-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KHTD7e0Miv/DmnnvsFd/1N/2u8znvqGQ/0krjK0sN+PltJvZ/aVcwTIE0uUbTF2M dUUSCtizg/c1//59JyYrqA== 0000820027-99-000476.txt : 19990630 0000820027-99-000476.hdr.sgml : 19990630 ACCESSION NUMBER: 0000820027-99-000476 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990430 FILED AS OF DATE: 19990629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IDS GLOBAL SERIES INC CENTRAL INDEX KEY: 0000842918 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: MN FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-05696 FILM NUMBER: 99654308 BUSINESS ADDRESS: STREET 1: IDS TOWER 10 CITY: MINNEAPOLIS STATE: MN ZIP: 55440 BUSINESS PHONE: 6126712772 FORMER COMPANY: FORMER CONFORMED NAME: IDS GLOBAL BOND FUND INC DATE OF NAME CHANGE: 19901011 N-30D 1 AXP(SM) Global Balanced Fund 1999 SEMIANNUAL REPORT (icon of) compass The goal of AXP Global Balanced Fund is to provide a balance of growth of capital and current income. Distributed by American Express Financial Advisors Inc. AMERICAN EXPRESS Financial Advisors An International Blend AXP Global Balanced Fund offers a logical first step for investors who want to have some exposure to foreign markets, but also want to avoid the greater volatility of a portfolio consisting of only foreign stocks. CONTENTS From the Chairman 3 From the Portfolio Managers 3 Fund Facts 5 The 10 Largest Holdings 6 Financial Statements 7 Notes to Financial Statements 10 Investments in Securities 19 (picture of) Arne H. Carlson Arne H. Carlson Chairman of the board From the Chairman It is an honor for me to join the American Express(R) Funds as chairman of the board and chief executive officer for each of the funds. I have served for the past eight years as governor of Minnesota and also for the past 20 years as a constitutional officer responsible for the pension investments made on behalf of government employees. My responsibility in the upcoming years is to serve your interests. By law, half the members of a mutual fund board must be independent of their investment manager and distributor. I am one of those persons. I am not an employee of American Express Financial Corporation (AEFC), nor do I own stock in American Express Company. Both are fine companies, but the law clearly states that to fully represent your interests I must be independent. Having said that, I have a great deal of respect for the capabilities of AEFC and for the services it provides to investors. Your financial advisor assists you in financial planning, conducts regular investment reviews and responds to your questions and needs. This is a very personal service that makes AEFC a partner in your financial future. I know that AEFC has an investment focus on the long-term performance of our economy and that it wants you to participate in that growth. Consistent with that, our board is here to serve you and represent your interests in a professional manner. I also want to let you know that, on June 16, 1999, there will be a regular meeting of shareholders. These meetings are held about every five years to elect directors and consider other proposals. One proposal that is expected to be approved is to change "IDS" to "AXP" in the Fund's name. We will discuss the action taken on other proposals in future reports. Arne H. Carlson (picture of) Peter Lamaison Peter Lamaison Portfolio manager (picture of) Michael Ng Michael Ng Portfolio manager From the Portfolio Managers AXP Global Balanced Fund enjoyed a substantial gain during the first half of the fiscal year, as it took advantage of generally strong stock and bond markets in the United States and Europe. For the six months -- November 1998 through April 1999 -- the Fund's Class A shares generated a total return of 12.94%. Investment sentiment was beginning to improve when the period began last fall. Inflation and interest rates were low in most major countries, while economic growth was at least positive in Europe and downright robust in the U.S. This was in sharp contrast to just a few months earlier, when a second bout of the financial malady known as the "Asian flu" was confining stocks throughout the world to a sick bed. By November, though, spurred largely by interest-rate cuts in the U.S. and parts of Europe, stocks and, to a lesser degree, bonds were off and running again. By the end of the period, the Fund would record solid gains in five of the six months -- the exception being February, when fear of higher inflation sent U.S. interest rates higher and stocks and bonds lower. THE U.S. LEADS THE WAY To the Fund's benefit, we concentrated most (up to 50%) of the stock investments in the U.S., whose market was among the strongest in the world over the six months. The bulk of the rest of the stock holdings were in Europe, primarily the United Kingdom, Germany and France. While those markets gained ground, the returns were tempered by overall weakness in the region's new currency, the euro. Among other major markets, Japan, where we