UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-07857
OPPENHEIMER REAL ASSET FUND
(Exact name of registrant as specified in charter)
6803 SOUTH TUCSON WAY, CENTENNIAL, COLORADO 80112-3924
(Address of principal executive offices) (Zip code)
Robert G. Zack, Esq.
Oppenheimerfunds, Inc.
TWO WORLD FINANCIAL CENTER, NEW YORK, NEW YORK 10281-1008
(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
Date of fiscal year end: August 31
Date of reporting period: August 31, 2005
ITEM 1. REPORTS TO STOCKHOLDERS.
TOP HOLDINGS AND ALLOCATIONS
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SECTOR ALLOCATION ON COMMODITY-LINKED INVESTMENTS
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Energy 81.0%
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Agriculture 6.0
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Industrial Metals 6.0
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Livestock 5.0
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Precious Metals 2.0
Portfolio holdings and allocations are subject to change. Percentages are as of
August 31, 2005, and are dollar-weighed based on percentages of commodity-linked
investments. Commodity-linked investments are investments whose return is based
upon the price movements (whether up or down) of a particular commodity or
basket of commodities. The Fund's allocation of its investments within each
sector of the GSCI(R) may differ (at times, significantly) from the sector
weightings of the GSCI(R). The Fund is not an index fund.
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PORTFOLIO ALLOCATION
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
U.S. Government Obligations 26.9%
Mortgage-Backed Obligations 25.4
Corporate Bonds and Notes 23.5
Commodity-Linked Notes 12.8
Cash Equivalents 9.6
Asset-Backed Securities 1.6
Foreign Government Obligations 0.2
Portfolio holdings and allocations are subject to change. Percentages are as of
August 31, 2005, and are based on total market value of investments.
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9 | OPPENHEIMER REAL ASSET FUND
FUND PERFORMANCE DISCUSSION
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HOW HAS THE FUND PERFORMED? BELOW IS A DISCUSSION BY OPPENHEIMERFUNDS, INC., OF
THE FUND'S PERFORMANCE DURING ITS FISCAL YEAR ENDED AUGUST 31, 2005, FOLLOWED BY
A GRAPHICAL COMPARISON OF THE FUND'S PERFORMANCE TO AN APPROPRIATE BROAD-BASED
MARKET INDEX.
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE. Benefiting from a strengthening
global economy that helped propel commodity prices, the Fund performed very well
during this 12-month period. In addition, the Fund produced a greater return
than the 12-month total return generated by the Goldman Sachs Commodities
Index(R) (the GSCI(R)), due to the success of its commodities and fixed-income
strategies, which added value to the portfolio.
At the core of our day-to-day investment strategy are two major ways in
which we attempt to add value for shareholders. The first is through our modest
tilts in the Fund's sectors or commodities weights. While the Fund's allocations
generally remain close to the weightings of the benchmark, we do adjust those
when we believe one area or another offers better value. The second way we
attempt to add value is through what we call "relative value decisions," where
we closely monitor all aspects of the commodities markets and are looking for
unique opportunities that we believe can help boost the Fund's return. These
opportunities can come in many different forms--whether we see strength within a
particular commodity sector and we choose to place a greater emphasis there, or
by favoring one type of closely related commodity over another, (e.g. crude oil
versus gasoline) to capture pricing inefficiencies between those market
segments, or making a decision to invest on a short- or long-term basis in a
particular agricultural product (corn, for instance). These are a few of the
ways in which we keep a watchful eye for opportunities that could potentially
benefit shareholders.
As always, we maintain a conservative approach to the Fund's management of
its fixed-income securities. In our view, the Fund's fixed-income component is
designed primarily as a tool to provide liquidity while making a small
contribution to total return. Accordingly, we invested the bulk of the
fixed-income assets in high-quality, short maturity securities. We increased the
Fund's exposure to what we consider "high-coupon" mortgage-backed securities,
believing that the majority of homeowners may have already refinanced and
therefore any significant prepayment risk may be behind us. Corporate securities
performed well during the reporting period and we have maintained our exposure
to short-maturity, high-quality bonds there. Otherwise, we attempted to add
value by modestly adjusting the Fund's duration as interest rates rose
throughout the reporting period, bearing in mind that we always strive to
minimize interest rate risk in the portfolio.
10 | OPPENHEIMER REAL ASSET FUND
COMPARING THE FUND'S PERFORMANCE TO THE MARKET. The graphs that follow show the
performance of a hypothetical $10,000 investment in each class of shares of the
Fund held until August 31, 2005. In the case of Class A, Class B, Class C and
Class Y shares, performance is measured from inception of the classes on March
31, 1997. In the case of Class N shares, performance is measured from the
inception of the class on March 1, 2001. The Fund's performance reflects the
deduction of the maximum initial sales charge on Class A shares, the applicable
contingent deferred sales charge on Class B, Class C, and Class N shares, and
reinvestments of all dividends and capital gains distributions. Past performance
cannot guarantee future results.
The Fund's performance is compared to the performance of the Goldman Sachs
Commodities Index(R) (GSCI(R)). The GSCI(R) is a composite index of commodity
sector returns representing an unleveraged long-term investment in commodity
futures that is broadly based across the spectrum of commodities and includes
reinvestment of income (to represent real assets). While correlation to the
GSCI(R) is a current portfolio strategy, it is not a stated objective or
investment policy of Oppenheimer Real Asset Fund. Index performance reflects the
reinvestment of income but does not consider the effect of transaction costs,
and none of the data in the graphs shows the effect of taxes. The Fund's
performance reflects the effects of the Fund's business and operating expenses.
While index comparisons may be useful to provide a benchmark for the Fund's
performance, it must be noted that the Fund's investments are not limited to the
investments in the index.
11 | OPPENHEIMER REAL ASSET FUND
FUND PERFORMANCE DISCUSSION
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CLASS A SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer Real Asset Fund(R) (Class A)
Goldman Sachs Commodity Index(R)
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer Real
Asset Fund(R) Goldman Sachs
(Class A) Commodity Index(R)
---------------- ------------------
03/31/1997 9,425 10,000
05/31/1997 9,679 10,305
08/31/1997 9,717 10,403
11/30/1997 9,161 9,879
02/28/1998 7,750 8,451
05/31/1998 7,057 7,805
08/31/1998 5,594 6,527
11/30/1998 4,872 6,025
02/28/1999 4,464 5,672
05/31/1999 5,028 6,526
08/31/1999 5,958 7,702
11/30/1999 6,160 8,003
02/29/2000 7,294 9,503
05/31/2000 7,803 10,349
08/31/2000 8,850 11,812
11/30/2000 9,566 12,753
02/28/2001 8,572 11,662
05/31/2001 8,489 11,470
08/31/2001 7,980 10,767
11/30/2001 6,435 8,616
02/28/2002 6,434 8,596
05/31/2002 6,990 9,418
08/31/2002 7,538 10,406
11/30/2002 7,463 10,361
02/28/2003 9,934 13,721
05/31/2003 8,826 12,079
08/31/2003 9,277 12,690
11/30/2003 9,340 12,722
02/29/2004 10,719 14,616
05/31/2004 11,765 16,030
08/31/2004 11,637 15,822
11/30/2004 13,138 17,659
02/28/2005 13,464 18,026
05/31/2005 13,083 17,502
08/31/2005 16,834 22,497
AVERAGE ANNUAL TOTAL RETURNS OF CLASS A SHARES WITH SALES CHARGE OF THE FUND AT
8/31/05
1-Year 36.34% 5-Year 12.38% Since Inception (3/31/97) 6.38%
12 | OPPENHEIMER REAL ASSET FUND
CLASS B SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer Real Asset Fund(R) (Class B)
Goldman Sachs Commodity Index(R)
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer Real
Asset Fund(R) Goldman Sachs
(Class B) Commodity Index(R)
---------------- ------------------
03/31/1997 10,000 10,000
05/31/1997 10,250 10,305
08/31/1997 10,270 10,403
11/30/1997 9,670 9,879
02/28/1998 8,156 8,451
05/31/1998 7,413 7,805
08/31/1998 5,865 6,527
11/30/1998 5,101 6,025
02/28/1999 4,662 5,672
05/31/1999 5,246 6,526
08/31/1999 6,202 7,702
11/30/1999 6,402 8,003
02/29/2000 7,570 9,503
05/31/2000 8,081 10,349
08/31/2000 9,144 11,812
11/30/2000 9,855 12,753
02/28/2001 8,822 11,662
05/31/2001 8,722 11,470
08/31/2001 8,185 10,767
11/30/2001 6,591 8,616
02/28/2002 6,576 8,596
05/31/2002 7,132 9,418
08/31/2002 7,663 10,406
11/30/2002 7,573 10,361
02/28/2003 10,068 13,721
05/31/2003 8,934 12,079
08/31/2003 9,392 12,690
11/30/2003 9,455 12,722
02/29/2004 10,852 14,616
05/31/2004 11,910 16,030
08/31/2004 11,781 15,822
11/30/2004 13,300 17,659
02/28/2005 13,630 18,026
05/31/2005 13,244 17,502
08/31/2005 17,041 22,497
AVERAGE ANNUAL TOTAL RETURNS OF CLASS B SHARES WITH SALES CHARGE OF THE FUND AT
8/31/05
1-Year 38.33% 5-Year 12.52% Since Inception (3/31/97) 6.54%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE CLASS B SHARES CONVERT TO
CLASS A SHARES 72 MONTHS AFTER PURCHASE, SINCE-INCEPTION RETURNS FOR CLASS B
SHARES USES CLASS A PERFORMANCE FOR THE PERIOD AFTER CONVERSION. SEE PAGE 17 FOR
FURTHER INFORMATION.
13 | OPPENHEIMER REAL ASSET FUND
FUND PERFORMANCE DISCUSSION
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CLASS C SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer Real Asset Fund(R) (Class C)
Goldman Sachs Commodity Index(R)
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer Real
Asset Fund(R) Goldman Sachs
(Class C) Commodity Index(R)
---------------- ------------------
03/31/1997 10,000 10,000
05/31/1997 10,240 10,305
08/31/1997 10,260 10,403
11/30/1997 9,650 9,879
02/28/1998 8,141 8,451
05/31/1998 7,408 7,805
08/31/1998 5,862 6,527
11/30/1998 5,088 6,025
02/28/1999 4,660 5,672
05/31/1999 5,237 6,526
08/31/1999 6,195 7,702
11/30/1999 6,397 8,003
02/29/2000 7,556 9,503
05/31/2000 8,069 10,349
08/31/2000 9,133 11,812
11/30/2000 9,845 12,753
02/28/2001 8,808 11,662
05/31/2001 8,719 11,470
08/31/2001 8,180 10,767
11/30/2001 6,584 8,616
02/28/2002 6,568 8,596
05/31/2002 7,114 9,418
08/31/2002 7,658 10,406
11/30/2002 7,570 10,361
02/28/2003 10,058 13,721
05/31/2003 8,921 12,079
08/31/2003 9,346 12,690
11/30/2003 9,396 12,722
02/29/2004 10,752 14,616
05/31/2004 11,783 16,030
08/31/2004 11,628 15,822
11/30/2004 13,098 17,659
02/28/2005 13,400 18,026
05/31/2005 12,997 17,502
08/31/2005 16,687 22,497
AVERAGE ANNUAL TOTAL RETURNS OF CLASS C SHARES WITH SALES CHARGE OF THE FUND AT
8/31/05
1-Year 42.50% 5-Year 12.81% Since Inception (3/31/97) 6.27%
14 | OPPENHEIMER REAL ASSET FUND
CLASS N SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer Real Asset Fund(R) (Class N)
Goldman Sachs Commodity Index(R)
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer Real
Asset Fund(R) Goldman Sachs
(Class N) Commodity Index(R)
---------------- ------------------
03/01/2001 10,000 10,000
05/31/2001 9,932 9,836
08/31/2001 9,325 9,233
11/30/2001 7,470 7,388
02/28/2002 7,463 7,371
05/31/2002 8,092 8,076
08/31/2002 8,722 8,923
11/30/2002 8,703 8,885
02/28/2003 11,558 11,766
05/31/2003 10,264 10,358
08/31/2003 10,782 10,882
11/30/2003 10,840 10,909
02/29/2004 12,429 12,534
05/31/2004 13,630 13,746
08/31/2004 13,467 13,568
11/30/2004 15,188 15,143
02/28/2005 15,564 15,458
05/31/2005 15,091 15,008
08/31/2005 19,396 19,292
AVERAGE ANNUAL TOTAL RETURNS OF CLASS N SHARES WITH SALES CHARGE OF THE FUND AT
8/31/05
1-Year 43.03% Since Inception (3/1/01) 15.86%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE CLASS B SHARES CONVERT TO
CLASS A SHARES 72 MONTHS AFTER PURCHASE, SINCE-INCEPTION RETURNS FOR CLASS B
SHARES USES CLASS A PERFORMANCE FOR THE PERIOD AFTER CONVERSION. SEE PAGE 17 FOR
FURTHER INFORMATION.
15 | OPPENHEIMER REAL ASSET FUND
FUND PERFORMANCE DISCUSSION
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CLASS Y SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer Real Asset Fund(R) (Class Y)
Goldman Sachs Commodity Index(R)
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Oppenheimer Real
Asset Fund(R) Goldman Sachs
(Class Y) Commodity Index(R)
---------------- ------------------
03/31/1997 10,000 10,000
05/31/1997 10,270 10,305
08/31/1997 10,310 10,403
11/30/1997 9,730 9,879
02/28/1998 8,221 8,451
05/31/1998 7,495 7,805
08/31/1998 5,941 6,527
11/30/1998 5,174 6,025
02/28/1999 4,743 5,672
05/31/1999 5,359 6,526
08/31/1999 6,343 7,702
11/30/1999 6,563 8,003
02/29/2000 7,772 9,503
05/31/2000 8,323 10,349
08/31/2000 9,464 11,812
11/30/2000 10,242 12,753
02/28/2001 9,195 11,662
05/31/2001 9,121 11,470
08/31/2001 8,592 10,767
11/30/2001 6,923 8,616
02/28/2002 6,927 8,596
05/31/2002 7,543 9,418
08/31/2002 8,132 10,406
11/30/2002 8,059 10,361
02/28/2003 10,738 13,721
05/31/2003 9,559 12,079
08/31/2003 10,058 12,690
11/30/2003 10,136 12,722
02/29/2004 11,647 14,616
05/31/2004 12,796 16,030
08/31/2004 12,657 15,822
11/30/2004 14,314 17,659
02/28/2005 14,694 18,026
05/31/2005 14,289 17,502
08/31/2005 18,407 22,497
AVERAGE ANNUAL TOTAL RETURNS OF CLASS Y SHARES OF THE FUND AT 8/31/05
1-Year 45.42% 5-Year 14.23% Since Inception (3/31/97) 7.52%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED.
FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT
WWW.OPPENHEIMERFUNDS.COM, OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE
CHANGES IN SHARE PRICE, REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES
CHARGE: FOR CLASS A SHARES, THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%;
FOR CLASS B SHARES, THE CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2%
(5-YEAR); AND FOR CLASS C AND N SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE
FOR THE 1-YEAR PERIOD. THERE IS NO SALES CHARGE FOR CLASS Y SHARES. BECAUSE
CLASS B SHARES CONVERT TO CLASS A SHARES 72 MONTHS AFTER PURCHASE,
SINCE-INCEPTION RETURNS FOR CLASS B SHARES USES CLASS A PERFORMANCE FOR THE
PERIOD AFTER CONVERSION. SEE PAGE 17 FOR FURTHER INFORMATION.
16 | OPPENHEIMER REAL ASSET FUND
NOTES
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Total returns and the ending account values in the graphs include changes in
share price and reinvestment of dividends and capital gains distributions in a
hypothetical investment for the periods shown. The Fund's total returns shown do
not reflect the deduction of income taxes on an individual's investment. Taxes
may reduce your actual investment returns on income or gains paid by the Fund or
any gains you may realize if you sell your shares.
Investors should consider the Fund's investment objectives, risks, and other
charges and expenses carefully before investing. The Fund's prospectus contains
this and other information about the Fund, and may be obtained by asking your
financial advisor, calling us at 1.800.525.7048 or visiting our website at
www.oppenheimerfunds.com. Read the prospectus carefully before investing.
The Fund's investment strategy and focus can change over time. The mention of
specific fund holdings does not constitute a recommendation by OppenheimerFunds,
Inc.
