THE OAKMARK GLOBAL FUND Report from Clyde S. McGregor and Robert A. Taylor, Portfolio Managers

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK GLOBAL FUND FROM ITS INCEPTION (8/4/99) TO PRESENT (9/30/06) AS COMPARED TO THE MSCI WORLD INDEX13 (UNAUDITED)
	Average Annual Total Returns (as of 9/30/06)
(Unaudited)	Total Return Last 3 Months*	1-year	5-year	Since Inception (8/4/99)
Oakmark Global Fund (Class I)	5.58%	17.46%	22.18%	16.67%
MSCI World	4.47%	14.18%	10.01%	3.19%
Lipper Global Fund Index14	4.06%	14.36%	10.63%	5.17%
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. The above performance information for the Fund does not reflect the imposition of a 2% redemption fee on shares held for 90 days or less to deter market timers. If reflected, the fee would reduce the performance quoted. Past performance does not guarantee future results. 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 most recent month-end performance data, visit oakmark.com.
* Not annualized

Quarter and Fiscal Year Review

A strong recovery in world stock markets helped to propel The Oakmark Global Fund to a pleasing 6% gain in the quarter ended September 30. Both the Lipper Global Fund Index and the MSCI World Index reported 4% for the period. September 30 also is the end of the Fund's fiscal year. For that 12-month period the Fund earned 17%, which contrasts to 14% for the Lipper Global Fund Index as well as the MSCI World Index. Most importantly, the Fund since inception has compounded at approximately 17% per year, measured against 3% per year for the MSCI World Index and 5% for the Lipper Global Fund Index.

While several stocks in the Fund lost ground during the quarter, every country in which we invested Fund assets contributed positively. The Netherlands, Italy, and Mexico provided the highest percentage total return. We ended the quarter with the portfolio divided roughly 40/60 between U.S. stocks and foreign-domiciled issues. As we have often stated, we build the portfolio from the bottom up. Each individual name fights for space within the portfolio. The resulting split between the U.S. and international simply captures a snapshot view of where we have identified dominant investment ideas. Consultants may tell us that we are "underweight" a country or an industry, but this has little meaning for our investment process. We go wherever we believe value to be taking us, and currently that means a lot of Europe and the U.S., some Asia, and a small position in the emerging markets.

Japan—The New Frontier

The changes that have taken place in Japan over the past decade have been dramatic. Deflation has ended, interest rates are on the rise, capital spending is booming, the banks are back from the brink, and the real estate market is experiencing a renaissance. Also, very importantly, management teams are starting to care about shareholders. Meeting a CEO or CFO is becoming common compared to dealing only with the investor relations department in the past. Companies are truly restructuring, and share repurchases are more than just an announcement. Average returns, measured by return on equity, have jumped from low single-digit levels to almost 10% today. The recent apex was the bid by OJI Paper for Hokuetsu Paper, which marked the first time a blue-chip Japanese company attempted a hostile takeover of a competitor. While the attempt was unsuccessful, it illustrates how things have changed from the keiretsu-dominated business relationships in Japan.

It is interesting to note that despite these positives, Japan has been one of the worst performing equity markets for the year. We see this as an opportunity. Close to 12% of the Fund is invested in Japan because of changes mentioned above, the owner-oriented management teams of our holdings, and our holdings' respective discounts to fair value. The management teams at Rohm, Takeda, Meitec and Uni-Charm share our belief in this discount to intrinsic value and are executing meaningful share repurchases. We are pleased that our Japanese holdings have been some of the biggest contributors for the Fund quarter and year-to-date. Even after these price moves we remain excited about our Japanese holdings.

Portfolio Changes

We kept the number of stocks in the portfolio constant during the quarter, adding two new names and eliminating another two. As noted above, every holding in the portfolio fights for space, and ConocoPhillips (received in exchange for the Fund's Burlington Resources shares) and Santen Pharmaceutical lost that fight. Both, however, are solid companies that could easily return to the portfolio in the future.

Our two new purchases are Intel and Kinetic Concepts, both U.S.-domiciled concerns. Intel, the world's largest microprocessor company, typifies the opportunity to buy a great company at a good price, which we always desire but rarely see. In the summer, market share losses to a major competitor combined with poor personal computer industry conditions to push Intel's stock price down to 1997 levels. Intel's market share position has experienced many cycles, and we believe that the current share loss will prove to be temporary. The company introduced several important new products in the third quarter, and more are on the way. Not only does Intel spend more than four times as much on research and development than its nearest competitor, but also the company sets the standard, in our opinion, for state of the art manufacturing in its industry.

In contrast to the very well known Intel, Kinetic Concepts is a somewhat obscure mid-size company that develops and manufactures health care products. The company has long been known for its specialty hospital beds, but wound care products now dominate corporate revenues. Kinetic Concepts controls a patented technology named Vacuum Assisted Closure that speeds healing for difficult wounds. Demographics are favorable for this product because two rapidly growing populations (diabetics and nursing home residents) are primary customers. Usually, specialty medical device companies trade at prices that we find too expensive, and this is usually the case for Kinetic Concepts. However, when a patent infringement trial produced an unexpected outcome, Kinetic Concepts' share price decreased, and we saw an investment opportunity. As with Intel, we believe that the stock market has overreacted to ambiguous news.

In closing, we note that the Fund passed its seventh anniversary during the quarter. While the Fund has grown in size over the years, it has not changed in its character. We thank you for your support and patience, and we welcome your e-mailed questions and comments.

Global Diversification—September 30, 2006 (Unaudited)

Schedule of Investments—September 30, 2006

See accompanying Notes to Financial Statements.