UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549  FORM N-CSRS  Investment Company Act file number
        811-5002
  DWS Variable Series II (Exact Name of Registrant as Specified in Charter)  345 Park Avenue New York, NY 10154-0004 (Address of Principal Executive Offices) (Zip Code)  Registrants Telephone Number, including Area Code:(212) 454-7190  Paul Schubert 345 Park Avenue New York, NY 10154-0004 (Name and Address of Agent for Service)  Date of fiscal year end:
        12/31
  Date of reporting period:
        06/30/09
   ITEM 1.REPORT TO STOCKHOLDERS




## June 30, 2009

## 

# SEMIANNUAL REPORT

DWS VARIABLE SERIES II



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|DWS Alternative Asset Allocation Plus VIP
DWS Balanced VIP
DWS Blue Chip VIP
DWS Core Fixed Income VIP
DWS Diversified International Equity VIP(formerly DWS International Select Equity VIP)
DWS Dreman Small Mid Cap Value VIP
DWS Global Thematic VIP
DWS Government & Agency Securities VIP
DWS High Income VIP
DWS Large Cap Value VIP
DWS Mid Cap Growth VIP
DWS Money Market VIP
DWS Small Cap Growth VIP
DWS Strategic Income VIP
DWS Strategic Value VIP(formerly DWS Dreman High Return Equity VIP)
DWS Technology VIP
DWS Turner Mid Cap Growth VIP
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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Contents

Information About Your Portfolio's Expenses, Management Summary, Portfolio Summary, Investment
Portfolio, Financial Statements and Financial Highlights for:

|4 DWS Alternative Asset Allocation Plus VIP
6 DWS Balanced VIP
49 DWS Blue Chip VIP
63        DWS Core Fixed Income VIP
77        DWS Diversified International Equity VIP(formerly DWS International Select Equity VIP)
95       DWS Dreman Small Mid Cap Value VIP
106        DWS Global Thematic VIP
119       DWS Government & Agency Securities VIP
130        DWS High Income VIP
151       DWS Large Cap Value VIP
162       DWS Mid Cap Growth VIP
173        DWS Money Market VIP
184       DWS Small Cap Growth VIP
195        DWS Strategic Income VIP
220      DWS Strategic Value VIP(formerly DWS Dreman High Return Equity VIP)
231       DWS Technology VIP
241      DWS Turner Mid Cap Growth VIP
253     Notes to Financial Statements

276     Other Information
276      Proxy Voting
277       Summary of Management Fee Evaluation by
Independent Fee Consultant
280      Summary of Administrative Fee Evaluation by
Independent Fee Consultant
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

This report must be preceded or accompanied by a prospectus. To obtain an additional prospectus, call (800) 778-1482 or
your financial representative. We advise you to carefully consider the product's objectives, risks, charges and expenses
before investing. The prospectus contains this and other important information about the product. Please read the
prospectus carefully before you invest.

NOT FDIC/NCUA INSURED NO BANK GUARANTEE MAY LOSE VALUE NOT A DEPOSIT 
NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY

Investments in variable portfolios involve risk. Some portfolios have more risk than others. These include portfolios that allow exposure to or
otherwise concentrate investments in certain sectors, geographic regions, security types, market capitalization or foreign securities (e.g.,
political or economic instability, which can be accentuated in Emerging Market countries). Please read the prospectus for specific details
regarding its investments and risk profile.

DWS Investments is part of Deutsche Bank's Asset Management division and, within the US, represents the retail asset management
activities of Deutsche Bank AG, Deutsche Bank Trust Company Americas, Deutsche Investment Management Americas Inc. and DWS Trust
Company.

Information About Your Portfolio's Expenses

DWS Alternative Asset Allocation Plus VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In addition to the ongoing expenses which the Portfolio bears directly, the
Portfolio's shareholders indirectly bear the expense of the Underlying Funds in which the Portfolio invests. The
Portfolio's estimated indirect expense from investing in the Underlying Funds is based on the expense ratios from
each of the Underlying Fund's most recent shareholder report. During the period from February 2, 2009
(commencement of operations for Class A shares) and from May 18, 2009 (commencement of operations for
Class B shares) to June 30, 2009, the Portfolio limited these expenses; had it not done so, expenses would have
been higher. In addition, certain of the Underlying Funds limited expenses; had they not done so, expenses would
have been higher. The examples in the table are based on an investment of $1,000 invested at the beginning of
the period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Direct Portfolio Expenses and Value of a $1,000 Investmentfor the period ended June 30, 2009
|--------------------------------------------------------------------------------------------
|Actual Portfolio Return                                                                     
|Beginning Account Value                                                                     
|Ending Account Value 6/30/09                                                                
|Expenses Paid per $1,000***                                                                 
|Hypothetical 5% Portfolio Return                                                            
|Beginning Account Value 1/1/09                                                              
|Ending Account Value 6/30/09                                                                
|Expenses Paid per $1,000+                                                                   

|Direct Portfolio Expenses and Acquired Funds (Underlying Funds) Fees and Expenses and Value of a $1,000
Investmentfor the period ended June 30, 2009
|----------------------------------------------------------------------------------------------------------------------------------------------------
|Actual Portfolio Return                                                                                                                             
|Beginning Account Value                                                                                                                             
|Ending Account Value 6/30/09                                                                                                                        
|Expenses Paid per $1,000***                                                                                                                         
|Hypothetical 5% Portfolio Return                                                                                                                    
|Beginning Account Value 1/1/09                                                                                                                      
|Ending Account Value 6/30/09                                                                                                                        
|Expenses Paid per $1,000++                                                                                                                          

|Annualized Expense Ratios                                                     | Class A | Class B
|----------------------------------------------------------------------------- | ------- | -------
|Direct Portfolio Expense Ratio                                                | .21%    | .61%   
|Acquired Portfolios (Underlying Funds) Fees and Expenses                      | 1.43%   | 1.43%  
|Net Annual Portfolio and Acquired Funds (Underlying Funds) Operating Expenses | 1.64%   | 2.04%  

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Alternative Asset Allocation Plus VIP

|Asset Allocation(As a % of Investment Portfolio) | 6/30/09
|------------------------------------------------ | -------
|                                                 |        
|Alternative Funds                                | 73%    
|Income Funds                                     | 15%    
|International Equity Funds                       | 10%    
|Money Market Funds                               | 2%     
|                                                 | 100%   

Asset allocation is subject to change.

For more complete details about the Portfolio's investment portfolio, see page 5. A complete list of portfolio holdings of the Portfolio is posted
as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of portfolio
holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Risk Considerations

Although asset allocation among different asset categories generally limits risk and exposure to any one category,
the risk remains that management may favor an asset category that performs poorly relative to the other asset
categories. The Portfolio expects to invest in underlying funds that emphasize alternatives or non-traditional asset
categories or investment strategies, and as a result, it is subject to the risk factors of those underlying funds.
Some of those risks include stock market risk, credit and interest-rate risk, volatility in commodity prices and
high-yield debt securities, short sales risk and the political, general economic, liquidity and currency risks of
foreign investments, which may be particularly significant for emerging markets. The Portfolio also expects to
have direct and indirect exposure to derivatives, which may be more volatile and less liquid than traditional
securities. The Portfolio could suffer losses on its derivative positions. See the prospectus for additional risks and
specific details regarding the Portfolio's risk profile.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Alternative Asset Allocation Plus VIP

|                                                             | Shares  | Value ($)
|------------------------------------------------------------ | ------- | ---------
|                                                             |        
|Equity Funds 63.2%                                          
|DWS Commodity Securities Fund
"Institutional"                | 8,725   | 28,357   
|DWS Disciplined Market Neutral
Fund "Institutional"          | 6.093   | 57,579   
|DWS Emerging Markets Equity Fund
"Institutional"             | 2,166   | 28,380   
|DWS Gold & Precious Metals Fund
"Institutional"              | 880     | 14,065   
|DWS RREEF Global Infrastructure
Fund "Institutional"         | 1,999   | 14,276   
|DWS RREEF Global Real Estate
Securities Fund "Institutional" | 9,892   | 56,881   
|Total Equity Funds (Cost $182,371)                           | 199,538
|                                                            
|Fixed Income  Bond Funds 27.4%                             
|DWS Emerging Markets Fixed
Income Fund "Institutional"       | 3,132   | 28,847   
|                                                             | Shares  | Value ($)
|                                                             |        
|DWS Floating Rate Plus Fund
"Institutional"                  | 1,768   | 14,447   
|DWS Inflation Protected Plus Fund
"Institutional"            | 4,658   | 43,412   
|Total Fixed Income  Bond Funds (Cost $82,596)               | 86,706 
|                                                            
|Fixed Income  Money Market Fund 2.3%                       
|Cash Management QP Trust
(Cost $7,196)                       | 7,196   | 7,196    

|                                           | % of Net
Assets | Value ($)
|------------------------------------------ | --------------- | ---------
|                                           |                
|Total Investment Portfolio(Cost $272,163)+ | 92.9            | 293,440  
|Other Assets and Liabilities, Net          | 7.1             | 22,362   
|Net Assets                                 | 100.0           | 315,802  

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                     | Level 1        | Level 2   | Level 3  | Total         
|-------------------------- | -------------- | --------- | -------- | --------------
|Underlying funds (a)       | $      286,244 | $        | $       | $      286,244
|Short-Term Investments (a) |               | 7,196     |         | 7,196         
|Total                      | $   286,244    | $   7,196 | $       | $   293,440   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                             
|Investments:Investments in Underlying Affiliated Funds, at
value (cost $264,967)                                                                                                   
|Investment in Cash Management QP Trust
(cost $7,196)                                                                                                                               
|Total investments, at value (cost $272,163)                                                                                                                                        
|Receivable for investments sold                                                                                                                                                    
|Receivable for Portfolio shares sold                                                                                                                                               
|Interest receivable                                                                                                                                                                
|Dividends receivable                                                                                                                                                               
|Deferred offering costs                                                                                                                                                            
|Due from Advisor                                                                                                                                                                   
|Total assets                                                                                                                                                                       
|Liabilities                                                                                                                                                                        
|Payable for investments purchased                                                                                                                                                  
|Accrued expenses and other liabilities                                                                                                                                             
|Total liabilities                                                                                                                                                                  
|Net assets, at value                                                                                                                                                               
|Net Assets Consist of                                                                                                                                                              
|Undistributed net investment income                                                                                                                                                
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                          
|Accumulated net realized gain (loss)                                                                                                                                               
|Paid-in capital                                                                                                                                                                    
|Net assets, at value                                                                                                                                                               
|Class A
Net Asset Value, offering and redemption price
per share ($314,776 ÷ 28,218 outstanding
shares of beneficial interest, no par value,
unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price
per share ($1,026 ÷ 92 outstanding shares of
beneficial interest, no par value, unlimited
number of shares authorized)      

The accompanying notes are an integral part of the financial statements.

|Statement of Operationsfor the period from
February 2, 2009 (commencement of operations) to June 30, 2009
(Unaudited)
|---------------------------------------------------------------------------------------------------------------------
|Investment Income                                                                                                    
|Income:Income distributions from Underlying
Affiliated Funds                                                         
|Interest  Cash Management QP Trust                                                                                  
|Total Income                                                                                                         
|Expenses:Management fee                                                                                              
|Administration service fee                                                                                           
|Services to shareholders                                                                                             
|Custodian fee                                                                                                        
|Legal fees                                                                                                           
|Audit and tax fees                                                                                                   
|Trustees' fees and expenses                                                                                          
|Reports to shareholders                                                                                              
|Offering expenses                                                                                                    
|Other                                                                                                                
|Total expenses before expense reductions                                                                             
|Expense reductions                                                                                                   
|Total expenses after expense reductions                                                                              
|Net investment income (loss)                                                                                         
|Realized and Unrealized Gain (Loss)                                                                                  
|Net realized gain (loss) from sale of Underlying
Affiliated Funds                                                    
|Change in net unrealized appreciation
(depreciation) on investments                                                  
|Net gain (loss)                                                                                                      
|Net increase (decrease) in net assets
resulting from operations                                                      

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                   
|-------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                    
|Operations:Net investment income (loss)                                              
|Net realized gain (loss)                                                             
|Change in net unrealized appreciation (depreciation)                                 
|Net increase (decrease) in net assets resulting from operations                      
|Portfolio share transactions:Class A
Proceeds from shares sold                       
|Cost of shares redeemed                                                              
|Net increase (decrease) in net assets from Class A share transactions                
|Increase (decrease) in net assets                                                    
|Net assets at beginning of period (initial capital)Class A
Class B                   
|Net assets at end of period (including undistributed net investment income of $1,107)
|Other Information                                                                    
|Class A
Shares sold                                                                  
|Shares redeemed                                                                      
|Net increase (decrease) in Class A shares                                            
|Initial Capital                                                                      
|Shares outstanding at end of period                                                  
|Class B
Initial Capital                                                              
|Shares outstanding at end of period                                                  

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Year Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 2009a    
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | $   10.00
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | .05      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 1.11     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1.16     
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | $   11.16
|Total Return (%)c,d                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 11.60**  
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Net assets, end of period ($ thousands)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 315      
|Ratio of expenses before expense reductions (%)e                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 60.94*   
|Ratio of expenses after expense reductions (%)e                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | .21*     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 1.27*    
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 37**     
|aFor the period from February 2, 2009 (commencement of operations of Class A shares) to June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dTotal return would have been lower if the Advisor had not reduced some Underlying Portfolios' expenses.eThe Portfolio invests in other Funds and indirectly bears its proportionate share of fees and expenses incurred by the Underlying Funds in
which the Portfolio is invested. This ratio does not include these indirect fees and expenses.*Annualized**Not annualized

|Class B
Year Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 2009a    
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | $   10.87
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | .01      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | .27      
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | .28      
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | $   11.15
|Total Return (%)c,d                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 2.58**   
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Net assets, end of period ($ thousands)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 1        
|Ratio of expenses before expense reductions (%)e                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 87.96*   
|Ratio of expenses after expense reductions (%)e                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | .61*     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 1.26*    
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 37**     
|aFor the period from May 18, 2009 (commencement of operations of Class B shares) to June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dTotal return would have been lower if the Advisor had not reduced some Underlying Portfolios' expenses.eThe Portfolio invests in other Funds and indirectly bears its proportionate share of fees and expenses incurred by the Underlying Funds in
which the Portfolio is invested. This ratio does not include these indirect fees and expenses.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Balanced VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is 0.61% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

The Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. The Portfolio also
invests in individual bonds whose yields and market values fluctuate so that your investment may be worth more or less than its
original cost. Bond investments are subject to interest-rate risk such that when interest rates rise, the prices of the bonds, and thus
the value of the bond portfolio, can decline and the investor can lose principal value. The Portfolio invests in derivatives seeking to
hedge positions in certain securities and to generate income in order to enhance the Portfolio's returns. Derivatives can be more
volatile and less liquid than traditional fixed-income securities. In the current market environment, mortgage-backed securities are
experiencing increased volatility. Please read this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns for the 1-year, 3-year, 5-year and 10-year periods shown reflect a fee waiver and/or expense reimbursement. Without
this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Balanced VIP                                                    
|---------------------------------------------------------------------------------------------------------------
|[] DWS Balanced VIP  Class A
[]Russell 1000® Index
[]Barclays Capital US Aggregate Bond Index
[]Blended  Index
|vs2_g10k1100                                                                                                   
|Yearly periods ended June 30                                                                                   

|Comparative Results                     
|----------------------------------------
|DWS Balanced VIP                        
|Class A                                 
|Average annual total return             
|Russell 1000 Index                      
|Average annual total return             
|Barclays Capital
US Aggregate Bond Index
|Average annual total return             
|Blended Index                           
|Average annual total return             

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Balanced VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratio                  | Class A | 
|----------------------------------------- | ------- | 
|DWS Variable Series II  DWS Balanced VIP | .69%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Balanced VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 55%     | 59%     
|Government & Agency Obligations                                                          | 13%     | 6%      
|Mortgage-Backed Securities Pass-Throughs                                                 | 10%     | 9%      
|Corporate Bonds                                                                          | 9%      | 12%     
|Cash Equivalents                                                                         | 7%      | 5%      
|Exchange-Traded Funds                                                                    | 5%      |        
|Commercial Mortgage-Backed Securities                                                    | 1%      | 2%      
|Collateralized Mortgage Obligations                                                      |        | 6%      
|Asset Backed                                                                             |        | 1%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(Excludes Cash Equivalents and Securities Lending) | 6/30/09 | 12/31/08
|------------------------------------------------------------------------ | ------- | --------
|                                                                         |         |         
|Financials                                                               | 15%     | 18%     
|Information Technology                                                   | 14%     | 12%     
|Health Care                                                              | 13%     | 14%     
|Energy                                                                   | 12%     | 11%     
|Consumer Staples                                                         | 10%     | 11%     
|Industrials                                                              | 10%     | 10%     
|Consumer Discretionary                                                   | 9%      | 7%      
|Utilities                                                                | 6%      | 6%      
|Materials                                                                | 6%      | 5%      
|Telecommunication Services                                               | 5%      | 6%      
|                                                                         | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 9. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Balanced VIP