Please note that Oppenheimer Real Asset Fund(R) invests a substantial portion of
its assets in derivative instruments that entail potentially higher volatility
and risk of loss than traditional equity or debt securities. The Fund is not
intended as a complete investment program and is intended for investors with
long-term investment goals who are willing to accept this risk.
CLASS A shares of the Fund were first publicly offered on 3/31/97. Class A
returns include the current maximum initial sales charge of 5.75%.
CLASS B shares of the Fund were first publicly offered on 3/31/97. Class B
returns include the applicable contingent deferred sales charge of 5% (1-year)
and 2% (5-year). Because Class B shares convert to Class A shares 72 months
after purchase, the "since inception" return for Class B uses Class A
performance for the period after conversion. Class B shares are subject to an
annual 0.75% asset-based sales charge.
CLASS C shares of the Fund were first publicly offered on 3/31/97. Class C
returns include the contingent deferred sales charge of 1% for the 1-year
period. Class C shares are subject to an annual 0.75% asset-based sales charge.
17 | OPPENHEIMER REAL ASSET FUND
NOTES
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CLASS N shares of the Fund were first publicly offered on 3/1/01. Class N shares
are offered only through retirement plans. Unless otherwise noted, Class N
returns include the contingent deferred sales charge of 1% for the 1-year
period. Class N shares are subject to an annual 0.25% asset-based sales charge.
CLASS Y shares of the Fund were first publicly offered on 3/31/97. Class Y
shares are offered principally to certain institutional investors under special
agreement with the Distributor and are not subject to a sales charge.
An explanation of the calculation of performance is in the Fund's Statement of
Additional Information.
18 | OPPENHEIMER REAL ASSET FUND
FUND EXPENSES
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FUND EXPENSES. As a shareholder of the Fund, you incur two types of costs: (1)
transaction costs, which may include sales charges (loads) on purchase payments,
contingent deferred sales charges on redemptions; and redemption fees, if any;
and (2) ongoing costs, including management fees; distribution and service fees;
and other Fund expenses. These examples are intended to help you understand your
ongoing costs (in dollars) of investing in the Fund and to compare these costs
with the ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000.00 invested at the beginning
of the period and held for the entire 6-month period ended August 31, 2005.
ACTUAL EXPENSES. The "actual" lines of the table provide information about
actual account values and actual expenses. You may use the information on this
line for the class of shares you hold, together with the amount you invested, to
estimate the expense that you paid over the period. Simply divide your account
value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00
= 8.60), then multiply the result by the number in the "actual" line under the
heading entitled "Expenses Paid During Period" to estimate the expenses you paid
on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The "hypothetical" lines of the
table provide information about hypothetical account values and hypothetical
expenses based on the Fund's actual expense ratio for each class of shares, and
an assumed rate of return of 5% per year before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Fund and other funds. To do so, compare this 5% hypothetical example for
the class of shares you hold with the 5% hypothetical examples that appear in
the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front-end
or contingent deferred sales charges (loads), redemption fees, or a $12.00 fee
imposed annually on accounts valued at less than $500.00 (subject to
19 | OPPENHEIMER REAL ASSET FUND
FUND EXPENSES
- --------------------------------------------------------------------------------
exceptions described in the Statement of Additional Information). Therefore, the
"hypothetical" lines of the table are useful in comparing ongoing costs only,
and will not help you determine the relative total costs of owning different
funds. In addition, if these transactional costs were included, your costs would
have been higher.
- --------------------------------------------------------------------------------
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
(3/1/05) (8/31/05) AUGUST 31, 2005
- --------------------------------------------------------------------------------
Class A Actual $ 1,000.00 $ 1,250.30 $ 7.40
- --------------------------------------------------------------------------------
Class A Hypothetical 1,000.00 1,018.65 6.64
- --------------------------------------------------------------------------------
Class B Actual 1,000.00 1,243.40 12.33
- --------------------------------------------------------------------------------
Class B Hypothetical 1,000.00 1,014.27 11.08
- --------------------------------------------------------------------------------
Class C Actual 1,000.00 1,245.30 11.88
- --------------------------------------------------------------------------------
Class C Hypothetical 1,000.00 1,014.67 10.67
- --------------------------------------------------------------------------------
Class N Actual 1,000.00 1,246.20 9.49
- --------------------------------------------------------------------------------
Class N Hypothetical 1,000.00 1,016.79 8.52
- --------------------------------------------------------------------------------
Class Y Actual 1,000.00 1,252.70 4.89
- --------------------------------------------------------------------------------
Class Y Hypothetical 1,000.00 1,020.87 4.39
Hypothetical assumes 5% annual return before expenses.
Expenses are equal to the Fund's annualized expense ratio for that class,
multiplied by the average account value over the period, multiplied by 184/365
(to reflect the one-half year period). Those annualized expense ratios based on
the 6-month period ended August 31, 2005 are as follows:
CLASS EXPENSE RATIOS
- ------------------------------
Class A 1.30%
- ------------------------------
Class B 2.17
- ------------------------------
Class C 2.09
- ------------------------------
Class N 1.67
- ------------------------------
Class Y 0.86
The expense ratios reflect voluntary waivers or reimbursements of expenses by
the Fund's Transfer Agent that can be terminated at any time, without advance
notice. The "Financial Highlights" tables in the Fund's financial statements,
included in this report, also show the gross expense ratios, without such
waivers or reimbursements.
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20 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS August 31, 2005
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
ASSET-BACKED SECURITIES--1.9%
- ----------------------------------------------------------------------------------------------------------------
Chase Manhattan Auto Owner Trust, Automobile Loan Pass-Through
Certificates, Series 2002-A, Cl. A4, 4.24%, 9/15/08 $ 451,492 $ 451,930
- ----------------------------------------------------------------------------------------------------------------
Citigroup Mortgage Loan Trust, Inc., Collateralized Mtg. Obligations,
Series 2005-WF2, Cl. AF2, 4.922%, 8/25/35 1,2 11,430,000 11,426,428
- ----------------------------------------------------------------------------------------------------------------
DaimlerChrysler Auto Trust, Automobile Loan Pass-Through Certificates,
Series 2004-B, Cl. A2, 2.48%, 2/8/07 3 1,360,993 1,358,674
- ----------------------------------------------------------------------------------------------------------------
Equity One ABS, Inc., Home Equity Mtg. Pass-Through Certificates,
Series 2004-3, Cl. AF2, 3.80%, 7/25/34 5,400,000 5,378,091
- ----------------------------------------------------------------------------------------------------------------
Ford Credit Auto Owner Trust, Automobile Loan Pass-Through Certificates,
Series 2005-B, Cl. A2, 3.77%, 9/15/07 6,010,000 6,006,364
- ----------------------------------------------------------------------------------------------------------------
NC Finance Trust, Collateralized Mtg. Obligations, Series 1999-I, Cl. ECFD,
8.75%, 1/25/29 3 645,555 174,300
- ----------------------------------------------------------------------------------------------------------------
Residential Asset Mortgage Products, Inc., Home Equity Asset-Backed
Pass-Through Certificates, Series 2004-RS7, Cl. AI3, 4.45%, 7/25/28 4,561,000 4,560,060
- ----------------------------------------------------------------------------------------------------------------
Salomon Smith Barney Mutual Fund Fee Trust XIV, Asset-Backed Nts.,
Series 2000-14, Cl. 2, 8.61%, 9/30/08 3 3,206,406 932,864
- ----------------------------------------------------------------------------------------------------------------
USAA Auto Owner Trust, Automobile Loan Asset-Backed Nts.,
Series 2004-2, Cl. A2, 2.41%, 2/15/07 1,409,612 1,406,546
- ----------------------------------------------------------------------------------------------------------------
Wells Fargo Home Equity Trust, Collateralized Mtg. Obligations,
Series 2004-2, Cl. AI1B, 2.94%, 9/25/18 3,380,800 3,354,056
---------------
Total Asset-Backed Securities (Cost $37,828,828) 35,049,313
- ----------------------------------------------------------------------------------------------------------------
MORTGAGE-BACKED OBLIGATIONS--30.4%
- ----------------------------------------------------------------------------------------------------------------
GOVERNMENT AGENCY--27.4%
- ----------------------------------------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED--27.4%
Fannie Mae Whole Loan, Collateralized Mtg. Obligations Pass-Through
Certificates, Trust 2004-W9, Cl. 2A2, 7%, 2/25/44 509,464 535,256
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.:
6%, 7/1/17 2,859,935 2,951,812
7%, 11/1/22-12/1/34 12,954,200 13,559,312
8%, 4/1/16 248,612 265,624
9%, 8/1/22-5/1/25 61,968 67,504
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., Gtd. Multiclass Real Estate Mtg.
Investment Conduit Pass-Through Certificates, Series 2116, Cl. ZA,
6%, 1/15/29 13,450,120 13,941,444
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., Interest-Only Stripped
Mtg.-Backed Security, Series 177, Cl. B, 9.33%, 7/1/26 4 1,533,329 288,271
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn.:
4.50%, 5/1/19-6/1/19 7,888,855 7,831,434
4.50%, 9/1/20 2 35,630,000 35,340,506
5%, 9/1/35 2 743,000 738,124
5.50%, 9/1/20 32,865,000 33,573,635
5.50%, 9/4/35 2 56,374,000 56,955,329
6%, 8/1/16-11/1/32 49,769,665 51,352,927
21 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
FHLMC/FNMA/SPONSORED Continued
Federal National Mortgage Assn.: Continued
6%, 9/1/35 2 $ 116,449,000 $ 119,178,332
6%, 10/1/30 3 9,944,928 10,213,752
6.50%, 12/1/28-10/1/34 33,977,998 35,204,243
6.50%, 9/1/35 2 106,131,000 109,679,808
7%, 11/1/17 7,017,800 7,352,915
8.50%, 7/1/32 51,717 56,343
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed Security:
Trust 294, Cl. 2, 9.01%, 2/1/28 4 1,231,528 227,997
Trust 321, Cl. 2, 5.925%, 3/1/32 4 5,527,132 1,066,894
Trust 333, Cl. 2, 9.536%, 3/1/33 4 2,481,688 472,718
Trust 346, Cl. 2, 15.82%, 12/1/33 4 8,628,192 1,621,872
---------------
502,476,052
- ----------------------------------------------------------------------------------------------------------------
GNMA/GUARANTEED--0.0%
Government National Mortgage Assn., 8.50%, 8/15/17-12/15/17 90,715 98,621
---------------
98,621
- ----------------------------------------------------------------------------------------------------------------
NON-AGENCY--3.0%
- ----------------------------------------------------------------------------------------------------------------
COMMERCIAL--2.5%
Banc of America Commercial Mortgage, Inc., Commercial Mtg.
Pass-Through Certificates, Series 2005-2, Cl. A4, 4.783%, 7/10/43 7,550,000 7,645,516
- ----------------------------------------------------------------------------------------------------------------
Bank of America Mortgage Securities, Inc., Collateralized Mtg. Obligations
Pass-Through Certificates:
Series 2004-2, Cl. 2A1, 6.50%, 7/20/32 3,619,331 3,673,870
Series 2004-E, Cl. 2A9, 3.712%, 6/25/34 1,043,221 1,042,781
- ----------------------------------------------------------------------------------------------------------------
Bear Stearns Commercial Mortgage Securities, Inc., Commercial Mtg.
Obligations, Series 2003-T10, Cl. A1, 4%, 3/13/40 1,183,054 1,164,244
- ----------------------------------------------------------------------------------------------------------------
Countrywide Alternative Loan Trust, Collateralized Mtg. Obligations,
Series 2005-J3, Cl. 3A1, 6.50%, 9/25/34 1,280,041 1,317,355
- ----------------------------------------------------------------------------------------------------------------
GE Capital Commercial Mortgage Corp., Commercial Mtg. Obligations:
Series 2003-C1, Cl. A2, 4.093%, 1/10/38 1,081,000 1,070,155
Series 2004-C3, Cl. A2, 4.433%, 7/10/39 2,050,000 2,052,945
Series 2005-C3, Cl. A2, 4.853%, 7/10/45 4,340,000 4,403,106
- ----------------------------------------------------------------------------------------------------------------
GS Mortgage Securities Corp. II, Commercial Mtg. Pass-Through
Certificates, Series 2004-GG2, Cl. A3, 4.602%, 8/10/38 1,370,000 1,379,235
- ----------------------------------------------------------------------------------------------------------------
JPMorgan Chase Commercial Mortgage Securities Corp., Commercial
Mtg. Pass-Through Certificates:
Series 2003-ML1A, Cl. A1, 3.972%, 3/12/39 744,450 732,751
Series 2005-LDP2, Cl. A2, 4.575%, 7/15/42 1,500,000 1,504,902
- ----------------------------------------------------------------------------------------------------------------
LB-UBS Securities Commercial Mortgage Trust, Commercial Mtg.
Pass-Through Certificates, Series 2005-C5, Cl. A2, 4.885%, 9/15/30 5,240,000 5,316,963
- ----------------------------------------------------------------------------------------------------------------
Mastr Seasoned Securities Trust, Collateralized Mtg. Obligations,
Series 2004-2, Cl. A1, 6.50%, 8/25/32 7,968,156 8,107,602
22 | OPPENHEIMER REAL ASSET FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
COMMERCIAL Continued
Wachovia Bank Commercial Mortgage Trust, Commercial Mtg.
Obligations, Series 2005-C20, Cl. A5, 5.087%, 7/15/42 $ 5,150,000 $ 5,280,759
- ----------------------------------------------------------------------------------------------------------------
Wells Fargo Mortgage-Backed Securities Trust, Collateralized Mtg.