maintained only a modest exposure, provided mixed results in the face of a still-struggling economy. Although a small area of investment for the Fund, holdings in the emerging markets of South Korea, Mexico, Argentina, Hong Kong and Venezuela provided a good boost to performance. Over the period, the asset allocation ranged from roughly 65%-70% stocks, 30%-35% bonds and a negligible amount of cash reserves. On the bond side, we split investments in the U.S. and Europe into essentially equal portions. The U.S. bond market rallied strongly through December, then retreated during the final few months of the period. In Europe, bond performance was more consistent, though, as with stocks, returns were hampered by the euro's decline. Looking ahead, given the remarkable ongoing strength of the U.S. economy and still-low rate of inflation, one might expect continued gains for stocks and bonds. However, the financial world looks far forward, and it could be that investors will anticipate that the surging economy could drive inflation and, thus, interest rates meaningfully higher. Should that happen, stocks and bonds would likely suffer. Still, such concerns have proved to be temporary in recent years, and we are keeping the portfolio fully invested, chiefly in the U.S. and Europe, to take advantage of what, in our view, remains a positive long-term investment environment. Peter Lamaison Michael Ng Fund Facts Class A -- 6-month performance (All figures per share) Net asset value (NAV) April 30, 1999 $6.48 Oct. 31, 1998 $5.79 Increase $0.69 Distributions -- Nov. 1, 1998 - April 30, 1999 From income $0.02 From capital gains $0.02 Total distributions $0.04 Total return* 12.94%** Class B -- 6-month performance (All figures per share) Net asset value (NAV) April 30, 1999 $6.46 Oct. 31, 1998 $5.77 Increase $0.69 Distributions -- Nov. 1, 1998 - April 30, 1999 From income $ -- From capital gains $0.02 Total distributions $0.02 Total return* 12.53%** Class Y -- 6-month performance (All figures per share) Net asset value (NAV) April 30, 1999 $6.49 Oct. 31, 1998 $5.79 Increase $0.70 Distributions -- Nov. 1, 1998 - April 30, 1999 From income $0.03 From capital gains $0.02 Total distributions $0.05 Total return* 13.02%** * The prospectus discusses the effect of sales charges, if any, on the various classes. ** The total return is a hypothetical investment in the Fund with all distributions reinvested. The 10 Largest Holdings Percent Value (of net assets) (as of April 30, 1999) U.S. Treasury (United States) 2.19% $3,164,682 7.50% 2016 General Electric (United Kingdom) 1.90 2,747,972 Fannie Mae (United States) 1.84 2,664,413 Citigroup (United States) 1.78 2,572,045 Electronic Data Systems (United States) 1.70 2,461,751 Total Petroleum Cl B (France) 1.66 2,405,270 SBC Communications (United States) 1.61 2,324,000 Banque Natl de Paris (France) 1.60 2,314,214 Nippon Telegraph & Telephone (Japan) 1.59 2,297,415 U.S. Treasury (United States) 1.58 2,284,045 7.88% 2021 Note: Certain foreign investment risks include changes in currency exchange rates, adverse political or economic order, and lack of similar regulatory requirements followed by U.S. companies. For further detail about these holdings, please refer to the section entitled "Investments in Securities." (icon of) pie chart The 10 holdings listed here make up 17.45% of net assets
Financial Statements Statement of assets and liabilities AXP Global Balanced Fund April 30, 1999 (Unaudited) Assets Investments in securities, at value (Note 1) (identified cost $131,223,634) $145,656,491 Cash in bank on demand deposit 1,215,190 Dividends and accrued interest receivable 1,113,525 Receivable for investment securities sold 2,072,034 Unrealized appreciation on foreign currency contracts held, at value (Notes 1 and 5) 9,587 ----- Total assets $150,066,827 ------------ Liabilities Payable for investment securities purchased 5,596,910 Unrealized depreciation on foreign currency contracts held, at value (Notes 1 and 5) 3,636 Accrued investment management services fee 3,135 Accrued distribution fee 1,199 Accrued service fee 694 Accrued transfer agency fee 633 Accrued administrative services fee 238 Other accrued expenses 117,470 ------- Total liabilities 5,723,915 --------- Net assets applicable to outstanding capital stock $144,342,912 ============ Represented by Capital stock-- $.01 par value (Note 1) $ 223,073 Additional paid-in capital 124,021,281 Undistributed net investment income 532,542 Accumulated net realized gain (loss) 5,146,764 Unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies 14,419,252 ---------- Total -- representing net assets applicable to outstanding capital stock $144,342,912 ============ Net assets applicable to outstanding shares: Class A $ 86,114,140 Class B $ 58,227,416 Class Y $ 1,356 Net asset value per share of outstanding capital stock: Class A shares 13,288,034 $ 6.48 Class B shares 9,019,078 $ 6.46 Class Y shares 209 $ 6.49 See accompanying notes to financial statements.