|                                                                       | Shares      | Value ($)
|---------------------------------------------------------------------- | ----------- | ---------
|                                                                       |            
|Common Stocks 55.2%                                                   
|Consumer Discretionary 4.7%                                           
|Auto Components 0.2%                                                  
|Bridgestone Corp.                                                      | 300         | 4,686    
|Compagnie Generale des Etablissements Michelin "B"                     | 105         | 6,001    
|Cooper Tire & Rubber Co.                                               | 9,200       | 91,264   
|Denso Corp.                                                            | 200         | 5,098    
|Magna International, Inc. "A"                                          | 300         | 12,729   
|Minth Group Ltd.                                                       | 153,700     | 127,563  
|Spartan Motors, Inc.                                                   | 1,800       | 20,394   
|Tianneng Power International Ltd.                                      | 192,000     | 58,571   
|Xinyi Glass Holdings Co., Ltd.                                         | 186,000     | 160,019  
|                                                                       | 486,325    
|Automobiles 0.2%                                                      
|Bayerische Motoren Werke (BMW) AG                                      | 257         | 9,706    
|Daimler AG (Registered)                                                | 6,752       | 244,300  
|Fiat SpA*                                                              | 2,518       | 25,544   
|Honda Motor Co., Ltd.                                                  | 700         | 19,167   
|Mitsubishi Motors Corp.*                                               | 2,000       | 3,734    
|Nissan Motor Co., Ltd.                                                 | 900         | 5,434    
|PSA Peugeot Citroen*                                                   | 112         | 2,954    
|Renault SA*                                                            | 129         | 4,762    
|Suzuki Motor Corp.                                                     | 200         | 4,472    
|Toyota Motor Corp.                                                     | 7,100       | 268,411  
|Volkswagen AG                                                          | 59          | 19,973   
|                                                                       | 608,457    
|Distributors 0.2%                                                     
|Genuine Parts Co.                                                      | 14,378      | 482,526  
|Jardine Cycle & Carriage Ltd.                                          | 1,000       | 13,236   
|Li & Fung Ltd.                                                         | 10,000      | 26,538   
|                                                                       | 522,300    
|Diversified Consumer Services 0.1%                                    
|Apollo Group, Inc. "A"*                                                | 2,400       | 170,688  
|Brink's Home Security Holdings, Inc.*                                  | 1,100       | 31,141   
|Capella Education Co.*                                                 | 1,400       | 83,930   
|Lincoln Educational Services Corp.*                                    | 5,300       | 110,929  
|Steiner Leisure Ltd.*                                                  | 1,000       | 30,530   
|                                                                       | 427,218    
|Hotels Restaurants & Leisure 1.2%                                     
|Accor SA                                                               | 151         | 6,005    
|Ambassadors Group, Inc.                                                | 700         | 9,639    
|Ameristar Casinos, Inc.                                                | 2,500       | 47,575   
|Buffets Restaurants Holdings, Inc.*                                    | 3,332       | 3,998    
|Burger King Holdings, Inc.                                             | 11,453      | 197,793  
|Carnival Corp. (Units)                                                 | 22,749      | 586,242  
|Carnival PLC                                                           | 148         | 3,927    
|Carrols Restaurant Group, Inc.*                                        | 700         | 4,662    
|Compass Group PLC                                                      | 1,151       | 6,486    
|Cracker Barrel Old Country Store, Inc.                                 | 1,900       | 53,010   
|Crown Ltd.                                                             | 2,440       | 14,219   
|Darden Restaurants, Inc.                                               | 8,500       | 280,330  
|Genting Singapore PLC*                                                 | 34,000      | 15,962   
|Isle of Capri Casinos, Inc.*                                           | 1,200       | 15,984   
|Lottomatica SpA                                                        | 275         | 5,309    
|Marriott International, Inc. "A"                                       | 13,150      | 290,225  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|McDonald's Corp.                                                       | 20,900      | 1,201,541
|MGM MIRAGE*                                                            | 15,200      | 97,128   
|OPAP SA                                                                | 2,343       | 62,226   
|P.F. Chang's China Bistro, Inc.*                                       | 3,900       | 125,034  
|Paddy Power PLC                                                        | 4,737       | 110,539  
|PartyGaming PLC*                                                       | 13,118      | 52,974   
|REXLot Holdings Ltd.*                                                  | 1,675,000   | 131,726  
|Shangri-La Asia Ltd.                                                   | 6,000       | 8,894    
|Sodexo                                                                 | 85          | 4,372    
|TABCORP Holding Ltd.                                                   | 3,148       | 18,116   
|Tatts Group Ltd.                                                       | 5,842       | 11,983   
|Whitbread PLC                                                          | 229         | 3,082    
|Wyndham Worldwide Corp.                                                | 6,200       | 75,144   
|                                                                       | 3,444,125  
|Household Durables 0.2%                                               
|Advanced Digital Broadcast Holdings SA (Registered)*                   | 1,203       | 36,517   
|Electrolux AB "B"*                                                     | 800         | 11,214   
|Garmin Ltd.                                                            | 7,100       | 169,122  
|Husqvarna AB "B"*                                                      | 900         | 4,942    
|La-Z-Boy, Inc.                                                         | 4,300       | 20,296   
|Meritage Homes Corp.*                                                  | 6,800       | 128,248  
|NVR, Inc.*                                                             | 100         | 50,239   
|Panasonic Corp.                                                        | 1,000       | 13,413   
|Rational AG                                                            | 700         | 80,750   
|Ryland Group, Inc.                                                     | 2,400       | 40,224   
|Sharp Corp.                                                            | 1,000       | 10,318   
|Sony Corp.                                                             | 400         | 10,333   
|                                                                       | 575,616    
|Internet & Catalog Retail 0.1%                                        
|Amazon.com, Inc.*                                                      | 3,500       | 292,810  
|Leisure Equipment & Products 0.1%                                     
|Hasbro, Inc.                                                           | 8,400       | 203,616  
|RC2 Corp.*                                                             | 300         | 3,969    
|Smith & Wesson Holding Corp.*                                          | 18,200      | 103,376  
|Sturm, Ruger & Co., Inc.                                               | 4,700       | 58,468   
|                                                                       | 369,429    
|Media 0.9%                                                            
|Aegis Group PLC                                                        | 34,751      | 52,748   
|British Sky Broadcasting Group PLC                                     | 1,232       | 9,242    
|Carmike Cinemas, Inc.                                                  | 1,100       | 9,218    
|Cinemark Holdings, Inc.                                                | 2,400       | 27,168   
|Comcast Corp. "A"                                                      | 56,300      | 815,787  
|DISH Network Corp. "A"*                                                | 6,600       | 106,986  
|Fairfax Media Ltd.                                                     | 9,014       | 8,824    
|Gestevision Telecinco SA                                               | 345         | 3,236    
|JC Decaux SA*                                                          | 4,696       | 74,738   
|Lagardere SCA                                                          | 107         | 3,561    
|Marvel Entertainment, Inc.*                                            | 1,600       | 56,944   
|Mediacom Communications Corp. "A"*                                     | 21,100      | 107,821  
|Mediaset SpA                                                           | 3,394       | 19,086   
|Publicis Groupe                                                        | 132         | 4,030    
|Reed Elsevier NV                                                       | 11,801      | 130,145  
|Scripps Networks Interactive "A"                                       | 5,000       | 139,150  
|SES "A" (FDR)                                                          | 184         | 3,513    
|Shaw Communications, Inc. "B"                                          | 800         | 13,467   
|Singapore Press Holdings Ltd.                                          | 17,000      | 37,012   
|Television Broadcasts Ltd.                                             | 1,000       | 3,905    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Thomson Reuters Corp.                                                  | 1,200       | 34,922   
|Thomson Reuters PLC                                                    | 113         | 3,224    
|Time Warner Cable, Inc.                                                | 16,325      | 517,013  
|Time Warner, Inc.                                                      | 21,333      | 537,378  
|Vertis Holdings, Inc.*                                                 | 1,645       | 0        
|Vivendi                                                                | 461         | 11,043   
|Wolters Kluwer NV                                                      | 4,847       | 84,813   
|WPP PLC                                                                | 1,683       | 11,194   
|                                                                       | 2,826,168  
|Multiline Retail 0.2%                                                 
|Canadian Tire Corp., Ltd. "A"                                          | 100         | 4,729    
|Kohl's Corp.*                                                          | 9,880       | 422,370  
|Macy's, Inc.                                                           | 17,900      | 210,504  
|Marks & Spencer Group PLC                                              | 1,148       | 5,794    
|Next PLC                                                               | 169         | 4,095    
|PPR                                                                    | 57          | 4,664    
|                                                                       | 652,156    
|Specialty Retail 0.8%                                                 
|Advance Auto Parts, Inc.                                               | 2,900       | 120,321  
|Aeropostale, Inc.*                                                     | 3,200       | 109,664  
|American Eagle Outfitters, Inc.                                        | 5,700       | 80,769   
|Best Buy Co., Inc.                                                     | 3,300       | 110,517  
|Big 5 Sporting Goods Corp.                                             | 3,700       | 40,922   
|Cato Corp. "A"                                                         | 5,100       | 88,944   
|Dress Barn, Inc.*                                                      | 600         | 8,580    
|Esprit Holdings Ltd.                                                   | 5,000       | 27,968   
|Foot Locker, Inc.                                                      | 11,700      | 122,499  
|Gymboree Corp.*                                                        | 1,900       | 67,412   
|Hennes & Mauritz AB "B"                                                | 4,320       | 215,963  
|Hot Topic, Inc.*                                                       | 3,200       | 23,392   
|Industria de Diseno Textil SA                                          | 1,095       | 52,623   
|J. Crew Group, Inc.*                                                   | 1,000       | 27,020   
|Jos. A. Bank Clothiers, Inc.*                                          | 3,700       | 127,502  
|Kingfisher PLC                                                         | 1,961       | 5,749    
|Lowe's Companies, Inc.                                                 | 11,600      | 225,156  
|Nitori Co., Ltd.                                                       | 900         | 63,878   
|Office Depot, Inc.*                                                    | 29,600      | 134,976  
|Rent-A-Center, Inc.*                                                   | 6,900       | 123,027  
|Ross Stores, Inc.                                                      | 500         | 19,300   
|Stage Stores, Inc.                                                     | 1,100       | 12,210   
|The Buckle, Inc.                                                       | 4,000       | 127,080  
|TJX Companies, Inc.                                                    | 6,500       | 204,490  
|Tractor Supply Co.*                                                    | 3,400       | 140,488  
|Urban Outfitters, Inc.*                                                | 3,800       | 79,306   
|                                                                       | 2,359,756  
|Textiles, Apparel & Luxury Goods 0.5%                                 
|Adidas AG                                                              | 129         | 4,915    
|Carter's, Inc.*                                                        | 5,000       | 123,050  
|Coach, Inc.                                                            | 8,500       | 228,480  
|Compagnie Financiere Richemont SA "A"                                  | 8,979       | 187,084  
|Deckers Outdoor Corp.*                                                 | 900         | 63,243   
|Fuqi International, Inc.*                                              | 2,400       | 49,704   
|G-III Apparel Group Ltd.*                                              | 2,400       | 27,576   
|Gildan Activewear, Inc.*                                               | 300         | 4,444    
|Hermes International                                                   | 19          | 2,645    
|Jones Apparel Group, Inc.                                              | 1,200       | 12,876   
|Luxottica Group SpA*                                                   | 492         | 10,232   
|Maidenform Brands, Inc.*                                               | 700         | 8,029    
|NIKE, Inc. "B"                                                         | 13,400      | 693,852  
|Polo Ralph Lauren Corp.                                                | 500         | 26,770   
|Steven Madden Ltd.*                                                    | 4,300       | 109,435  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Swatch Group AG (Bearer)                                               | 83          | 13,347   
|Swatch Group AG (Registered)                                           | 219         | 7,181    
|Timberland Co. "A"*                                                    | 2,400       | 31,848   
|Yue Yuen Industrial (Holdings) Ltd.                                    | 3,000       | 6,722    
|                                                                       | 1,611,433  
|                                                                      
|Consumer Staples 5.5%                                                 
|Beverages 0.9%                                                        
|Anheuser-Busch InBev NV                                                | 1,362       | 49,308   
|Asahi Breweries Ltd.                                                   | 1,300       | 18,669   
|C&C Group PLC                                                          | 40,826      | 137,880  
|Carlsberg AS "B"                                                       | 4,796       | 308,277  
|Central European Distribution Corp.*                                   | 2,700       | 71,739   
|Coca-Cola Amatil Ltd.                                                  | 614         | 4,253    
|Coca-Cola Bottling Co. Consolidated                                    | 300         | 16,539   
|Coca-Cola Co.                                                          | 2,500       | 119,975  
|Coca-Cola Enterprises, Inc.                                            | 4,800       | 79,920   
|Coca-Cola Hellenic Bottling Co. SA                                     | 3,500       | 71,718   
|Coca-Cola West Co., Ltd.                                               | 400         | 7,645    
|Diageo PLC                                                             | 274         | 3,935    
|Foster's Group Ltd.                                                    | 2,760       | 11,439   
|Heineken Holding NV                                                    | 156         | 4,963    
|Heineken NV                                                            | 730         | 27,122   
|Kirin Holdings Co., Ltd.                                               | 3,000       | 41,881   
|National Beverage Corp.*                                               | 1,000       | 10,650   
|PepsiCo, Inc.                                                          | 28,734      | 1,579,221
|Pernod Ricard SA                                                       | 459         | 28,978   
|SABMiller PLC                                                          | 434         | 8,835    
|Sapporo Holdings Ltd.                                                  | 1,000       | 5,704    
|                                                                       | 2,608,651  
|Food & Staples Retailing 1.6%                                         
|AEON Co., Ltd.                                                         | 2,500       | 24,625   
|Carrefour SA                                                           | 1,655       | 70,796   
|Casino Guichard-Perrachon SA                                           | 82          | 5,539    
|Colruyt SA                                                             | 24          | 5,477    
|CVS Caremark Corp.                                                     | 24,249      | 772,816  
|Delhaize Group                                                         | 196         | 13,800   
|FamilyMart Co., Ltd.                                                   | 300         | 9,403    
|George Weston Ltd.                                                     | 200         | 10,031   
|J Sainsbury PLC                                                        | 405         | 2,091    
|Koninklijke Ahold NV                                                   | 4,134       | 47,504   
|Kroger Co.                                                             | 17,376      | 383,141  
|Lawson, Inc.                                                           | 300         | 13,183   
|Loblaw Companies Ltd.                                                  | 300         | 8,963    
|Metro AG                                                               | 1,278       | 61,092   
|Metro, Inc. "A"                                                        | 400         | 13,075   
|Seven & I Holdings Co., Ltd.                                           | 7,400       | 173,612  
|Shoppers Drug Mart Corp.                                               | 600         | 25,787   
|SUPERVALU, Inc.                                                        | 20,100      | 260,295  
|Sysco Corp.                                                            | 37,800      | 849,744  
|Tesco PLC                                                              | 2,772       | 16,157   
|The Andersons, Inc.                                                    | 4,200       | 125,748  
|UNY Co., Ltd.                                                          | 1,100       | 9,358    
|Wal-Mart Stores, Inc.                                                  | 31,500      | 1,525,860
|Walgreen Co.                                                           | 4,300       | 126,420  
|Weis Markets, Inc.                                                     | 500         | 16,760   
|Wesfarmers Ltd.                                                        | 1,325       | 24,120   
|Wesfarmers Ltd. (PPS)                                                  | 167         | 3,152    
|William Morrison Supermarkets PLC                                      | 498         | 1,940    
|Woolworths Ltd.                                                        | 1,283       | 27,129   
|                                                                       | 4,627,618  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Food Products 1.2%                                                    
|Ajinomoto Co., Inc.                                                    | 2,000       | 15,804   
|Archer-Daniels-Midland Co.                                             | 27,500      | 736,175  
|Aryzta AG*                                                             | 159         | 5,115    
|Bunge Ltd.                                                             | 7,900       | 475,975  
|Cadbury PLC                                                            | 1,029       | 8,790    
|DANONE SA                                                              | 1,348       | 66,664   
|Darling International, Inc.*                                           | 8,300       | 54,780   
|Diamond Foods, Inc.                                                    | 3,600       | 100,440  
|General Mills, Inc.                                                    | 6,523       | 365,419  
|Green Mountain Coffee Roasters, Inc.*                                  | 1,650       | 97,548   
|J & J Snack Foods Corp.                                                | 1,400       | 50,260   
|Kellogg Co.                                                            | 12,342      | 574,767  
|Kikkoman Corp.                                                         | 1,000       | 10,010   
|Kraft Foods, Inc. "A"                                                  | 9,600       | 243,264  
|Lancaster Colony Corp.                                                 | 300         | 13,221   
|MEIJI Holdings Co., Ltd.*                                              | 300         | 12,057   
|Nestle SA (Registered)                                                 | 12,937      | 488,257  
|Nippon Meat Packers, Inc.                                              | 1,000       | 12,612   
|Nisshin Seifun Group, Inc.                                             | 1,000       | 11,872   
|Nissin Foods Holdings Co., Ltd.                                        | 300         | 9,089    
|Saputo, Inc.                                                           | 600         | 12,519   
|Suedzucker AG                                                          | 739         | 15,031   
|SunOpta, Inc.*                                                         | 28,800      | 68,832   
|Unilever NV (CVA)                                                      | 5,429       | 131,022  
|Unilever PLC                                                           | 503         | 11,803   
|Viterra, Inc.*                                                         | 700         | 6,078    
|Yakult Honsha Co., Ltd.                                                | 200         | 3,810    
|                                                                       | 3,601,214  
|Household Products 0.9%                                               
|Central Garden & Pet Co. "A"*                                          | 400         | 3,940    
|Colgate-Palmolive Co.                                                  | 12,770      | 903,350  
|Energizer Holdings, Inc.*                                              | 6,900       | 360,456  
|Henkel AG & Co. KGaA                                                   | 1,371       | 36,969   
|Kao Corp.                                                              | 2,000       | 43,586   
|Kimberly-Clark Corp.                                                   | 13,000      | 681,590  
|Procter & Gamble Co.                                                   | 13,090      | 668,899  
|Reckitt Benckiser Group PLC                                            | 234         | 10,664   
|Unicharm Corp.                                                         | 100         | 7,634    
|                                                                       | 2,717,088  
|Personal Products 0.1%                                                
|Beiersdorf AG                                                          | 1,027       | 48,413   
|Chattem, Inc.*                                                         | 1,200       | 81,720   
