THE OAKMARK FUND Report from Bill Nygren and Kevin Grant, Portfolio Managers

THE VALUE OF A $10,000 INVESTMENT IN THE OAKMARK FUND FROM ITS INCEPTION (8/5/91) TO PRESENT (12/31/07) AS COMPARED TO THE STANDARD & POOR'S 500 INDEX6 (UNAUDITED)
	Average Annual Total Returns (as of 12/31/07)
(Unaudited)	Total Return Last 3 Months*	1-year	5-year	10-year	Since Inception (8/5/91)
Oakmark Fund (Class I)	-6.41%	-3.64%	9.51%	5.17%	14.30%
S&P 500	-3.33%	5.49%	12.83%	5.91%	10.67%
Dow Jones Average7	-3.91%	6.41%	11.72%	7.20%	11.84%
Lipper Large Cap Value Index8	-4.67%	2.48%	13.05%	6.12%	10.43%
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.
Expense Ratio as of 9/30/07 was 1.01%.
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

The fiscal year for The Oakmark Fund got off to a disappointing start with the Fund losing 6% of its value while the S&P 500 lost only half that much. The explanation of why that happened reads like a repeat of the prior quarter. Our strongest contributors were two stocks that had been performing well and continued to do so—McDonald’s and YUM Brands. Both companies consistently posted strong operating results. McDonalds maintained good growth in U.S. same-store-sales, as well as good growth outside the U.S. (albeit currency assisted). YUM Brands furthered its lead over restaurant competitors in China with new store openings and good same-store-sales growth. Using a purchasing power comparison, we conclude that the Chinese Yuan, unlike most foreign currencies, is undervalued versus the dollar. Because of that, we believe that YUM Brands is one of very few US based businesses that will continue to benefit from currency translation gains.

Looking at the stocks we owned that declined, the biggest losers were Washington Mutual, Citigroup and MGIC. All continued to suffer from the decline in housing prices and the resultant increase in mortgage delinquencies. Washington Mutual owns mortgages, Citigroup owns low quality tranches of mortgage backed securities, and MGIC insures mortgage holders against large losses. After reassessing all three holdings based on both new fundamental information and lower stock prices, we concluded that MGIC did not present as favorable a risk-return profile as our other holdings did, so we eliminated the position. During the quarter we also sold DirecTV and Coca-Cola after they reached our price targets.

Comcast Corp (CMCSK - $18)

Our only new addition to the portfolio was Comcast, the largest cable TV provider. We had previously owned Comcast, and sold it less than a year ago after it had achieved our price target. From its 2007 peak price of $30, Comcast stock subsequently declined by 40% despite achieving double-digit growth in EBITDA. Comcast is now priced at about six times projected 2008 EBITDA, its lowest multiple in a decade. We believe that the cable business still has growth opportunities in video and has the opportunity for significant market share gains in telephony and Internet access. Further, Comcast management is viewed as the best in the industry, and we share that favorable assessment of them.

December 31, 2007

Schedule of Investments—December 31, 2007 (Unaudited)