Statement of operations AXP Global Balanced Fund Six months ended April 30, 1999 (Unaudited) Investment income Income: Dividends $ 340,947 Interest 1,422,918 Less foreign taxes withheld (35,026) ------- Total income 1,728,839 --------- Expenses (Note 2): Investment management services fee 503,535 Distribution fee-- Class B 193,754 Transfer agency fee 109,204 Incremental transfer agency fee Class A 6,876 Class B 8,009 Service fee Class A 66,145 Class B 45,122 Administrative services fees and expenses 38,452 Compensation of board members 5,138 Custodian fees 54,688 Postage 49,757 Registration fees 40,377 Reports to shareholders 21,615 Audit fees 8,000 Other 3,692 ----- Total expenses 1,154,364 Less expenses voluntarily reimbursed by AEFA (Note 2) (265) ---- 1,154,099 Earnings credits on cash balances (Note 2) (9,977) ------ Total net expenses 1,144,122 --------- Investment income (loss)-- net 584,717 ------- Realized and unrealized gain (loss) -- net Net realized gain (loss) on: Security transactions (Note 3) 5,459,785 Foreign currency transactions (151,456) -------- Net realized gain (loss) on investments 5,308,329 Net change in unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies 8,541,617 --------- Net gain (loss) on investments and foreign currencies 13,849,946 ---------- Net increase (decrease) in net assets resulting from operations $14,434,663 =========== See accompanying notes to financial statements.
Statements of changes in net assets AXP Global Balanced Fund April 30, 1999 Oct. 31, 1998 Six months ended Year ended (Unaudited) Operations and distributions Investment income (loss)-- net $ 584,717 $ 1,257,087 Net realized gain (loss) on investments 5,308,329 299,267 Net change in unrealized appreciation (depreciation) on investments and on translation of assets and liabilities in foreign currencies 8,541,617 4,486,751 --------- --------- Net increase (decrease) in net assets resulting from operations 14,434,663 6,043,105 ---------- --------- Distributions to shareholders from: Net investment income Class A (264,628) (929,021) Class B -- (390,897) Class Y (5) (24) Net realized gain Class A (240,294) (81,058) Class B (167,699) (51,691) Class Y (4) (3) -- -- Total distributions (672,630) (1,452,694) -------- ---------- Capital share transactions (Note 4) Proceeds from sales Class A shares (Note 2) 24,308,927 37,246,605 Class B shares 13,293,306 26,572,664 Reinvestment of distributions at net asset value Class A shares 475,236 955,528 Class B shares 165,954 435,464 Class Y shares 9 26 Payments for redemptions Class A shares (10,345,880) (8,176,071) Class B shares (Note 2) (4,760,663) (4,003,221) ---------- ---------- Increase (decrease) in net assets from capital share transactions 23,136,889 53,030,995 ---------- ---------- Total increase (decrease) in net assets 36,898,922 57,621,406 Net assets at beginning of period 107,443,990 49,822,584 ----------- ---------- Net assets at end of period $144,342,912 $107,443,990 ============ ============ Undistributed net investment income $ 532,542 $ 212,458 ------------ ------------ See accompanying notes to financial statements.
Notes to Financial Statements AXP Global Balanced Fund (Unaudited as to April 30, 1999) 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Fund is a series of AXP Global Series, Inc. and is registered under the Investment Company Act of 1940 (as amended) as a diversified open-end management investment company. The Fund invests primarily in equity and debt securities of companies throughout the world. AXP Global Series, Inc. has 10 billion authorized shares of capital stock that can be allocated among the separate series as designated by the board. The Fund offers Class A, Class B and Class Y shares. o Class A shares are sold with a front-end sales charge. o Class B shares may be subject to a contingent deferred sales charge and automatically convert to Class A shares during the ninth calendar year of ownership. o Class Y shares have no sales charge and are offered only to qualifying institutional investors. All classes of shares have identical voting, dividend and liquidation rights. The distribution fee, transfer agency fee and service fee (class specific expenses) differs 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. The Fund's significant accounting policies are summarized below: Use of estimates Preparing financial statements that conform to generally accepted accounting principles requires management to make estimates (e.g., on assets and liabilities) that could differ from actual results. 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. Debt securities are generally traded in the over-the-counter market and are valued at a price that reflects fair value as quoted by dealers in these securities or by an independent pricing service. Securities for which market quotations are not readily available are valued at fair value according to methods selected in good faith by the board. 