 17,341,125 U S WEST 750,000 31,031,250 ______________ Total 157,675,312 _____________________________________________________________________________________________________________________________ Total common stocks of unaffiliated issuers (Cost: $1,912,631,576) $2,104,590,110 _____________________________________________________________________________________________________________________________
Preferred stocks (3.6%) _____________________________________________________________________________________________________________________________ Issuer Shares Value(a) _____________________________________________________________________________________________________________________________ Allstate $2.30 Cm Cv 280,000 $ 10,115,000 Ceridan $2.75 Cm Cv 275,000 21,312,500 COINTEL 5.04% Cv 225,000 (f) 11,306,250 First Chicago Nextell 5.50% Cm Cv 900,000 17,437,500 General Motors 3.25% Cm Cv 300,000 18,787,500 Kenetech $1.67 Cm Cv 783,000 (f) 11,157,750 _____________________________________________________________________________________________________________________________ Total preferred stocks (Cost: $90,995,376) $ 90,116,500 _____________________________________________________________________________________________________________________________
Bonds (4.7%) _____________________________________________________________________________________________________________________________ Principal Issuer and coupon rate amount Value(a) _____________________________________________________________________________________________________________________________ Banco Nacional de Mexico 7% Cv 1999 $ 7,500,000 (b,e) $ 5,025,000 Conner Peripherals 6.75% Cv 2001 15,000,000 11,737,500 Danka Business Systems 6.75% Cv 2002 7,000,000 (e) 7,708,750 Equitable Companies 6.125% Cv 2024 20,000,000 21,875,000 Intl Cable Telephone 7.25% Cv 2005 12,500,000 (d) 12,453,125 NAC Re 5.25% Cv 2002 15,000,000 (e) 13,050,000 Roche Holdings Zero Coupon 7% Cv 2010 30,000,000 (e,g) 11,025,000 Rogers Communications Zero Coupon 4.74% Cv 2013 50,000,000 (g) 16,500,000 SynOptics Communications 5.25% 2003 20,000,000 (e) 17,325,000 _____________________________________________________________________________________________________________________________ Total bonds (Cost: $122,716,896) $ 116,699,375 _____________________________________________________________________________________________________________________________
Options purchased (0.3%) _____________________________________________________________________________________________________________________________ Issuer Number of Exercise Expiration Value(a) of contracts price date _____________________________________________________________________________________________________________________________ Put S&P 500 4,000 $475 June 1995 $ 375,000 3,000 480 June 1995 450,000 2,000 480 Sept. 1995 1,050,000 2,000 485 June 1995 325,000 2,000 490 Sept. 1995 1,100,000 4,000 505 Sept. 1995 3,600,000 _____________________________________________________________________________________________________________________________ Total options purchased (Cost: $12,513,660) $ 6,900,000 _____________________________________________________________________________________________________________________________
Short-term securities (10.8%) _____________________________________________________________________________________________________________________________ Issuer Annualized Amount Value(a) yield on payable at date of maturity purchase _____________________________________________________________________________________________________________________________ U.S. government agency (--%) Federal Home Loan Bank Fidelity Federal 05-05-95 6.25% $ 200,000 $ 199,749 _____________________________________________________________________________________________________________________________ Certificate of Deposit (0.2%) Natl Bank Detroit 05-11-95 6.01 3,900,000 3,900,013 _____________________________________________________________________________________________________________________________ Commercial paper (10.4%) AIG Funding 05-31-95 6.03 4,500,000 4,476,080 Amer General 05-08-95 6.03 5,500,000 (h) 5,491,750 Aon 05-10-95 6.00 3,393,000 3,386,811 05-10-95 6.05 3,700,000 3,693,205 AT&T 05-03-95 6.03 4,300,000 4,297,133 Avco Financial Services 06-14-95 6.06 4,000,000 3,969,333 BBV Finance (Delaware) 05-05-95 6.01 800,000 799,203 Becton Dickinson Real Estate 05-18-95 6.02 700,000 (h) 697,791 BellSouth Telecommunications 05-04-95 6.04 3,400,000 3,397,167 05-16-95 5.98 1,200,000 1,196,628 Beneficial 05-03-95 6.08 8,000,000 7,994,126 Cafco 05-09-95 6.01 6,100,000 (h) 6,089,867 Chevron Transport 05-26-95 6.00 3,400,000 (h) 3,384,802 Colgate Palmolive 05-17-95 6.01 8,300,000 (h) 8,275,225 05-18-95 6.00 5,700,000 (h) 5,682,040 Commerzbank U.S. Finance 05-01-95 6.03 2,800,000 2,799,067 Consolidated Rail 05-05-95 6.10 3,000,000 (h) 2,996,980 CPC Intl 07-20-95 6.09 9,300,000 (h) 9,166,633 Deutsche Bank Financial 05-22-95 5.98 8,500,000 8,467,688 Dresdner U.S. Finance 07-07-95 6.36 7,800,000 7,705,663 Dun & Bradstreet 06-01-95 6.15 4,900,000 4,865,221 Fleet Funding 05-04-95 6.11 6,500,000 (h) 6,494,538 05-15-95 6.06 3,900,000 (h) 