|China Sky One Medical, Inc.*                                           | 7,100       | 95,708   
|L'Oreal SA                                                             | 594         | 44,472   
|Shiseido Co., Ltd.                                                     | 1,000       | 16,362   
|                                                                       | 286,675    
|Tobacco 0.8%                                                          
|Altria Group, Inc.                                                     | 50,412      | 826,253  
|British American Tobacco PLC                                           | 596         | 16,465   
|Imperial Tobacco Group PLC                                             | 458         | 11,912   
|Japan Tobacco, Inc.                                                    | 56          | 174,550  
|Lorillard, Inc.                                                        | 1,500       | 101,655  
|Philip Morris International, Inc.                                      | 30,208      | 1,317,673
|Reynolds American, Inc.                                                | 1,800       | 69,516   
|Swedish Match AB                                                       | 327         | 5,315    
|                                                                       | 2,523,339  
|Energy 6.4%                                                           
|Energy Equipment & Services 1.5%                                      
|AMEC PLC                                                               | 15,956      | 171,796  
|Cal Dive International, Inc.*                                          | 13,000      | 112,190  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Cameron International Corp.*                                           | 17,000      | 481,100  
|Dawson Geophysical Co.*                                                | 1,200       | 35,820   
|Dresser-Rand Group, Inc.*                                              | 5,500       | 143,550  
|ENSCO International, Inc.                                              | 10,744      | 374,643  
|Fugro NV (CVA)                                                         | 143         | 5,938    
|Geokinetics, Inc.*                                                     | 4,200       | 57,330   
|John Wood Group PLC                                                    | 14,875      | 65,575   
|Lamprell PLC                                                           | 28,582      | 54,044   
|Noble Corp.                                                            | 10,291      | 311,303  
|Parker Drilling Co.*                                                   | 25,900      | 112,406  
|Prosafe Production Public Ltd.*                                        | 18,000      | 33,976   
|Prosafe SE                                                             | 11,700      | 60,436   
|Rowan Companies, Inc.                                                  | 22,400      | 432,768  
|Saipem SpA                                                             | 7,731       | 188,717  
|SBM Offshore NV                                                        | 8,672       | 148,545  
|Schlumberger Ltd.                                                      | 5,760       | 311,674  
|Seadrill Ltd.                                                          | 800         | 11,495   
|Shinko Plantech Co., Ltd.                                              | 13,800      | 108,843  
|Technip SA                                                             | 75          | 3,687    
|Tecnicas Reunidas SA                                                   | 1,522       | 71,825   
|Tenaris SA                                                             | 434         | 5,867    
|Transocean Ltd.*                                                       | 16,092      | 1,195,475
|Union Drilling, Inc.*                                                  | 900         | 5,958    
|Willbros Group, Inc.*                                                  | 8,600       | 107,586  
|WorleyParsons Ltd.                                                     | 324         | 6,173    
|                                                                       | 4,618,720  
|Oil, Gas & Consumable Fuels 4.9%                                      
|Alpha Natural Resources, Inc.*                                         | 3,900       | 102,453  
|Anadarko Petroleum Corp.                                               | 9,600       | 435,744  
|Apache Corp.                                                           | 1,600       | 115,440  
|BG Group PLC                                                           | 13,541      | 227,515  
|BP PLC                                                                 | 3,445       | 27,261   
|Canadian Natural Resources Ltd.                                        | 200         | 10,521   
|Chevron Corp.                                                          | 14,747      | 976,989  
|ConocoPhillips                                                         | 34,762      | 1,462,090
|Cosmo Oil Co., Ltd.                                                    | 3,000       | 10,167   
|CVR Energy, Inc.*                                                      | 2,600       | 19,058   
|Delek US Holdings, Inc.                                                | 3,400       | 28,832   
|Devon Energy Corp.                                                     | 14,895      | 811,778  
|Enbridge, Inc.                                                         | 100         | 3,470    
|EnCana Corp.                                                           | 200         | 9,916    
|Encore Acquisition Co.*                                                | 6,100       | 188,185  
|Eni SpA                                                                | 2,390       | 56,698   
|EOG Resources, Inc.                                                    | 5,520       | 374,918  
|EXCO Resources, Inc.*                                                  | 12,600      | 162,792  
|ExxonMobil Corp.                                                       | 45,995      | 3,215,510
|Forest Oil Corp.*                                                      | 9,500       | 141,740  
|Gazprom (ADR)                                                          | 13,250      | 269,995  
|Hess Corp.                                                             | 3,800       | 204,250  
|Husky Energy, Inc.                                                     | 100         | 2,797    
|Idemitsu Kosan Co., Ltd.                                               | 100         | 8,550    
|Imperial Oil Ltd.                                                      | 300         | 11,637   
|INPEX Corp.                                                            | 2           | 15,931   
|Japan Petroleum Exploration Co., Ltd.                                  | 200         | 11,035   
|LUKOIL (ADR)*                                                          | 2,500       | 111,696  
|Marathon Oil Corp.                                                     | 29,882      | 900,345  
|Murphy Oil Corp.                                                       | 6,700       | 363,944  
|Nexen, Inc.                                                            | 16,813      | 364,016  
|Nippon Mining Holdings, Inc.                                           | 3,000       | 15,483   
|Nippon Oil Corp.                                                       | 4,000       | 23,544   
|Noble Energy, Inc.                                                     | 7,624       | 449,587  
|Occidental Petroleum Corp.                                             | 7,400       | 486,994  
|OMV AG                                                                 | 1,989       | 74,564   
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Origin Energy Ltd.                                                     | 1,587       | 18,674   
|Paladin Energy Ltd.*                                                   | 1,162       | 4,575    
|Petro-Canada                                                           | 200         | 7,724    
|PetroChina Co., Ltd. "H"                                               | 226,000     | 249,324  
|Repsol YPF SA                                                          | 3,776       | 84,675   
|Royal Dutch Shell PLC "A"                                              | 559         | 14,000   
|Royal Dutch Shell PLC "B"                                              | 376         | 9,493    
|Santos Ltd.                                                            | 1,486       | 17,457   
|Showa Shell Sekiyu KK                                                  | 1,100       | 11,595   
|Southwestern Energy Co.*                                               | 3,400       | 132,090  
|StatoilHydro ASA                                                       | 11,050      | 218,281  
|Suncor Energy, Inc.                                                    | 17,000      | 515,801  
|Sunoco, Inc.                                                           | 18,362      | 425,998  
|Talisman Energy, Inc.                                                  | 500         | 7,183    
|Tesoro Corp.                                                           | 6,500       | 82,745   
|TonenGeneral Sekiyu KK                                                 | 1,000       | 10,163   
|Total SA                                                               | 1,172       | 63,478   
|Ultra Petroleum Corp.*                                                 | 6,000       | 234,000  
|Valero Energy Corp.                                                    | 7,400       | 124,986  
|Venoco, Inc.*                                                          | 13,500      | 103,545  
|Williams Companies, Inc.                                               | 8,200       | 128,002  
|Woodside Petroleum Ltd.                                                | 5,370       | 186,079  
|XTO Energy, Inc.                                                       | 5,500       | 209,770  
|                                                                       | 14,555,083 
|Financials 7.2%                                                       
|Capital Markets 1.8%                                                  
|Affiliated Managers Group, Inc.*                                       | 1,100       | 64,009   
|Ashmore Group PLC                                                      | 35,378      | 110,161  
|Bank of New York Mellon Corp.                                          | 20,800      | 609,648  
|BGC Partners, Inc. "A"                                                 | 7,400       | 28,046   
|Calamos Asset Management, Inc. "A"                                     | 500         | 7,055    
|Charles Schwab Corp.                                                   | 10,900      | 191,186  
|Credit Suisse Group AG (Registered)                                    | 5,965       | 272,300  
|Daiwa Securities Group, Inc.                                           | 1,000       | 5,911    
|Duff & Phelps Corp. "A"                                                | 3,300       | 58,674   
|Franklin Resources, Inc.                                               | 5,300       | 381,653  
|Greenhill & Co., Inc.                                                  | 2,001       | 144,492  
|Jefferies Group, Inc.*                                                 | 4,400       | 93,852   
|Julius Baer Holding AG (Registered)                                    | 126         | 4,913    
|KBW, Inc.*                                                             | 4,600       | 132,296  
|Knight Capital Group, Inc. "A"*                                        | 1,300       | 22,165   
|Lazard Ltd. "A"                                                        | 5,300       | 142,676  
|Marfin Investment Group SA*                                            | 1,344       | 5,726    
|Mediobanca SpA                                                         | 278         | 3,341    
|Morgan Stanley                                                         | 6,400       | 182,464  
|Nomura Holdings, Inc.                                                  | 1,400       | 11,730   
|Northern Trust Corp.                                                   | 5,218       | 280,102  
|Partners Group Holding AG                                              | 1,000       | 97,174   
|Penson Worldwide, Inc.*                                                | 2,800       | 25,060   
|Prospect Capital Corp.                                                 | 575         | 5,290    
|State Street Corp.                                                     | 7,600       | 358,720  
|T. Rowe Price Group, Inc.                                              | 12,400      | 516,708  
|The Goldman Sachs Group, Inc.                                          | 8,600       | 1,267,984
|UBS AG (Registered)*                                                   | 20,113      | 246,077  
|Waddell & Reed Financial, Inc. "A"                                     | 4,500       | 118,665  
|                                                                       | 5,388,078  
|Commercial Banks 1.5%                                                 
|1st Source Corp.                                                       | 800         | 13,816   
|Alpha Bank AE*                                                         | 8,755       | 94,602   
|Anglo Irish Bank Corp., Ltd.                                           | 14,896      | 4,535    
|Australia & New Zealand Banking Group Ltd.                             | 535         | 7,073    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Banca Monte dei Paschi di Siena SpA                                    | 1,688       | 2,727    
|Banco Bilbao Vizcaya Argentaria SA                                     | 705         | 8,884    
|Banco de Sabadell SA                                                   | 598         | 3,739    
|Banco Latinoamericano de Exportaciones SA "E"                          | 5,700       | 70,851   
|Banco Popular Espanol SA                                               | 560         | 4,900    
|Banco Santander SA                                                     | 24,019      | 289,861  
|Bank of Cyprus PCL                                                     | 1,263       | 7,043    
|Bank of East Asia Ltd.                                                 | 580         | 1,760    
|Bank of Montreal                                                       | 200         | 8,429    
|Bank of Nova Scotia                                                    | 400         | 14,932   
|Barclays PLC                                                           | 1,486       | 6,921    
|BNP Paribas                                                            | 3,227       | 209,412  
|BOC Hong Kong (Holdings) Ltd.                                          | 2,000       | 3,540    
|Canadian Imperial Bank of Commerce                                     | 100         | 5,013    
|Cardinal Financial Corp.                                               | 3,800       | 29,754   
|China Construction Bank Corp. "H"                                      | 182,400     | 140,781  
|Chuo Mitsui Trust Holdings, Inc.                                       | 1,000       | 3,795    
|Commonwealth Bank of Australia                                         | 446         | 13,945   
|Credit Agricole SA                                                     | 488         | 6,112    
|Cullen/Frost Bankers, Inc.                                             | 2,944       | 135,777  
|Danske Bank AS*                                                        | 2,642       | 45,604   
|DBS Group Holdings Ltd.                                                | 2,000       | 16,231   
|Dexia SA*                                                              | 1,404       | 10,647   
|DnB NOR ASA*                                                           | 29,700      | 227,398  
|EFG Eurobank Ergasias*                                                 | 637         | 6,636    
|Erste Group Bank AG                                                    | 1,182       | 32,115   
|Hang Seng Bank Ltd.                                                    | 600         | 8,479    
|Home Bancshares, Inc.                                                  | 600         | 11,424   
|HSBC Holdings PLC                                                      | 38,815      | 322,227  
|Industrial & Commercial Bank of China Ltd. "H"                         | 359,000     | 249,776  
|Intesa Sanpaolo*                                                       | 4,603       | 14,924   
|KBC GROEP NV*                                                          | 454         | 8,282    
|Lloyds Banking Group PLC                                               | 3,147       | 3,622    
|M&T Bank Corp.                                                         | 3,179       | 161,906  
|Marshall & Ilsley Corp.                                                | 25,300      | 121,440  
|Mitsubishi UFJ Financial Group, Inc.                                   | 5,000       | 30,736   
|Mizuho Financial Group, Inc.                                           | 6,200       | 14,420   
|National Australia Bank Ltd.                                           | 522         | 9,398    
|National Bank of Canada                                                | 100         | 4,621    
|National Bank of Greece SA*                                            | 653         | 17,891   
|NBT Bancorp., Inc.                                                     | 2,300       | 49,933   
|Nordea Bank AB                                                         | 3,492       | 27,707   
|Oriental Financial Group, Inc.                                         | 11,300      | 109,610  
|Oversea-Chinese Banking Corp., Ltd.                                    | 1,000       | 4,599    
|Park National Corp.                                                    | 1,800       | 101,664  
|Peoples Bancorp., Inc.                                                 | 400         | 6,820    
|Piraeus Bank SA                                                        | 713         | 7,028    
|PNC Financial Services Group, Inc.                                     | 2,100       | 81,501   
|PrivateBancorp., Inc.                                                  | 3,200       | 71,168   
|Prosperity Bancshares, Inc.                                            | 4,700       | 140,201  
|Raiffeisen International Bank-Holding AG                               | 442         | 15,350   
|Regions Financial Corp.                                                | 22,500      | 90,900   
|Resona Holdings, Inc.                                                  | 300         | 4,205    
|Royal Bank of Canada                                                   | 400         | 16,359   
|Santander BanCorp.*                                                    | 3,500       | 24,360   
|Skandinaviska Enskilda Banken AB "A"*                                  | 1,639       | 7,204    
|Societe Generale                                                       | 175         | 9,548    
|Southside Bancshares, Inc.                                             | 4,825       | 110,348  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Standard Chartered PLC                                                 | 445         | 8,381    
|Sumitomo Mitsui Financial Group, Inc.                                  | 300         | 12,132   
|Sumitomo Trust & Banking Co., Ltd.                                     | 1,000       | 5,383    
|Svenska Handelsbanken AB "A"                                           | 554         | 10,468   
|The Bancorp., Inc.*                                                    | 1,500       | 9,000    
|The Bank of Yokohama Ltd.                                              | 1,000       | 5,326    
|Tompkins Financial Corp.                                               | 2,200       | 105,490  
|Toronto-Dominion Bank                                                  | 200         | 10,332   
|Trustmark Corp.                                                        | 6,000       | 115,920  
|UBI Banca-Unione di Banche Italiane ScpA                               | 348         | 4,543    
|UniCredit SpA*                                                         | 7,443       | 19,069   
|United Overseas Bank Ltd.                                              | 1,000       | 10,102   
|Wells Fargo & Co.                                                      | 22,200      | 538,572  
|Westamerica Bancorp.                                                   | 200         | 9,922    
|Westpac Banking Corp.                                                  | 1,076       | 17,429   
|Wing Hang Bank Ltd.                                                    | 18,000      | 158,704  
|Wintrust Financial Corp.                                               | 5,800       | 93,264   
|                                                                       | 4,418,521  
|Consumer Finance 0.1%                                                 
|Aeon Credit Service Co., Ltd.                                          | 5,000       | 65,096   
|American Express Co.                                                   | 1,200       | 27,888   
|Nelnet, Inc. "A"*                                                      | 10,400      | 141,336  
|ORIX Corp.                                                             | 50          | 2,949    
|                                                                       | 237,269    
|Diversified Financial Services 1.4%                                   
|Bank of America Corp.                                                  | 111,571     | 1,472,737
|Citigroup, Inc.                                                        | 38,400      | 114,048  
|Compagnie Nationale a Portefeuille                                     | 132         | 6,381    
|Deutsche Boerse AG                                                     | 127         | 9,871    
|Encore Capital Group, Inc.*                                            | 2,700       | 35,775   
|Financiere Marc de Lacharriere SA                                      | 1,851       | 101,398  
|Fortis*                                                                | 81,896      | 279,217  
|Groupe Bruxelles Lambert SA                                            | 86          | 6,298    
|Hellenic Exchanges SA                                                  | 6,200       | 69,143   
|Hong Kong Exchanges & Clearing Ltd.                                    | 700         | 10,869   
|ING Groep NV (CVA)                                                     | 22,289      | 224,341  
|IntercontinentalExchange, Inc.*                                        | 2,700       | 308,448  
|Investor AB "B"                                                        | 600         | 9,281    
|JPMorgan Chase & Co.                                                   | 35,653      | 1,216,124
|Medallion Financial Corp.                                              | 1,200       | 9,180    
|MSCI, Inc. "A"*                                                        | 2,604       | 63,642   
|NYSE Euronext                                                          | 8,212       | 223,777  
|PHH Corp.*                                                             | 7,600       | 138,168  
|Pohjola Bank PLC                                                       | 854         | 6,830    
|Singapore Exchange Ltd.                                                | 1,000       | 4,886    
|                                                                       | 4,310,414  
|Insurance 1.6%                                                        
|Aegon NV                                                               | 2,462       | 15,143   
|Alleanza Assicurazioni SpA                                             | 737         | 5,075    
|Allianz SE (Registered)                                                | 2,399       | 221,840  
|Allied World Assurance Co. Holdings Ltd.                               | 2,300       | 93,909   
|Allstate Corp.                                                         | 26,474      | 645,966  
|American Equity Investment Life Holding Co.                            | 14,500      | 80,910   
|AMP Ltd.                                                               | 965         | 3,781    
|Assicurazioni Generali SpA                                             | 354         | 7,388    
|Assurant, Inc.                                                         | 15,281      | 368,119  
|Assured Guaranty Ltd.                                                  | 11,000      | 136,180  
|Aviva PLC                                                              | 589         | 3,328    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|AXA SA                                                                 | 11,797      | 223,026  
|China Life Insurance Co., Ltd. "H"                                     | 64,300      | 239,083  
|Chubb Corp.                                                            | 3,449       | 137,546  
|Cincinnati Financial Corp.                                             | 6,110       | 136,559  
|Crawford & Co. "B"*                                                    | 500         | 2,400    
|Fidelity National Financial, Inc. "A"                                  | 11,162      | 151,022  
|First American Corp.                                                   | 5,270       | 136,546  
|Hallmark Financial Services, Inc.*                                     | 1,900       | 13,585   
|HCC Insurance Holdings, Inc.                                           | 5,646       | 135,560  
|Insurance Australia Group Ltd.                                         | 1,063       | 2,981    
|Loews Corp.                                                            | 15,900      | 435,660  
|Maiden Holdings Ltd.                                                   | 5,400       | 35,424   
|Manulife Financial Corp.                                               | 300         | 5,207    
|Meadowbrook Insurance Group, Inc.                                      | 5,200       | 33,956   
|MetLife, Inc.                                                          | 9,518       | 285,635  
|Mitsui Sumitomo Insurance Group Holdings, Inc.                         | 300         | 7,823    
|Muenchener Rueckversicherungs-Gesellschaft AG (Registered)             | 60          | 8,115    