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. Option transactions To produce incremental earnings, protect gains, and facilitate buying and selling of securities for investments, the Fund may buy and write options traded on any U.S. or foreign exchange or in the over-the-counter market where completing the obligation depends 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 as well as write cash-secured put options. The risk in writing a call option is that the Fund gives up the opportunity for 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 being unable 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 when the option transaction expires or closes. 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 To gain exposure to or protect itself from market changes, the Fund may buy and sell financial futures contracts traded on any U.S. or foreign exchange. The Fund also may buy and write put and call options on these futures contracts. Risks of entering into futures contracts and related options include the possibility of 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 or 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, if any, may arise from sales of foreign currency, closed forward contracts, exchange gains or losses realized between the trade date and settlement date 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 and/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 its contract obligations. Securities purchased on a when-issued basis Delivery and payment for securities that have been purchased by the Fund on a forward-commitment or when-issued basis can take place one month or more after the transaction date. During this period, such securities are subject to market fluctuations, and they may affect the Fund's net assets the same as owned securities. The Fund designates cash or liquid high-grade short-term debt securities at least equal to the amount of its commitment. As of April 30, 1999, the Fund has outstanding when-issued or forward-commitments of $1,012,049. Federal taxes The Fund's policy is to comply with all sections of the Internal Revenue Code that apply to regulated investment companies and to distribute all of its taxable income to shareholders. No provision for income or excise taxes is thus required. Net investment income (loss) and net realized gains (losses) may differ for financial statement and tax purposes primarily because of deferred 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 or upon receipt of ex-dividend notification in the case of certain foreign securities. For U.S. dollar denominated bonds, interest income, including level-yield amortization of premium and discount, is accrued daily. For foreign bonds the Fund amortizes premium and original issue discount daily and market discount is recognized at the time of sale. As of April 30, 1999, AEFC owned 209 shares of Class Y. 2. EXPENSES AND SALES CHARGES The Fund has agreements with American Express Financial Corporation (AEFC) to manage its portfolio and provide administrative services. Under an Investment Management Services Agreement, AEFC 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 0.79% to 0.67% annually. Under an Administrative Services Agreement, the Fund pays AEFC a fee for administration and accounting services at a percentage of the Fund's average daily net assets in reducing percentages from 0.06% to 0.035% annually. Additional administrative service expenses paid by the Fund are office expenses, consultants' fees and compensation of officers and employees. Under this agreement, the Fund also pays taxes, audit and certain legal fees, registration fees for shares, compensation of board members, corporate filing fees and any other expenses properly payable by the Fund and approved by the board. Under a separate Transfer Agency Agreement, American Express Client Service Corporation (AECSC) maintains shareholder accounts and records. The Fund pays AECSC an annual fee per shareholder account for this service as follows: o Class A $19 o Class B $20 o Class Y $17 Under terms of a prior agreement that ended Jan. 31, 1999, the Fund paid a transfer agency fee at an annual rate per shareholder account of $15 for Class A and $16 for Class B. Under terms of a prior agreement that ended March 31, 1999, the Fund paid a transfer agency fee at an annual rate per shareholder account of $15 for Class Y. The Fund has agreements with American Express Financial Advisors Inc. for distribution and shareholder services. Under a Plan and Agreement of Distribution, 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 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 and 0.10% of the Fund's average daily net assets attributable to Class Y shares. Sales charges received by American Express Financial Advisors Inc. for distributing Fund shares were $271,844 for Class A and $22,730 for Class B for the six months ended April 30, 1999. The Fund also pays custodian fees to American Express Trust Company, an affiliate of AEFC. AEFC has agreed to waive certain fees and reimburse expenses, with the exception of 12b-1 fees, to the extent that total expenses for Class A shares exceed 1.50% for a minimum period ending Oct. 31, 1999. Any waiver or reimbursement applies to each class on a pro rata basis. During the six months ended April 30, 1999, the Fund's custodian and transfer agency fees were reduced by $9,977 as a result of earnings credits from overnight cash balances. 