Obligations, Series 2004-N, Cl. A10, 3.803%, 8/25/34 3 1,556,543 1,557,317
---------------
46,249,501
- ----------------------------------------------------------------------------------------------------------------
OTHER--0.5%
Lehman XS Trust, Mortgage-Backed Obligations, Series 2005-2, Cl. 2A1B,
3.63%, 8/25/35 1,3 8,851,120 8,920,206
---------------
Total Mortgage-Backed Obligations (Cost $555,554,763) 557,744,380
- ----------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS--32.2%
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Bank Unsec. Bonds:
2.50%, 4/11/06 5 17,400,000 17,256,868
3.125%, 11/15/06 90,000 89,077
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. Unsec. Nts.:
2.875%, 9/15/05 5 30,000,000 29,989,890
5.25%, 1/15/06 38,385,000 38,592,125
5.50%, 7/15/06 5 89,140,000 90,332,069
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn. Unsec. Nts.:
1.50%, 9/21/05 5 20,000,000 19,975,620
2.50%, 6/15/06 20,290,000 20,070,158
3.125%, 7/15/06 30,000,000 29,796,690
5.25%, 6/15/06 50,000,000 50,506,900
5.50%, 2/15/06 5 18,000,000 18,138,060
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn. Unsec. Sub. Nts., 5.50%, 5/2/06 25,000,000 25,262,775
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Bills:
2.925%, 9/1/05 20,000,000 20,000,000
2.97%, 9/22/05 15,000,000 14,974,056
3.04%, 12/8/05 10,000,000 9,908,040
3.19%, 11/3/05 20,000,000 19,884,520
3.27%, 12/29/05 20,000,000 19,772,760
3.32%, 10/6/05 40,000,000 39,870,889
3.375%, 9/29/05 50,000,000 49,868,750
- ----------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts.:
2.375%, 8/31/06 25,000,000 24,665,050
3.50%, 12/15/09 6 27,000,000 26,629,830
4.625%, 5/15/06 10,000,000 10,062,510
7%, 7/15/06 15,000,000 15,408,990
---------------
Total U.S. Government Obligations (Cost $590,679,179) 591,055,627
- ----------------------------------------------------------------------------------------------------------------
FOREIGN GOVERNMENT OBLIGATIONS--0.2%
- ----------------------------------------------------------------------------------------------------------------
New Zealand (Government of) Debs., Series RG, 10.625%, 11/15/05 1,000,000 1,012,981
- ----------------------------------------------------------------------------------------------------------------
Quebec (Province of) Unsec. Debs., 6.50%, 1/17/06 2,800,000 2,827,636
---------------
Total Foreign Government Obligations (Cost $3,847,852) 3,840,617
23 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--28.1%
- ----------------------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--3.0%
- ----------------------------------------------------------------------------------------------------------------
AUTOMOBILES--1.0%
American Honda Finance Corp., 3.67% Nts., 1/20/06 1,7 $ 6,500,000 $ 6,502,061
- ----------------------------------------------------------------------------------------------------------------
DaimlerChrysler NA Holdings Corp., 6.40% Nts., 5/15/06 8,480,000 8,594,285
- ----------------------------------------------------------------------------------------------------------------
General Motors Nova Scotia Finance Co., 6.85% Nts., 10/15/08 1,205,000 1,166,139
- ----------------------------------------------------------------------------------------------------------------
Hertz Corp. (The), 6.50% Sr. Nts., 5/15/06 5 1,215,000 1,225,408
---------------
17,487,893
- ----------------------------------------------------------------------------------------------------------------
MEDIA--1.4%
Chancellor Media CCU, 8% Sr. Unsec. Nts., 11/1/08 825,000 900,582
- ----------------------------------------------------------------------------------------------------------------
Knight-Ridder, Inc., 6.30% Sr. Unsec. Nts., 12/15/05 1,992,000 2,000,327
- ----------------------------------------------------------------------------------------------------------------
News America, Inc., 6.625% Sr. Nts., 1/9/08 443,000 464,679
- ----------------------------------------------------------------------------------------------------------------
Reed Elsevier Capital, Inc., 6.125% Bonds, 8/1/06 7,885,000 7,977,436
- ----------------------------------------------------------------------------------------------------------------
Time Warner Cos., Inc., 8.18% Nts., 8/15/07 5 890,000 952,278
- ----------------------------------------------------------------------------------------------------------------
Viacom, Inc., 6.40% Sr. Nts., 1/30/06 5 7,330,000 7,392,532
- ----------------------------------------------------------------------------------------------------------------
Walt Disney Co. (The):
5.375% Sr. Unsec. Nts., 6/1/07 410,000 417,820
6.75% Sr. Unsec. Nts., Series B, 3/30/06 6,210,000 6,297,853
---------------
26,403,507
- ----------------------------------------------------------------------------------------------------------------
MULTILINE RETAIL--0.4%
Kohl's Corp., 6.70% Unsec. Nts., 2/1/06 1,210,000 1,220,544
- ----------------------------------------------------------------------------------------------------------------
Target Corp., 5.95% Sr. Unsec. Nts., 5/15/06 5,139,000 5,193,401
---------------
6,413,945
- ----------------------------------------------------------------------------------------------------------------
SPECIALTY RETAIL--0.2%
Lowe's Cos., Inc., 7.50% Sr. Unsec. Nts., 12/15/05 4,500,000 4,542,336
- ----------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES--1.0%
- ----------------------------------------------------------------------------------------------------------------
BEVERAGES--0.2%
PepsiAmericas, Inc., 5.95% Nts., 2/15/06 3,000,000 3,022,509
- ----------------------------------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING--0.1%
Kroger Co. (The), 7.625% Sr. Nts., 9/15/06 460,000 474,358
- ----------------------------------------------------------------------------------------------------------------
Wal-Mart Stores, Inc. (Canada), 5.58% Nts., 5/1/06 7 2,000,000 2,019,728
---------------
2,494,086
- ----------------------------------------------------------------------------------------------------------------
FOOD PRODUCTS--0.7%
General Mills, Inc., 3.875% Nts., 11/30/07 515,000 509,659
- ----------------------------------------------------------------------------------------------------------------
Heinz (H.J.) Co., 6.189% Bonds, 12/1/05 7 150,000 150,720
- ----------------------------------------------------------------------------------------------------------------
McCormick & Co., Inc., 6.40% Nts., 2/1/06 4,815,000 4,873,151
24 | OPPENHEIMER REAL ASSET FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
FOOD PRODUCTS Continued
Unilever Capital Corp., 6.875% Sr. Unsec. Unsub. Nts., 11/1/05 $ 7,583,000 $ 7,618,109
---------------
13,151,639
- ----------------------------------------------------------------------------------------------------------------
ENERGY--0.6%
- ----------------------------------------------------------------------------------------------------------------
OIL & GAS--0.6%
Petroleum Export Ltd. Cayman SPV, 4.623% Sr. Nts., Cl. A1, 6/15/10 3 11,550,000 11,365,200
- ----------------------------------------------------------------------------------------------------------------
FINANCIALS--12.1%
- ----------------------------------------------------------------------------------------------------------------
CAPITAL MARKETS--0.4%
Bank of New York Co., Inc. (The), 3.75% Unsec. Unsub. Nts., 2/15/08 5 470,000 464,763
- ----------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston, Inc. (USA):
3.71% Nts., 6/19/06 1 2,000,000 2,005,256
5.75% Unsec. Nts., 4/15/07 600,000 614,963
5.875% Nts., 8/1/06 1,310,000 1,329,583
- ----------------------------------------------------------------------------------------------------------------
Northern Trust Co., 6.70% Sub. Nts., 9/15/05 3,600,000 3,602,243
---------------
8,016,808
- ----------------------------------------------------------------------------------------------------------------
COMMERCIAL BANKS--5.1%
ABN Amro Bank NV (Chicago Branch), 7.55% Unsec. Sub. Nts., 6/28/06 7,990,000 8,193,401
- ----------------------------------------------------------------------------------------------------------------
Bank of America Corp., 3.875% Nts., 1/15/08 5 500,000 496,701
- ----------------------------------------------------------------------------------------------------------------
Barclays Bank plc, 3.552% Certificate of Deposit, 6/21/06 1 8,575,000 8,575,369
- ----------------------------------------------------------------------------------------------------------------
Bayerische Landesbank Girozentrale:
2.50% Sr. Nts., 3/30/06 1,000,000 991,100
6.375% Unsec. Sub. Nts., 10/15/05 4,800,000 4,812,811
- ----------------------------------------------------------------------------------------------------------------
Credit Suisse First Boston, Inc. (New York), 3.38% Nts., 9/9/05 1 3,800,000 3,799,825
- ----------------------------------------------------------------------------------------------------------------
First Tennessee Bank:
3.379% Certificate of Deposit, 3/21/06 1 4,500,000 4,468,662
3.742% Nts., 11/18/05 1 1,000,000 1,000,012
- ----------------------------------------------------------------------------------------------------------------
FleetBoston Financial Corp., 4.20% Nts., 11/30/07 430,000 430,121
- ----------------------------------------------------------------------------------------------------------------
HBOS Treasury Services plc, 2.25% Nts., 5/1/06 7 3,995,000 3,940,356
- ----------------------------------------------------------------------------------------------------------------
Household Finance Corp.:
6.50% Unsec. Nts., 1/24/06 515,000 519,765
7.20% Sr. Unsec. Nts., 7/15/06 2,880,000 2,948,129
- ----------------------------------------------------------------------------------------------------------------
HSBC Bank plc, 7.625% Unsec. Sub. Nts., 6/15/06 4,200,000 4,302,383
- ----------------------------------------------------------------------------------------------------------------
Huntington National Bank, 3.49% Nts., 12/1/05 1 8,550,000 8,553,001
- ----------------------------------------------------------------------------------------------------------------
KeyCorp:
6.75% Jr. Unsec. Sub. Nts., 3/15/06 1,700,000 1,721,255
7.50% Sub. Nts., 6/15/06 395,000 404,105
- ----------------------------------------------------------------------------------------------------------------
Nordea Bank Finland plc, 6.50% Unsec. Sub. Nts., 1/15/06 5,100,000 5,148,159
- ----------------------------------------------------------------------------------------------------------------
PNC Funding Corp., 5.75% Sr. Unsec. Nts., 8/1/06 7,645,000 7,739,385
- ----------------------------------------------------------------------------------------------------------------
Regions Bank, 3.47% Deposit Nts., 12/27/05 1,3 5,000,000 5,003,000
- ----------------------------------------------------------------------------------------------------------------
Regions Financial Corp., 4.50% Bonds, 8/8/08 2,185,000 2,196,001
25 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
COMMERCIAL BANKS Continued
SunTrust Bank, Inc.:
2.125% Sr. Nts., 1/30/06 $ 1,400,000 $ 1,388,552
3.46% Nts., 3/24/06 1 5,850,000 5,851,802
- ----------------------------------------------------------------------------------------------------------------
Union Planters Corp., 6.75% Unsec. Sub. Nts., 11/1/05 1,000,000 1,004,079
- ----------------------------------------------------------------------------------------------------------------
Washington Mutual, Inc.:
2.40% Unsec. Nts., 11/3/05 4,550,000 4,538,275
4.375% Nts., 1/15/08 515,000 515,205
- ----------------------------------------------------------------------------------------------------------------
Wells Fargo & Co., 6.875% Unsec. Sub. Nts., 4/1/06 1,300,000 1,318,613
- ----------------------------------------------------------------------------------------------------------------
Wells Fargo Financial, Inc., 7% Sr. Unsec. Nts., 11/1/05 700,000 703,196
- ----------------------------------------------------------------------------------------------------------------
Zions Bancorp, 2.70% Sr. Unsec. Nts., 5/1/06 3,290,000 3,259,929
---------------
93,823,192
- ----------------------------------------------------------------------------------------------------------------
CONSUMER FINANCE--0.2%
American Express Bank FSB, 3.583% Nts., 10/17/05 1 2,525,000 2,525,101
- ----------------------------------------------------------------------------------------------------------------
SLM Corp., 2.75% Nts., 12/1/05 300,000 299,112
---------------
2,824,213
- ----------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--2.7%
American Express Co., 5.50% Nts., 9/12/06 5 770,000 779,021
- ----------------------------------------------------------------------------------------------------------------
Bank One Corp., 6.125% Unsec. Sub. Nts., 2/15/06 100,000 100,797
- ----------------------------------------------------------------------------------------------------------------
CIT Group, Inc., 4.125% Sr. Nts., 2/21/06 6,700,000 6,702,385
- ----------------------------------------------------------------------------------------------------------------
Citicorp, 7.75% Sub. Nts., 6/15/06 5,790,000 5,933,667
- ----------------------------------------------------------------------------------------------------------------
Citigroup, Inc.:
3.50% Nts., 2/1/08 800,000 787,386
5.75% Sr. Unsec. Nts., 5/10/06 170,000 171,758
- ----------------------------------------------------------------------------------------------------------------
Goldman Sachs Group LP, 7.25% Unsec. Nts., 10/1/05 7 2,500,000 2,505,580
- ----------------------------------------------------------------------------------------------------------------
Goldman Sachs Group, Inc. (The), 4.125% Nts., 1/15/08 5 1,000,000 997,180
- ----------------------------------------------------------------------------------------------------------------
ING Security Life Institutional Funding, 3.719% Sr. Nts., 1/27/06 1,7 4,810,000 4,810,967
- ----------------------------------------------------------------------------------------------------------------
JPMorgan Chase & Co.:
4% Nts., 2/1/08 800,000 796,140
5.625% Sr. Unsub. Nts., 8/15/06 4,010,000 4,057,330
- ----------------------------------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc., 6.25% Sr. Unsec. Nts., 5/15/06 6,650,000 6,739,329
- ----------------------------------------------------------------------------------------------------------------
MBNA Corp., 5.625% Nts., 11/30/07 500,000 514,197
- ----------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc.:
2.47% Nts., Series B, 3/10/06 50,000 49,601
4% Nts., Series B, 11/15/07 410,000 408,264
- ----------------------------------------------------------------------------------------------------------------
Morgan Stanley Dean Witter & Co., 6.10% Unsec. Unsub. Bond, 4/15/06 5,300,000 5,359,938
- ----------------------------------------------------------------------------------------------------------------
Morgan Stanley Group, Inc., 3.75% Sr. Nts., 3/27/06 1 1,800,000 1,802,896
- ----------------------------------------------------------------------------------------------------------------
Principal Life Global Funding, 6.125% Sec. Nts., 3/1/06 7 5,400,000 5,448,551
- ----------------------------------------------------------------------------------------------------------------
Salomon, Inc., 6.75% Nts., 1/15/06 600,000 605,672
26 | OPPENHEIMER REAL ASSET FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES Continued
SLM Corp., 3.59% Nts., Series A, 9/15/05 1 $ 700,000 $ 699,963
---------------
49,270,622
- ----------------------------------------------------------------------------------------------------------------
INSURANCE--2.7%
Allstate Financial Global Fund, 6.15% Bonds, 2/1/06 7 1,250,000 1,260,036
- ----------------------------------------------------------------------------------------------------------------
Allstate Financial Global Funding LLC, 7.125% Nts., 9/26/05 7 2,030,000 2,033,508
- ----------------------------------------------------------------------------------------------------------------
Dresdner Bank (New York), 6.625% Unsec. Sub. Nts., 9/15/05 5,000,000 5,003,205
- ----------------------------------------------------------------------------------------------------------------
Equitable Life Assurance Society (USA), 6.95% Surplus Nts., 12/1/05 7 4,950,000 4,982,749
- ----------------------------------------------------------------------------------------------------------------
Hartford Financial Services Group, Inc. (The), 2.375% Nts., 6/1/06 12,260,000 12,089,083
- ----------------------------------------------------------------------------------------------------------------
John Hancock Global Funding II:
3.65% Nts., 9/6/05 1,7 5,200,000 5,199,984
5% Nts., 7/27/07 7 760,000 770,058
5.625% Nts., 6/27/06 7 800,000 808,027
- ----------------------------------------------------------------------------------------------------------------
Marsh & McLennan Cos., Inc., 3.625% Nts., 2/15/08 1,130,000 1,099,786
- ----------------------------------------------------------------------------------------------------------------
Metropolitan Life Insurance Co., 7% Nts., 11/1/05 900,000 904,195
- ----------------------------------------------------------------------------------------------------------------
Monumental Global Funding II:
3.85% Nts., 3/3/08 7 1,120,000 1,107,276
6.05% Sec. Nts., 1/19/06 7 6,310,000 6,353,823
- ----------------------------------------------------------------------------------------------------------------
Nationwide Life Global Funding I, 3.953% Sr. Nts., 1/27/06 1,7 962,000 962,444
- ----------------------------------------------------------------------------------------------------------------
Pricoa Global Funding I, 3.90% Nts., 12/15/08 7 1,800,000 1,773,992
- ----------------------------------------------------------------------------------------------------------------
Protective Life US Funding Trust, 4.022% Sr. Sec. Nts., 2/17/06 1,7 1,828,000 1,830,300
- ----------------------------------------------------------------------------------------------------------------
Teachers Insurance & Annuity Assn. Global Markets, 3.875% Sr. Unsec.