3,889,565 Ford Motor Credit 05-02-95 6.07 5,600,000 5,596,159 General Electric Capital 06-13-95 6.07 7,400,000 7,339,149 Goldman Sachs Group 05-11-95 6.04 4,200,000 4,191,600 05-24-95 6.06 1,700,000 1,692,905 Household Finance 06-23-95 6.08 9,700,000 9,605,619 Kredietbank North Amer Finance 05-22-95 6.00 6,000,000 5,977,115 Metlife Funding 05-12-95 6.07 12,000,000 11,971,189 Mobile Australia Finance (Delaware) 05-04-95 5.99 5,000,000 (h) 4,995,854 05-23-95 6.00 6,000,000 (h) 5,976,120 Motorola 05-26-95 6.00 4,700,000 4,678,991 PACCAR Financial 05-22-95 6.00 2,400,000 2,390,099 06-01-95 6.13 900,000 894,522 Penney (JC) Funding 05-08-95 6.04 7,000,000 6,989,500 05-16-95 6.01 6,000,000 5,983,085 PepsiCo 05-05-95 6.00 2,700,000 (h) 2,697,314 Pitney Bowes Credit 05-09-95 6.14 7,100,000 7,086,182 SAFECO Credit 06-05-95 6.08 4,000,000 3,999,486 07-17-95 6.10 9,000,000 8,875,600 St. Paul Companies 05-19-95 5.99 5,800,000 (h) 5,780,796 05-25-95 5.99 3,200,000 (h) 3,186,226 Sara Lee 05-10-95 5.99 4,500,000 4,491,805 Societe Generale North Amer 05-04-95 6.03 2,400,000 2,398,000 Southern California Gas 08-16-95 6.45 5,500,000 (h) 5,395,301 Southwestern Bell Telephone 05-15-95 6.00 5,000,000 4,986,733 Toyota Motor Credit 05-25-95 6.00 6,900,000 6,870,299 Unilever Capital 06-12-95 6.01 6,800,000 (h) 6,750,466 United Parcel 05-01-95 6.04 3,200,000 3,198,932 Wachovia Bank Notes 05-22-95 5.99 6,700,000 6,700,085 ______________ Total 259,915,648 _____________________________________________________________________________________________________________________________ Letter of credit (0.2%) Bank of Amer- AES Barbers Point 05-05-95 6.12 5,000,000 4,994,578 _____________________________________________________________________________________________________________________________ Total short-term securities (Cost: $269,026,045) $ 269,009,988 _____________________________________________________________________________________________________________________________ Total investments in securities of unaffiliated issuers (Cost: $2,407,883,553) $2,587,315,973 _____________________________________________________________________________________________________________________________ /TABLE
Investments in securities of affiliated issuers (i) _____________________________________________________________________________________________________________________________ Common stocks (1.3%) _____________________________________________________________________________________________________________________________ Issuer Shares Value(a) _____________________________________________________________________________________________________________________________ Lukens 800,000 $ 25,900,000 VMARK Software 500,000 (c) 7,500,000 _____________________________________________________________________________________________________________________________ Total investments in securities of affiliated issuers (Cost: $35,481,140) $ 33,400,000 _____________________________________________________________________________________________________________________________ Total investments in securities (Cost: $2,443,364,693)(j) $2,620,715,973 _____________________________________________________________________________________________________________________________ Notes to investments in securities _____________________________________________________________________________________________________________________________ (a) Securities are valued by procedures described in Note 1 to the financial statements. (b) Foreign security values and principal amounts are stated in U.S. dollars. (c) Presently non-income producing. (d) Security is partially or fully on loan. See Note 5 to the financial statements. (e) Represents a security sold under Rule 144A, which is exempt from registration under the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the board of directors. (f) PRIDES - Preferred Redeemed Increased Dividend Equity Securities are structured as convertible preferred securities issued by a company. Investors receive an enhanced yield but based upon a specific formula, potential appreciation is limited. PRIDES pay dividends, have voting rights, are noncallable for three years and upon maturity, convert into shares of common stock. (g) For zero coupon bonds, the interest rate disclosed represents the annualized effective yield on the date of acquisition. (h) Commercial paper sold within terms of a private placement memorandum, exempt from registration under Section 4(2) of the Securities Act of 1933, as amended, and may be sold only to dealers in that program or other "accredited investors." This security has been determined to be liquid under the guidelines established by the board of directors. (i) Investments representing 5% or more of the outstanding voting securities of the issuer. (j) At April 30, 1995, the cost of securities for federal income tax purposes was approximately $2,442,843,000 and the approximate aggregate gross unrealized appreciation and depreciation based on that cost was: Unrealized appreciation $249,559,000 Unrealized depreciation (71,686,000) ___________________________________________________________________________________________ Net unrealized