3. SECURITIES TRANSACTIONS Cost of purchases and proceeds from sales of securities (other than short-term obligations) aggregated $60,852,251 and $46,780,773, respectively, for the six months ended April 30, 1999. Realized gains and losses are determined on an identified cost basis. 4. CAPITAL SHARE TRANSACTIONS Transactions in shares of capital stock for the periods indicated are as follows: Six months ended April 30, 1999 Class A Class B Class Y Sold 3,883,585 2,134,702 -- Issued for reinvested distributions 76,189 26,920 1 Redeemed (1,638,790) (759,251) -- ---------- -------- ---- Net increase (decrease) 2,320,984 1,402,371 1 Year ended Oct. 31, 1998 Class A Class B Class Y Sold 6,478,414 4,626,191 -- Issued for reinvested distributions 168,495 77,135 5 Redeemed (1,426,496) (700,458) -- ---------- -------- ---- Net increase (decrease) 5,220,413 4,002,868 5
5. FOREIGN CURRENCY CONTRACTS As of April 30, 1999, the Fund has foreign currency exchange contracts that obligate it to deliver currencies at specified future dates. The unrealized appreciation and/or depreciation on these contracts is included in the accompanying financial statements. See "Summary of significant accounting policies." The terms of the open contracts are as follows: Exchange date Currency to Currency to Unrealized Unrealized be delivered be received appreciation depreciation May 3, 1999 106,239 161,017 $ 314 $ -- U.S. Dollar Australian Dollar May 3, 1999 1,223,342 1,155,513 -- 2,427 U.S. Dollar European Monetary Unit May 3, 1999 828,042 881,078 6,169 -- European Monetary Unit U.S. Dollar May 4, 1999 317,226 512,769 2,415 -- British Pound U.S. Dollar May 4, 1999 72,022 108,960 82 -- U.S. Dollar Australian Dollar May 6, 1999 180,384 21,455,289 -- 684 U.S. Dollar Japanese Yen May 7, 1999 245,928 29,299,847 -- 525 U.S. Dollar Japanese Yen May 28, 1999 68,194 72,661 607 -- European Monetary Unit U.S. Dollar Total $9,587 $3,636 6. BANK BORROWINGS The Fund has a revolving credit agreement with U.S. Bank, N.A., whereby the Fund is permitted to have bank borrowings for temporary or emergency purposes to fund shareholder redemptions. The Fund must have asset coverage for borrowings not to exceed the aggregate of 333% of advances equal to or less than five business days plus 367% of advances over five business days. The agreement, which enables the Fund to participate with other American Express funds, permits borrowings up to $200 million, collectively. Interest is charged to each Fund based on its borrowings at a rate equal to the Federal Funds Rate plus 0.30% or the Eurodollar Rate (Reserve Adjusted) plus 0.20%. Borrowings are payable up to 90 days after such loan is executed. The Fund also pays a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.05% per annum. The Fund had no borrowings outstanding during the six months ended April 30, 1999.
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 changesa Class A Class B Class Y 1999c 1998 1997b 1999c 1998 1997b 1999c 1998 1997b Net asset value, beginning of period $5.79 $5.33 $5.00 $5.77 $5.31 $5.00 $5.79 $5.33 $5.00 Income from investment operations: Net investment income (loss) .04 .10 .09 -- .06 .06 .05 .12 .10 Net gains (losses) (both realized and unrealized) .69 .48 .31 .71 .48 .30 .70 .47 .31 Total from investment operations .73 .58 .40 .71 .54 .36 .75 .59 .41 Less distributions: Dividends from net investment income (.02) (.11) (.07) -- (.07) (.05) (.03) (.12) (.08) Distributions from realized gains (.02) (.01) -- (.02) (.01) -- (.02) (.01) -- Total distributions (.04) (.12) (.07) (.02) (.08) (.05) (.05) (.13) (.08) Net asset value, end of period $6.48 $5.79 $5.33 $6.46 $5.77 $5.31 $6.49 $5.79 $5.33 Ratios/supplemental data Net assets, end of period (in millions) $86 $63 $31 $58 $44 $19 $-- $-- $-- Ratio of expenses to average daily net assetsd 1.50%e 1.49%f 1.45%e,f 2.26%e 2.25%f 2.22%e,f 1.24%e 1.42%f 1.30%e,f Ratio of net investment income (loss) to average daily net assets 1.23%e 1.86% 2.18%e .46%e 1.10% 1.41%e 1.41%e 2.02% 2.46%e Portfolio turnover rate (excluding short-term securities) 38% 74% 44% 38% 74% 44% 38% 74% 44% Total returng 12.94% 11.01% 8.10% 12.53% 10.18% 7.31% 13.02% 11.17% 8.24% a For a share outstanding throughout the period. Rounded to the nearest cent. b Inception date. Period from Nov. 13, 1996 to Oct. 31, 1997. c Six months ended April 30, 1999 (Unaudited). d Expense ratio is based on total expenses of the Fund before reduction of earnings credits on cash balances. e Adjusted to an annual basis. f AEFC reimbursed the Fund for certain expenses. Had AEFC not done so, the annualratios of expenses would have been 1.53% and 2.29% for Class A, 2.29% and 2.96% for Class B, and 1.46% and 2.14% for Class Y, for the periods ended 1998 and 1997, respectively. g Total return does not reflect payment of a sales charge.