Nts., 1/22/08 7 1,750,000 1,733,347
- ----------------------------------------------------------------------------------------------------------------
TIAA Global Markets, 2.75% Sr. Unsec. Nts., 1/13/06 7 2,000,000 1,988,652
---------------
49,900,465
- ----------------------------------------------------------------------------------------------------------------
REAL ESTATE--0.1%
EOP Operating LP, 8.10% Unsec. Nts., 8/1/10 1,260,000 1,436,397
- ----------------------------------------------------------------------------------------------------------------
THRIFTS & MORTGAGE FINANCE--0.9%
Abbey National plc, 6.69% Sub. Nts., 10/17/05 6,420,000 6,440,788
- ----------------------------------------------------------------------------------------------------------------
Countrywide Home Loans, Inc.:
3.50% Nts., Series K, 12/19/05 4,810,000 4,803,006
5.50% Nts., 8/1/06 3,210,000 3,243,172
5.50% Nts., Series K, 2/1/07 5 635,000 645,349
6.875% Sr. Unsec. Unsub. Nts., Series D, 9/15/05 115,000 115,086
- ----------------------------------------------------------------------------------------------------------------
Washington Mutual, Inc., 3.98% Sr. Unsec. Nts., 11/3/05 1 1,900,000 1,900,606
---------------
17,148,007
- ----------------------------------------------------------------------------------------------------------------
HEALTH CARE--1.7%
- ----------------------------------------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--0.3%
UnitedHealth Group, Inc., 7.50% Sr. Unsec. Nts., 11/15/05 5,040,000 5,068,380
27 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
PHARMACEUTICALS--1.4%
Glaxo Wellcome plc, 6.125% Sr. Unsec. Unsub. Nts., 1/25/06 $ 7,110,000 $ 7,166,560
- ----------------------------------------------------------------------------------------------------------------
Merck & Co., Inc., 6.75% Unsec. Unsub. Nts., 9/19/05 4,372,000 4,372,000
- ----------------------------------------------------------------------------------------------------------------
Novartis Corp., 6.625% Sr. Sub. Nts., Series 4, 10/18/05 10,098,000 10,120,872
- ----------------------------------------------------------------------------------------------------------------
Pharmacia Corp., 5.75% Sr. Unsec. Nts., 12/1/05 5,000,000 5,022,545
---------------
26,681,977
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIALS--2.7%
- ----------------------------------------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.2%
Boeing Capital Corp.:
5.65% Sr. Unsec. Nts., 5/15/06 6,661,000 6,731,600
5.75% Sr. Nts., 2/15/07 161,000 164,604
- ----------------------------------------------------------------------------------------------------------------
General Dynamics Corp., 2.125% Nts., 5/15/06 8,126,000 8,013,187
- ----------------------------------------------------------------------------------------------------------------
Honeywell International, Inc., 6.875% Nts., 10/3/05 1,915,000 1,919,081
- ----------------------------------------------------------------------------------------------------------------
McDonnell Douglas Corp., 6.875% Unsec. Unsub. Nts., 11/1/06 2,222,000 2,283,916
- ----------------------------------------------------------------------------------------------------------------
United Technologies Corp., 4.375% Nts., 5/1/10 2,855,000 2,867,982
---------------
21,980,370
- ----------------------------------------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--0.3%
Dun & Bradstreet Corp., 6.625% Sr. Unsec. Nts., Series B, 3/15/06 4,810,000 4,865,661
- ----------------------------------------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.6%
General Electric Capital Corp.:
2.85% Nts., Series A, 1/30/06 25,000 24,889
5.35% Nts., Series A, 3/30/06 3,850,000 3,876,303
6.80% Nts., Series A, 11/1/05 2,200,000 2,209,968
- ----------------------------------------------------------------------------------------------------------------
Heller Financial, Inc., 6.375% Sr. Unsec. Nts., Cl. A, 3/15/06 2,860,000 2,893,225
- ----------------------------------------------------------------------------------------------------------------
Textron Financial Corp., 2.75% Nts., Series E, 6/1/06 3,070,000 3,039,592
---------------
12,043,977
- ----------------------------------------------------------------------------------------------------------------
MACHINERY--0.3%
Caterpillar Financial Services Corp.:
2.65% Nts., Series F, 1/30/06 2,200,000 2,187,572
5.95% Sr. Nts., 5/1/06 3,700,000 3,742,113
---------------
5,929,685
- ----------------------------------------------------------------------------------------------------------------
ROAD & RAIL--0.3%
Canadian National Railway Co., 6.45% Unsec. Nts., 7/15/06 4,905,000 4,994,472
- ----------------------------------------------------------------------------------------------------------------
MATERIALS--0.6%
- ----------------------------------------------------------------------------------------------------------------
CHEMICALS--0.6%
Dow Chemical Co. (The), 8.625% Unsec. Debs., 4/1/06 4,000,000 4,086,632
- ----------------------------------------------------------------------------------------------------------------
International Flavors & Fragrances, Inc., 6.45% Sr. Unsec Unsub. Nts.,
5/15/06 6,133,000 6,211,012
---------------
10,297,644
28 | OPPENHEIMER REAL ASSET FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--3.7%
- ----------------------------------------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--2.8%
ALLTEL Corp., 6.75% Unsec. Debs., 9/15/05 $ 5,505,000 $ 5,508,953
- ----------------------------------------------------------------------------------------------------------------
British Telecommunications plc, 7.875% Nts., 12/15/05 7,232,000 7,307,155
- ----------------------------------------------------------------------------------------------------------------
France Telecom SA, 7.45% Sr. Unsec. Nts., 3/1/06 1 7,265,000 7,374,273
- ----------------------------------------------------------------------------------------------------------------
GTE Corp., 6.36% Unsec. Debs., 4/15/06 1,055,000 1,069,131
- ----------------------------------------------------------------------------------------------------------------
Koninklijke (Royal) KPN NV, 7.50% Sr. Unsec. Unsub. Bonds, 10/1/05 8,375,000 8,395,418
- ----------------------------------------------------------------------------------------------------------------
SBC Communications, Inc., 5.75% Sr. Nts., 5/2/06 7,405,000 7,488,106
- ----------------------------------------------------------------------------------------------------------------
Telefonica Europe BV, 7.35% Nts., 9/15/05 7,710,000 7,716,569
- ----------------------------------------------------------------------------------------------------------------
Verizon Communications, Inc., 6.60% Nts., Series A, 9/22/05 1,250,000 1,251,503
- ----------------------------------------------------------------------------------------------------------------
Verizon Global Funding Corp., 6.75% Sr. Unsec. Unsub. Nts., 12/1/05 4,210,000 4,237,348
- ----------------------------------------------------------------------------------------------------------------
Verizon Wireless Capital LLC, 5.375% Unsub. Nts., 12/15/06 860,000 872,798
---------------
51,221,254
- ----------------------------------------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--0.9%
AT&T Wireless Services, Inc., 7.35% Sr. Unsec. Nts., 3/1/06 8,210,000 8,341,426
- ----------------------------------------------------------------------------------------------------------------
Sprint Capital Corp., 4.78% Unsec. Nts., 8/17/06 6,840,000 6,874,740
- ----------------------------------------------------------------------------------------------------------------
Vodafone Group plc, 3.95% Unsec. Nts., 1/30/08 860,000 854,744
--------------
16,070,910
- ----------------------------------------------------------------------------------------------------------------
UTILITIES--2.7%
- ----------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES--2.4%
Alabama Power Co., 2.65% Nts., 2/15/06 780,000 775,335
- ----------------------------------------------------------------------------------------------------------------
Boston Edison Co., 4.099% Unsec. Debs., 10/15/05 1 5,900,000 5,901,717
- ----------------------------------------------------------------------------------------------------------------
Consolidated Edison Co. of New York, 6.625% Unsec. Debs.,
Series 2000-C, 12/15/05 3,700,000 3,727,014
- ----------------------------------------------------------------------------------------------------------------
Detroit Edison Co. (The), 5.05% Sr. Nts., 10/1/05 4,785,000 4,787,833
- ----------------------------------------------------------------------------------------------------------------
DTE Energy Co., 6.45% Sr. Unsub. Nts., 6/1/06 615,000 625,060
- ----------------------------------------------------------------------------------------------------------------
Florida Power & Light Co., 6.875% Sec. Bond, 12/1/05 5,945,000 5,985,622
- ----------------------------------------------------------------------------------------------------------------
FPL Group Capital, Inc., 3.25% Nts., 4/11/06 1,305,000 1,300,320
- ----------------------------------------------------------------------------------------------------------------
Georgia Power Co., 5.50% Sr. Unsec. Unsub. Nts., Series C, 12/1/05 2,940,000 2,950,378
- ----------------------------------------------------------------------------------------------------------------
MidAmerican Energy Co., 6.375% Nts., 6/15/06 4,448,000 4,527,174
- ----------------------------------------------------------------------------------------------------------------
MidAmerican Energy Holdings Co., 4.625% Sr. Nts., 10/1/07 910,000 914,714
- ----------------------------------------------------------------------------------------------------------------
Niagara Mohawk Power Corp., 7.625% Sr. Unsec. Nts., Series F, 10/1/05 4,471,875 4,482,997
- ----------------------------------------------------------------------------------------------------------------
PP&L Resources, Inc., 6.55% Bonds, 3/1/06 1,250,000 1,264,821
- ----------------------------------------------------------------------------------------------------------------
Progress Energy, Inc., 6.75% Sr. Nts., 3/1/06 465,000 471,024
- ----------------------------------------------------------------------------------------------------------------
PSI Energy, Inc., 6.65% Sr. Sec. Bonds, Series EEE, 6/15/06 3,400,000 3,464,960
- ----------------------------------------------------------------------------------------------------------------
Virginia Electric & Power Co., 5.75% Sr. Unsec. Unsub Nts., Series A, 3/31/06 2,587,000 2,611,613
---------------
43,790,582
29 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
GAS UTILITIES--0.0%
NiSource Finance Corp., 3.20% Nts., 11/1/06 $ 680,000 $ 672,948
- ----------------------------------------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER--0.3%
Niagara Mohawk Power Corp., 7.75% Sec. Bond, 5/15/06 1,630,000 1,668,584
- ----------------------------------------------------------------------------------------------------------------
Wisconsin Energy Corp., 5.875% Sr. Unsec. Unsub. Nts., 4/1/06 3,359,000 3,391,932
---------------
5,060,516
---------------
Total Corporate Bonds and Notes (Cost $516,986,179) 515,979,195
- ----------------------------------------------------------------------------------------------------------------
STRUCTURED NOTES--15.3%
- ----------------------------------------------------------------------------------------------------------------
AIG:
Goldman Sachs Commodity Index Total Return Linked Security,
2.295%, 11/2/05 8 15,000,000 31,830,603
Goldman Sachs Commodity Index Total Return Linked Security,
3.096%, 1/26/06 8 24,000,000 44,120,232
- ----------------------------------------------------------------------------------------------------------------
Cargill, Inc.:
Goldman Sachs Commodity Index Total Return Linked Security,
3.39%, 3/21/06 8 29,000,000 49,448,669
Goldman Sachs Commodity Index Total Return Linked Security,
3.503%, 3/31/06 8 39,000,000 55,628,161
- ----------------------------------------------------------------------------------------------------------------
Core Investment Grade Bond Trust I, Pass-Through Certificates,
Series 2002-1, 4.659%, 11/30/07 1 8,813,827 8,851,683
- ----------------------------------------------------------------------------------------------------------------
Eksportfinans AS, Goldman Sachs Commodity Index Excess Return
Linked Security, 1.70%, 12/5/05 8 18,000,000 30,245,400
- ----------------------------------------------------------------------------------------------------------------
Koch Industries, Inc.:
Goldman Sachs Energy Total Return Index Linked Security, 3.615%, 3/1/06 1,9 10,000,000 20,482,890
Goldman Sachs Energy Total Return Index Linked Security, 3.615%, 5/5/06 1,9 20,000,000 39,503,900
---------------
Total Structured Notes (Cost $163,918,662) 280,111,538
- ----------------------------------------------------------------------------------------------------------------
SHORT-TERM NOTES--9.2%
- ----------------------------------------------------------------------------------------------------------------
Amsterdam Funding Corp., 3.61%, 10/5/05 10 5,000,000 4,982,953
- ----------------------------------------------------------------------------------------------------------------
Barton Capital Corp., 3.51%, 9/8/05 10 5,000,000 4,996,588
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Bank, 3.58%, 11/2/05 25,000,000 24,846,925
- ----------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.:
3.36%, 11/29/05 25,000,000 24,780,275
5%, 11/22/05 9,250,000 9,171,005
- ----------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn.:
3%, 12/7/05 15,000,000 14,852,280
3.15%, 9/7/05 10,000,000 9,994,633
4%, 11/9/05 16,100,000 15,990,295
4%, 11/30/05 25,000,000 24,777,825
- ----------------------------------------------------------------------------------------------------------------
Lexington Parker Capital Co. LLC, 3.57%, 9/23/05 10 5,000,000 4,989,092
- ----------------------------------------------------------------------------------------------------------------
Neptune Funding Corp., 3.46%, 9/1/05 10 5,000,000 5,000,000
- ----------------------------------------------------------------------------------------------------------------
Old Line Funding Corp., 3.56%, 9/27/05 10 5,000,000 4,987,144
- ----------------------------------------------------------------------------------------------------------------
Regency Markets No. 1 LLC, 3.59%, 9/26/05 10 5,000,000 4,987,535
30 | OPPENHEIMER REAL ASSET FUND
PRINCIPAL VALUE
AMOUNT SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------
SHORT-TERM NOTES Continued
- ----------------------------------------------------------------------------------------------------------------
Sheffield Receivables Corp., 3.51%, 9/9/05 10 $ 5,000,000 $ 4,996,100
- ----------------------------------------------------------------------------------------------------------------
Steamboat Funding Corp., 3.53%, 9/15/05 10 5,000,000 4,993,136
- ----------------------------------------------------------------------------------------------------------------
Victory Receivables Corp., 3.55%, 9/19/05 10 4,669,000 4,660,713
--------------
Total Short-Term Notes (Cost $169,000,031) 169,006,499
- ----------------------------------------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--2.3%
- ----------------------------------------------------------------------------------------------------------------
Undivided interest of 9.37% in joint repurchase agreement (Principal Amount/
Value $438,604,000, with a maturity value of $438,647,129) with UBS Warburg
LLC, 3.54%, dated 8/31/05, to be repurchased at $41,094,041 on 9/1/05,
collateralized by Federal National Mortgage Assn., 6%, 4/1/35, with a
value of $447,924,090 (Cost $41,090,000) 41,090,000 41,090,000
- ----------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $2,078,905,494) 119.6% 2,193,877,169
- ----------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (19.6) (359,095,534)
--------------------------------
NET ASSETS
100.0% $1,834,781,635
================================
FOOTNOTES TO STATEMENT OF INVESTMENTS
1. Represents the current interest rate for a variable or increasing rate
security.
2. When-issued security or forward commitment to be delivered and settled after
August 31, 2005. See Note 1 of Notes to Financial Statements.
3. Illiquid security. The aggregate value of illiquid securities as of August
31, 2005 was $39,525,313, which represents 2.15% of the Fund's net assets. See
Note 7 of Notes to Financial Statements.
4. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed income securities
increase in price when interest rates decline. The principal amount of the
underlying pool represents the notional amount on which current interest is
calculated. The price of these securities is typically more sensitive to changes
in prepayment rates than traditional mortgage-backed securities (for example,
GNMA pass-throughs). Interest rates disclosed represent current yields based
upon the current cost basis and estimated timing and amount of future cash
flows. These securities amount to $3,677,752 or 0.20% of the Fund's net assets
as of August 31, 2005.
5. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts. The aggregate
market value of such securities is $133,042,706. See Note 5 of Notes to
Financial Statements.
6. A sufficient amount of securities has been designated to cover outstanding
written put options, as follows:
CONTRACTS EXPIRATION EXERCISE PREMIUM VALUE
SUBJECT TO PUT DATES PRICE RECEIVED SEE NOTE 1
- ----------------------------------------------------------------------------------------------------
Cocoa Futures, 12/14/05 60 9/2/05 $ 350 $ 3,450 $ 600
Coffee Futures, Cl. C, 12/19/05 67 9/9/05 90 8,626 5,025
---------------------
$ 12,076 $ 5,625
=====================
31 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF INVESTMENTS Continued
- --------------------------------------------------------------------------------
FOOTNOTES TO STATEMENT OF INVESTMENTS Continued
7. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $56,182,159 or 3.06% of the Fund's net
assets as of August 31, 2005.
8. Security is linked to the Goldman Sachs Commodity Index, the Goldman Sachs
Commodity Excess Return Index or the Goldman Sachs Commodity Index Total Return
Index. The indexes currently contain twenty-four commodities from the sectors of
energy, metals, livestock and agricultural products. Individual components in
the index are weighted by their respective world production values.
9. Security is linked to the Goldman Sachs Energy Total Return Index. The index
currently contains six commodities from the energy sector. Individual components
in the index are weighted by their respective world production values.