|Odyssey Re Holdings Corp.                                              | 3,753       | 150,045  
|PartnerRe Ltd.                                                         | 2,123       | 137,889  
|Power Corp. of Canada                                                  | 200         | 4,615    
|Progressive Corp.*                                                     | 6,400       | 96,704   
|Prudential Financial, Inc.                                             | 13,100      | 487,582  
|Prudential PLC                                                         | 566         | 3,851    
|QBE Insurance Group Ltd.                                               | 387         | 6,175    
|Sampo Oyj "A"                                                          | 2,713       | 51,195   
|Sompo Japan Insurance, Inc.                                            | 1,000       | 6,639    
|Stewart Information Services Corp.                                     | 400         | 5,700    
|Sun Life Financial, Inc.                                               | 100         | 2,700    
|Swiss Re (Registered)                                                  | 190         | 6,286    
|T&D Holdings, Inc.                                                     | 100         | 2,851    
|Tokio Marine Holdings, Inc.                                            | 300         | 8,239    
|Topdanmark AS*                                                         | 86          | 10,051   
|Trygvesta AS                                                           | 112         | 6,608    
|Validus Holdings Ltd.                                                  | 3,800       | 83,524   
|Vienna Insurance Group                                                 | 320         | 13,908   
|Zurich Financial Services AG                                           | 62          | 10,975   
|                                                                       | 4,667,304  
|Real Estate Investment Trusts 0.5%                                    
|AMB Property Corp. (REIT)                                              | 1,200       | 22,572   
|Annaly Capital Management, Inc. (REIT)                                 | 11,900      | 180,166  
|Apartment Investment & Management Co. "A" (REIT)                       | 2,199       | 19,461   
|AvalonBay Communities, Inc. (REIT)                                     | 1,134       | 63,436   
|BioMed Realty Trust, Inc. (REIT)                                       | 4,800       | 49,104   
|Boston Properties, Inc. (REIT)                                         | 1,200       | 57,240   
|CapitaMall Trust (REIT)                                                | 3,000       | 2,888    
|Cogdell Spencer, Inc. (REIT)                                           | 3,300       | 14,157   
|Colonial Properties Trust (REIT)                                       | 4,600       | 34,040   
|Corio NV (REIT)                                                        | 72          | 3,510    
|Cousins Properties, Inc. (REIT)                                        | 3,078       | 26,163   
|Developers Diversified Realty Corp. (REIT)                             | 8,800       | 42,944   
|Digital Realty Trust, Inc. (REIT)                                      | 1,100       | 39,435   
|Entertainment Properties Trust (REIT)                                  | 2,000       | 41,200   
|Equity Residential (REIT)                                              | 2,400       | 53,352   
|First Industrial Realty Trust, Inc. (REIT)                             | 6,900       | 30,015   
|Glimcher Realty Trust (REIT)                                           | 3,000       | 8,700    
|HCP, Inc. (REIT)                                                       | 1,100       | 23,309   
|Healthcare Realty Trust, Inc. (REIT)                                   | 2,100       | 35,343   
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Home Properties, Inc. (REIT)                                           | 1,500       | 51,150   
|Hospitality Properties Trust (REIT)                                    | 1,900       | 22,591   
|Host Hotels & Resorts, Inc. (REIT)                                     | 3,600       | 30,204   
|iStar Financial, Inc. (REIT)                                           | 2,800       | 7,952    
|Kilroy Realty Corp. (REIT)                                             | 2,100       | 43,134   
|Kimco Realty Corp. (REIT)                                              | 3,200       | 32,160   
|LaSalle Hotel Properties (REIT)                                        | 3,000       | 37,020   
|Lexington Realty Trust (REIT)                                          | 5,298       | 18,013   
|Link (REIT)                                                            | 2,500       | 5,330    
|Mid-America Apartment Communities, Inc. (REIT)                         | 1,400       | 51,394   
|National Retail Properties, Inc. (REIT)                                | 2,000       | 34,700   
|Parkway Properties, Inc. (REIT)                                        | 2,200       | 28,600   
|Pennsylvania Real Estate Investment Trust (REIT)                       | 5,800       | 29,000   
|ProLogis (REIT)                                                        | 2,900       | 23,374   
|Rayonier, Inc. (REIT)                                                  | 400         | 14,540   
|Redwood Trust, Inc. (REIT)                                             | 3,500       | 51,660   
|Simon Property Group, Inc. (REIT)                                      | 1,668       | 85,785   
|Sovran Self Storage, Inc. (REIT)                                       | 1,300       | 31,980   
|Strategic Hotels & Resorts, Inc. (REIT)                                | 4,300       | 4,773    
|Sunstone Hotel Investors, Inc. (REIT)                                  | 4,535       | 24,262   
|Unibail-Rodamco SE (REIT)                                              | 59          | 8,811    
|Vornado Realty Trust (REIT)                                            | 2,656       | 119,600  
|Washington Real Estate Investment Trust (REIT)                         | 2,500       | 55,925   
|Wereldhave NV (REIT)                                                   | 48          | 3,577    
|Westfield Group (Units) (REIT)                                         | 891         | 8,116    
|                                                                       | 1,570,686  
|Real Estate Management & Development 0.2%                             
|AEON Mall Co., Ltd.                                                    | 5,000       | 94,610   
|Brookfield Asset Management, Inc. "A"                                  | 300         | 5,133    
|CapitaLand Ltd.                                                        | 3,000       | 7,619    
|Cheung Kong (Holdings) Ltd.                                            | 1,000       | 11,438   
|City Developments Ltd.                                                 | 1,000       | 5,903    
|Hang Lung Properties Ltd.                                              | 2,000       | 6,486    
|Henderson Land Development Co., Ltd.                                   | 1,000       | 5,682    
|IMMOEAST AG*                                                           | 25,882      | 65,196   
|Midland Holdings Ltd.                                                  | 146,000     | 87,869   
|Mitsubishi Estate Co., Ltd.                                            | 1,000       | 16,566   
|Mitsui Fudosan Co., Ltd.                                               | 1,000       | 17,325   
|Soho China                                                             | 210,000     | 127,881  
|Sumitomo Realty & Development Co., Ltd.                                | 5,000       | 90,951   
|Sun Hung Kai Properties Ltd.                                           | 1,000       | 12,486   
|Swire Pacific Ltd. "A"                                                 | 1,000       | 9,960    
|The St. Joe Co.*                                                       | 700         | 18,543   
|Wharf Holdings Ltd.                                                    | 1,000       | 4,234    
|                                                                       | 587,882    
|Thrifts & Mortgage Finance 0.1%                                       
|Astoria Financial Corp.                                                | 2,400       | 20,592   
|NASB Financial, Inc.                                                   | 200         | 5,720    
|New York Community Bancorp., Inc.                                      | 13,245      | 141,589  
|People's United Financial, Inc.                                        | 8,071       | 121,388  
|                                                                       | 289,289    
|                                                                      
|Health Care 7.9%                                                      
|Biotechnology 1.2%                                                    
|Actelion Ltd. (Registered)*                                            | 174         | 9,125    
|Amgen, Inc.*                                                           | 8,300       | 439,402  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|BioMarin Pharmaceutical, Inc.*                                         | 2,500       | 39,025   
|Celgene Corp.*                                                         | 12,200      | 583,648  
|CSL Ltd.                                                               | 2,359       | 60,971   
|Cubist Pharmaceuticals, Inc.*                                          | 5,100       | 93,483   
|Enzon Pharmaceuticals, Inc.*                                           | 14,400      | 113,328  
|Gilead Sciences, Inc.*                                                 | 30,180      | 1,413,631
|Grifols SA                                                             | 15,178      | 268,440  
|Intercell AG*                                                          | 7,536       | 258,318  
|Metabolix, Inc.*                                                       | 3,500       | 28,770   
|Myriad Genetics, Inc.*                                                 | 4,300       | 153,295  
|Myriad Pharmaceuticals, Inc.*                                          | 1,825       | 8,486    
|NPS Pharmaceuticals, Inc.*                                             | 6,300       | 29,358   
|PDL BioPharma, Inc.                                                    | 16,200      | 127,980  
|                                                                       | 3,627,260  
|Health Care Equipment & Supplies 0.9%                                 
|American Medical Systems Holdings, Inc.*                               | 8,300       | 131,140  
|Baxter International, Inc.                                             | 12,301      | 651,461  
|Becton, Dickinson & Co.                                                | 5,555       | 396,127  
|bioMerieux                                                             | 54          | 4,736    
|Cochlear Ltd.                                                          | 210         | 9,755    
|Coloplast AS "B"                                                       | 229         | 15,778   
|Edwards Lifesciences Corp.*                                            | 7,800       | 530,634  
|Elekta AB "B"                                                          | 2,000       | 29,388   
|Essilor International SA                                               | 667         | 31,841   
|ev3, Inc.*                                                             | 700         | 7,504    
|Nobel Biocare Holding AG (Registered)                                  | 1,409       | 30,888   
|NxStage Medical, Inc.*                                                 | 9,800       | 57,820   
|Olympus Corp.                                                          | 800         | 18,799   
|Smith & Nephew PLC                                                     | 1,343       | 9,957    
|Somanetics Corp.*                                                      | 6,300       | 104,013  
|Sonova Holding AG (Registered)                                         | 59          | 4,802    
|St. Jude Medical, Inc.*                                                | 11,200      | 460,320  
|Synthes, Inc.                                                          | 82          | 7,938    
|Terumo Corp.                                                           | 400         | 17,608   
|Thoratec Corp.*                                                        | 6,700       | 179,426  
|William Demant Holding AS*                                             | 249         | 12,888   
|                                                                       | 2,712,823  
|Health Care Providers & Services 2.3%                                 
|Aetna, Inc.                                                            | 28,700      | 718,935  
|Alfresa Holdings Corp.                                                 | 100         | 4,603    
|Amedisys, Inc.*                                                        | 3,400       | 112,268  
|AMERIGROUP Corp.*                                                      | 5,300       | 142,305  
|AmerisourceBergen Corp.                                                | 3,600       | 63,864   
|Celesio AG                                                             | 137         | 3,149    
|Centene Corp.*                                                         | 6,600       | 131,868  
|CorVel Corp.*                                                          | 1,500       | 34,155   
|Coventry Health Care, Inc.*                                            | 54,200      | 1,014,082
|Diagnosticos da America SA*                                            | 5,400       | 94,800   
|Emergency Medical Services Corp. "A"*                                  | 3,100       | 114,142  
|Express Scripts, Inc.*                                                 | 12,700      | 873,125  
|Fresenius Medical Care AG & Co. KGaA                                   | 15,380      | 686,386  
|Gentiva Health Services, Inc.*                                         | 5,300       | 87,238   
|Healthspring, Inc.*                                                    | 10,500      | 114,030  
|Laboratory Corp. of America Holdings*                                  | 4,800       | 325,392  
|LHC Group, Inc.*                                                       | 5,300       | 117,713  
|Magellan Health Services, Inc.*                                        | 4,100       | 134,562  
|McKesson Corp.                                                         | 9,745       | 428,780  
|Medco Health Solutions, Inc.*                                          | 21,701      | 989,782  
|Mediceo Paltac Holdings Co., Ltd.                                      | 400         | 4,577    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Owens & Minor, Inc.                                                    | 2,500       | 109,550  
|Providence Service Corp.*                                              | 1,900       | 20,805   
|RehabCare Group, Inc.*                                                 | 5,100       | 122,043  
|Sonic Healthcare Ltd.                                                  | 1,199       | 11,870   
|Suzuken Co., Ltd.                                                      | 200         | 5,783    
|Triple-S Management Corp. "B"*                                         | 1,300       | 20,267   
|UnitedHealth Group, Inc.                                               | 5,800       | 144,884  
|WellPoint, Inc.*                                                       | 6,207       | 315,874  
|                                                                       | 6,946,832  
|Health Care Technology 0.0%                                           
|So-net M3, Inc.                                                        | 18          | 56,851   
|Life Sciences Tools & Services 0.3%                                   
|Cambrex Corp.*                                                         | 3,100       | 12,772   
|ICON PLC (ADR)                                                         | 6,900       | 148,902  
|Life Technologies Corp.*                                               | 3,100       | 129,332  
|Lonza Group AG (Registered)                                            | 58          | 5,761    
|QIAGEN NV*                                                             | 9,000       | 167,049  
|Thermo Fisher Scientific, Inc.*                                        | 8,669       | 353,435  
|                                                                       | 817,251    
|Pharmaceuticals 3.2%                                                  
|Abbott Laboratories                                                    | 34,184      | 1,608,015
|Allergan, Inc.                                                         | 3,800       | 180,804  
|Astellas Pharma, Inc.                                                  | 1,200       | 42,389   
|AstraZeneca PLC                                                        | 2,602       | 114,585  
|Bayer AG                                                               | 4,165       | 223,644  
|Bristol-Myers Squibb Co.                                               | 6,439       | 130,776  
|Caraco Pharmaceutical Laboratories Ltd.*                               | 8,500       | 26,095   
|Chugai Pharmaceutical Co., Ltd.                                        | 600         | 11,432   
|Daiichi Sankyo Co., Ltd.                                               | 1,900       | 33,998   
|Dainippon Sumitomo Pharma Co., Ltd.                                    | 600         | 5,243    
|Eisai Co., Ltd.                                                        | 700         | 24,907   
|Eli Lilly & Co.                                                        | 33,200      | 1,150,048
|Flamel Technologies SA (ADR)*                                          | 14,800      | 103,600  
|GlaxoSmithKline PLC                                                    | 9,165       | 161,392  
|H. Lundbeck AS                                                         | 586         | 11,163   
|Hisamitsu Pharmaceutical Co., Inc.                                     | 200         | 6,213    
|Johnson & Johnson                                                      | 20,382      | 1,157,698
|Kyowa Hakko Kirin Co., Ltd.                                            | 1,000       | 11,278   
|Matrixx Initiatives, Inc.*                                             | 6,000       | 33,540   
|Merck & Co., Inc.                                                      | 32,689      | 913,984  
|Merck KGaA                                                             | 81          | 8,258    
|MiddleBrook Pharmaceuticals, Inc.*                                     | 40,900      | 55,215   
|Mitsubishi Tanabe Pharma Corp.                                         | 1,000       | 11,492   
|Mylan, Inc.*                                                           | 19,155      | 249,973  
|Novartis AG (Registered)                                               | 2,715       | 110,306  
|Noven Pharmaceuticals, Inc.*                                           | 8,400       | 120,120  
|Novo Nordisk AS "B"                                                    | 4,652       | 252,846  
|Ono Pharmaceutical Co., Ltd.                                           | 300         | 13,273   
|Par Pharmaceutical Companies, Inc.*                                    | 8,200       | 124,230  
|Pfizer, Inc.                                                           | 74,100      | 1,111,500
|Roche Holding AG (Genusschein)                                         | 998         | 135,777  
|Sanofi-Aventis                                                         | 3,738       | 219,836  
|Santen Pharmaceutical Co., Ltd.                                        | 300         | 9,124    
|Shionogi & Co., Ltd.                                                   | 1,000       | 19,318   
|Shire PLC                                                              | 975         | 13,447   
|Takeda Pharmaceutical Co., Ltd.                                        | 2,000       | 77,713   
|Teva Pharmaceutical Industries Ltd. (ADR)                              | 12,306      | 607,178  
|Tsumura & Co.                                                          | 200         | 6,232    
|Wyeth                                                                  | 11,595      | 526,297  
|                                                                       | 9,622,939  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Industrials 5.7%                                                      
|Aerospace & Defense 1.8%                                              
|American Science & Engineering, Inc.                                   | 1,800       | 124,416  
|BAE Systems PLC                                                        | 3,710       | 20,709   
|BE Aerospace, Inc.*                                                    | 5,400       | 77,544   
|Bombardier, Inc. "B"                                                   | 2,000       | 5,932    
|CAE, Inc.                                                              | 14,000      | 83,050   
|Cobham PLC                                                             | 1,159       | 3,306    
|Cubic Corp.                                                            | 3,400       | 121,686  
|DynCorp International, Inc. "A"*                                       | 6,300       | 105,777  
|European Aeronautic Defence & Space Co.                                | 222         | 3,598    
|Finmeccanica SpA                                                       | 1,335       | 18,838   
|General Dynamics Corp.                                                 | 9,600       | 531,744  
|Honeywell International, Inc.                                          | 15,480      | 486,072  
|Lockheed Martin Corp.                                                  | 11,500      | 927,475  
|Northrop Grumman Corp.                                                 | 9,400       | 429,392  
|Precision Castparts Corp.                                              | 1,800       | 131,454  
|Raytheon Co.                                                           | 13,600      | 604,248  
|Rockwell Collins, Inc.                                                 | 11,700      | 488,241  
|Rolls-Royce Group PLC*                                                 | 1,977       | 11,788   
|Singapore Technologies Engineering Ltd.                                | 5,000       | 8,440    
|Thales SA                                                              | 71          | 3,177    
|United Technologies Corp.                                              | 21,110      | 1,096,876
|                                                                       | 5,283,763  
|Air Freight & Logistics 0.1%                                          
|Deutsche Post AG (Registered)                                          | 495         | 6,470    
|FedEx Corp.                                                            | 2,900       | 161,298  
|TNT NV                                                                 | 588         | 11,453   
|Toll Holdings Ltd.                                                     | 1,903       | 9,441    
|United Parcel Service, Inc. "B"                                        | 2,400       | 119,976  
|                                                                       | 308,638    
|Airlines 0.1%                                                         
|Allegiant Travel Co.*                                                  | 2,000       | 79,280   
|Hawaiian Holdings, Inc.*                                               | 21,200      | 127,624  
|Qantas Airways Ltd.                                                    | 4,668       | 7,530    
|Ryanair Holdings PLC (ADR)*                                            | 3,700       | 105,043  
|Singapore Airlines Ltd.                                                | 1,000       | 9,162    
|                                                                       | 328,639    
|Building Products 0.1%                                                
|AAON, Inc.                                                             | 5,100       | 101,592  
|Apogee Enterprises, Inc.                                               | 3,700       | 45,510   
|Asahi Glass Co., Ltd.                                                  | 1,000       | 7,980    
|Assa Abloy AB "B"                                                      | 400         | 5,576    
|Compagnie de Saint-Gobain                                              | 4,909       | 164,139  
|Daikin Industries Ltd.                                                 | 100         | 3,197    
|Geberit AG (Registered)*                                               | 59          | 7,272    
|Wienerberger AG*                                                       | 5,095       | 63,342   
|                                                                       | 398,608    
|Commercial Services & Supplies 0.4%                                   
|Babcock International Group PLC                                        | 19,943      | 158,133  
|Brambles Ltd.                                                          | 3,381       | 16,175   
|Deluxe Corp.                                                           | 8,000       | 102,480  
|G4S PLC                                                                | 2,453       | 8,436    
|Healthcare Services Group, Inc.                                        | 2,600       | 46,488   
|R.R. Donnelley & Sons Co.                                              | 20,500      | 238,210  
|Ritchie Bros. Auctioneers, Inc.                                        | 200         | 4,694    
|Schawk, Inc.                                                           | 5,600       | 42,056   
|Secom Co., Ltd.                                                        | 100         | 4,056    
|Securitas AB "B"                                                       | 308         | 2,621    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Serco Group PLC                                                        | 18,512      | 128,614  
|Standard Register Co.                                                  | 5,100       | 16,626   
|Stericycle, Inc.*                                                      | 9,300       | 479,229  
|Tetra Tech, Inc.*                                                      | 1,200       | 34,380   
