THE OAKMARK GLOBAL FUND Report from Clyde S. McGregor and Michael J. Welsh, Portfolio Managers

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK GLOBAL FUND FROM ITS INCEPTION (8/4/99) TO PRESENT (3/31/04) AS COMPARED TO THE MSCI WORLD INDEX16
	Annual Average Total Returns
	(as of 03/31/04)
	Total Return Last 3 Months*	1-year	3-year	Since Inception (8/4/99)
Oakmark Global Fund (Class I)	3.89%	73.04%	22.33%	17.29%3
MSCI World	2.62%	43.87%	1.46%	-1.95%
Lipper Global Fund Index17	3.83%	46.75%	2.31%	1.01%
The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The performance data quoted represents past performance. Past performance does not guarantee future results.
The fund's high performance may not be repeated. The investment return and principal value 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 data quoted. Average annual total return measures annualized change, while total return measures aggregate change. To obtain current month end performance data, call 1-800-OAKMARK or visit www.oakmark.com.
* Not annualized

Fellow Shareholders,

The Oakmark Global Fund gained 4% for the three-month period ending March 31, 2004, compared with the 3% increase for the MSCI World Index and the 4% increase for the Lipper Global Fund Index.

Over the past twelve months, The Oakmark Global Fund has returned 73%, compared to the smaller gains of 44% and 47% for the MSCI World Index and the Lipper Global Fund Index, respectively. Most importantly, since inception the Fund has returned 17% annualized compared to a 2% decline in the MSCI World Index and 1% return in the Lipper Global Fund Index.

Portfolio Composition

We made few changes during the quarter. We sold two companies, L.M. Ericsson (Sweden) and First Health Group (US). Ericsson, the mobile network equipment powerhouse, significantly contributed to performance over the past twelve months as the share price more than tripled before hitting our sell price during the quarter. We became less comfortable in our assessment of First Health's business franchise after a very poor earnings announcement, and we sold our entire position.

We also exchanged our shares in Concord EFS for shares in First Data Corp, who completed their acquisition this quarter. First Data, along with Diageo, are now your Fund's largest holdings at just under 5% each of fund assets.

We added one new position during the quarter, Switzerland-based Lonza Group. Lonza is one of the world's leading suppliers of active ingredients, chemical intermediates, and biotechnology solutions to the pharmaceutical and agrochemical industries. Their main businesses are: Exclusive Synthesis, Biotechnology, Organic Fine Chemicals, and Performance Chemicals.

Currently, Exclusive Synthesis is Lonza's biggest profit generator. The business is based on the outsourcing trend in the life science industry, which entrusts specialized companies with the manufacturing of advanced intermediates and active ingredients. Lonza has state-of-the-art, multipurpose plants that can be adapted to each customer's individual needs. This advanced customization capability makes them the world's leader in exclusive custom manufacturing for global life sciences companies.

We purchased the stock during the quarter after the release of disappointing 2003 results caused the share price to weaken. We believe the market is underestimating the growth potential in both Lonza's Exclusive Synthesis and Biotechnology segments. On a normalized basis we think Lonza is valued at just over 10x earnings. Management is also sound with strong shareholder orientation. We've respected Chairman Sergio Marchionne's ability for a number of years and applauded his quick decision to replace the operationally-deficient former CEO.

Global Outlook

Currently, your portfolio is composed of roughly 35% US-listed companies, 47% in the UK and Europe, 3% in Latin America, and 15% in the Asia Pacific region. As you've probably surmised from our dwindling US market weighting, we continue to have difficulty finding new US stocks that are more attractive than current holdings or new overseas opportunities. However, we continued to increase our holdings in several US companies during the quarter, namely Burlington Resources and Waste Management. Internationally, we continue to find companies that meet our value criteria in a number of areas, including blue-chip European consumer non-durables (Nestle, Henkel, and Diageo), pharmaceuticals (Takeda Chemical, Aventis, and GlaxoSmithKline), and financial services (Australia and New Zealand Bank, Bank of Ireland, Banca Popolare di Verona, and Julius Baer Holding).

Over the past twelve months, we have seen strong price appreciation around the globe in equities, fixed income, and natural resources. Many asset classes formerly (and usually) thought risky, such as junk bonds, emerging markets, and technology/story stocks, have been the strongest performers. The risk premium we demand for investing in emerging markets, for example, has all but evaporated in most cases. In sum, we think high-quality businesses, especially in the UK and Europe, represent a much more interesting risk-reward relationship.

As an example, let's use Diageo plc, the world's largest spirits company. Diageo generates tremendous amounts of free cash flow from their high return on capital business, much of which is returned to shareholders in the form of rising dividends and share repurchases. In addition the company is well-positioned to take advantage of the growth of those same emerging markets of which investors are so currently enamored.

At 14x this year's earnings and a 4% dividend yield, we find Diageo's valuation too cheap in a relatively dear world. And unlike investing in many emerging markets, there are also no corporate governance concerns—management is solely focused on increasing shareholders' wealth.

Looking Forward

Despite the Fund's strong performance we remain excited about the value and quality of the names, such as First Data, Diageo and Lonza, in the portfolio. We thank you for your support.

Clyde S. McGregor, CFA Portfolio Manager mcgregor@oakmark.com	Michael J. Welsh, CFA, CPA Portfolio Manager mwelsh@oakmark.com

Global Diversification—March 31, 2004 (Unaudited)

Schedule of Investments—March 31, 2004 (Unaudited)

See accompanying notes to financial statements.