10. Security issued in an exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $44,593,261, or 2.43% of the
Fund's net assets, and have been determined to be liquid pursuant to guidelines
adopted by the Board of Trustees.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
32 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF ASSETS AND LIABILITIES August 31, 2005
- --------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
ASSETS
- -----------------------------------------------------------------------------------------------------------
Investments, at value (cost $2,078,905,494)--see accompanying statement of investments $ 2,193,877,169
- -----------------------------------------------------------------------------------------------------------
Cash 5,103,516
- -----------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold on a when-issued basis or forward commitment 42,732,555
Shares of beneficial interest sold 18,477,340
Interest and principal paydowns 15,585,173
Other 18,217
-------------------
Total assets 2,275,793,970
- -----------------------------------------------------------------------------------------------------------
LIABILITIES
- -----------------------------------------------------------------------------------------------------------
Options written, at value (premiums received $12,076)
- --see accompanying statement of investments 5,625
- -----------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased (including $407,949,324 purchased on a
when-issued basis or forward commitment) 423,059,900
Shares of beneficial interest redeemed 10,765,744
Futures margins 6,034,009
Distribution and service plan fees 612,619
Transfer and shareholder servicing agent fees 265,590
Shareholder communications 113,164
Trustees' compensation 18,204
Other 137,480
-------------------
Total liabilities 441,012,335
- -----------------------------------------------------------------------------------------------------------
NET ASSETS $ 1,834,781,635
===================
- -----------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- -----------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest $ 192,013
- -----------------------------------------------------------------------------------------------------------
Additional paid-in capital 1,551,018,318
- -----------------------------------------------------------------------------------------------------------
Accumulated net investment income 6,684,985
- -----------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments 51,380,804
- -----------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments 225,505,515
-------------------
NET ASSETS $ 1,834,781,635
===================
33 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF ASSETS AND LIABILITIES Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- --------------------------------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of $1,246,435,520 and
129,994,315 shares of beneficial interest outstanding) $ 9.59
Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price) $ 10.18
- --------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $147,663,062 and 15,602,307 shares of
beneficial interest outstanding) $ 9.46
- --------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge) and
offering price per share (based on net assets of $264,019,099 and 28,032,628 shares of
beneficial interest outstanding) $ 9.42
- --------------------------------------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge) and
offering price per share (based on net assets of $25,585,796 and 2,689,646 shares of
beneficial interest outstanding) $ 9.51
- --------------------------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net assets of
$151,078,158 and 15,694,531 shares of beneficial interest outstanding) $ 9.63
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
34 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF OPERATIONS For the Year Ended August 31, 2005
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT INCOME
- -------------------------------------------------------------------------------
Interest (net of foreign withholding taxes $2,275) $ 32,290,910
- -------------------------------------------------------------------------------
Dividends 1,105
---------------
Total investment income 32,292,015
- -------------------------------------------------------------------------------
EXPENSES
- -------------------------------------------------------------------------------
Management fees 10,191,671
- -------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 2,081,767
Class B 1,022,271
Class C 1,692,655
Class N 71,303
- -------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 1,616,217
Class B 307,456
Class C 400,151
Class N 46,059
Class Y 14,780
- -------------------------------------------------------------------------------
Shareholder communications:
Class A 129,225
Class B 33,612
Class C 36,664
Class N 2,992
Class Y 1,498
- -------------------------------------------------------------------------------
Custodian fees and expenses 97,181
- -------------------------------------------------------------------------------
Trustees' compensation 24,754
- -------------------------------------------------------------------------------
Other 188,500
---------------
Total expenses 17,958,756
Less reduction to custodian expenses (87,293)
Less waivers and reimbursements of expenses (266)
---------------
Net expenses 17,871,197
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME 14,420,818
35 | OPPENHEIMER REAL ASSET FUND
STATEMENT OF OPERATIONS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain on:
Investments $ 62,080,176
Closing and expiration of option contracts written 467,178
Closing of futures contracts 187,046,213
Swap contracts 306,922
----------------
Net realized gain 249,900,489
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments 90,746,710
Futures contracts 134,644,941
Option contracts 9,363
Swap contracts (311,698)
----------------
Net change in unrealized appreciation 225,089,316
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 489,410,623
================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
36 | OPPENHEIMER REAL ASSET FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
YEAR ENDED AUGUST 31, 2005 2004
- ----------------------------------------------------------------------------------------------------------------
OPERATIONS
- ----------------------------------------------------------------------------------------------------------------
Net investment income $ 14,420,818 $ 322,013
- ----------------------------------------------------------------------------------------------------------------
Net realized gain 249,900,489 140,358,876
- ----------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation 225,089,316 (31,403,796)
--------------------------------
Net increase in net assets resulting from operations 489,410,623 109,277,093
- ----------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ----------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Class A (7,247,857) (51,684)
Class B (190,261) -
Class C (467,943) -
Class N (86,194) -
Class Y (970,044) (64,204)
- ----------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (176,519,945) (9,145,151)
Class B (21,692,760) (1,194,188)
Class C (33,838,230) (1,409,006)
Class N (2,633,667) (77,055)
Class Y (14,050,224) (793,204)
- ----------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ----------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial interest transactions:
Class A 452,635,213 328,433,627
Class B 51,758,221 31,994,068
Class C 120,499,718 63,172,169
Class N 13,842,607 5,907,317
Class Y 81,631,447 16,401,022
- ----------------------------------------------------------------------------------------------------------------
NET ASSETS
- ----------------------------------------------------------------------------------------------------------------
Total increase 952,080,704 542,450,804
- ----------------------------------------------------------------------------------------------------------------
Beginning of period 882,700,931 340,250,127
--------------------------------
End of period (including accumulated net investment income
of $6,684,985 and $277,611, respectively) $1,834,781,635 $ 882,700,931
================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
37 | OPPENHEIMER REAL ASSET FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
CLASS A YEAR ENDED AUGUST 31, 2005 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.13 $ 7.51 $ 6.15 $ 6.93 $ 8.18
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .11 1 .01 .03 .29 .45
Net realized and unrealized gain (loss) 2.84 1.85 1.38 (.71) (1.21)
---------------------------------------------------------------------------
Total from investment operations 2.95 1.86 1.41 (.42) (.76)
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.07) -- 2 (.05) (.36) (.43)
Distributions from net realized gain (2.42) (.24) -- -- (.06)
---------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (2.49) (.24) (.05) (.36) (.49)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.59 $ 9.13 $ 7.51 $ 6.15 $ 6.93
===========================================================================
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 44.66% 25.44% 23.08% (5.54)% (9.83)%
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 1,246,436 $ 638,254 $ 238,828 $ 148,319 $ 117,331
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 844,342 $ 413,618 $ 193,837 $ 115,458 $ 139,631
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 1.34% 0.22% 0.46% 4.73% 5.73%
Total expenses 1.32% 5 1.40% 5,6 1.49% 5 1.68% 5,6 1.51% 5
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 94% 7 87% 61% 49% 105%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Voluntary waiver of transfer agent fees less than 0.01%.
7. The portfolio turnover rate excludes purchase and sales of To Be Announced
(TBA) mortgage-related securities as follows:
PURCHASE TRANSACTIONS SALE TRANSACTIONS
- --------------------------------------------------------------------------------
Year Ended August 31, 2005 $4,827,248,691 $4,809,916,669
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
38 | OPPENHEIMER REAL ASSET FUND
CLASS B YEAR ENDED AUGUST 31, 2005 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.05 $ 7.51 $ 6.16 $ 6.95 $ 8.20
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .04 1 (.05) (.04) .23 .40
Net realized and unrealized gain (loss) 2.80 1.83 1.40 (.70) (1.22)
---------------------------------------------------------------------------
Total from investment operations 2.84 1.78 1.36 (.47) (.82)
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.01) -- (.01) (.32) (.37)
Distributions from net realized gain (2.42) (.24) -- -- (.06)
---------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (2.43) (.24) (.01) (.32) (.43)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.46 $ 9.05 $ 7.51 $ 6.16 $ 6.95
===========================================================================
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 43.33% 24.32% 22.12% (6.38)% (10.49)%
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 147,663 $ 78,125 $ 37,589 $ 24,738 $ 21,321
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 102,816 $ 52,436 $ 32,101 $ 20,032 $ 26,295
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income (loss) 0.46% (0.69)% (0.41)% 4.10% 4.99%
Total expenses 2.19% 2.32% 2.44% 2.45% 2.27%
Expenses after payments and waivers and
reduction to custodian expenses N/A 4,5 2.31% 2.36% N/A 4,5 N/A 4
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 94% 6 87% 61% 49% 105%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Voluntary waiver of transfer agent fees less than 0.01%.
6. The portfolio turnover rate excludes purchase and sales of To Be Announced
(TBA) mortgage-related securities as follows:
PURCHASE TRANSACTIONS SALE TRANSACTIONS
- --------------------------------------------------------------------------------
Year Ended August 31, 2005 $4,827,248,691 $4,809,916,669
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
39 | OPPENHEIMER REAL ASSET FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
CLASS C YEAR ENDED AUGUST 31, 2005 2004 2003 2002 2001
- ----------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ----------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.02 $ 7.48 $ 6.14 $ 6.93 $ 8.17
- ----------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .05 1 (.03) (.03) .23 .41
Net realized and unrealized gain (loss) 2.79 1.81 1.38 (.70) (1.22)
--------------------------------------------------------------
Total from investment operations 2.84 1.78 1.35 (.47) (.81)
- ----------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.02) -- (.01) (.32) (.37)
Distributions from net realized gain (2.42) (.24) -- -- (.06)
--------------------------------------------------------------
Total dividends and/or distributions
to shareholders (2.44) (.24) (.01) (.32) (.43)
- ----------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.42 $ 9.02 $ 7.48 $ 6.14 $ 6.93
==============================================================
- ----------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 43.50% 24.42% 22.04% (6.39)% (10.43)%
- ----------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ----------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 264,019 $ 110,728 $ 36,531 $ 18,115 $ 12,588
- ----------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 170,306 $ 68,392 $ 25,746 $ 11,771 $ 16,165
- ----------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income (loss) 0.57% (0.62)% (0.43)% 3.99% 4.95%
Total expenses 2.11% 2.24% 2.40% 2.45% 2.26%
Expenses after payments and waivers and
reduction to custodian expenses N/A 4 N/A 4 2.36% N/A 4,5 N/A 4
- ----------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 94% 6 87% 61% 49% 105%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Voluntary waiver of transfer agent fees less than 0.01%.
6. The portfolio turnover rate excludes purchase and sales of To Be Announced
(TBA) mortgage-related securities as follows:
PURCHASE TRANSACTIONS SALE TRANSACTIONS
- -----------------------------------------------------------------------
Year Ended August 31, 2005 $4,827,248,691 $4,809,916,669
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
40 | OPPENHEIMER REAL ASSET FUND
CLASS N YEAR ENDED AUGUST 31, 2005 2004 2003 2002 2001 1
- -------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.08 $ 7.50 $ 6.15 $ 6.99 $ 7.67
- -------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .08 2 -- .07 .30 .22
Net realized and unrealized gain (loss) 2.82 1.82 1.36 (.78) (.73)
-----------------------------------------------------
Total from investment operations 2.90 1.82 1.43 (.48) (.51)
- -------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.05) -- (.08) (.36) (.17)
Distributions from net realized gain (2.42) (.24) -- -- --
-----------------------------------------------------
Total dividends and/or distributions to shareholders (2.47) (.24) (.08) (.36) (.17)
- -------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.51 $ 9.08 $ 7.50 $ 6.15 $ 6.99
=====================================================
- -------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 44.03% 24.90% 23.63% (6.47)% (6.75)%
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 25,586 $ 8,206 $ 1,578 $ 314 $ 61
- -------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 14,654 $ 4,516 $ 1,001 $ 146 $ 14
- -------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss) 1.03% (0.17)% 0.27% 3.57% 5.95%
Total expenses 1.68% 1.84% 1.83% 1.94% 1.88%
Expenses after payments and waivers and reduction to custodian expenses N/A 5,6 1.80% 1.63% N/A 5,6 N/A 5
- -------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 94% 7 87% 61% 49% 105%
1. For the period from March 1, 2001 (inception of offering) to August 31, 2001.
2. Per share amounts calculated based on the average shares outstanding during
the period.
3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Voluntary waiver of transfer agent fees less than 0.01%.
7. The portfolio turnover rate excludes purchase and sales of To Be Announced
(TBA) mortgage-related securities as follows:
PURCHASE TRANSACTIONS SALE TRANSACTIONS
- --------------------------------------------------------------------------------
Year Ended August 31, 2005 $4,827,248,691 $4,809,916,669
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
41 | OPPENHEIMER REAL ASSET FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
CLASS Y YEAR ENDED AUGUST 31, 2005 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.15 $ 7.52 $ 6.15 $ 6.94 $ 8.16
- ------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .15 1 .05 .06 .32 .25
Net realized and unrealized gain (loss) 2.86 1.84 1.39 (.73) (.95)
-----------------------------------------------------------------
Total from investment operations 3.01 1.89 1.45 (.41) (.70)
- ------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.11) (.02) (.08) (.38) (.46)
Distributions from net realized gain (2.42) (.24) -- -- (.06)
-----------------------------------------------------------------
Total dividends and/or distributions to shareholders (2.53) (.26) (.08) (.38) (.52)
- ------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.63 $ 9.15 $ 7.52 $ 6.15 $ 6.94
=================================================================
- ------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 45.42% 25.84% 23.69% (5.36)% (9.21)%
- ------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 151,078 $ 47,387 $ 25,724 $ 6,908 $ 1,741
- ------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 83,836 $ 31,449 $ 15,755 $ 3,420 $ 868
- ------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 1.83% 0.65% 0.83% 3.95% 6.46%
Total expenses 0.88% 0.97% 1.08% 1.27% 1.38% 4
Expenses after payments and waivers and
reduction to custodian expenses N/A 5 N/A 5 N/A 5 1.26% 1.17%
- ------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 94% 6 87% 61% 49% 105%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares
on the reinvestment date, and redemption at the net asset value calculated on
the last business day of the fiscal period. Sales charges are not reflected in
the total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Added since August 31, 2001 to reflect expenses before reduction to custodian
expenses and voluntary waiver of transfer agent fees.
5. Reduction to custodian expenses less than 0.01%.
6. The portfolio turnover rate excludes purchase and sales of To Be Announced
(TBA) mortgage-related securities as follows:
PURCHASE TRANSACTIONS SALE TRANSACTIONS
- ----------------------------------------------------------------------
Year Ended August 31, 2005 $4,827,248,691 $4,809,916,669
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
42 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Real Asset Fund (the Fund) is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
The Fund's investment objective is to seek total return. Total return refers to
the change in value of an investment in shares of the Fund over time resulting
from changes in value of the Fund's investments and income on those investments.
The Fund's investment advisor is OppenheimerFunds, Inc. (the Advisor). The
Sub-Advisor is Oppenheimer Real Asset Management, Inc. (the Manager), a wholly
owned subsidiary of the Advisor.
The Fund offers Class A, Class B, Class C, Class N and Class Y shares.
Class A shares are sold at their offering price, which is normally net asset
value plus a front-end sales charge. Class B, Class C and Class N shares are
sold without a front-end sales charge but may be subject to a contingent
deferred sales charge (CDSC). Class N shares are sold only through retirement
plans. Retirement plans that offer Class N shares may impose charges on those
accounts. Class Y shares are sold to certain institutional investors without
either a front-end sales charge or a CDSC, however, the institutional investor
may impose charges on those accounts. All classes of shares have identical
rights and voting privileges with respect to the Fund in general and exclusive
voting rights on matters that affect that class alone. Earnings, net assets and
net asset value per share may differ due to each class having its own expenses,
such as transfer and shareholder servicing agent fees and shareholder
communications, directly attributable to that class. Class A, B, C and N have
separate distribution and/or service plans. No such plan has been adopted for
Class Y shares. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The Fund assesses a 2% fee on the proceeds of
fund shares that are redeemed (either by selling or exchanging to another
Oppenheimer fund) within 30 days of their purchase. The fee, which is retained
by the Fund, is accounted for as an addition to paid-in capital.
The following is a summary of significant accounting policies consistently
followed by the Fund.
- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic exchanges are valued
based on the last sale price of the security traded on that exchange prior to
the time when the Fund's assets are valued. Securities traded on NASDAQ are
valued based on the closing price provided by NASDAQ prior to the time when the
Fund's assets are valued. In the absence of a sale, the security is valued at
the last sale price on the prior trading day, if it is within the spread of the
closing "bid" and "asked" prices, and if not, at the closing bid price.
Securities traded on foreign exchanges are valued based on the last sale price
on the principal exchange on which the security is traded, in the country that
is identified by the portfolio pricing service, prior to the time when the
Fund's assets are valued. In the absence of a sale, the security is valued at
the official closing price on the principal exchange. Corporate,
43 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
government and municipal debt instruments having a remaining maturity in excess
of sixty days and all mortgage-backed securities will be valued at the mean
between the "bid" and "asked" prices. Futures contracts traded on a commodities
or futures exchange will be valued at the final settlement price or official
closing price on the principal exchange as reported by such principal exchange
at its trading session ending at, or most recently prior to, the time when the
Fund's assets are valued. Securities may be valued primarily using
dealer-supplied valuations or a portfolio pricing service authorized by the
Board of Trustees. Securities (including restricted securities) for which market
quotations are not readily available are valued at their fair value. Foreign and
domestic securities whose values have been materially affected by what the
Manager identifies as a significant event occurring before the Fund's assets are
valued but after the close of their respective exchanges will be fair valued.
Fair value is determined in good faith using consistently applied procedures
under the supervision of the Board of Trustees. Short-term "money market type"
debt securities with remaining maturities of sixty days or less are valued at
amortized cost (which approximates market value).
- --------------------------------------------------------------------------------
STRUCTURED NOTES. The Fund invests in structured notes whose market values,
interest rates and/or redemption prices are linked to the performance of
underlying foreign currencies, interest rate spreads, stock market indices,
prices of individual securities, commodities or other financial instruments or
the occurrence of other specific events. The structured notes are often
leveraged, increasing the volatility of each note's market value relative to the
change in the underlying linked financial element or event. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying Statement of Operations. The Fund records a realized gain or loss
when a structured note is sold or matures. As of August 31, 2005, the market
value of these securities comprised 15.3% of the Fund's net assets and resulted
in unrealized cumulative gains of $116,192,876.