|                                                                       | 1,282,198  
|Construction & Engineering 0.5%                                       
|ACS, Actividades de Construccion y Servicios SA                        | 358         | 18,152   
|Aecom Technology Corp.*                                                | 6,900       | 220,800  
|Bouygues SA                                                            | 90          | 3,385    
|Chicago Bridge & Iron Co. NV (NY Registered Shares)                    | 5,400       | 66,960   
|Dycom Industries, Inc.*                                                | 10,200      | 112,914  
|EMCOR Group, Inc.*                                                     | 3,800       | 76,456   
|Fluor Corp.                                                            | 9,900       | 507,771  
|Fomento de Construcciones y Contratas SA                               | 89          | 3,656    
|Granite Construction, Inc.                                             | 3,100       | 103,168  
|Grupo Ferrovial SA                                                     | 161         | 5,181    
|Koninklijke Boskalis Westminster NV                                    | 117         | 2,653    
|Leighton Holdings Ltd.                                                 | 428         | 8,058    
|Skanska AB "B"                                                         | 600         | 6,710    
|SNC-Lavalin Group, Inc.                                                | 300         | 11,052   
|Tutor Perini Corp.*                                                    | 1,500       | 26,040   
|URS Corp.*                                                             | 5,200       | 257,504  
|Vinci SA                                                               | 266         | 11,938   
|                                                                       | 1,442,398  
|Electrical Equipment 0.6%                                             
|ABB Ltd. (Registered)*                                                 | 12,348      | 194,364  
|Alstom SA                                                              | 2,125       | 125,771  
|AMETEK, Inc.                                                           | 21,900      | 757,302  
|Emerson Electric Co.                                                   | 18,658      | 604,519  
|EnerSys*                                                               | 1,600       | 29,104   
|Gamesa Corp. Tecnologica SA                                            | 635         | 12,055   
|Mitsubishi Electric Corp.                                              | 1,000       | 6,292    
|Powell Industries, Inc.*                                               | 200         | 7,414    
|Prysmian SpA                                                           | 407         | 6,131    
|Renewable Energy Corp. AS*                                             | 1,400       | 10,947   
|Schneider Electric SA                                                  | 56          | 4,283    
|SGL Carbon SE*                                                         | 2,900       | 89,828   
|Sumitomo Electric Industries Ltd.                                      | 400         | 4,484    
|Vestas Wind Systems AS*                                                | 481         | 34,578   
|                                                                       | 1,887,072  
|Industrial Conglomerates 0.4%                                         
|3M Co.                                                                 | 3,000       | 180,300  
|Carlisle Companies, Inc.                                               | 5,500       | 132,220  
|CSR Ltd.                                                               | 3,192       | 4,347    
|General Electric Co.                                                   | 46,000      | 539,120  
|Hutchison Whampoa Ltd.                                                 | 6,000       | 39,004   
|Keppel Corp., Ltd.                                                     | 2,000       | 9,495    
|Koninklijke (Royal) Philips Electronics NV                             | 2,008       | 37,131   
|NWS Holdings Ltd.                                                      | 3,000       | 5,400    
|Orkla ASA                                                              | 4,100       | 29,868   
|SembCorp Industries Ltd.                                               | 3,000       | 6,237    
|Siemens AG (Registered)                                                | 485         | 33,577   
|Smiths Group PLC                                                       | 412         | 4,768    
|Tredegar Corp.                                                         | 3,400       | 45,288   
|                                                                       | 1,066,755  
|Machinery 0.7%                                                        
|Alfa Laval AB                                                          | 446         | 4,269    
|Ampco-Pittsburgh Corp.                                                 | 2,000       | 46,900   
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Austal Ltd.                                                            | 42,918      | 96,303   
|Chart Industries, Inc.*                                                | 2,700       | 49,086   
|Danaher Corp.                                                          | 700         | 43,218   
|Dover Corp.                                                            | 12,469      | 412,599  
|FANUC Ltd.                                                             | 100         | 7,979    
|Gardner Denver, Inc.*                                                  | 4,400       | 110,748  
|Invensys PLC                                                           | 823         | 3,034    
|Joy Global, Inc.                                                       | 6,600       | 235,752  
|Komatsu Ltd.                                                           | 14,900      | 228,674  
|Kone Oyj "B"                                                           | 1,076       | 33,046   
|Kubota Corp.                                                           | 1,000       | 8,213    
|MAN SE                                                                 | 98          | 6,027    
|Metso Corp.                                                            | 910         | 17,045   
|Mitsubishi Heavy Industries Ltd.                                       | 2,000       | 8,250    
|Mueller Water Products, Inc. "A"                                       | 5,800       | 21,692   
|Parker Hannifin Corp.                                                  | 7,000       | 300,720  
|Sandvik AB                                                             | 1,158       | 8,628    
|Scania AB "B"                                                          | 362         | 3,603    
|Schindler Holding AG                                                   | 84          | 5,220    
|SembCorp Marine Ltd.                                                   | 2,000       | 3,686    
|SKF AB "B"                                                             | 600         | 7,416    
|Timken Co.                                                             | 19,800      | 338,184  
|Vallourec SA                                                           | 33          | 4,012    
|Volvo AB "B"                                                           | 1,115       | 6,909    
|Wartsila Oyj                                                           | 538         | 17,379   
|Zardoya Otis SA                                                        | 412         | 8,611    
|                                                                       | 2,037,203  
|Marine 0.0%                                                           
|A P Moller-Maersk AS "A"                                               | 2           | 11,748   
|A P Moller-Maersk AS "B"                                               | 2           | 12,010   
|American Commercial Lines, Inc.*                                       | 2,325       | 35,991   
|International Shipholding Corp.                                        | 900         | 24,264   
|Kuehne & Nagel International AG (Registered)                           | 78          | 6,123    
|Mitsui O.S.K. Lines Ltd.                                               | 1,000       | 6,451    
|Nippon Yusen Kabushiki Kaisha                                          | 1,000       | 4,291    
|                                                                       | 100,878    
|Professional Services 0.2%                                            
|Adecco SA (Registered)                                                 | 181         | 7,559    
|Bureau Veritas SA                                                      | 1,171       | 57,762   
|Capita Group PLC                                                       | 467         | 5,506    
|COMSYS IT Partners, Inc.*                                              | 2,900       | 16,965   
|Experian PLC                                                           | 763         | 5,718    
|FTI Consulting, Inc.*                                                  | 3,000       | 152,160  
|Manpower, Inc.                                                         | 6,700       | 283,678  
|Michael Page International PLC                                         | 28,639      | 112,966  
|Randstad Holding NV*                                                   | 312         | 8,660    
|SGS SA (Registered)*                                                   | 7           | 8,692    
|                                                                       | 659,666    
|Road & Rail 0.5%                                                      
|Burlington Northern Santa Fe Corp.                                     | 2,400       | 176,496  
|Canadian National Railway Co.                                          | 700         | 30,073   
|Canadian Pacific Railway Ltd.                                          | 300         | 11,962   
|Central Japan Railway Co.                                              | 1           | 6,144    
|CSX Corp.                                                              | 3,500       | 121,205  
|Dollar Thrifty Automotive Group, Inc.*                                 | 11,700      | 163,215  
|DSV AS*                                                                | 754         | 9,365    
|East Japan Railway Co.                                                 | 200         | 12,043   
|Kintetsu Corp.                                                         | 1,000       | 4,406    
|Marten Transport Ltd.*                                                 | 5,200       | 107,952  
|MTR Corp., Ltd.                                                        | 4,500       | 13,572   
|Norfolk Southern Corp.                                                 | 17,592      | 662,691  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Ryder System, Inc.                                                     | 3,900       | 108,888  
|Tokyu Corp.                                                            | 1,000       | 5,037    
|Union Pacific Corp.                                                    | 3,800       | 197,828  
|West Japan Railway Co.                                                 | 1           | 3,304    
|                                                                       | 1,634,181  
|Trading Companies & Distributors 0.2%                                 
|Beacon Roofing Supply, Inc.*                                           | 8,700       | 125,802  
|Bunzl PLC                                                              | 366         | 3,032    
|Finning International, Inc.                                            | 200         | 2,889    
|Itochu Corp.                                                           | 1,000       | 6,907    
|Marubeni Corp.                                                         | 1,000       | 4,418    
|Mitsubishi Corp.                                                       | 10,800      | 198,344  
|Mitsui & Co., Ltd.                                                     | 15,000      | 176,707  
|Noble Group Ltd.                                                       | 2,000       | 2,504    
|Sumitomo Corp.                                                         | 500         | 5,056    
|WESCO International, Inc.*                                             | 800         | 20,032   
|Wolseley PLC*                                                          | 328         | 6,270    
|                                                                       | 551,961    
|Transportation Infrastructure 0.1%                                    
|Abertis Infraestructuras SA                                            | 534         | 10,058   
|Atlantia SpA                                                           | 938         | 18,983   
|Cintra Concesiones de Infraestructuras de Transporte SA                | 540         | 3,358    
|Koninlijke Vopak NV                                                    | 1,765       | 88,285   
|Macquarie Infrastructure Group (Units)                                 | 7,473       | 8,583    
|Transurban Group (Units)                                               | 2,803       | 9,335    
|                                                                       | 138,602    
|Information Technology 9.0%                                           
|Communications Equipment 1.9%                                         
|Alcatel-Lucent*                                                        | 4,531       | 11,417   
|Arris Group, Inc.*                                                     | 11,700      | 142,272  
|Brocade Communications Systems, Inc.*                                  | 40,065      | 313,308  
|Cisco Systems, Inc.*                                                   | 81,570      | 1,520,465
|EchoStar Corp. "A"*                                                    | 1,600       | 25,504   
|EMS Technologies, Inc.*                                                | 3,500       | 73,150   
|Harris Corp.                                                           | 1,000       | 28,360   
|Nokia Oyj                                                              | 12,113      | 176,773  
|Nokia Oyj (ADR)                                                        | 18,360      | 267,689  
|Plantronics, Inc.                                                      | 7,400       | 139,934  
|QUALCOMM, Inc.                                                         | 46,930      | 2,121,236
|Research In Motion Ltd.*                                               | 8,100       | 575,531  
|Riverbed Technology, Inc.*                                             | 5,800       | 134,502  
|Symmetricom, Inc.*                                                     | 4,500       | 25,965   
|Tekelec*                                                               | 4,700       | 79,101   
|Telefonaktiebolaget LM Ericsson "B"                                    | 18,664      | 182,558  
|                                                                       | 5,817,765  
|Computers & Peripherals 1.8%                                          
|Apple, Inc.*                                                           | 16,000      | 2,278,880
|Compal Electronics, Inc.                                               | 98,000      | 79,214   
|EMC Corp.*                                                             | 48,930      | 640,983  
|Fujitsu Ltd.                                                           | 1,000       | 5,419    
|Hewlett-Packard Co.                                                    | 10,300      | 398,095  
|International Business Machines Corp.                                  | 11,140      | 1,163,239
|NEC Corp.*                                                             | 1,000       | 3,904    
|Seagate Technology                                                     | 22,400      | 234,304  
|Synaptics, Inc.*                                                       | 3,500       | 135,275  
|Teradata Corp.*                                                        | 700         | 16,401   
|Toshiba Corp.                                                          | 2,000       | 7,199    
|Western Digital Corp.*                                                 | 9,700       | 257,050  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Wincor Nixdorf AG                                                      | 1,000       | 56,079   
|                                                                       | 5,276,042  
|Electronic Equipment, Instruments & Components 0.9%                   
|Arrow Electronics, Inc.*                                               | 26,400      | 560,736  
|Avnet, Inc.*                                                           | 35,900      | 754,977  
|Checkpoint Systems, Inc.*                                              | 800         | 12,552   
|Cogent, Inc.*                                                          | 17,200      | 184,556  
|Fujifilm Holdings Corp.                                                | 500         | 15,774   
|Hitachi Ltd.                                                           | 4,000       | 12,389   
|HOYA Corp.                                                             | 200         | 4,005    
|IBIDEN Co., Ltd.                                                       | 100         | 2,793    
|Ingram Micro, Inc. "A"*                                                | 3,700       | 64,750   
|Inspur International Ltd.                                              | 575,000     | 99,142   
|Itron, Inc.*                                                           | 2,900       | 159,703  
|Jabil Circuit, Inc.                                                    | 21,300      | 158,046  
|Kingboard Chemical Holdings Ltd.                                       | 48,500      | 121,056  
|Kyocera Corp.                                                          | 100         | 7,502    
|Mercury Computer Systems, Inc.*                                        | 2,445       | 22,616   
|Multi-Fineline Electronix, Inc.*                                       | 5,300       | 113,420  
|Murata Manufacturing Co., Ltd.                                         | 100         | 4,238    
|Nidec Corp.                                                            | 2,100       | 126,897  
|RadiSys Corp.*                                                         | 3,000       | 27,030   
|Rotork PLC                                                             | 4,070       | 55,511   
|SYNNEX Corp.*                                                          | 4,800       | 119,952  
|TDK Corp.                                                              | 100         | 4,674    
|Venture Corp., Ltd.                                                    | 25,000      | 119,983  
|                                                                       | 2,752,302  
|Internet Software & Services 0.5%                                     
|Access Co., Ltd.*                                                      | 13          | 32,221   
|Art Technology Group, Inc.*                                            | 10,000      | 38,000   
|EarthLink, Inc.*                                                       | 16,300      | 120,783  
|Google, Inc. "A"*                                                      | 1,815       | 765,186  
|Internet Initiative Japan, Inc.                                        | 43          | 66,933   
|LogMeIn, Inc.*                                                         | 600         | 9,600    
|Meetic*                                                                | 2,668       | 69,800   
|SAVVIS, Inc.*                                                          | 7,100       | 81,366   
|United Internet AG (Registered)*                                       | 12,000      | 140,957  
|ValueClick, Inc.*                                                      | 3,000       | 31,560   
|Web.com Group, Inc.*                                                   | 2,200       | 12,386   
|                                                                       | 1,368,792  
|IT Services 0.9%                                                      
|Accenture Ltd. "A"                                                     | 25,210      | 843,527  
|Acxiom Corp.                                                           | 10,500      | 92,715   
|Atos Origin SA*                                                        | 177         | 6,009    
|Automatic Data Processing, Inc.                                        | 8,500       | 301,240  
|Broadridge Financial Solutions, Inc.                                   | 1,400       | 23,212   
|Cap Gemini SA                                                          | 342         | 12,632   
|CGI Group, Inc. "A"*                                                   | 600         | 5,334    
|CIBER, Inc.*                                                           | 11,100      | 34,410   
|Computer Sciences Corp.*                                               | 3,900       | 172,770  
|Convergys Corp.*                                                       | 3,300       | 30,624   
|CSG Systems International, Inc.*                                       | 8,100       | 107,244  
|DST Systems, Inc.*                                                     | 800         | 29,560   
|Fidelity National Information Services, Inc.                           | 3,700       | 73,852   
|Global Cash Access Holdings, Inc.*                                     | 16,400      | 130,544  
|iGATE Corp.                                                            | 5,200       | 34,424   
|Indra Sistemas SA                                                      | 724         | 15,685   
|ManTech International Corp. "A"*                                       | 2,200       | 94,688   
|NeuStar, Inc. "A"*                                                     | 1,400       | 31,024   
|NTT Data Corp.                                                         | 1           | 3,225    
|SAIC, Inc.*                                                            | 23,900      | 443,345  
|Syntel, Inc.                                                           | 300         | 9,432    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|TNS, Inc.*                                                             | 5,800       | 108,750  
|Western Union Co.                                                      | 5,100       | 83,640   
|Wright Express Corp.*                                                  | 4,800       | 122,256  
|                                                                       | 2,810,142  
|Office Electronics 0.1%                                               
|Canon, Inc.                                                            | 6,700       | 218,065  
|Konica Minolta Holdings, Inc.                                          | 500         | 5,195    
|Neopost SA                                                             | 90          | 8,093    
|Ricoh Co., Ltd.                                                        | 1,000       | 12,810   
|                                                                       | 244,163    
|Semiconductors & Semiconductor Equipment 1.0%                         
|ARM Holdings PLC                                                       | 63,795      | 126,034  
|ASML Holding NV                                                        | 2,442       | 52,968   
|Broadcom Corp. "A"*                                                    | 27,340      | 677,759  
|Intel Corp.                                                            | 44,300      | 733,165  
|Lam Research Corp.*                                                    | 2,100       | 54,600   
|NVE Corp.*                                                             | 410         | 19,926   
|NVIDIA Corp.*                                                          | 18,400      | 207,736  
|ROHM Co., Ltd.                                                         | 100         | 7,263    
|Semtech Corp.*                                                         | 7,900       | 125,689  
|Siliconware Precision Industries Co.                                   | 83,000      | 95,550   
|Skyworks Solutions, Inc.*                                              | 14,400      | 140,832  
|STMicroelectronics NV                                                  | 1,889       | 14,171   
|Tessera Technologies, Inc.*                                            | 5,400       | 136,566  
|Texas Instruments, Inc.                                                | 18,000      | 383,400  
|Tokyo Electron Ltd.                                                    | 100         | 4,803    
|Volterra Semiconductor Corp.*                                          | 300         | 3,942    
|Zoran Corp.*                                                           | 11,100      | 120,990  
|                                                                       | 2,905,394  
|Software 1.9%                                                         
|Adobe Systems, Inc.*                                                   | 14,150      | 400,445  
|ANSYS, Inc.*                                                           | 1,200       | 37,392   
|Autonomy Corp. PLC*                                                    | 1,729       | 40,968   
|Dassault Systemes SA                                                   | 101         | 4,466    
|i2 Technologies, Inc.*                                                 | 9,300       | 116,715  
|Intuit, Inc.*                                                          | 12,400      | 349,184  
|Microsoft Corp.                                                        | 123,219     | 2,928,916
|Nintendo Co., Ltd.                                                     | 600         | 165,122  
|Norkom Group PLC*                                                      | 26,825      | 38,731   
|Oracle Corp.                                                           | 41,800      | 895,356  
|Renaissance Learning, Inc.                                             | 1,500       | 13,815   
|S1 Corp.*                                                              | 12,300      | 84,870   
|SAP AG                                                                 | 1,130       | 45,557   
|Software AG                                                            | 1,115       | 79,064   
|Square Enix Holdings Co., Ltd.                                         | 5,200       | 121,765  