appreciation $177,873,000 ___________________________________________________________________________________________ /TABLE PAGE Directors and officers Directors and officers of the fund _____________________________________________________________________ President and interested director William R. Pearce President of all funds in the IDS MUTUAL FUND GROUP. _____________________________________________________________________ Independent directors Lynne V. Cheney Distinguished fellow, American Enterprise Institute for Public Policy Research. Robert F. Froehlke Former president of all funds in the IDS MUTUAL FUND GROUP. Heinz F. Hutter Former president and chief operating officer, Cargill, Inc. Anne P. Jones Attorney and telecommunications consultant. Donald M. Kendall Former chairman and chief executive officer, PepsiCo, Inc. Melvin R. Laird Senior counsellor for national and international affairs, The Reader's Digest Association, Inc. Lewis W. Lehr Former chairman and chief executive officer, Minnesota Mining and Manufacturing Company (3M). Edson W. Spencer Former chairman and chief executive officer, Honeywell, Inc. Wheelock Whitney Chairman, Whitney Management Company. C. Angus Wurtele Chairman of the board and chief executive officer, The Valspar Corporation. _____________________________________________________________________ Interested directors who are officers and/or employees of American Express Financial Corporation. William H. Dudley Exective vice president, American Express Financial Corporation. David R. Hubers President and chief executive officer, American Express Fianacial Corporation. PAGE John R. Thomas Senior vice president, American Express Financial Corporation. _____________________________________________________________________ Officers who also are officers and/or employees of American Express Financial Corporation. Peter J.Anderson Vice president of all funds in the IDS MUTUAL FUND GROUP. Melinda S. Urion Treasurer of all funds in the IDS MUTUAL FUND GROUP. _____________________________________________________________________ Other officer Leslie L. Ogg Vice president, general counsel and secretary of all funds in the IDS MUTUAL FUND GROUP. PAGE IDS mutual funds Cash equivalent investments These money market funds have three main goals: conservation of capital, constant liquidity and the highest possible current income consistent with these objectives. Very limited risk. IDS Cash Management Fund Invests in such money market securities as high quality commercial paper, bankers' acceptances, certificates of deposit (CDs) and other bank securities. (icon of) piggy bank IDS Tax-Free Money Fund Invests primarily in short-term bonds and notes issued by state and local governments to seek high current income exempt from federal income taxes. (icon of) shield with piggy bank enclosed Income investments The funds in this group invest their assets primarily in corporate bonds or government securities to seek interest income. Secondary objective is capital growth. Risk varies by bond quality. IDS Global Bond Fund Invests primarily in debt securities of U.S. and foreign issuers to seek high total return through income and growth of capital. (icon of) globe IDS Extra Income Fund Invests mainly in long-term, high-yielding corporate fixed-income securities in the lower rated, higher risk bond categories to seek high current income. Secondary objective is capital growth. (icon of) cornucopia IDS Bond Fund Invests mainly in corporate bonds, at least 50% in the higher rated, lower risk bond categories, or the equivalent, and in government bonds. (icon of) greek column PAGE IDS Selective Fund Invests in high-quality corporate bonds and other highly rated debt instruments including government securities and short-term investments. Seeks current income and preservation of capital. (icon of) skyline IDS Federal Income Fund Invests primarily in securities issued or guaranteed as to the timely payment of principal and interest by the U.S. government, its agencies and instrumentalities. Seeks a high level of current income and safety of principal consistent with its type of investments. (icon of) federal building Tax-exempt income investments These funds provide tax-free income by investing in municipal bonds. The income is generally free from federal income tax. Risk varies by bond quality. IDS High Yield Tax-Exempt Fund Invests primarily in medium- and lower-quality municipal bonds and notes. Lower-quality securities generally involve greater risk of principal and income. (icon of) shield with basket of apples enclosed IDS State Tax-Exempt Funds (CA, MA, MI, MN, NY, OH) Invests primarily in high- and medium-grade municipal securities to provide income to residents of each respective state that is exempt from federal, state and local income taxes. (New York is the only state that is exempt at the local level.) (icon of) shield with U.S. enclosed IDS Tax-Exempt Bond Fund Invests mainly in bonds and notes of state or local government units, with at least 75% in the four highest rated, lowest risk bond categories. (icon of) shield with Greek column IDS Insured Tax-Exempt Fund Invests primarily in municipal securities that are insured as to