Investments in Securities AXP Global Balanced Fund April 30, 1999 (Unaudited) (Percentages represent value of investments compared to net assets) Common stocks (67.8%) Issuer Shares Value(a) Australia (1.2%) Airlines (0.2%) Qantas Airways 91,000 $249,913 Banks and savings & loans (0.2%) Commonwealth Bank of Australia 18,000 327,744 Media (0.1%) Publishing & Broadcasting 29,000 194,921 Metals (0.4%) Broken Hill Proprietary 21,000 237,411 WMC ADR 49,000 211,739 Total 449,150 Utilities -- telephone (0.3%) AAPT 96,000(b) 343,046 Telstra 18,798 102,004 Total 445,050 Chile (--%) Utilities -- telephone Compania de Telecomunicaciones de Chile ADR 127 3,358 France (8.8%) Banks and savings & loans (1.6%) Banque Natl de Paris 27,919 2,314,214 Building materials & construction (0.8%) Lafarge 12,528 1,217,812 Electronics (0.7%) SGS-Thomson Microelectronics 10,299 1,072,958 Energy (3.1%) Elf Aquitaine 13,181 2,047,276 Total Petroleum Cl B 17,565 2,405,270 Total 4,452,546 Food (0.5%) Sodexho Alliance 4,838(b) 793,867 Household products (1.1%) Rhone-Poulenc Cl A 33,258 1,581,318 Industrial equipment & services (0.9%) Castorama Dubois 5,350 1,280,361 Utilities -- electric (0.1%) Suez Lyonnaise des Eaux 804 136,771 Germany (3.1%) Automotive & related (1.4%) Volkswagen 29,089 2,062,349 Chemicals (0.6%) Henkel KGaA 11,203 886,598 Industrial equipment & services (1.1%) Mannesmann 11,540 1,519,269 Hong Kong (0.4%) Banks and savings & loans Hang Seng Bank 45,000 532,674 Italy (3.1%) Banks and savings & loans (2.9%) Banca Nazionale del Lavoro 287,115 979,866 Instituto Bancario San Paolo di Torino 126,504 1,898,028 Unicredito Italiano 251,331 1,274,675 Total 4,152,569 Utilities -- telephone (0.2%) Telecom Italia 25,400 270,256 Japan (5.8%) Automotive & related (1.3%) Denso 42,000 853,049 Toyota Motor 35,000 993,759 Total 1,846,808 Banks and savings & loans (0.3%) Sumitomo Chemical 93,000 415,171 Computers & office equipment (0.5%) Fujitsu 42,000 719,376 Electronics (0.6%) Matsushita Communication Industrial 12,000 861,343 Multi-industry conglomerates (0.3%) Marubeni 215,000 497,016 Retail (0.5%) Marui ADR 44,000 730,048 Utilities -- telephone (2.3%) Nippon Telegraph & Telephone 2,110 2,297,415 NTT Mobile Communication Network 170 996,692 Total 3,294,107 Mexico (0.8%) Banks and savings & loans (0.1%) Grupo Financiero Banamex Accival 47,170(b) 120,222 Beverages & tobacco (0.4%) Fomento Economico Mexicano ADR 14,300 520,163 Media (0.3%) Grupo Televisa 10,300(b) 422,300 Netherlands (2.2%) Industrial equipment & services (1.4%) Philips Electronics 25,022 2,154,717 Utilities -- telephone (0.8%) Equant 12,387 1,124,268 New Zealand (0.2%) Utilities -- telephone Telecom Corp of New Zealand 59,000 307,325 Singapore (0.9%) Banks and savings & loans Oversea-Chinese Banking 138,000 1,293,515 Spain (1.2%) Utilities -- telephone Telefonica de Espana 36,415 1,706,414 Sweden (0.9%) Communications equipment & services Ericsson (LM) Cl B 51,305 1,346,772 Switzerland (1.3%) Banks and savings & loans UBS 5,739 1,948,995 United Kingdom (6.8%) Banks and savings & loans (0.1%) Standard Chartered 33,133 598,074 Multi-industry conglomerates (2.9%) General Electric 260,380 2,747,972 Williams 195,621 1,333,607 Total 4,081,579 Retail (0.7%) Great Universal Stores 85,188 971,007 Transportation (0.3%) Stagecoach Holdings 119,204 413,280 Utilities -- telephone (2.8%) Cable & Wireless Communications 110,796 1,264,670 Orange 71,593 970,959 Vodafone 99,677 1,824,905 Total 4,060,534 United States (31.3%) Banks and savings & loans (1.3%) Bank of America 26,866 1,929,315 Chemicals (2.8%) Du Pont (EI) de Nemours 30,800 2,175,249 Monsanto 40,470 1,831,268 Total 4,006,517 Computers & office equipment (6.6%) America Online 10,300 1,470,325 Cisco Systems 14,517(b) 1,655,845 Electronic Data Systems 45,800 2,461,751 Hewlett-Packard 21,710 1,712,376 Intl Business Machines 10,450 2,186,009 Total 9,486,306 Electronics (1.4%) Intel 32,240 1,972,685 Energy (1.1%) Texaco 26,000 1,631,500 Financial services (3.6%) Citigroup 34,180 2,572,045 Fannie Mae 37,560 2,664,413 Total 5,236,458 Health care (2.5%) Boston Scientific 48,400(b) 2,060,025 Pfizer 13,540 1,557,946 Total 3,617,971 Household products (0.8%) Colgate-Palmolive 10,680 1,094,033 Insurance (1.5%) American Intl Group 18,010 2,115,049 Metals (0.4%) Pasminco 133,300 149,083 Multi-industry conglomerates (1.1%) General Electric 15,640 1,650,020 Retail (3.9%) Rite Aid 63,940 1,490,601 Safeway 16,250(b) 876,484 Wal-Mart Stores 33,800 1,554,800 Walgreen 63,460 1,705,488 Total 5,627,373 Utilities -- telephone (4.3%) AT&T 32,250 $1,628,625 MCI WorldCom 27,700(b) 2,276,594 SBC Communications 41,500 2,324,000 Total 6,229,219 Total common stocks (Cost: $83,259,806) $98,122,261 Other (--%) Issuer Shares Value(a) United States Telefonica Rights 36,415 $33,859 Total other (Cost: $--) $33,859 See accompanying notes to investments in securities.