|Symantec Corp.*                                                        | 6,000       | 93,360   
|The Sage Group PLC                                                     | 12,871      | 37,800   
|Tyler Technologies, Inc.*                                              | 6,800       | 106,216  
|VanceInfo Technologies, Inc. (ADR)*                                    | 6,100       | 90,097   
|Websense, Inc.*                                                        | 7,000       | 124,880  
|                                                                       | 5,774,719  
|Materials 3.3%                                                        
|Chemicals 1.7%                                                        
|Agrium, Inc.                                                           | 100         | 3,993    
|Air Liquide SA                                                         | 246         | 22,526   
|Air Products & Chemicals, Inc.                                         | 9,819       | 634,209  
|Airgas, Inc.                                                           | 2,000       | 81,060   
|Akzo Nobel NV                                                          | 800         | 35,204   
|Asahi Kasei Corp.                                                      | 1,000       | 5,067    
|Ashland, Inc.                                                          | 17,200      | 482,460  
|BASF SE                                                                | 4,552       | 181,563  
|C. Uyemura & Co., Ltd.                                                 | 1,100       | 35,528   
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Celanese Corp. "A"                                                     | 9,600       | 228,000  
|Dow Chemical Co.                                                       | 13,500      | 217,890  
|Eastman Chemical Co.                                                   | 1,500       | 56,850   
|Ecolab, Inc.                                                           | 13,350      | 520,517  
|GenTek, Inc.*                                                          | 200         | 4,466    
|Givaudan SA (Registered)*                                              | 8           | 4,901    
|Innophos Holdings, Inc.                                                | 5,500       | 92,895   
|JSR Corp.                                                              | 200         | 3,408    
|K+S AG                                                                 | 104         | 5,859    
|Koninklijke DSM NV                                                     | 486         | 15,227   
|Koppers Holdings, Inc.                                                 | 1,600       | 42,192   
|Kuraray Co., Ltd.                                                      | 500         | 5,542    
|Linde AG                                                               | 1,970       | 161,963  
|Lumena Resources Corp.*                                                | 162,000     | 48,077   
|Mitsubishi Chemical Holdings Corp.                                     | 1,000       | 4,219    
|Mitsubishi Gas Chemical Co., Inc.                                      | 1,000       | 5,438    
|Mitsui Chemicals, Inc.                                                 | 1,000       | 3,185    
|Monsanto Co.                                                           | 10,800      | 802,872  
|NewMarket Corp.                                                        | 1,700       | 114,461  
|Nitto Denko Corp.                                                      | 200         | 6,060    
|Omnova Solutions, Inc.*                                                | 1,300       | 4,238    
|Potash Corp. of Saskatchewan, Inc.                                     | 101         | 9,401    
|Praxair, Inc.                                                          | 7,396       | 525,634  
|Shin-Etsu Chemical Co., Ltd.                                           | 400         | 18,474   
|Showa Denko KK                                                         | 2,000       | 3,569    
|Solvay SA                                                              | 487         | 41,089   
|Spartech Corp.                                                         | 5,500       | 50,545   
|Stepan Co.                                                             | 1,800       | 79,488   
|Sumitomo Chemical Co., Ltd.                                            | 2,000       | 8,965    
|Syngenta AG (Registered)                                               | 156         | 36,225   
|The Mosaic Co.                                                         | 10,300      | 456,290  
|Toray Industries, Inc.                                                 | 2,000       | 10,156   
|Umicore                                                                | 1,053       | 23,984   
|Yara International ASA                                                 | 1,560       | 43,687   
|                                                                       | 5,137,377  
|Construction Materials 0.1%                                           
|CRH PLC                                                                | 12,847      | 294,385  
|Holcim Ltd. (Registered)                                               | 340         | 19,367   
|Imerys SA*                                                             | 73          | 3,068    
|Lafarge SA*                                                            | 210         | 14,258   
|Martin Marietta Materials, Inc.                                        | 600         | 47,328   
|                                                                       | 378,406    
|Containers & Packaging 0.3%                                           
|AEP Industries, Inc.*                                                  | 800         | 21,112   
|Bway Holding Co.*                                                      | 4,700       | 82,391   
|Owens-Illinois, Inc.*                                                  | 8,800       | 246,488  
|Rock-Tenn Co. "A"                                                      | 3,600       | 137,376  
|Sonoco Products Co.                                                    | 16,859      | 403,773  
|Toyo Seikan Kaisha Ltd.                                                | 300         | 6,322    
|                                                                       | 897,462    
|Metals & Mining 0.9%                                                  
|Agnico-Eagle Mines Ltd.                                                | 100         | 5,268    
|Anglo American PLC                                                     | 683         | 19,930   
|ArcelorMittal                                                          | 8,967       | 294,491  
|Barrick Gold Corp.                                                     | 14,000      | 348,963  
|BHP Billiton Ltd.                                                      | 10,461      | 286,709  
|BHP Billiton PLC                                                       | 964         | 21,775   
|Cliffs Natural Resources, Inc.                                         | 28,800      | 704,736  
|Goldcorp, Inc.                                                         | 300         | 10,428   
|JFE Holdings, Inc.                                                     | 600         | 20,040   
|Kinross Gold Corp.                                                     | 17,035      | 309,216  
|Kobe Steel Ltd.                                                        | 3,000       | 5,544    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Mitsubishi Materials Corp.                                             | 3,000       | 9,323    
|Newcrest Mining Ltd.                                                   | 264         | 6,469    
|Nippon Steel Corp.                                                     | 6,000       | 22,883   
|Nisshin Steel Co., Ltd.                                                | 1,000       | 2,224    
|Norsk Hydro ASA*                                                       | 6,800       | 35,084   
|Outokumpu Oyj                                                          | 788         | 13,648   
|Rautaruukki Oyj                                                        | 565         | 11,299   
|Rio Tinto Ltd.                                                         | 114         | 4,771    
|Rio Tinto PLC                                                          | 422         | 14,691   
|SSAB AB "A"                                                            | 1,243       | 14,471   
|SSAB AB "B"                                                            | 629         | 6,772    
|Stillwater Mining Co.*                                                 | 3,200       | 18,272   
|Sumitomo Metal Industries Ltd.                                         | 5,000       | 13,205   
|Sumitomo Metal Mining Co., Ltd.                                        | 1,000       | 14,062   
|Teck Resources Ltd. "B"*                                               | 324         | 5,167    
|ThyssenKrupp AG                                                        | 248         | 6,179    
|voestalpine AG                                                         | 5,600       | 153,642  
|Xstrata PLC                                                            | 24,039      | 265,124  
|Yamana Gold, Inc.                                                      | 300         | 2,667    
|                                                                       | 2,647,053  
|Paper & Forest Products 0.3%                                          
|Clearwater Paper Corp.*                                                | 1,914       | 48,405   
|Glatfelter                                                             | 12,700      | 113,030  
|Holmen AB "B"                                                          | 286         | 6,248    
|International Paper Co.                                                | 35,400      | 535,602  
|OJI Paper Co., Ltd.                                                    | 1,000       | 4,292    
|Schweitzer-Mauduit International, Inc.                                 | 2,600       | 70,746   
|Stora Enso Oyj "R"*                                                    | 3,519       | 18,570   
|Svenska Cellulosa AB "B"                                               | 3,865       | 40,673   
|UPM-Kymmene Oyj                                                        | 3,114       | 27,140   
|                                                                       | 864,706    
|Telecommunication Services 2.5%                                       
|Diversified Telecommunication Services 1.9%                           
|AT&T, Inc.                                                             | 103,290     | 2,565,723
|Atlantic Tele-Network, Inc.                                            | 1,800       | 70,722   
|BCE, Inc.                                                              | 1,600       | 33,014   
|Belgacom SA                                                            | 3,359       | 107,384  
|BT Group PLC                                                           | 9,801       | 16,408   
|Cable & Wireless PLC                                                   | 3,199       | 7,021    
|Deutsche Telekom AG (ADR)                                              | 26,041      | 307,284  
|Deutsche Telekom AG (Registered)                                       | 26,407      | 312,092  
|France Telecom SA                                                      | 6,062       | 137,730  
|Iliad SA                                                               | 58          | 5,634    
|Koninklijke (Royal) KPN NV                                             | 11,130      | 153,325  
|Nippon Telegraph & Telephone Corp.                                     | 2,100       | 85,445   
|Portugal Telecom SGPS SA (Registered)                                  | 599         | 5,866    
|Singapore Telecommunications Ltd.                                      | 37,000      | 76,351   
|Swisscom AG (Registered)                                               | 498         | 152,961  
|Tele2 AB "B"                                                           | 1,008       | 10,211   
|Telecom Italia SpA                                                     | 75,041      | 103,932  
|Telecom Italia SpA (RSP)                                               | 44,063      | 43,325   
|Telefonica SA                                                          | 14,981      | 339,694  
|Telenor ASA*                                                           | 9,000       | 69,478   
|TeliaSonera AB                                                         | 6,311       | 33,197   
|Telstra Corp., Ltd.                                                    | 29,444      | 80,340   
|Telus Corp.                                                            | 100         | 2,652    
|Telus Corp. (Non-Voting Shares)                                        | 200         | 5,158    
|Verizon Communications, Inc.                                           | 27,792      | 854,048  
|                                                                       | 5,578,995  
|Wireless Telecommunication Services 0.6%                              
|American Tower Corp. "A"*                                              | 13,600      | 428,808  
|China Mobile Ltd.                                                      | 25,000      | 250,684  
|                                                                       | Shares      | Value ($)
|                                                                       |            
|KDDI Corp.                                                             | 12          | 63,621   
|Millicom International Cellular SA (SDR)*                              | 181         | 10,259   
|Mobistar SA                                                            | 682         | 42,097   
|NII Holdings, Inc.*                                                    | 1,500       | 28,605   
|NTT DoCoMo, Inc.                                                       | 65          | 94,935   
|Rogers Communications, Inc. "B"                                        | 1,000       | 25,706   
|Softbank Corp.                                                         | 3,200       | 62,144   
|United States Cellular Corp.*                                          | 3,900       | 149,955  
|USA Mobility, Inc.                                                     | 9,300       | 118,668  
|Vodafone Group PLC                                                     | 146,066     | 282,342  
|Vodafone Group PLC (ADR)                                               | 15,598      | 304,005  
|                                                                       | 1,861,829  
|Utilities 3.0%                                                        
|Electric Utilities 2.2%                                               
|Acciona SA                                                             | 55          | 6,761    
|Allegheny Energy, Inc.                                                 | 25,273      | 648,253  
|American Electric Power Co., Inc.                                      | 23,235      | 671,259  
|Cheung Kong Infrastructure Holdings Ltd.                               | 1,000       | 3,488    
|Chubu Electric Power Co., Inc.                                         | 1,500       | 34,674   
|Chugoku Electric Power Co., Inc.                                       | 700         | 14,613   
|CLP Holdings Ltd.                                                      | 5,000       | 33,200   
|Duke Energy Corp.                                                      | 29,739      | 433,892  
|E.ON AG                                                                | 6,878       | 244,130  
|Edison International                                                   | 12,300      | 386,958  
|EDP  Energias de Portugal SA                                          | 9,124       | 35,799   
|Electricite de France                                                  | 3,227       | 157,361  
|Enel SpA                                                               | 9,954       | 48,493   
|Entergy Corp.                                                          | 4,577       | 354,809  
|Exelon Corp.                                                           | 19,185      | 982,464  
|FirstEnergy Corp.                                                      | 10,765      | 417,144  
|Fortis, Inc.                                                           | 1,200       | 26,215   
|Fortum Oyj                                                             | 13,082      | 298,395  
|FPL Group, Inc.                                                        | 12,092      | 687,551  
|Hokkaido Electric Power Co., Inc.                                      | 600         | 11,235   
|Hokuriku Electric Power Co.                                            | 500         | 11,429   
|Hongkong Electric Holdings Ltd.                                        | 3,000       | 16,707   
|Iberdrola SA                                                           | 3,697       | 30,067   
|Kansai Electric Power Co., Inc.                                        | 1,800       | 39,723   
|Kyushu Electric Power Co., Inc.                                        | 800         | 17,218   
|MGE Energy, Inc.                                                       | 1,100       | 36,905   
|NV Energy, Inc.                                                        | 31,400      | 338,806  
|Red Electrica Corporacion SA                                           | 128         | 5,791    
|Scottish & Southern Energy PLC                                         | 1,114       | 20,915   
|Shikoku Electric Power Co., Inc.                                       | 500         | 14,926   
|Southern Co.                                                           | 11,019      | 343,352  
|SP Ausnet                                                              | 35,313      | 21,850   
|Terna-Rete Elettrica Nationale SpA                                     | 3,428       | 11,433   
|Tohoku Electric Power Co., Inc.                                        | 1,000       | 20,901   
|Tokyo Electric Power Co., Inc.                                         | 3,000       | 77,112   
|                                                                       | 6,503,829  
|Gas Utilities 0.1%                                                    
|Chesapeake Utilities Corp.                                             | 900         | 29,277   
|Enagas                                                                 | 311         | 6,122    
|Gas Natural SDG SA                                                     | 302         | 5,501    
|Hong Kong & China Gas Co., Ltd.                                        | 10,500      | 22,069   
|New Jersey Resources Corp.                                             | 3,800       | 140,752  
|Northwest Natural Gas Co.                                              | 1,000       | 44,320   
|ONEOK, Inc.                                                            | 4,000       | 117,960  
|Osaka Gas Co., Ltd.                                                    | 5,000       | 15,958   
|Snam Rete Gas SpA                                                      | 3,613       | 15,893   
|Toho Gas Co., Ltd.                                                     | 1,000       | 4,062    
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Tokyo Gas Co., Ltd.                                                    | 5,000       | 17,875   
|                                                                       | 419,789    
|Independent Power Producers & Energy Traders 0.2%                     
|Drax Group PLC                                                         | 680         | 4,922    
|EDP Renovaveis SA*                                                     | 829         | 8,504    
|Electric Power Development Co., Ltd.                                   | 400         | 11,335   
|Iberdrola Renovables SA*                                               | 1,405       | 6,430    
|International Power PLC                                                | 2,098       | 8,237    
|Mirant Corp.*                                                          | 10,100      | 158,974  
|NRG Energy, Inc.*                                                      | 11,000      | 285,560  
|TransAlta Corp.                                                        | 1,100       | 21,099   
|                                                                       | 505,061    
|Multi-Utilities 0.5%                                                  
|A2A SpA                                                                | 2,094       | 3,830    
|AGL Energy Ltd.                                                        | 13,204      | 142,392  
|Canadian Utilities Ltd. "A"                                            | 700         | 22,839   
|Centrica PLC                                                           | 5,814       | 21,365   
|CH Energy Group, Inc.                                                  | 1,600       | 74,720   
|Dominion Resources, Inc.                                               | 3,100       | 103,602  
|GDF Suez                                                               | 759         | 28,354   
|National Grid PLC                                                      | 2,563       | 23,116   
|NiSource, Inc.                                                         | 8,700       | 101,442  
|PG&E Corp.                                                             | 16,590      | 637,720  
|RWE AG                                                                 | 210         | 16,578   
|Sempra Energy                                                          | 3,100       | 153,853  
|Suez Environnement SA                                                  | 342         | 5,997    
|United Utilities Group PLC                                             | 779         | 6,380    
|Veolia Environnement                                                   | 237         | 7,002    
|                                                                       | 1,349,190  
|Water Utilities 0.0%                                                  
|California Water Service Group                                         | 2,900       | 106,836  
|Severn Trent PLC                                                       | 213         | 3,841    
|                                                                       | 110,677    
|Total Common Stocks (Cost $159,814,457)                                | 165,291,835
|                                                                      
|Preferred Stocks 0.0%                                                 
|Consumer Discretionary 0.0%                                           
|Porsche Automobil Holding SE                                           | 50          | 3,360    
|Volkswagen AG                                                          | 62          | 4,338    
|                                                                       |             | 7,698    
|Consumer Staples 0.0%                                                 
|Henkel AG & Co. KGaA                                                   | 1,933       | 60,396   
|Health Care 0.0%                                                      
|Fresenius SE                                                           | 134         | 7,241    
|Total Preferred Stocks (Cost $113,288)                                 | 75,335     
|                                                                      
|Convertible Preferred Stocks 0.0%                                     
|Consumer Discretionary                                                
|ION Media Networks, Inc., 144A, 12.0%* (Cost $8,344)                   | 60,000      | 0        
|                                                                      
|Rights 0.0%                                                           
|Consumer Staples 0.0%                                                 
|Casino Guichard-Perrachon SA, Expiration Date 7/10/2009*               | 82          | 316      
|                                                                       | Shares      | Value ($)
|                                                                       |            
|Financials 0.0%                                                       
|Fortis, Expiration Date 7/4/2014*                                      | 6,275       | 0        
|UBI Banca-Unione di Banche Italiane ScpA, Expiration Date 7/3/2009*    | 348         | 24       
|                                                                       | 24         
|Industrials 0.0%                                                      
|Renewable Energy Corp. AS, Expiration Date 7/13/2009*                  | 482         | 1,724    
|Total Rights (Cost $2,135)                                             | 2,064      
|                                                                      
|Warrants 0.0%                                                         
|Financials                                                            
|New ASAT (Finance) Ltd., Expiration Date 2/1/2011*                     | 24,700      | 1,387    
|UBI Banca  Unione di Banche Italiane ScpA, Expiration Date 6/30/2011* | 685         | 911      
|                                                                       | 2,298      
|Materials                                                             
|Ashland, Inc., Expiration Date 3/31/2029* (Cost $30,283)               | 170         | 0        
|Total Warrants (Cost $30,283)                                          | 2,298      
|                                                                      
|Exchange-Traded Funds 5.3%                                            
|iShares Barclays Aggregate Bond Fund                                   | 63,995      | 6,537,089
|iShares MSCI Japan Index Fund                                          | 46,074      | 434,478  
|Vanguard Emerging Markets                                              | 281,908     | 8,970,314
|Total Exchange-Traded Funds (Cost $12,743,118)                         | 15,941,881 
|                                                                      
|Closed-End-Investment Company 0.0%                                    
|Financials                                                            
|Apollo Investment Corp. (Cost $44,002)                                 | 8,800       | 52,799   