- --------------------------------------------------------------------------------
SECURITIES ON A WHEN-ISSUED BASIS OR FORWARD COMMITMENT. Delivery and payment
for securities that have been purchased by the Fund on a when-issued basis or
forward commitment can take place up to ten days or more after the trade date.
Normally the settlement date occurs within six months after the trade date;
however, the Fund may, from time to time, purchase securities whose settlement
date extends six months or more beyond trade date. During this period, such
securities do not earn interest, are subject to market fluctuation and may
increase or decrease in value prior to their delivery. The Fund maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The purchase of securities on a when-issued
basis or forward commitment may increase the volatility of the Fund's net asset
value to the extent the Fund executes such transactions while remaining
substantially fully invested. The Fund may also sell securities that it
purchased on a when-issued basis or forward commitment prior to settlement of
the original purchase. As of August 31, 2005, the Fund had purchased
$407,949,324 of securities issued on a when-issued basis
44 | OPPENHEIMER REAL ASSET FUND
or forward commitment and sold $42,732,555 of securities issued on a when-issued
basis or forward commitment.
In connection with its ability to purchase or sell securities on a
when-issued basis, the Fund may enter into forward roll transactions with
respect to mortgage-related securities. Forward roll transactions require the
sale of securities for delivery in the current month, and a simultaneous
agreement with the same counterparty to repurchase similar (same type, coupon
and maturity) but not identical securities on a specified future date. The Fund
records the incremental difference between the forward purchase and sale of each
forward roll as realized gain (loss) on investments or as fee income in the case
of such transactions that have an associated fee in lieu of a difference in the
forward purchase and sale price.
Risks of entering into forward roll transactions include the potential
inability of the counterparty to meet the terms of the agreement; the potential
of the Fund to receive inferior securities at redelivery as compared to the
securities sold to the counterparty; counterparty credit risk; and the potential
pay down speed variance between the mortgage-related pools.
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. The values of securities denominated in foreign currencies and
amounts related to the purchase and sale of foreign securities and foreign
investment income are translated into U.S. dollars as of the close of The New
York Stock Exchange (the Exchange), normally 4:00 P.M. Eastern time, on each day
the Exchange is open for business. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.
Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be
45 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
sufficient to cover payments of interest and principal. In the event of default
by the other party to the agreement, retention of the collateral may be subject
to legal proceedings.
- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders, therefore, no federal income or excise tax provision is
required.
The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.
NET UNREALIZED
APPRECIATION
BASED ON COST OF
SECURITIES AND
UNDISTRIBUTED UNDISTRIBUTED ACCUMULATED OTHER INVESTMENTS
NET INVESTMENT LONG-TERM LOSS FOR FEDERAL INCOME
INCOME GAIN CARRYFORWARD 1,2,3 TAX PURPOSES
--------------------------------------------------------------------------
$66,585,299 $89,627,391 $346,014 $127,718,659
1. The Fund had $346,014 of straddle losses which were deferred.
2. During the fiscal year ended August 31, 2005, the Fund did not utilize any
capital loss carryforward.
3. During the fiscal year ended August 31, 2004, the Fund did not utilize any
capital loss carryforward.
Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for August 31, 2005. Net assets of the
Fund were unaffected by the reclassifications.
INCREASE TO REDUCTION TO
ACCUMULATED ACCUMULATED NET
INCREASE TO NET INVESTMENT REALIZED GAIN
PAID-IN CAPITAL INCOME ON INVESTMENTS 4
-----------------------------------------------------
$32,747,735 $948,855 $33,696,590
4. $32,747,735, including $23,022,965 of long-term capital gain, was distributed
in connection with Fund share redemptions.
46 | OPPENHEIMER REAL ASSET FUND
The tax character of distributions paid during the years ended August 31, 2005
and August 31, 2004 was as follows:
YEAR ENDED YEAR ENDED
AUGUST 31, 2005 AUGUST 31, 2004
----------------------------------------------------------------
Distributions paid from:
Ordinary income $ 128,279,617 $ 115,888
Long-term capital gain 129,417,508 12,618,604
---------------------------------
Total $ 257,697,125 $ 12,734,492
=================================
The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of August 31, 2005 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.
Federal tax cost of securities $ 2,078,996,577
Federal tax cost of other investments 438,193,458
----------------
Total federal tax cost $ 2,517,190,035
================
Gross unrealized appreciation $ 143,516,519
Gross unrealized depreciation (15,797,860)
----------------
Net unrealized appreciation $ 127,718,659
================
- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Fund asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Fund, and will not materially affect the
Fund's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income distributions, if any, are declared
and paid quarterly. Capital gain distributions, if any, are declared and paid
annually.
- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at
47 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
the fair market value of the securities received. Interest income, which
includes accretion of discount and amortization of premium, is accrued as
earned.
- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.
- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.
- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:
YEAR ENDED AUGUST 31, 2005 YEAR ENDED AUGUST 31, 2004
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------
CLASS A
Sold 94,212,026 $ 777,455,272 60,864,784 $ 526,237,973
Dividends and/or
distributions reinvested 24,089,571 160,454,202 1,021,225 7,760,573
Redeemed (58,238,089) (485,274,261) 1 (23,760,653) (205,564,919)
-----------------------------------------------------------------
Net increase 60,063,508 $ 452,635,213 38,125,356 $ 328,433,627
=================================================================
- ---------------------------------------------------------------------------------------------
CLASS B
Sold 9,282,558 $ 76,207,355 6,075,661 $ 52,623,081
Dividends and/or
distributions reinvested 2,820,081 18,521,469 136,911 1,037,789
Redeemed (5,135,305) (42,970,603) 1 (2,581,998) (21,666,802)
-----------------------------------------------------------------
Net increase 6,967,334 $ 51,758,221 3,630,574 $ 31,994,068
=================================================================
48 | OPPENHEIMER REAL ASSET FUND
YEAR ENDED AUGUST 31, 2005 YEAR ENDED AUGUST 31, 2004
SHARES AMOUNT SHARES AMOUNT
- --------------------------------------------------------------------------------------------
CLASS C
Sold 18,790,237 $152,585,965 10,218,639 $ 87,296,277
Dividends and/or
distributions reinvested 4,162,996 27,230,330 148,152 1,118,549
Redeemed (7,202,060) (59,316,577) 1 (2,968,721) (25,242,657)
---------------------------------------------------------------
Net increase 15,751,173 $120,499,718 7,398,070 $ 63,172,169
===============================================================
- --------------------------------------------------------------------------------------------
CLASS N
Sold 2,265,268 $ 18,313,212 818,178 $ 6,975,731
Dividends and/or
distributions reinvested 403,003 2,665,360 10,161 77,023
Redeemed (882,773) (7,135,965) 1 (134,749) (1,145,437)
---------------------------------------------------------------
Net increase 1,785,498 $ 13,842,607 693,590 $ 5,907,317
===============================================================
- --------------------------------------------------------------------------------------------
CLASS Y
Sold 16,487,939 $131,638,201 3,051,718 $ 26,560,158
Dividends and/or
distributions reinvested 1,252,352 8,401,675 28,193 213,586
Redeemed (7,222,356) (58,408,429) 1 (1,324,757) (10,372,722)
---------------------------------------------------------------
Net increase 10,517,935 $ 81,631,447 1,755,154 $ 16,401,022
===============================================================
1. Net of redemption fees of $92,832, $11,304, $18,724, $1,611 and $9,217 for
Class A, Class B, Class C, Class N and Class Y, respectively.
- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended August 31, 2005, were as
follows:
PURCHASES SALES
-----------------------------------------------------------------
Investment securities $ 478,499,811 $ 185,127,506
U.S. government and government
agency obligations 158,175,005 166,048,968
To Be Announced (TBA)
mortgage-related securities 4,827,248,691 4,809,916,669
- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES. Management fees paid to the Advisor were in accordance with the
investment advisory agreement with the Fund which provides for a fee at an
annual rate of 1.00% of the first $200 million of average annual net assets,
0.90% of the next $200 million, 0.85% of the next $200 million, 0.80% of the
next $200 million, and 0.75% of net assets in excess of $800 million. Under the
sub-advisory agreement, the Advisor pays the Sub-Advisor the following annual
fees: 0.50% of the first $200 million of average annual net assets, 0.45% of the
next $200 million, 0.425% of the next $200 million, 0.40% of the next $200
million, and 0.375% of the net assets in excess of $800 million.
49 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.
- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended August 31, 2005, the Fund paid
$2,255,755 to OFS for services to the Fund.
Additionally, Class Y shares are subject to minimum fees of $10,000 per
annum for assets of $10 million or more. The Class Y shares are subject to the
minimum fees in the event that the per account fee does not equal or exceed the
applicable minimum fees. OFS may voluntarily waive the minimum fees.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN (12b-1) FEES. Under its General Distributor's
Agreement with the Fund, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the Fund's principal underwriter in the continuous public offering of
the Fund's classes of shares.
- --------------------------------------------------------------------------------
SERVICE PLAN FOR CLASS A SHARES. The Fund has adopted a Service Plan for Class A
shares. It reimburses the Distributor for a portion of its costs incurred for
services provided to accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate of up to 0.25% of the average annual net assets of
Class A shares of the Fund. The Distributor currently uses all of those fees to
pay dealers, brokers, banks and other financial institutions quarterly for
providing personal services and maintenance of accounts of their customers that
hold Class A shares. Any unreimbursed expenses the Distributor incurs with
respect to Class A shares in any fiscal year cannot be recovered in subsequent
years. Fees incurred by the Fund under the Plan are detailed in the Statement of
Operations.
- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLANS FOR CLASS B, CLASS C AND CLASS N SHARES. The Fund
has adopted Distribution and Service Plans for Class B, Class C and Class N
shares to compensate the Distributor for its services in connection with the
distribution of those shares and servicing accounts. Under the plans, the Fund
pays the Distributor an annual asset-based sales charge of 0.75% per year on
Class B and Class C shares and 0.25% per year on Class N shares. The Distributor
also receives a service fee of 0.25% per year under each plan. If either the
Class B, Class C or Class N plan is terminated by the Fund or by the
shareholders of a class, the Board of Trustees and its independent trustees must
determine whether the Distributor shall be entitled to payment from the Fund of
all or a portion of the service fee and/or asset-based sales charge in respect
to shares sold prior to the effective date of such termination. The
Distributor's aggregate uncompensated expenses under the plan at August 31, 2005
for Class B, Class C and Class N shares were $3,728,815, $2,395,326 and
$191,568, respectively. Fees incurred by the Fund under the plans are detailed
in the Statement of Operations.
- --------------------------------------------------------------------------------
SALES CHARGES. Front-end sales charges and contingent deferred sales charges
(CDSC) do not represent expenses of the Fund. They are deducted from the
proceeds of sales
50 | OPPENHEIMER REAL ASSET FUND
of Fund shares prior to investment or from redemption proceeds prior to
remittance, as applicable. The sales charges retained by the Distributor from
the sale of shares and the CDSC retained by the Distributor on the redemption of
shares is shown in the table below for the period indicated.
CLASS A CLASS B CLASS C CLASS N
CLASS A CONTINGENT CONTINGENT CONTINGENT CONTINGENT
FRONT-END DEFERRED DEFERRED DEFERRED DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES
RETAINED BY RETAINED BY RETAINED BY RETAINED BY RETAINED BY
YEAR ENDED DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR
- ------------------------------------------------------------------------------------------
August 31, 2005 $1,350,675 $23,963 $316,782 $154,457 $31,646
- --------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS OF EXPENSES. OFS has voluntarily agreed to limit
transfer and shareholder servicing agent fees for all classes to 0.35% of
average annual net assets per class. During the year ended August 31, 2005, OFS
waived $131 and $135 for Class B and Class N shares, respectively. This
undertaking may be amended or withdrawn at any time.
- --------------------------------------------------------------------------------
5. FUTURES CONTRACTS
A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures), debt securities (interest rate futures) and various
commodities (commodity index futures) inherent in the Fund's holdings of
structured notes. The Fund may also buy or write put or call options on these
futures contracts.
The Fund generally sells futures contracts to hedge against increases in
interest rates and the resulting negative effect on the value of fixed rate
portfolio securities, decreases in market value of portfolio securities, or
decreases in commodity prices. The Fund may also purchase futures contracts
without owning the underlying fixed-income security as an efficient or cost
effective means to gain exposure to changes in interest rates, commodity prices
or market indices. The Fund will then either purchase the underlying
fixed-income security or close out the futures contract.
Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount 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.
Securities held in collateralized accounts to cover initial margin
requirements on open futures contracts are noted in the Statement of
Investments. The Statement of Assets and Liabilities reflects a receivable or
payable for the daily mark to market for variation margin. Realized gains and
losses are reported in the Statement of Operations as the closing and expiration
of futures contracts.
51 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
5. FUTURES CONTRACTS Continued
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.
As of August 31, 2005, the Fund had outstanding futures contracts as follows:
UNREALIZED
EXPIRATION NUMBER OF VALUATION AS OF APPRECIATION
CONTRACT DESCRIPTION DATES CONTRACTS AUGUST 31, 2005 (DEPRECIATION)
- ----------------------------------------------------------------------------------------
CONTRACTS TO PURCHASE
AGRICULTURE
Corn 12/14/05 1,638 $ 17,731,350 $ (2,206,220)
Cotton #2 12/7/05 434 10,793,580 (1,266,345)
Soybean 11/14/05 314 9,400,375 (1,984,185)
Wheat 12/14/05 1,768 28,172,938 (1,822,057)
ENERGY
Brent Crude Oil 10/14/05 2,470 166,156,900 6,925,315
Crude Oil 9/20/05 5,221 359,935,740 24,880,898
Gas Oil 10/12/05 889 56,673,750 5,131,628
Heating Oil 9/30/05 1,338 116,690,994 14,868,393
Natural Gas 9/28/05 1,359 155,904,480 36,506,703
Unleaded Gasoline 9/30/05 1,324 125,412,722 25,981,909
LIVESTOCK
Cattle Feeder 10/27/05 151 8,318,213 232,598
Lean Hogs 10/14/05 1,268 32,308,640 2,277,447
Live Cattle 10/31/05 898 29,544,200 63,701
INDUSTRIAL METALS
Copper 12/28/05 687 27,814,913 2,617,319
London Metals Exchange
Aluminum High Grade 10/19/05 657 30,291,806 189,470
London Metals Exchange Copper 10/19/05 43 3,972,125 (39,883)
London Metals Exchange Lead 10/19/05 326 7,167,925 172,810
London Metals Exchange Nickel 10/19/05 89 7,983,300 (10,903)
London Metals Exchange Zinc 10/19/05 298 10,143,175 469,630
PRECIOUS METALS
Gold 100 Oz. 12/28/05 419 18,356,390 (72,968)
Silver 12/28/05 56 1,919,400 (35,140)
SOFTS
Sugar #11 9/30/05 948 10,691,923 1,083,726
GOVERNMENTS
U.S. Treasury Nts., 10 yr. 9/21/05 551 62,219,953 314,433
--------------
114,278,279
==============
52 | OPPENHEIMER REAL ASSET FUND
UNREALIZED
EXPIRATION NUMBER OF VALUATION AS OF APPRECIATION
CONTRACT DESCRIPTION DATES CONTRACTS AUGUST 31, 2005 (DEPRECIATION)
- ----------------------------------------------------------------------------------------
CONTRACTS TO SELL
SOFTS
Cocoa 12/14/05 139 $ 1,951,560 $ (42,358)
Coffee, Cl. C. 12/19/05 151 5,721,956 (48,715)
GOVERNMENTS
U.S. Long Bonds 12/20/05 378 44,615,813 (572,490)
U.S. Treasury Nts., 2 yr. 12/30/05 3,558 736,839,563 (2,614,611)
U.S. Treasury Nts., 5 yr. 12/20/05 530 57,438,750 (472,716)
--------------
(3,750,890)
--------------
$ 110,527,389
==============
- --------------------------------------------------------------------------------
6. OPTION ACTIVITY
The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
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 the security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Contracts subject to call, expiration
date, exercise price, premium received and market value are detailed in a note
to the Statement of Investments. Options written are reported as a liability in
the Statement of Assets and Liabilities. Realized gains and losses are reported
in the Statement of Operations.