Bonds (28.4%) Issuer Coupon Principal Value(a) rate amount Australia (0.3%) New South Wales Treasury (Australian Dollar) 03-01-08 8.00% 600,000(d) $458,249 Canada (0.4%) Govt of Canada (Canadian Dollar) 06-01-09 5.50 640,000 450,108 Rogers Communication (Canadian Dollar) Sr Nts 07-15-07 6.37 300,000 214,109 Total 664,217 China (0.1%) Greater Beijing (U.S. Dollar) Sr Nts 06-15-07 9.50 300,000 159,000 Denmark (0.8%) Govt of Denmark (Danish Krone) 05-15-03 8.00 600,000 99,659 11-10-24 7.00 6,300,000 1,110,602 Total 1,210,261 Germany (2.7%) Federal Republic of Germany (European Monetary Unit) 06-20-16 6.00 434,598 544,166 07-04-27 6.50 1,515,809 1,988,615 Treuhandanstalt (European Monetary Unit) 01-29-03 7.13 1,022,584 1,233,098 Total 3,765,879 Greece (0.4%) Hellenic Republic (Greek Drachma) 03-21-00 9.80 160,000,000 521,920 Hong Kong (0.4%) Guangdong Enterprises (U.S. Dollar) Sr Nts 05-22-07 8.88 200,000(d) 65,000 Hutchison Whampoa Finance (U.S. Dollar) Company Guaranty 08-01-27 7.50 525,000(d) 472,606 Total 537,606 Indonesia (--%) Tjiwi Kimia Finance Mauritius (U.S. Dollar) Company Guaranty 08-01-04 10.00 100,000 66,000 Italy (0.7%) Govt of Italy (European Monetary Unit) 01-01-04 8.50 800,000 1,025,942 Japan (0.2%) Sony (U.S. Dollar) 03-04-03 6.13 250,000 251,709 Mexico (0.4%) Banco Nacional de Comercio Exterior (U.S. Dollar) 02-02-04 7.25 500,000 459,687 Bancomext Trust (U.S. Dollar) 05-30-06 11.25 150,000(d) 160,500 United Mexican States (British Pound) Medium-term Nts Series E 05-30-02 14.48 125,000 199,908 Total 820,095 Norway (2.5%) Govt of Norway (Norwegian Krone) 05-31-01 7.00 14,960,000 1,998,567 11-30-04 5.75 7,200,000 971,568 05-15-09 5.50 4,715,000 640,636 Total 3,610,771 Panama (0.2%) Banco General (U.S. Dollar) 08-01-02 7.70 250,000(d) 231,323 Peru (0.2%) Southern Peru Copper (U.S. Dollar) 05-30-07 7.90 250,000 225,698 Philippines (0.1%) Philippine Long Distance Telephone (U.S. Dollar) Medium-term Nts Series E 03-06-17 8.35 150,000(d) 129,007 South Korea (0.3%) Hyundai Semiconductor (U.S. Dollar) Sr Nts 05-15-07 8.63 200,000(d) 169,256 Korea Electric Power (U.S. Dollar) 07-01-02 8.00 200,000 203,572 Total 372,828 Spain (0.9%) Govt of Spain (European Monetary Unit) 04-30-06 8.80 322,744 445,538 01-31-29 6.00 690,863 838,544 Total 1,284,082 Sweden (0.4%) Govt of Sweden (Swedish Krona) 02-09-05 6.00 1,300,000 172,699 08-15-07 8.00 1,600,000 241,894 Paulson Enterprenad (Swedish Krona) 12-15-00 6.14 1,000,000 119,057 Total 533,650 United Kingdom (3.4%) United Kingdom Treasury (British Pound) 03-03-00 9.00 250,000 415,037 07-14-00 13.00 250,000 439,049 11-06-01 7.00 500,000 840,679 06-07-02 7.00 75,000 127,650 06-10-03 8.00 865,000 1,547,138 04-18-05 9.50 340,000 677,338 12-07-05 8.50 425,000 824,728 Total 4,871,619 United States (13.7%) California Infrastructure- Pacific Gas & Electric (U.S. Dollar) 06-25-03 6.16 400,000 403,836 Citicorp (Deutsche Mark) 09-19-09 3.47 1,000,000 591,637 DTE Burns Harbor LLC (U.S. Dollar) Sr Nts 01-30-03 6.57 180,240(d) 175,373 Federal Natl Mtge Assn (U.S. Dollar) 02-15-08 5.75 900,000 893,795 03-01-10 6.50 1,000,000(f) 1,009,063 07-01-13 6.00 744,294 738,481 03-01-27 7.50 170,792 175,632 Ford Motor Credit (U.S. Dollar) 09-10-02 6.55 400,000 407,632 GTE North (U.S. Dollar) Series F 02-15-10 6.38 250,000 251,421 Morgan (JP) (U.S. Dollar) Sr Sub Medium-term Nts Series A 02-15-12 4.00 100,000(e) 89,706 