the timely payment of principal and interest. The insurance feature minimizes credit risk of the fund but does not guarantee the market value of the fund's shares. (icon of) shield with eagle head PAGE Growth and income investments These funds focus on securities of medium to large, well-established companies that offer long-term growth of capital and reasonable income from dividends and interest. Moderate risk. IDS International Fund Invests primarily in common stocks of foreign companies that offer potential for superior growth. The fund may invest up to 20% of its assets in the U.S. market. (icon of) three flags IDS Managed Retirement Fund Invests in a combination of common stocks, fixed-income investments and money market securities to seek a maximum total return through a combination of growth of capital and current income. (icon of) bird in a nest IDS Equity Select Fund Invests primarily in a combination of moderate growth stocks, higher-yielding equities and bonds. Seeks growth of capital and income. (icon of) three apple trees IDS Blue Chip Advantage Fund Invests in selected stocks from a major market index. Securities purchased are those recommended by our research analysts as the best from each industry represented on the index. Offers potential for long-term growth as well as dividend income. (icon of) ribbon IDS Stock Fund Invests in common stocks of companies representing many sectors of the economy. Seeks current income and growth of capital. (icon of) building with columns IDS Equity Value Fund Invests primarily in undervalued common stocks that offer potential for growth of capital and income. (icon of) three growing flowers PAGE IDS Utilities Income Fund Invests primarily in the stocks of public utility companies to seek high current income and growth of income and capital with reduced volatility. (icon of) electrical cord IDS Diversified Equity Income Fund Invests primarily in high-yielding common stocks to seek high current income and, secondarily, to benefit from the growth potential offered by stock investments. (icon of) four puzzle pieces IDS Mutual Invests in a balance between common stocks and senior securities (preferred stocks and bonds). Seeks a balance of growth of capital and current income. (icon of) scale of justice Growth investments Funds in this group seek capital growth, primarily from common stocks. They are high risk mutual funds with a potential for high reward. IDS Discovery Fund Invests in small- and medium-size, growth-oriented companies emphasizing technological innovation and productivity enhancement. Buys and holds larger growth-oriented stocks. (icon of) ship IDS Strategy, Aggressive Fund Invests primarily in common stocks of companies that are selected for their potential for above-average growth. Above-average means that their growth potential is better, in the opinion of the portfolio's investment manager, than the Standard & Poor's Corporation (S&P) 500 Stock Index. (icon of) chess piece PAGE IDS Growth Fund Invests primarily in companies that have above-average potential for long-term growth as a result of new management, marketing opportunities or technological superiority. (icon of) flower IDS Global Growth Fund Invests in stocks of companies throughout the world that are positioned to meet market needs in a changing world economy. These companies offer above-average potential for long-term growth. (icon of) world IDS New Dimensions Fund Invests primarily in companies with significant growth potential due to superiority in technology, marketing or management. The fund frequently changes its industry mix. (icon of) dimension IDS Progressive Fund Invests primarily in undervalued common stocks. The fund holds stocks for the long term with the goal of capital growth. (icon of) shooting star Specialty growth investment This fund aggressively seeks capital growth as a hedge against inflation. IDS Precious Metals Fund Invests primarily in the securities of foreign or domestic companies that explore for, mine and process or distribute gold and other precious metals. This is the most aggressive and most speculative IDS mutual fund. (icon of) cart of precious gems For more complete information about any of these funds, including charges and expenses, you can obtain a prospectus by contacting your financial planner or writing to American Express Shareholder Service, P.O. Box 534, Minneapolis, MN 55440-0534. Read it carefully before you invest or send money. PAGE Quick telephone reference American Express Telephone Transaction Service Redemptions and exchanges, dividend payments or reinvestments and automatic payment arrangements National/Minnesota: 800-437-3133 Mpls./St. Paul area: 671-3800 American Express Shareholder Service Fund performance, objectives and account inquiries 612-671-3733 TTY Service For the hearing impaired 800-846-4852 American Express Infoline Automated account information (TouchTone phones only), including current fund prices and performance, account values and recent account transactions National/Minnesota: 800-272-4445 Mpls./St. Paul area: 671-1630 AMERICAN EXPRESS FINANCIAL ADVISORS IDS Stock Fund IDS Tower 10 Minneapolis, MN 55440-0010 -----END PRIVACY-ENHANCED MESSAGE-----