The risk in writing a call option is that the Fund gives up the
opportunity for profit if the market price of the security or commodity
increases and the option is exercised. The risk in writing a put option is that
the Fund may incur a loss if the market price of the security or commodity
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.
53 | OPPENHEIMER REAL ASSET FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
6. OPTION ACTIVITY Continued
Written option activity for the year ended August 31, 2005 was as follows:
CALL OPTIONS PUT OPTIONS
---------------------- -----------------------
NUMBER OF AMOUNT OF NUMBER OF AMOUNT OF
CONTRACTS PREMIUMS CONTRACTS PREMIUMS
- -----------------------------------------------------------------------------
Options outstanding as of
August 31, 2004 90 $ 19,162 100 $ 8,026
Options written 545 298,069 2,034 375,534
Options closed or expired (273) (204,739) (1,944) (357,209)
Options exercised (362) (112,492) (63) (14,275)
--------------------------------------------
Options outstanding as of
August 31, 2005 -- $ -- 127 $ 12,076
============================================
- --------------------------------------------------------------------------------
7. ILLIQUID SECURITIES
As of August 31, 2005, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 10% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities. Securities that are
illiquid are marked with the applicable footnote on the Statement of
Investments.
- --------------------------------------------------------------------------------
8. LITIGATION
A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor, as well as 51 of the
Oppenheimer funds (as "Nominal Defendants") including the Fund, 30 present and
former Directors or Trustees and 8 present and former officers of the funds.
This complaint, initially filed in the U.S. District Court for the Southern
District of New York on January 10, 2005 and amended on March 4, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.
54 | OPPENHEIMER REAL ASSET FUND
The defendants believe that the allegations contained in the Complaints
are without merit and that they have meritorious defenses against the claims
asserted. The defendants intend to defend these lawsuits vigorously and to
contest any claimed liability. The defendants believe that it is premature to
render any opinion as to the likelihood of an outcome unfavorable to them and
that no estimate can yet be made with any degree of certainty as to the amount
or range of any potential loss.
- --------------------------------------------------------------------------------
9. FISCAL YEAR END
The Fund's Board of Trustees has approved a change in the Fund's fiscal year end
from August 31 to May 31. This change is anticipated to be implemented in
calendar 2006.
55 | OPPENHEIMER REAL ASSET FUND
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER REAL ASSET FUND:
We have audited the accompanying statement of assets and liabilities of
Oppenheimer Real Asset Fund, including the statement of investments, as of
August 31, 2005, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
The Fund is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audit includes consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of August 31, 2005, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Real Asset Fund as of August 31, 2005, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the five
years in the period then ended, in conformity with accounting principles
generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
Denver, Colorado
October 17, 2005
56 | OPPENHEIMER REAL ASSET FUND
FEDERAL INCOME TAX INFORMATION Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
In early 2006, if applicable, shareholders of record will receive information
regarding all dividends and distributions paid to them by the Fund during
calendar year 2005. Regulations of the U.S. Treasury Department require the Fund
to report this information to the Internal Revenue Service.
Dividends and distributions of $2.4469, $2.4208, $2.4242, $2.4379 and
$2.4603 per share were paid to Class A, Class B, Class C, Class N and Class Y
shareholders, respectively, on December 13, 2004, of which $1.2589 was
designated as a "capital gain distribution" for federal income tax purposes.
Whether received in stock or in cash, the capital gain distribution should be
treated by shareholders as a gain from the sale of the capital assets held for
more than one year (long-term capital gains).
None of the dividends paid by the Fund during the fiscal year ended August
31, 2005 are eligible for the corporate dividend-received deduction.
Dividends, if any, paid by the Fund during the fiscal year ended August
31, 2005, which are not designated as capital gain distributions, may be
eligible for lower individual income tax rates to the extent that the Fund has
received qualified dividend income as stipulated by recent tax legislation. In
early 2006, shareholders of record will receive information regarding the
percentage of distributions that are eligible for lower individual income tax
rates. The amount will be the maximum amount allowed.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
57 | OPPENHEIMER REAL ASSET FUND
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which
the Fund votes proxies relating to securities ("portfolio proxies") held by the
Fund. A description of the Fund's Portfolio Proxy Voting Policies and Procedures
is available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525.7048, (ii) on the Fund's website at www.oppenheimerfunds.com, and
(iii) on the SEC's website at www.sec.gov. In addition, the Fund is required to
file Form N-PX, with its complete proxy voting record for the 12 months ended
June 30th, no later than August 31st of each year. The Fund's voting record is
available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525.7048, and (ii) in the Form N-PX filing on the SEC's website at
www.sec.gov.
The Fund files its complete schedule of portfolio holdings with the SEC
for the first quarter and the third quarter of each fiscal year on Form N-Q. The
Fund's Form N-Q filings are available on the SEC's website at
http://www.sec.gov. Those forms may be reviewed and copied at the SEC's Public
Reference Room in Washington D.C. Information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
58 | OPPENHEIMER REAL ASSET FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Each year, the Board of Trustees (the "Board"), including a majority of the
independent Trustees, is required to determine whether to renew the Fund's
advisory and sub-advisory agreements (the "advisory agreements"). The Investment
Company Act of 1940, as amended, requires that the Board request and evaluate,
and that the Manager and Oppenheimer Real Asset Management, Inc. (the
"Sub-Adviser") provide, such information as may be reasonably necessary to
evaluate the terms of the advisory agreements. The Board employs an independent
consultant to prepare a report that provides information, including comparative
information, that the Board requests for this purpose. In addition, the Board
receives information throughout the year regarding Fund services, fees, expenses
and performance.
NATURE AND EXTENT OF SERVICES. In considering the renewal of the Fund's
advisory agreements for the current year, the Board evaluated the nature and
extent of the services provided by the Manager, the Sub-Adviser and their
affiliates. The Manager provides the Fund with office space, facilities and
equipment; administrative, accounting, clerical, legal and compliance personnel;
securities trading services and oversight of third party service providers. The
Sub-Adviser, a wholly-owned subsidiary of the Manager, provides investment
advise with respect to the Fund and invests and reinvests the cash, securities
and property comprising the assets of the Fund, under the sub-advisory agreement
between the Manager and the Sub-Adviser.
QUALITY OF SERVICES. The Board also considered the quality of the services
provided and the quality of the Manager's and Sub-Adviser's resources that are
available to the Fund. The Board noted that the Manager has had over forty years
of experience as an investment adviser and that its assets under management rank
it among the top mutual fund managers in the United States. The Board evaluated
the Manager's administrative, accounting, legal and compliance services and
information the Board received regarding the experience and professional
qualifications of the Manager's personnel and the size and functions of its
staff. The Board members also considered their experiences as directors or
trustees of the Fund and other funds advised by the Manager. The Board received
and reviewed information regarding the quality of services provided by
affiliates of the Manager, which it also reviews at other times during the year
in connection with the renewal of the Fund's service agreements. The Board also
considered that the Sub-Adviser, a registered Commodity Trading Adviser with the
Commodity Futures Trading Commission (CFTC), has operated as a registered
investment adviser since 1989 and has been the Fund's sub-adviser since its
inception. The Board was aware that there are alternatives to retaining the
Manager.
59 | OPPENHEIMER REAL ASSET FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited / Continued
- --------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT SERVICES AND PERFORMANCE. In its evaluation of the
quality of the portfolio management services provided, the Board considered the
experience of the Fund's portfolio managers and fixed income investment team and
analysts. The commodity-linked component of the Fund's portfolio has been
managed by Kevin Baum since May 1999. Mr. Baum is a Vice President of the Fund
and the Manager. He is a Chartered Financial Analyst and has had over ten years
of experience managing commodities-related investments. The Fund's fixed-income
component has been managed by Angelo Manioudakis since April 2002. Mr.
Manioudakis is a Vice President of the Fund and a Senior Vice President of the
Manager and has had over twelve years of experience managing fixed-income
investments.
The Board also reviewed information, prepared by the Manager and by the
independent consultant, comparing the Fund's historical performance to relevant
market indices and to the performance of other "specialty and miscellaneous"
funds advised by other investment advisers. The Board also receives and reviews
comparative performance information regarding the Fund and other funds at each
Board meeting. The Board noted that the Fund's one-year, three-year and
five-year performance were all better than its peer group average.
MANAGEMENT FEES AND EXPENSES. The Board also reviewed information,
including comparative information, regarding the fees paid to the Manager and
its affiliates and the other expenses borne by the Fund. The independent
consultant provided comparative data in regard to the fees and expenses of the
Fund, other specialty and miscellaneous funds and other funds with comparable
asset levels and distribution features. The Board considered that the Fund's
contractual and actual management fees are higher than its peer group average,
however its total expenses are lower than its peer group average. In addition,
the Board evaluated the comparability of the fees charged and the services
provided to the Fund to the fees charged and services provided to other types of
entities advised by the Manager. The Board noted that the Manager, not the Fund,
pays the Sub-Adviser's annual fee under the sub-advisory agreement.
PROFITABILITY OF THE MANAGER AND AFFILIATES. The Board also reviewed
information regarding the cost of services provided by the Manager and its
affiliates and the Manager's profitability. The Board considered that the
Manager must be able to pay and retain experienced professional personnel at
competitive rates to provide services to the Fund and that maintaining the
financial viability of the Manager is important in order for the Manager to
continue to provide significant services to the Fund and its shareholders. In
addition the Board considered information that was provided regarding the direct
and
60 | OPPENHEIMER REAL ASSET FUND
indirect benefits the Manager and the Sub-Adviser receive as a result of their
relationship with the Fund, including compensation paid to affiliates.
ECONOMIES OF SCALE. The Board reviewed the extent to which the Manager may
realize economies of scale in managing and supporting the Fund and the current
level of Fund assets in relation to the Fund's breakpoint schedule for its
management fees. The Board considered that the Fund has recently experienced
significant asset growth and that, based on current asset levels, the Fund has
passed its last management fee breakpoint.
CONCLUSIONS. These factors were also considered by the independent
Trustees meeting separately from the full Board, assisted by experienced counsel
to the Fund and to the independent Trustees. Fund counsel and the independent
Trustees' counsel are both independent of the Manager and the Sub-Adviser within
the meaning and intent of the Securities and Exchange Commission Rules.
Based on its review of the information it received and its evaluations
described above, the Board, including a majority of the independent Trustees,
concluded that the nature, extent and quality of the services provided to the
Fund by the Manager and the Sub-Adviser are a benefit to the Fund and in the
best interest of the Fund's shareholders and that the amount and structure of
the compensation received by the Manager, the Sub-Adviser and their affiliates
are reasonable in relation to the services provided. Accordingly, the Board
elected to continue the advisory agreements for another year. In arriving at
this decision, the Board did not single out any factor or factors as being more
important than others, but considered all of the factors together. The Board
judged the terms and conditions of the advisory agreements, including the
management fee, in light of all of the surrounding circumstances.
61 | OPPENHEIMER REAL ASSET FUND
TRUSTEES AND OFFICERS Unaudited
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
NAME, POSITION(S) HELD WITH THE PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS; OTHER TRUSTEESHIPS/
FUND, LENGTH OF SERVICE, AGE DIRECTORSHIPS HELD; NUMBER OF PORTFOLIOS IN FUND COMPLEX CURRENTLY OVERSEEN
INDEPENDENT THE ADDRESS OF EACH TRUSTEE IN THE CHART BELOW IS 6803 S. TUCSON WAY,
TRUSTEES CENTENNIAL, CO 80112-3924. EACH TRUSTEE SERVES FOR AN INDEFINITE TERM,
OR UNTIL HIS OR HER RESIGNATION, RETIREMENT, DEATH OR REMOVAL.
WILLIAM L. ARMSTRONG, Chairman of the following private mortgage banking companies: Cherry
Chairman of the Board of Trustees Creek Mortgage Company (since 1991), Centennial State Mortgage Company
(since 2003) and (since 1994), and The El Paso Mortgage Company (since 1993); Chairman of
Trustee (since 1999) the following private companies: Ambassador Media Corporation (since
Age: 68 1984) and Broadway Ventures (since 1984); Director of the following:
Helmerich & Payne, Inc. (oil and gas drilling/production company) (since
1992), Campus Crusade for Christ (since 1991) and the Bradley Foundation
(since 2002); former Chairman of the following: Transland Financial
Services, Inc. (private mortgage banking company) (1997-2003), Great
Frontier Insurance (insurance agency) (1995-2000), Frontier Real Estate,
Inc. (residential real estate brokerage) (1994-2000) and Frontier Title
(title insurance agency) (1995-2000); former Director of the following:
UNUMProvident (insurance company) (1991-2004), Storage
Technology Corporation (computer equipment company) (1991-2003) and
International Family Entertainment (television channel) (1992-1997);
U.S. Senator (January 1979-January 1991). Oversees 38 portfolios in the
OppenheimerFunds complex.
ROBERT G. AVIS, Director and President of A.G. Edwards Capital, Inc. (General Partner of
Trustee (since 1997) private equity funds) (until February 2001); Chairman, President and
Age: 74 Chief Executive Officer of A.G. Edwards Capital, Inc. (until March
2000); Director of A.G. Edwards & Sons, Inc. (brokerage company) (until
2000) and A.G. Edwards Trust Company (investment adviser) (until 2000);
Vice Chairman and Director of A.G. Edwards, Inc. (until March 1999);
Vice Chairman of A.G. Edwards & Sons, Inc. (until March 1999); Chairman
of A.G. Edwards Trust Company (until March 1999) and A.G.E. Asset
Management (investment adviser) (until March 1999). Oversees 38 portfolios
in the OppenheimerFunds complex.
GEORGE C. BOWEN, Assistant Secretary and Director of Centennial Asset Management
Trustee (since 1998) Corporation (December 1991-April 1999); President, Treasurer and Director
Age: 69 of Centennial Capital Corporation (June 1989-April 1999); Chief Executive
Officer and Director of MultiSource Services, Inc. (March 1996-April
1999); Mr. Bowen held several positions with the Manager and with
subsidiary or affiliated companies of the Manager (September 1987-April
1999). Oversees 38 portfolios in the OppenheimerFunds complex.
EDWARD L. CAMERON, Member of The Life Guard of Mount Vernon (George Washington historical
Trustee (since 1999) site) (since June 2000); Director of Genetic ID, Inc. (biotech company)
Age: 67 (March 2001-May 2002); Partner at PricewaterhouseCoopers LLP (accounting
firm) (July 1974-June 1999); Chairman of Price Waterhouse LLP Global
Investment Management Industry Services Group (July 1994-June 1998).
Oversees 38 portfolios in the OppenheimerFunds complex.
JON S. FOSSEL, Director of UNUMProvident (insurance company) (since June 2002);
Trustee (since 1997) Director of Northwestern Energy Corp. (public utility corporation)
Age: 63 (since November 2004); Director of P.R. Pharmaceuticals (October
1999-October 2003); Director of Rocky Mountain Elk Foundation (February
1998-February 2003); Chairman and Director (until October 1996) and
President and Chief Executive Officer (until October 1995) of the
Manager; President, Chief Executive Officer and Director of the
following: Oppenheimer Acquisition Corp. ("OAC") (parent holding company
of the Manager), Shareholder Services, Inc. and Shareholder Financial
62 | OPPENHEIMER REAL ASSET FUND
JON S. FOSSEL, Services, Inc. (until October 1995). Oversees 38 portfolios in the
Continued OppenheimerFunds complex.
SAM FREEDMAN, Director of Colorado Uplift (charitable organization) (since September
Trustee (since 1997) 1984). Mr. Freedman held several positions with the Manager and with
Age: 64 subsidiary or affiliated companies of the Manager (until October 1994).
Oversees 38 portfolios in the OppenheimerFunds complex.
BEVERLY L. HAMILTON, Trustee of Monterey Institute for International Studies (educational
Trustee (since 2002) organization) (since February 2000); Director of The California
Age: 59 Endowment (philanthropic organization) (since April 2002); Director of
Community Hospital of Monterey Peninsula (since February 2002); Director
of Emerging Markets Growth Fund, Inc. (mutual fund) (since October
1991); President of ARCO Investment Management Company (February
1991-April 2000); Member of the investment committees of The Rockefeller
Foundation and The University of Michigan; Advisor at Credit Suisse
First Boston's Sprout venture capital unit (venture capital fund)
(1994-January 2005); Trustee of MassMutual Institutional Funds (investment
company) (1996-June 2004); Trustee of MML Series Investment Fund
(investment company) (April 1989-June 2004); Member of the investment
committee of Hartford Hospital (2000-2003); and Advisor to Unilever
(Holland) pension fund (2000-2003). Oversees 38 portfolios in the
OppenheimerFunds complex.