Phillips Petroleum (U.S. Dollar) 03-15-28 7.13 200,000 191,849 TU Electric Capital (U.S. Dollar) Company Guaranty 01-30-37 8.18 100,000 104,144 U.S. Treasury (U.S. Dollar) 11-30-99 5.63 800,000 803,994 05-15-00 6.38 500,000 507,280 11-15-00 5.75 1,500,000 1,515,272 11-30-00 4.63 1,500,000 1,490,395 02-28-01 5.63 2,000,000 2,018,520 02-28-03 5.50 650,000 655,514 02-15-05 7.50 650,000 719,035 10-15-06 6.50 465,000 495,433 11-15-16 7.50 2,700,000 3,164,682 02-15-21 7.88 1,850,000 2,284,045 02-15-29 5.25 600,000 563,016 TIPS 01-15-07 3.38 200,000(c) 200,348 USX (U.S. Dollar) 03-01-08 6.85 200,000 199,451 Zurich Capital (U.S. Dollar) Company Guaranty 06-01-37 8.38 125,000(d) 132,441 Total 19,781,995 Venezuela (0.4%) PDVSA Finance (U.S. Dollar) 02-15-10 9.75 500,000(d) 498,215 Total bonds (Cost: $41,483,383) $41,020,066 See accompanying notes to investments in securities.
Short-term securities (4.5%) Issuer Annualized Amount Value(a) yield on date payable at of purchase maturity U.S. government agencies (3.5%) Federal Home Loan Bank Disc Nt 05-21-99 4.77% $600,000 $598,420 Federal Home Loan Mtge Corp Disc Nts 05-20-99 4.75 2,400,000 2,394,016 06-04-99 4.71 500,000 497,785 06-04-99 4.78 400,000 398,207 06-21-99 4.72 600,000 595,873 06-22-99 4.72 500,000 496,613 Total 4,980,914 Commercial paper (1.0%) Merrill Lynch 05-04-99 4.87 1,500,000 1,499,391 Total short-term securities (Cost: $6,480,445) $6,480,305 Total investments in securities (Cost: $131,223,634)(g) $145,656,491 See accompanying notes to investments in securities.
Notes to investments in securities (a) Securities are valued by procedures described in Note 1 to the financial statements. Foreign security values are stated in U.S. dollars. For debt securities, principal amounts are denominated in the currency indicated. (b) Non-income producing. (c) U.S. Treasury inflation-protection securities (TIPS) are securities in which the principal amount is adjusted for inflation and the semiannual interest payments equal a fixed percentage of the inflation-adjusted principal amount. (d) 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. (e) Interest rate varies either based on a predetermined schedule or to reflect current market conditions; rate shown is the effective rate on April 30, 1999. (f) At April 30, 1999, the cost of securities purchased, including interest purchased, on a when-issued basis was $1,012,049. (g) At April 30, 1999, the cost of securities for federal income tax purposes was approximately $131,206,000 and the approximate aggregate gross unrealized appreciation and depreciation based on that cost was: Unrealized appreciation $16,655,000 Unrealized depreciation (2,205,000) ---------- Net unrealized appreciation $14,450,000 Quick telephone reference AMERICAN EXPRESS FINANCIAL ADVISORS TELEPHONE TRANSACTION SERVICE Sales and exchanges, dividend payments or reinvestments and automatic payment arrangements: 800-437-3133 AMERICAN EXPRESS CLIENT SERVICE CORPORATION Fund performance, fund prices, account values, recent account transactions and account inquiries: 800-862-7919 TTY SERVICE For the hearing impaired: 800-846-4852 TICKER SYMBOL Class A: IDGAX Class B: IGBBX Class Y: N/A S-6346 D (6/99) BULK RATE U.S. POSTAGE PAID PERMIT NO. 85 SPENCER, IA AXP Global Balanced Fund IDS Tower 10 Minneapolis, MN 55440-0010 AMERICAN EXPRESS Financial Advisors -----END PRIVACY-ENHANCED MESSAGE-----