|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ----------
|                                                                                                              |                                                               
|Corporate Bonds 9.3%                                                                                         
|Consumer Discretionary 1.2%                                                                                  
|AMC Entertainment, Inc.:                                                                                     
|                                                                                                              | 8.0%, 3/1/2014                                                 | 35,000    
|                                                                                                              | 144A, 8.75%, 6/1/2019                                          | 35,000    
|American Achievement Corp., 144A, 8.25%, 4/1/2012                                                             | 15,000                                                         | 14,025    
|American Achievement Group Holding Corp., 16.75%, 10/1/2012 (PIK)                                             | 24,453                                                         | 6,602     
|Ameristar Casinos, Inc., 144A, 9.25%, 6/1/2014                                                                | 25,000                                                         | 25,500    
|Asbury Automotive Group, Inc.:                                                                               
|                                                                                                              | 7.625%, 3/15/2017                                              | 35,000    
|                                                                                                              | 8.0%, 3/15/2014                                                | 15,000    
|British Sky Broadcasting Group PLC, 144A, 9.5%, 11/15/2018                                                    | 500,000                                                        | 597,606   
|CanWest MediaWorks LP, 144A, 9.25%, 8/1/2015**                                                                | 25,000                                                         | 2,500     
|Carrols Corp., 9.0%, 1/15/2013                                                                                | 15,000                                                         | 14,062    
|Cox Communications, Inc., 7.125%, 10/1/2012                                                                   | 300,000                                                        | 322,487   
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|CSC Holdings, Inc., 6.75%, 4/15/2012                                                                          | 25,000                                                         | 24,125    
|DirecTV Holdings LLC, 7.625%, 5/15/2016                                                                       | 70,000                                                         | 68,075    
|DISH DBS Corp.:                                                                                              
|                                                                                                              | 6.625%, 10/1/2014                                              | 40,000    
|                                                                                                              | 7.125%, 2/1/2016                                               | 35,000    
|Dollarama Group Holdings LP, 7.468%***, 8/15/2012 (b)                                                         | 24,000                                                         | 22,200    
|Expedia, Inc., 7.456%, 8/15/2018                                                                              | 20,000                                                         | 19,000    
|Fontainebleau Las Vegas Holdings LLC, 144A, 11.0%, 6/15/2015**                                                | 25,000                                                         | 938       
|Fortune Brands, Inc.:                                                                                        
|                                                                                                              | 5.375%, 1/15/2016                                              | 170,000   
|                                                                                                              | 6.375%, 6/15/2014                                              | 130,000   
|Goodyear Tire & Rubber Co., 10.5%, 5/15/2016                                                                  | 10,000                                                         | 10,100    
|Great Canadian Gaming Corp., 144A, 7.25%, 2/15/2015                                                           | 30,000                                                         | 26,400    
|Group 1 Automotive, Inc., 8.25%, 8/15/2013                                                                    | 15,000                                                         | 12,675    
|Hertz Corp., 8.875%, 1/1/2014                                                                                 | 55,000                                                         | 50,600    
|Idearc, Inc., 8.0%, 11/15/2016**                                                                              | 55,000                                                         | 1,444     
|Indianapolis Downs LLC, 144A, 11.0%, 11/1/2012                                                                | 20,000                                                         | 15,500    
|Isle of Capri Casinos, Inc., 7.0%, 3/1/2014                                                                   | 17,000                                                         | 13,685    
|Kabel Deutschland GmbH, 10.625%, 7/1/2014                                                                     | 75,000                                                         | 77,344    
|Lamar Media Corp., Series C, 6.625%, 8/15/2015                                                                | 20,000                                                         | 16,900    
|MTR Gaming Group, Inc., Series B, 9.75%, 4/1/2010                                                             | 40,000                                                         | 38,300    
|Norcraft Holdings LP, 9.75%, 9/1/2012                                                                         | 80,000                                                         | 74,800    
|Penske Automotive Group, Inc., 7.75%, 12/15/2016                                                              | 50,000                                                         | 40,375    
|Pinnacle Entertainment, Inc., 8.75%, 10/1/2013                                                                | 20,000                                                         | 20,100    
|Quebecor Media, Inc., 7.75%, 3/15/2016                                                                        | 20,000                                                         | 18,125    
|Quebecor World, Inc., 144A, 9.75%, 1/15/2015**                                                                | 25,000                                                         | 2,250     
|Reader's Digest Association, Inc., 9.0%, 2/15/2017                                                            | 25,000                                                         | 1,125     
|Sabre Holdings Corp., 8.35%, 3/15/2016                                                                        | 25,000                                                         | 16,500    
|Seminole Hard Rock Entertainment, Inc., 144A, 3.129%***, 3/15/2014                                            | 30,000                                                         | 20,700    
|Shingle Springs Tribal Gaming Authority, 144A, 9.375%, 6/15/2015                                              | 25,000                                                         | 15,000    
|Simmons Co., Step-up Coupon, 0% to 12/15/2009, 10.0% to 12/15/2014                                            | 105,000                                                        | 14,700    
|Sonic Automotive, Inc., Series B, 8.625%, 8/15/2013                                                           | 30,000                                                         | 21,000    
|Starwood Hotels & Resorts Worldwide, Inc., 7.875%, 10/15/2014                                                 | 20,000                                                         | 18,800    
|TCI Communications, Inc., 8.75%, 8/1/2015                                                                     | 135,000                                                        | 153,864   
|Time Warner Cable, Inc.:                                                                                     
|                                                                                                              | 6.75%, 6/15/2039                                               | 175,000   
|                                                                                                              | 8.25%, 2/14/2014                                               | 300,000   
|Time Warner, Inc., 5.875%, 11/15/2016                                                                         | 147,000                                                        | 144,870   
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Travelport LLC:                                                                                              
|                                                                                                              | 5.293%***, 9/1/2014                                            | 20,000    
|                                                                                                              | 9.875%, 9/1/2014                                               | 5,000     
|Trump Entertainment Resorts, Inc., 8.5%, 6/1/2015**                                                           | 5,000                                                          | 619       
|United Components, Inc., 9.375%, 6/15/2013                                                                    | 5,000                                                          | 3,175     
|Unity Media GmbH, 144A, 8.75%, 2/15/2015 EUR                                                                  | 50,000                                                         | 68,564    
|Vertis, Inc., 13.5%, 4/1/2014 (PIK)                                                                           | 35,028                                                         | 175       
|Viacom, Inc., 6.875%, 4/30/2036                                                                               | 300,000                                                        | 276,393   
|WMG Acquisition Corp., 144A, 9.5%, 6/15/2016                                                                  | 20,000                                                         | 19,900    
|Young Broadcasting, Inc., 8.75%, 1/15/2014**                                                                  | 130,000                                                        | 325       
|Yum! Brands, Inc., 6.875%, 11/15/2037                                                                         | 300,000                                                        | 302,400   
|                                                                                                              | 3,589,428                                                     
|Consumer Staples 1.0%                                                                                        
|Alliance One International, Inc., 8.5%, 5/15/2012                                                             | 15,000                                                         | 14,813    
|Altria Group, Inc., 9.25%, 8/6/2019                                                                           | 125,000                                                        | 140,364   
|Anheuser-Busch InBev Worldwide, Inc., 144A, 7.75%, 1/15/2019                                                  | 500,000                                                        | 546,828   
|ConAgra Foods, Inc., 7.0%, 4/15/2019                                                                          | 200,000                                                        | 219,256   
|CVS Caremark Corp., 6.25%, 6/1/2027                                                                           | 750,000                                                        | 761,279   
|Delhaize America, Inc., 8.05%, 4/15/2027                                                                      | 30,000                                                         | 30,826    
|Dr. Pepper Snapple Group, Inc., 6.12%, 5/1/2013                                                               | 200,000                                                        | 207,048   
|General Nutrition Centers, Inc., 6.404%***, 3/15/2014 (PIK)                                                   | 15,000                                                         | 12,000    
|Ingles Markets, Inc., 144A, 8.875%, 5/15/2017                                                                 | 10,000                                                         | 9,850     
|Kroger Co., 6.15%, 1/15/2020                                                                                  | 500,000                                                        | 510,866   
|North Atlantic Trading Co., 144A, 10.0%, 3/1/2012                                                             | 108,750                                                        | 43,500    
|Safeway, Inc., 7.45%, 9/15/2027                                                                               | 130,000                                                        | 137,187   
|SUPERVALU, Inc., 8.0%, 5/1/2016                                                                               | 30,000                                                         | 29,100    
|Viskase Companies, Inc., 11.5%, 6/15/2011                                                                     | 480,000                                                        | 350,400   
|                                                                                                              | 3,013,317                                                     
|Energy 1.3%                                                                                                  
|Atlas Energy Resources LLC, 144A, 10.75%, 2/1/2018                                                            | 55,000                                                         | 51,838    
|Belden & Blake Corp., 8.75%, 7/15/2012                                                                        | 130,000                                                        | 105,300   
|Bristow Group, Inc., 7.5%, 9/15/2017                                                                          | 30,000                                                         | 27,225    
|Chaparral Energy, Inc., 8.5%, 12/1/2015                                                                       | 40,000                                                         | 24,800    
|Chesapeake Energy Corp.:                                                                                     
|                                                                                                              | 6.25%, 1/15/2018                                               | 20,000    
|                                                                                                              | 6.875%, 1/15/2016                                              | 90,000    
|                                                                                                              | 7.5%, 6/15/2014                                                | 10,000    
|ConocoPhillips, 6.0%, 1/15/2020                                                                               | 200,000                                                        | 214,141   
|DCP Midstream LLC, 144A, 9.75%, 3/15/2019                                                                     | 400,000                                                        | 445,897   
|Devon Energy Corp., 5.625%, 1/15/2014                                                                         | 375,000                                                        | 395,072   
|El Paso Corp., 7.25%, 6/1/2018                                                                                | 20,000                                                         | 18,466    
|Enterprise Products Operating LLP, Series L, 6.3%, 9/15/2017                                                  | 190,000                                                        | 190,942   
|Forest Oil Corp., 7.25%, 6/15/2019                                                                            | 15,000                                                         | 13,425    
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Frontier Oil Corp., 6.625%, 10/1/2011                                                                         | 20,000                                                         | 19,500    
|Hess Corp., 8.125%, 2/15/2019                                                                                 | 200,000                                                        | 227,691   
|KCS Energy, Inc., 7.125%, 4/1/2012                                                                            | 105,000                                                        | 98,962    
|Kinder Morgan Energy Partners LP:                                                                            
|                                                                                                              | 5.625%, 2/15/2015                                              | 52,000    
|                                                                                                              | 7.3%, 8/15/2033                                                | 360,000   
|Linn Energy LLC, 144A, 11.75%, 5/15/2017                                                                      | 35,000                                                         | 34,038    
|Marathon Oil Corp., 7.5%, 2/15/2019                                                                           | 190,000                                                        | 207,376   
|Mariner Energy, Inc.:                                                                                        
|                                                                                                              | 7.5%, 4/15/2013                                                | 25,000    
|                                                                                                              | 8.0%, 5/15/2017                                                | 20,000    
|Newfield Exploration Co., 7.125%, 5/15/2018                                                                   | 40,000                                                         | 36,350    
|ONEOK Partners LP, 8.625%, 3/1/2019                                                                           | 440,000                                                        | 492,090   
|OPTI Canada, Inc.:                                                                                           
|                                                                                                              | 7.875%, 12/15/2014                                             | 35,000    
|                                                                                                              | 8.25%, 12/15/2014                                              | 70,000    
|Petrohawk Energy Corp., 7.875%, 6/1/2015                                                                      | 15,000                                                         | 13,875    
|Plains Exploration & Production Co., 7.0%, 3/15/2017                                                          | 15,000                                                         | 13,125    
|Quicksilver Resources, Inc., 7.125%, 4/1/2016                                                                 | 70,000                                                         | 54,600    
|Regency Energy Partners LP, 8.375%, 12/15/2013                                                                | 31,000                                                         | 29,915    
|Stone Energy Corp.:                                                                                          
|                                                                                                              | 6.75%, 12/15/2014                                              | 40,000    
|                                                                                                              | 8.25%, 12/15/2011                                              | 75,000    
|Talisman Energy, Inc., 7.75%, 6/1/2019                                                                        | 72,000                                                         | 79,761    
|Tesoro Corp., 6.5%, 6/1/2017                                                                                  | 25,000                                                         | 21,375    
|TransCanada PipeLines Ltd., 7.625%, 1/15/2039                                                                 | 140,000                                                        | 163,394   
|Whiting Petroleum Corp., 7.25%, 5/1/2012                                                                      | 50,000                                                         | 47,875    
|Williams Companies, Inc., 8.125%, 3/15/2012                                                                   | 85,000                                                         | 88,090    
|                                                                                                              | 3,813,894                                                     
|Financials 2.7%                                                                                              
|Algoma Acquisition Corp., 144A, 9.875%, 6/15/2015                                                             | 60,000                                                         | 33,600    
|American Express Co., 7.0%, 3/19/2018                                                                         | 390,000                                                        | 378,705   
|Ashton Woods USA LLC, 144A, 11.0%, 6/30/2015, Step-up Coupon, 0% to 6/30/2012, 11.0% to 6/30/2015             | 36,400                                                         | 13,279    
|Bank of America Corp., 7.625%, 6/1/2019                                                                       | 400,000                                                        | 401,784   
|Bank of America NA, 6.1%, 6/15/2017                                                                           | 250,000                                                        | 220,288   
|Bank of New York Mellon Corp., 4.3%, 5/15/2014                                                                | 170,000                                                        | 172,741   
|BB&T Corp., 5.2%, 12/23/2015                                                                                  | 200,000                                                        | 184,836   
|Buffalo Thunder Development Authority, 144A, 9.375%, 12/15/2014**                                             | 15,000                                                         | 2,100     
|Calpine Construction Finance Co., LP, 144A, 8.0%, 6/1/2016                                                    | 30,000                                                         | 28,725    
|Capital One Financial Corp., 7.375%, 5/23/2014                                                                | 150,000                                                        | 154,677   
|CIT Group, Inc.:                                                                                             
|                                                                                                              | 5.8%, 7/28/2011                                                | 40,000    
|                                                                                                              | Series A, 7.625%, 11/30/2012                                   | 40,000    
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Citigroup, Inc.:                                                                                             
|                                                                                                              | 5.0%, 9/15/2014                                                | 30,000    
|                                                                                                              | 6.125%, 5/15/2018                                              | 350,000   
|                                                                                                              | 6.5%, 8/19/2013                                                | 10,000    
|                                                                                                              | 8.5%, 5/22/2019                                                | 174,000   
|Conproca SA de CV, REG S, 12.0%, 6/16/2010                                                                    | 193,185                                                        | 199,463   
|Deutsche Telekom International Finance BV:                                                                   
|                                                                                                              | 4.875%, 7/8/2014                                               | 60,000    
|                                                                                                              | 6.0%, 7/8/2019                                                 | 380,000   
|Ford Motor Credit Co., LLC:                                                                                  
|                                                                                                              | 7.25%, 10/25/2011                                              | 155,000   
|                                                                                                              | 7.875%, 6/15/2010                                              | 55,000    
|                                                                                                              | 9.875%, 8/10/2011                                              | 90,000    
|General Electric Capital Corp., Series A, 5.25%, 10/19/2012                                                   | 550,000                                                        | 565,387   
|GMAC LLC:                                                                                                    
|                                                                                                              | 144A, 6.875%, 9/15/2011                                        | 132,000   
|                                                                                                              | 144A, 7.75%, 1/19/2010                                         | 180,000   
|Hexion US Finance Corp., 9.75%, 11/15/2014                                                                    | 20,000                                                         | 9,000     
|Inmarsat Finance II PLC, 10.375%, 11/15/2012                                                                  | 30,000                                                         | 31,050    
|iPayment, Inc., 9.75%, 5/15/2014                                                                              | 25,000                                                         | 13,500    
|Jefferson-Pilot Corp., 4.75%, 1/30/2014                                                                       | 40,000                                                         | 35,295    
|JPMorgan Chase & Co.:                                                                                        
|                                                                                                              | 4.65%, 6/1/2014                                                | 220,000   
|                                                                                                              | 6.3%, 4/23/2019                                                | 350,000   
|MetLife, Inc.:                                                                                               
|                                                                                                              | 6.75%, 6/1/2016                                                | 113,000   
|                                                                                                              | 7.717%, 2/15/2019                                              | 250,000   
|Morgan Stanley:                                                                                              
|                                                                                                              | Series F, 6.625%, 4/1/2018                                     | 225,000   
|                                                                                                              | 7.3%, 5/13/2019                                                | 130,000   
|New ASAT (Finance) Ltd., 9.25%, 2/1/2011**                                                                    | 95,000                                                         | 119       
|Orascom Telecom Finance SCA, 144A, 7.875%, 2/8/2014                                                           | 100,000                                                        | 84,500    
|PNC Bank NA, 6.875%, 4/1/2018                                                                                 | 300,000                                                        | 296,574   
|Principal Financial Group, Inc., 7.875%, 5/15/2014                                                            | 315,000                                                        | 331,850   
|Prudential Financial, Inc.:                                                                                  
|                                                                                                              | Series B, 5.1%, 9/20/2014                                      | 100,000   
|                                                                                                              | 7.375%, 6/15/2019                                              | 30,000    
|Qwest Capital Funding, Inc., 7.0%, 8/3/2009                                                                   | 25,000                                                         | 25,000    
|Rainbow National Services LLC, 144A, 10.375%, 9/1/2014                                                        | 4,000                                                          | 4,145     
|Simon Property Group LP, (REIT), 6.75%, 5/15/2014                                                             | 70,000                                                         | 70,336    
|Sprint Capital Corp.:                                                                                        
|                                                                                                              | 7.625%, 1/30/2011                                              | 20,000    
|                                                                                                              | 8.375%, 3/15/2012                                              | 80,000    
|Telecom Italia Capital SA:                                                                                    |                                                                |           
|                                                                                                              | 5.25%, 11/15/2013                                              | 200,000   
|                                                                                                              | 6.175%, 6/18/2014                                              | 80,000    
|                                                                                                              | 7.175%, 6/18/2019                                              | 70,000    
|Telefonica Emisiones SAU, 5.877%, 7/15/2019 (c)                                                               | 90,000                                                         | 92,789    
|The Goldman Sachs Group, Inc.:                                                                               
|                                                                                                              | 6.0%, 5/1/2014                                                 | 105,000   
|                                                                                                              | 6.15%, 4/1/2018                                                | 400,000   
|Tropicana Entertainment LLC, 9.625%, 12/15/2014**                                                             | 75,000                                                         | 656       
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|UCI Holdco, Inc., 8.629%***, 12/15/2013 (PIK)                                                                 | 36,641                                                         | 8,061     
|Universal City Development Partners Ltd., 11.75%, 4/1/2010                                                    | 125,000                                                        | 119,062   
|Verizon Wireless Capital LLC, 144A, 7.375%, 11/15/2013                                                        | 250,000                                                        | 279,627   
|Virgin Media Finance PLC, 8.75%, 4/15/2014                                                                    | 65,000                                                         | 63,375    
|Wachovia Corp., Series G, 5.5%, 5/1/2013                                                                      | 470,000                                                        | 485,512   
|Wind Acquisition Finance SA, 144A, 9.75%, 12/1/2015                                                           | 55,000                                                         | 74,842    
|                                                                                                              | 8,343,107                                                     
|Health Care 0.5%                                                                                             
|Boston Scientific Corp., 6.0%, 6/15/2011                                                                      | 25,000                                                         | 24,937    
|Community Health Systems, Inc., 8.875%, 7/15/2015                                                             | 120,000                                                        | 117,600   
|Express Scripts, Inc.:                                                                                       
|                                                                                                              | 6.25%, 6/15/2014                                               | 100,000   
|                                                                                                              | 7.25%, 6/15/2019                                               | 30,000    
|HCA, Inc.:                                                                                                   
|                                                                                                              | 144A, 8.5%, 4/15/2019                                          | 10,000    
|                                                                                                              | 9.125%, 11/15/2014                                             | 35,000    
|                                                                                                              | 9.25%, 11/15/2016                                              | 130,000   
|                                                                                                              | 9.625%, 11/15/2016 (PIK)                                       | 42,000    
|HEALTHSOUTH Corp., 10.75%, 6/15/2016                                                                          | 20,000                                                         | 20,100    
|IASIS Healthcare LLC, 8.75%, 6/15/2014                                                                        | 30,000                                                         | 29,400    
|McKesson Corp., 7.5%, 2/15/2019                                                                               | 125,000                                                        | 140,769   
|Medco Health Solutions, Inc., 7.125%, 3/15/2018                                                               | 300,000                                                        | 315,923   
|Merck & Co., Inc.:                                                                                           
|                                                                                                              | 5.0%, 6/30/2019                                                | 133,000   
|                                                                                                              | 5.85%, 6/30/2039                                               | 29,000    
|Quest Diagnostics, Inc., 6.95%, 7/1/2037                                                                      | 90,000                                                         | 90,442    
|Surgical Care Affiliates, Inc., 144A, 8.875%, 7/15/2015 (PIK)                                                 | 30,000                                                         | 23,100    
|The Cooper Companies, Inc., 7.125%, 2/15/2015                                                                 | 45,000                                                         | 41,962    
|Valeant Pharmaceuticals International, 144A, 8.375%, 6/15/2016                                                | 15,000                                                         | 14,888    
|Vanguard Health Holding Co. I, LLC, Step-up Coupon, 0% to 10/1/2009, 11.25% to 10/1/2015                      | 25,000                                                         | 24,375    
|Vanguard Health Holding Co. II, LLC, 9.0%, 10/1/2014                                                          | 75,000                                                         | 71,812    
|                                                                                                              | 1,432,738                                                     
|Industrials 0.4%                                                                                             
|Actuant Corp., 6.875%, 6/15/2017                                                                              | 20,000                                                         | 18,200    
|ARAMARK Corp., 8.5%, 2/1/2015                                                                                 | 10,000                                                         | 9,700     
|BE Aerospace, Inc., 8.5%, 7/1/2018                                                                            | 50,000                                                         | 47,125    
|Belden, Inc., 7.0%, 3/15/2017                                                                                 | 25,000                                                         | 22,125    
|Bombardier, Inc., 144A, 6.3%, 5/1/2014                                                                        | 100,000                                                        | 87,500    