ROBERT J. MALONE, Director of Jones International University (educational organization)
Trustee (since 2002) (since August 2005); Chairman, Chief Executive Officer and Director of
Age: 61 Steele Street State Bank (commercial banking) (since August 2003);
Director of Colorado UpLIFT (charitable organization) (since 1986);
Trustee of the Gallagher Family Foundation (non-profit organization)
(since 2000); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S.
Bancorp and formerly Colorado National Bank) (July 1996-April 1999);
Director of Commercial Assets, Inc. (real estate investment trust)
(1993-2000); Director of Jones Knowledge, Inc. (2001-July 2004); and
Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-
February 2004). Oversees 38 portfolios in the OppenheimerFunds complex.
F. WILLIAM MARSHALL, JR., Trustee of MassMutual Select Funds (formerly MassMutual Institutional
Trustee (since 2000) Funds) (investment company) (since 1996) and MML Series Investment Fund
Age: 63 (investment company) (since 1996), the Springfield Library and Museum
Association (museums) (since 1995) and the Community Music School of
Springfield (music school) (since 1996); Chairman and Trustee (since
2003) and Chairman of the Investment Committee (since 1994) of the
Worcester Polytech Institute (private university); President and
Treasurer of the SIS Funds (private charitable fund) (since January
1999); Chairman of SIS & Family Bank, F.S.B. (formerly SIS Bank)
(commercial bank) (January 1999-July 1999); Member of the Investment
Committee of the Community Foundation of Western Massachusetts (1998-
2003); and Executive Vice President of Peoples Heritage Financial Group,
Inc. (commercial bank) (January 1999-July 1999). Oversees 38 portfolios
in the OppenheimerFunds complex.
63 | OPPENHEIMER REAL ASSET FUND
TRUSTEES AND OFFICERS Unaudited / Continuted
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE THE ADDRESS OF MR. MURPHY IS TWO WORLD FINANCIAL CENTER, 225 LIBERTY
AND OFFICER STREET, 11TH FLOOR, NEW YORK, NY 10281-1008. MR. MURPHY SERVES AS A
TRUSTEE FOR AN INDEFINITE TERM AND AS AN OFFICER FOR AN ANNUAL TERM, OR
UNTIL HIS RESIGNATION, RETIREMENT, DEATH OR REMOVAL. MR. MURPHY IS AN
INTERESTED TRUSTEE DUE TO HIS POSITIONS WITH OPPENHEIMERFUNDS, INC. AND
ITS AFFILIATES.
JOHN V. MURPHY, Chairman, Chief Executive Officer and Director (since June 2001) and
President and Principal President (since September 2000) of the Manager; President and Director or
Executive Officer Trustee of other Oppenheimer funds; President and Director of OAC and of
(since 2001) and Trustee Oppenheimer Partnership Holdings, Inc. (holding company subsidiary of the
(since 2001) Manager) (since July 2001); Director of OppenheimerFunds Distributor, Inc.
Age: 56 (subsidiary of the Manager) (since November 2001); Chairman and Director of
Shareholder Services, Inc. and of Shareholder Financial Services, Inc.
(transfer agent subsidiaries of the Manager) (since July 2001); President
and Director of OppenheimerFunds Legacy Program (charitable trust program
established by the Manager) (since July 2001); Director of the following
investment advisory subsidiaries of the Manager: OFI Institutional Asset
Management, Inc., Centennial Asset Management Corporation, Trinity
Investment Management Corporation and Tremont Capital Management, Inc.
(since November 2001), HarbourView Asset Management Corporation and OFI
Private Investments, Inc. (since July 2001); President (since November
2001) and Director (since July 2001) of Oppenheimer Real Asset Management,
Inc.; Executive Vice President of Massachusetts Mutual Life Insurance
Company (OAC's parent company) (since February 1997); Director of DLB
Acquisition Corporation (holding company parent of Babson Capital
Management LLC) (since June 1995); Member of the Investment Company
Institute's Board of Governors (since October 3, 2003); Chief Operating
Officer of the Manager (September 2000-June 2001); President and Trustee of
MML Series Investment Fund and MassMutual Select Funds (open-end investment
companies) (November 1999-November 2001); Director of C.M. Life Insurance
Company (September 1999-August 2000); President, Chief Executive Officer
and Director of MML Bay State Life Insurance Company (September 1999-August
2000); Director of Emerald Isle Bancorp and Hibernia Savings Bank (wholly-
owned subsidiary of Emerald Isle Bancorp) (June 1989-June 1998). Oversees
87 portfolios as a Trustee or Director and officer in the OppenheimerFunds
complex.
- ----------------------------------------------------------------------------------------------------------------------
OTHER OFFICERS THE ADDRESSES OF THE OFFICERS IN THE CHART BELOW ARE AS FOLLOWS: FOR
OF THE FUND MESSRS. BAUM, MANIOUDAKIS, AND ZACK, TWO WORLD FINANCIAL CENTER, 225
LIBERTY STREET, 11TH FLOOR, NEW YORK, NY 10281-1008, FOR MESSRS. VANDEHEY
AND WIXTED, 6803 S. TUCSON WAY, CENTENNIAL, CO 80112-3924. EACH OFFICER
SERVES FOR AN ANNUAL TERM OR UNTIL HIS OR HER EARLIER RESIGNATION,
RETIREMENT, DEATH OR REMOVAL.
KEVIN BAUM, Vice President of the Manager since October 2000; a Chartered Financial
Vice President (since 2000) Analyst; he has served as the Fund's principal trader since its inception
Age: 34 in March 1997. An officer of 1 portfolio in the OppenheimerFunds complex.
ANGELO G. MANIOUDAKIS, Senior Vice President of the Manager (since April 2002), of HarbourView
Sr. Vice President (since 2002) Asset Management Corporation (since April, 2002 and of OFI Institutional
Age: 37 Asset Management, Inc. (since June 2002). Formerly Executive Director and
portfolio manager for Miller, Anderson & Sherrerd, a division of Morgan
Stanley Investment Management (August 1993-April 2002). An officer of 14
portfolios in the OppenheimerFunds complex.
64 | OPPENHEIMER REAL ASSET FUND
MARK S. VANDEHEY, Senior Vice President and Chief Compliance Officer of the Manager (since
Vice President and March 2004); Vice President of OppenheimerFunds Distributor, Inc.,
Chief Compliance Officer Centennial Asset Management Corporation and Shareholder Services, Inc.
(since 2004) (since June 1983); Vice President and Director of Internal Audit of the
Age: 55 Manager (1997-February 2004). An officer of 87 portfolios in the
OppenheimerFunds complex.
BRIAN W. WIXTED, Senior Vice President and Treasurer of the Manager (since March 1999);
Treasurer and Treasurer of the following: HarbourView Asset Management Corporation,
Principal Financial and Shareholder Financial Services, Inc., Shareholder Services, Inc.,
Accounting Officer Oppenheimer Real Asset Management Corporation, and Oppenheimer Partnership
(since 1999) Holdings, Inc. (since March 1999), OFI Private Investments, Inc. (since
Age: 45 March 2000), OppenheimerFunds International Ltd. and OppenheimerFunds plc
(since May 2000), OFI Institutional Asset Management, Inc. (since November
2000), and OppenheimerFunds Legacy Program (since June 2003); Treasurer and
Chief Financial Officer of OFI Trust Company (trust company subsidiary of
the Manager) (since May 2000); Assistant Treasurer of the following: OAC
(since March 1999), Centennial Asset Management Corporation (March
1999-October 2003) and OppenheimerFunds Legacy Program (April 2000-June
2003); Principal and Chief Operating Officer of Bankers Trust
Company-Mutual Fund Services Division (March 1995-March 1999). An officer
of 87 portfolios in the OppenheimerFunds complex.
ROBERT G. ZACK, Executive Vice President (since January 2004) and General Counsel (since
Vice President and Secretary March 2002) of the Manager; General Counsel and Director of the Distributor
(since 2001) (since December 2001); General Counsel of Centennial Asset Management
Age: 57 Corporation (since December 2001); Senior Vice President and General
Counsel of HarbourView Asset Management Corporation (since December 2001);
Secretary and General Counsel of OAC (since November 2001); Assistant
Secretary (since September 1997) and Director (since November 2001) of
OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice
President and Director of Oppenheimer Partnership Holdings, Inc. (since
December 2002); Director of Oppenheimer Real Asset Management, Inc. (since
November 2001); Senior Vice President, General Counsel and Director of
Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since
December 2001); Senior Vice President, General Counsel and Director of OFI
Private Investments, Inc. and OFI Trust Company (since November 2001); Vice
President of OppenheimerFunds Legacy Program (since June 2003); Senior Vice
President and General Counsel of OFI Institutional Asset Management, Inc.
(since November 2001); Director of OppenheimerFunds (Asia) Limited (since
December 2003); Senior Vice President (May 1985-December 2003), Acting
General Counsel (November 2001-February 2002) and Associate General Counsel
(May 1981-October 2001) of the Manager; Assistant Secretary of the
following: Shareholder Services, Inc. (May 1985-November 2001), Shareholder
Financial Services, Inc. (November 1989-November 2001), and
OppenheimerFunds International Ltd. (September 1997-November 2001). An
officer of 87 portfolios in the OppenheimerFunds complex.
THE FUND'S STATEMENT OF ADDITIONAL INFORMATION CONTAINS ADDITIONAL INFORMATION
ABOUT THE FUND'S TRUSTEES AND OFFICERS AND IS AVAILABLE WITHOUT CHARGE UPON
REQUEST, BY CALLING 1.800.525.7048.
65 | OPPENHEIMER REAL ASSET FUND
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller or persons performing similar functions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Board of Trustees of the registrant has determined that Edward L. Cameron,
the Chairman of the Board's Audit Committee, and George C. Bowen, a member of
the Board's Audit Committee, possess the technical attributes identified in
Instruction 2(b) of Item 3 to Form N-CSR to qualify as "audit committee
financial experts," and has designated Messrs. Cameron and
Bowen as the Audit Committee's financial experts. Messrs. Cameron and Bowen are
"independent" Trustees pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees
The principal accountant for the audit of the registrant's annual financial
statements billed $35,000 in fiscal 2005 and $32,000 in fiscal 2004.
(b) Audit-Related Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years.
The principal accountant for the audit of the registrant's annual financial
statements billed $5,000 in fiscal 2005 and no such fees in fiscal 2004 to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
Such services: seed money audit.
(c) Tax Fees
The principal accountant for the audit of the registrant's annual financial
statements billed to the registrant $20,000 in fiscal 2005 and no such fees in
fiscal 2004.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
Such services: audit of the tax provision for certain structured instruments.
(d) All Other Fees
The principal accountant for the audit of the registrant's annual financial
statements billed to the registrant no such fees during the last two fiscal
years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
(e) (1) During its regularly scheduled periodic meetings, the registrant's
audit committee will pre-approve all audit, audit-related, tax and other
services to be provided by the principal accountants of the registrant.
The audit committee has delegated pre-approval authority to its Chairman
for any subsequent new engagements that arise between regularly scheduled
meeting dates provided that any fees such pre-approved are presented to
the audit committee at its next regularly scheduled meeting.
Under applicable laws, pre-approval of non-audit services maybe waived
provided that: 1) the aggregate amount of all such services provided
constitutes no more than five percent of the total amount of fees paid by
the registrant to it principal accountant during the fiscal year in which
services are provided 2) such services were not recognized by the
registrant at the time of engagement as non-audit services and 3) such
services are promptly brought to the attention of the audit committee of
the registrant and approved prior to the completion of the audit.
(2) 100%
(f) Not applicable as less than 50%.
(g) The principal accountant for the audit of the registrant's annual
financial statements billed $25,000 in fiscal 2005 and no such fees in
fiscal 2004 to the registrant and the registrant's investment adviser or
any entity controlling, controlled by, or under common control with the
adviser that provides ongoing services to the registrant related to
non-audit fees. Those billings did not include any prohibited non-audit
services as defined by the Securities Exchange Act of 1934.
(h) The registrant's audit committee of the board of trustees has considered
whether the provision of non-audit services that were rendered to the
registrant's investment adviser, and any entity controlling, controlled
by, or under common control with the investment adviser that provides
ongoing services to the registrant that were not pre-approved pursuant to
paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
THE FUND'S GOVERNANCE COMMITTEE PROVISIONS WITH RESPECT TO NOMINATIONS OF
DIRECTORS/TRUSTEES TO THE RESPECTIVE BOARDS
1. The Fund's Governance Committee (the "Committee") will evaluate potential
Board candidates to assess their qualifications. The Committee shall have
the authority, upon approval of the Board, to retain an executive search
firm to assist in this effort. The Committee may consider recommendations
by business and personal contacts of current Board members and by
executive search firms which the Committee may engage from time to time
and may also consider shareholder recommendations. The Committee may
consider the advice and recommendation of the Funds' investment manager
and its affiliates in making the selection.
2. The Committee shall screen candidates for Board membership. The Committee
has not established specific qualifications that it believes must be met
by a trustee nominee. In evaluating trustee nominees, the Committee
considers, among other things, an individual's background, skills, and
experience; whether the individual is an "interested person" as defined in
the Investment Company Act of 1940; and whether the individual would be
deemed an "audit committee financial expert" within the meaning of
applicable SEC rules. The Committee also considers whether the
individual's background, skills, and experience will complement the
background, skills, and experience of other nominees and will contribute
to the Board. There are no differences in the manner in which the
Committee evaluates nominees for trustees based on whether the nominee is
recommended by a shareholder.
3. The Committee may consider nominations from shareholders for the Board at
such times as the Committee meets to consider new nominees for the Board.
The Committee shall have the sole discretion to determine the candidates
to present to the Board and, in such cases where
required, to shareholders. Recommendations for trustee nominees should, at
a minimum, be accompanied by the following:
o the name, address, and business, educational, and/or other pertinent
background of the person being recommended;
o a statement concerning whether the person is an "interested person"
as defined in the Investment Company Act of 1940;
o any other information that the Funds would be required to include in
a proxy statement concerning the person if he or she was nominated;
and
o the name and address of the person submitting the recommendation
and, if that person is a shareholder, the period for which that
person held Fund shares.
The recommendation also can include any additional information which the
person submitting it believes would assist the Committee in evaluating the
recommendation.
4. Shareholders should note that a person who owns securities issued by
Massachusetts Mutual Life Insurance Company (the parent company of the
Funds' investment adviser) would be deemed an "interested person" under
the Investment Company Act of 1940. In addition, certain other
relationships with Massachusetts Mutual Life Insurance Company or its
subsidiaries, with registered broker-dealers, or with the Funds' outside
legal counsel may cause a person to be deemed an "interested person."
5. Before the Committee decides to nominate an individual as a trustee,
Committee members and other directors customarily interview the individual
in person. In addition, the individual customarily is asked to complete a
detailed questionnaire which is designed to elicit information which must
be disclosed under SEC and stock exchange rules and to determine whether
the individual is subject to any statutory disqualification from serving
as a trustee of a registered investment company.
ITEM 11. CONTROLS AND PROCEDURES.
Based on their evaluation of the registrant's disclosure controls and procedures
(as defined in rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR
270.30a-3(c)) as of August 31, 2005, the registrant's principal executive
officer and principal financial officer found the registrant's disclosure
controls and procedures to provide reasonable assurances that information
required to be disclosed by the registrant in the reports that it files under
the Securities Exchange Act of 1934 (a) is accumulated and communicated to
registrant's management, including its principal executive officer and principal
financial officer, to allow timely decisions regarding required disclosure, and
(b) is recorded, processed, summarized and reported, within the time periods
specified in the rules and forms adopted by the U.S. Securities and Exchange
Commission.
There have been no changes in the registrant's internal controls over financial
reporting that occurred during the registrant's second fiscal quarter of the
period covered by this report that have materially affected, or are reasonably
likely to materially affect, the registrant's internal control over financial
reporting.
ITEM 12. EXHIBITS.
(a) (1) Exhibit attached hereto.
(2) Exhibits attached hereto.
(3) Not applicable.
(b) Exhibit attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Oppenheimer Real Asset Fund
By: /s/ John V. Murphy
------------------
John V. Murphy
Principal Executive Officer
Date: October 17, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ John V. Murphy
------------------
John V. Murphy
Principal Executive Officer
Date: October 17, 2005
By: /s/ Brian W. Wixted
-------------------
Brian W. Wixted
Principal Financial Officer
Date: October 17, 2005