|Browning-Ferris Industries, Inc., 7.4%, 9/15/2035                                                             | 10,000                                                         | 9,364     
|Cenveo Corp., 144A, 10.5%, 8/15/2016                                                                          | 10,000                                                         | 7,500     
|Congoleum Corp., 8.625%, 8/1/2008**                                                                           | 190,000                                                        | 57,000    
|Corrections Corp. of America, 7.75%, 6/1/2017                                                                 | 10,000                                                         | 9,850     
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Esco Corp., 144A, 8.625%, 12/15/2013                                                                          | 35,000                                                         | 30,275    
|Great Lakes Dredge & Dock Co., 7.75%, 12/15/2013                                                              | 20,000                                                         | 17,150    
|K. Hovnanian Enterprises, Inc., 8.875%, 4/1/2012                                                              | 25,000                                                         | 15,500    
|Kansas City Southern de Mexico SA de CV:                                                                     
|                                                                                                              | 7.375%, 6/1/2014                                               | 20,000    
|                                                                                                              | 7.625%, 12/1/2013                                              | 185,000   
|                                                                                                              | 9.375%, 5/1/2012                                               | 60,000    
|Mobile Mini, Inc., 9.75%, 8/1/2014                                                                            | 25,000                                                         | 23,937    
|Navios Maritime Holdings, Inc., 9.5%, 12/15/2014                                                              | 35,000                                                         | 28,700    
|Owens Corning, Inc., 9.0%, 6/15/2019                                                                          | 10,000                                                         | 9,700     
|R.H. Donnelley Corp., Series A-4, 8.875%, 10/15/2017**                                                        | 75,000                                                         | 3,844     
|RBS Global & Rexnord Corp., 9.5%, 8/1/2014                                                                    | 20,000                                                         | 17,100    
|Titan International, Inc., 8.0%, 1/15/2012                                                                    | 85,000                                                         | 76,925    
|TransDigm, Inc., 7.75%, 7/15/2014                                                                             | 15,000                                                         | 14,250    
|United Rentals North America, Inc.:                                                                          
|                                                                                                              | 6.5%, 2/15/2012                                                | 15,000    
|                                                                                                              | 7.0%, 2/15/2014                                                | 65,000    
|                                                                                                              | 144A, 10.875%, 6/15/2016                                       | 35,000    
|US Concrete, Inc., 8.375%, 4/1/2014                                                                           | 30,000                                                         | 19,650    
|Waste Management, Inc., 6.375%, 3/11/2015                                                                     | 320,000                                                        | 331,534   
|                                                                                                              | 1,191,116                                                     
|Information Technology 0.1%                                                                                  
|Alcatel-Lucent USA, Inc., 6.45%, 3/15/2029                                                                    | 30,000                                                         | 17,025    
|L-3 Communications Corp.:                                                                                    
|                                                                                                              | 5.875%, 1/15/2015                                              | 80,000    
|                                                                                                              | Series B, 6.375%, 10/15/2015                                   | 35,000    
|MasTec, Inc., 7.625%, 2/1/2017                                                                                | 35,000                                                         | 30,319    
|Oracle Corp.:                                                                                                
|                                                                                                              | 3.75%, 7/8/2014 (c)                                            | 85,000    
|                                                                                                              | 5.0%, 7/8/2019 (c)                                             | 140,000   
|SunGard Data Systems, Inc., 10.25%, 8/15/2015                                                                 | 70,000                                                         | 64,662    
|Vangent, Inc., 9.625%, 2/15/2015                                                                              | 15,000                                                         | 12,450    
|                                                                                                              | 451,626                                                       
|Materials 0.4%                                                                                               
|Appleton Papers, Inc., Series B, 8.125%, 6/15/2011                                                            | 15,000                                                         | 9,750     
|ARCO Chemical Co., 9.8%, 2/1/2020**                                                                           | 195,000                                                        | 61,425    
|Cascades, Inc., 7.25%, 2/15/2013                                                                              | 12,000                                                         | 10,470    
|CPG International I, Inc., 10.5%, 7/1/2013                                                                    | 50,000                                                         | 28,000    
|Crown Americas LLC, 144A, 7.625%, 5/15/2017                                                                   | 10,000                                                         | 9,650     
|Domtar Corp., 10.75%, 6/1/2017                                                                                | 20,000                                                         | 19,200    
|Dow Chemical Co., 8.55%, 5/15/2019                                                                            | 20,000                                                         | 20,036    
|Exopack Holding Corp., 11.25%, 2/1/2014                                                                       | 80,000                                                         | 65,600    
|Freeport-McMoRan Copper & Gold, Inc.:                                                                        
|                                                                                                              | 8.25%, 4/1/2015                                                | 65,000    
|                                                                                                              | 8.375%, 4/1/2017                                               | 120,000   
|GEO Specialty Chemicals, Inc.:                                                                               
|                                                                                                              | 144A, 7.5%***, 3/31/2015 (PIK)                                 | 207,955   
|                                                                                                              | 10.0%, 3/31/2015                                               | 206,080   
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Georgia-Pacific LLC, 144A, 7.125%, 1/15/2017                                                                  | 15,000                                                         | 13,950    
|Graphic Packaging International, Inc., 144A, 9.5%, 6/15/2017                                                  | 30,000                                                         | 29,550    
|Hexcel Corp., 6.75%, 2/1/2015                                                                                 | 95,000                                                         | 88,112    
|Innophos, Inc., 8.875%, 8/15/2014                                                                             | 10,000                                                         | 9,150     
|Koppers Holdings, Inc., Zero Coupon, 11/15/2014, Step-up Coupon, 0% to 11/15/2009, 9.875% to 11/15/2014       | 70,000                                                         | 62,825    
|Millar Western Forest Products Ltd., 7.75%, 11/15/2013                                                        | 15,000                                                         | 6,900     
|NewMarket Corp., 7.125%, 12/15/2016                                                                           | 65,000                                                         | 58,500    
|Owens-Brockway Glass Container, Inc., 144A, 7.375%, 5/15/2016                                                 | 10,000                                                         | 9,700     
|Radnor Holdings Corp., 11.0%, 3/15/2010**                                                                     | 40,000                                                         | 52        
|Silgan Holdings, Inc., 144A, 7.25%, 8/15/2016                                                                 | 20,000                                                         | 19,200    
|Teck Resources Ltd.:                                                                                         
|                                                                                                              | 144A, 9.75%, 5/15/2014                                         | 20,000    
|                                                                                                              | 144A, 10.25%, 5/15/2016                                        | 20,000    
|                                                                                                              | 144A, 10.75%, 5/15/2019                                        | 55,000    
|Terra Capital, Inc., Series B, 7.0%, 2/1/2017                                                                 | 50,000                                                         | 45,688    
|The Mosaic Co., 144A, 7.375%, 12/1/2014                                                                       | 40,000                                                         | 41,200    
|Wolverine Tube, Inc., 15.0%, 3/31/2012 (PIK)                                                                  | 40,000                                                         | 34,100    
|                                                                                                              | 1,199,506                                                     
|Telecommunication Services 0.6%                                                                              
|AT&T Mobility LLC, 6.5%, 12/15/2011                                                                           | 550,000                                                        | 593,352   
|BCM Ireland Preferred Equity Ltd., 144A, 8.281%***, 
2/15/2017 (PIK)         EUR                              | 96,369                                                         | 26,929    
|Cincinnati Bell, Inc.:                                                                                       
|                                                                                                              | 7.25%, 7/15/2013                                               | 70,000    
|                                                                                                              | 8.375%, 1/15/2014                                              | 25,000    
|Cricket Communications, Inc.:                                                                                
|                                                                                                              | 9.375%, 11/1/2014                                              | 55,000    
|                                                                                                              | 10.0%, 7/15/2015                                               | 50,000    
|Intelsat Corp.:                                                                                              
|                                                                                                              | 144A, 9.25%, 8/15/2014                                         | 10,000    
|                                                                                                              | 144A, 9.25%, 6/15/2016                                         | 110,000   
|Intelsat Subsidiary Holding Co., Ltd., 144A, 8.875%, 1/15/2015                                                | 60,000                                                         | 57,900    
|iPCS, Inc., 3.153%***, 5/1/2013                                                                               | 10,000                                                         | 7,900     
|MetroPCS Wireless, Inc., 9.25%, 11/1/2014                                                                     | 60,000                                                         | 59,625    
|Millicom International Cellular SA, 10.0%, 12/1/2013                                                          | 80,000                                                         | 81,100    
|Qwest Corp.:                                                                                                 
|                                                                                                              | 7.875%, 9/1/2011                                               | 65,000    
|                                                                                                              | 8.875%, 3/15/2012                                              | 15,000    
|Stratos Global Corp., 9.875%, 2/15/2013                                                                       | 15,000                                                         | 15,000    
|Telesat Canada, 144A, 11.0%, 11/1/2015                                                                        | 225,000                                                        | 230,625   
|Verizon Communications, Inc., 6.35%, 4/1/2019                                                                 | 100,000                                                        | 104,029   
|Windstream Corp.:                                                                                            
|                                                                                                              | 7.0%, 3/15/2019                                                | 25,000    
|                                                                                                              | 8.625%, 8/1/2016                                               | 10,000    
|                                                                                                              | 1,593,873                                                     
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Utilities 1.1%                                                                                               
|AES Corp.:                                                                                                   
|                                                                                                              | 8.0%, 10/15/2017                                               | 35,000    
|                                                                                                              | 8.0%, 6/1/2020                                                 | 30,000    
|                                                                                                              | 144A, 8.75%, 5/15/2013                                         | 172,000   
|Alabama Power Co., 6.0%, 3/1/2039                                                                             | 220,000                                                        | 232,211   
|Appalachian Power Co., 7.0%, 4/1/2038                                                                         | 750,000                                                        | 777,148   
|CMS Energy Corp., 8.5%, 4/15/2011                                                                             | 110,000                                                        | 113,854   
|CP&L, Inc., 5.3%, 1/15/2019                                                                                   | 500,000                                                        | 521,996   
|DPL, Inc., 6.875%, 9/1/2011                                                                                   | 500,000                                                        | 525,419   
|DTE Energy Co., 7.625%, 5/15/2014                                                                             | 81,000                                                         | 84,537    
|Energy Future Holdings Corp., 10.875%, 11/1/2017                                                              | 35,000                                                         | 25,550    
|Knight, Inc., 6.5%, 9/1/2012                                                                                  | 15,000                                                         | 14,663    
|Mirant Americas Generation LLC, 8.3%, 5/1/2011                                                                | 45,000                                                         | 44,888    
|Mirant North America LLC, 7.375%, 12/31/2013                                                                  | 20,000                                                         | 19,200    
|NRG Energy, Inc.:                                                                                            
|                                                                                                              | 7.25%, 2/1/2014                                                | 55,000    
|                                                                                                              | 7.375%, 2/1/2016                                               | 50,000    
|                                                                                                              | 7.375%, 1/15/2017                                              | 60,000    
|NV Energy, Inc.:                                                                                             
|                                                                                                              | 6.75%, 8/15/2017                                               | 50,000    
|                                                                                                              | 8.625%, 3/15/2014                                              | 8,000     
|Pepco Holdings, Inc., 6.125%, 6/1/2017                                                                        | 350,000                                                        | 324,196   
|Sempra Energy, 6.5%, 6/1/2016                                                                                 | 135,000                                                        | 140,919   
|Southern Co., 4.15%, 5/15/2014                                                                                | 71,000                                                         | 71,282    
|Texas Competitive Electric Holdings Co., LLC, Series A, 10.25%, 11/1/2015                                     | 60,000                                                         | 37,350    
|                                                                                                              | 3,377,653                                                     
|Total Corporate Bonds (Cost $28,866,469)                                                                      | 28,006,258                                                    
|                                                                                                             
|Asset-Backed 0.3%                                                                                            
|Automobile Receivables                                                                                       
|Capital Auto Receivables Asset Trust, "B", Series 2006-1, 5.26%, 10/15/2010                                   | 566,000                                                        | 569,869   
|Ford Credit Auto Owner Trust, "B", Series 2007-B, 5.69%, 11/15/2012                                           | 379,000                                                        | 356,296   
|Total Asset-Backed (Cost $944,845)                                                                            | 926,165                                                       
|                                                                                                             
|Mortgage-Backed Securities Pass-Throughs 9.6%                                                                
|Federal Home Loan Mortgage Corp., 6.0%, with various maturities from 8/1/2035 until 3/1/2038                  | 557,541                                                        | 581,400   
|Federal National Mortgage Association:                                                                       
|                                                                                                              | 4.5%,with various maturities from 11/1/2019 until 9/1/2035 (c) | 3,460,150 
|                                                                                                              | 5.0%,with various maturities from 5/1/2019 until 2/1/2038 (c)  | 11,520,003
|                                                                                                              | 5.5%,with various maturities from 2/1/2037 until 4/1/2038      | 6,013,205 
|                                                                                                              | 6.0%,with various maturities from 1/1/2024 until 8/1/2037      | 3,316,788 
|                                                                                                              | 6.5%,with various maturities from 5/1/2017 until 9/1/2038      | 2,838,517 
|                                                                                                              | 8.0%, 9/1/2015                                                 | 108,472   
|Total Mortgage-Backed Securities Pass-Throughs (Cost $28,190,989)                                             | 28,753,837                                                    
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Commercial Mortgage-Backed Securities 0.7%                                                                   
|Greenwich Capital Commercial Funding Corp., "A4", Series 2007-GG11, 5.736%, 12/10/2049                        | 1,705,000                                                      | 1,370,893 
|GS Mortgage Securities Corp. II, "A4", Series 2006-GG8, 5.56%, 11/10/2039                                     | 730,000                                                        | 595,393   
|LB-UBS Commercial Mortgage Trust, "A2", Series 2005-C2, 4.821%, 4/15/2030                                     | 125,047                                                        | 122,888   
|Total Commercial Mortgage-Backed Securities (Cost $2,130,962)                                                 | 2,089,174                                                     
|                                                                                                             
|Collateralized Mortgage Obligations 0.2%                                                                     
|Fannie Mae Whole Loan, "1A1", Series 2004-W15, 6.0%, 8/25/2044                                                | 576,685                                                        | 609,613   
|Federal Home Loan Mortgage Corp., "H", Series 2278, 6.5%, 1/15/2031                                           | 17,694                                                         | 18,938    
|Total Collateralized Mortgage Obligations (Cost $605,121)                                                     | 628,551                                                       
|                                                                                                             
|Loan Participations and Assignments 0.1%                                                                     
|Senior Loans***                                                                                              
|Buffets, Inc.:                                                                                               
|                                                                                                              | Term Loan 2, LIBOR plus 7.25%, 7.729%, 4/30/2009**             | 464       
|                                                                                                              | Term Loan 3, LIBOR plus 7.25%, 7.729%, 4/30/2009**             | 46        
|                                                                                                              | Term Loan, LIBOR plus 7.25%, 7.768%, 11/1/2013**               | 965       
|Essar Steel Algoma, Inc., Term Loan B, LIBOR plus 2.5%, 2.81%, 6/20/2013                                      | 19,848                                                         | 16,127    
|Golden Nugget, Inc., Second Lien Term Loan, LIBOR plus 3.25%, 3.56%, 12/31/2014                               | 35,000                                                         | 14,000    
|Hawker Beechcraft Acquisition Co., LLC:                                                                      
|                                                                                                              | Term Loan, LIBOR plus 2.0%, 2.598%, 3/26/2014                  | 22,693    
|                                                                                                              | Letter of Credit, LIBOR plus 2.1%, 2.598%, 3/26/2014           | 1,336     
|Hexion Specialty Chemicals, Inc.:                                                                            
|                                                                                                              | Term Loan C2, LIBOR plus 2.25%, 2.875%, 5/6/2013               | 10,870    
|                                                                                                              | Term Loan C1, LIBOR plus 2.25%, 3.5%, 5/6/2013                 | 72,282    
|IASIS Healthcare LLC, Term Loan, LIBOR plus 5.25%, 6.289%, 6/13/2014 (PIK)                                    | 83,801                                                         | 65,574    
|Sabre, Inc., Term Loan B, LIBOR plus 2.25%, 3.289%, 9/30/2014                                                 | 23,027                                                         | 16,694    
|Sbarro, Inc., Term Loan, LIBOR plus 4.5%, 6.106%, 1/31/2014                                                   | 15,000                                                         | 11,675    
|Tribune Co., Term Loan B, Prime plus 2.0%, 5.25%, 6/4/2014**                                                  | 49,152                                                         | 16,850    
|Total Loan Participations and Assignments (Cost $322,689)                                                     | 214,751                                                       
|                                                                                                             
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|Preferred Securities 0.1%                                                                                    
|Financials 0.1%                                                                                              
|Farm Credit Bank of Texas, Series 1, 7.561%, 
12/15/2013 (d)                                                  | 218,000                                                        | 141,558   
|Xerox Capital Trust I, 
8.0%, 2/1/2027                                                                        | 15,000                                                         | 11,400    
|                                                                                                              |                                                                | 152,958   
|Materials 0.0%                                                                                               
|Hercules, Inc., 6.5%, 6/30/2029                                                                               | 170,000                                                        | 91,800    
|Total Preferred Securities (Cost $331,163)                                                                    | 244,758                                                       
|                                                                                                             
|Government & Agency Obligations 13.2%                                                                        
|Other Government Related 0.5%                                                                                
|Citigroup, Inc., FDIC Guaranteed, 2.125%, 4/30/2012                                                           | 1,500,000                                                      | 1,506,585 
|Sovereign Bonds 3.3%                                                                                         
|Federal Republic of Germany, 2.25%, 4/15/2013         EUR                                                     | 210,724                                                        | 308,769   
|Government of Canada, 4.0%, 12/1/2031  CAD                                                                    | 436,258                                                        | 518,629   
|Government of France:                                                                                        
|                                                                                                              | 1.0%, 7/25/2017       EUR                                      | 238,795   
|                                                                                                              | 1.6%, 7/25/2011       EUR                                      | 742,649   
|                                                                                                              | 2.25%, 7/25/2020      EUR                                      | 264,206   
|                                                                                                              | 3.15%, 7/25/2032      EUR                                      | 580,974   
|Government of Japan, 1.1%, 9/10/2016  JPY                                                                     | 65,325,000                                                     | 601,409   
|Government of Sweden, 3.5%, 12/1/2015         SEK                                                             | 2,650,000                                                      | 452,293   
|Republic of Italy, 2.1%, 
9/15/2017       EUR                                                                 | 1,124,361                                                      | 1,565,905 
|United Kingdom Treasury-
Inflation Linked Bonds:                                                             
|                                                                                                              | 1.125%, 11/22/2037    GBP                                      | 219,659   
|                                                                                                              | 1.25%, 11/22/2032     GBP                                      | 224,027   
|                                                                                                              | 1.875%, 11/22/2022    GBP                                      | 370,213   
|                                                                                                              | 2.0%, 1/26/2035       GBP                                      | 225,000   
|                                                                                                              | 2.5%, 8/16/2013       GBP                                      | 205,000   
|                                                                                                              | 2.5%, 7/26/2016       GBP                                      | 112,000   
|                                                                                                              | 2.5%, 4/16/2020       GBP                                      | 96,000    
|                                                                                                              |                                                                |           
|US Treasury Obligations 9.4%                                                                                 
|US Treasury Bills:                                                                                           
|                                                                                                              | 0.15%****, 9/17/2009 (e)                                       | 3,854,000 
|                                                                                                              | 0.16%****, 8/27/2009 (e)                                       | 71,000    
|US Treasury Bond, 
3.5%, 2/15/2039                                                                            | 1,750,000                                                      | 1,513,207 
|US Treasury 
Inflation-Indexed Bonds:                                                                        
|                                                                                                              | 2.375%, 1/15/2025                                              | 546,355   
|                                                                                                              | 3.625%, 4/15/2028                                              | 369,124   
|                                                                                                              | 3.875%, 4/15/2029                                              | 389,109   
|US Treasury 
Inflation-Indexed Notes:                                                                        
|                                                                                                              | 1.875%, 7/15/2015                                              | 153,468   
|                                                                                                              | 2.0%, 1/15/2014                                                | 86,547    
|                                                                                                              | 2.0%, 1/15/2016                                                | 469,465   
|                                                                                                              | 2.375%, 4/15/2011                                              | 966,816   
|                                                                                                              | 2.5%, 7/15/2016                                                | 490,952   
|                                                                                                              | 2.375%, 1/15/2017                                              | 1,030,877 
|                                                                                                              | Principal
Amount ($)(a)                                        | Value ($) 
|                                                                                                              |                                                               
|US Treasury Notes:                                                                                           
|                                                                                                              | 0.875%, 3/31/2011                                              | 11,750,000
|                                                                                                              | 3.125%, 5/15/2019                                              | 3,000,000 
|                                                                                                              | 4.5%, 11/15/2015                                               | 3,000,000 
|                                                                                                              | 28,145,319                                                    
|Total Government & Agency Obligations (Cost $39,008,527)                                                      | 39,664,259                                                    
|                                                                                                             
|Municipal Bonds and Notes 0.1%                                                                               
|New Jersey, State Turnpike Authority Revenue, Build America Bonds, Series F, 7.414%, 1/1/2040 (Cost
$120,000) | 120,000                                                        | 142,853   

|                                                       | Shares     | Value ($) 
|------------------------------------------------------ | ---------- | ----------
|                                                       |           
|Cash Equivalents 6.4%                                 
|Cash Management QP Trust, 0.27% (f) (Cost $19,242,473) | 19,242,473 | 19,242,473

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio(Cost $292,518,865)+ | 100.5           | 301,279,291
|Other Assets and Liabilities, Net              | (0.5)           | (1,628,318)
|Net Assets                                     | 100.0           | 299,650,973

|Securities                            | Coupon | Maturity
Date | Principal Amount | Acquisition
Cost ($) | Value ($)
|------------------------------------- | ------ | ------------- | ---------------- | -------------------- | ---------
|ARCO Chemical Co.                     | 9.8%   | 2/1/2020      | 195,000          | USD                  | 175,673  
|Buffalo Thunder Development Authority | 9.375% | 12/15/2014    | 15,000           | USD                  | 15,000   
|Buffets, Inc., Term Loan              | 7.768% | 11/1/2013     | 965              | USD                  | 965      
|Buffets, Inc., Term Loan 2            | 7.729% | 4/30/2009     | 464              | USD                  | 464      
|Buffets, Inc., Term Loan 3            | 7.729% | 4/30/2009     | 46               | USD                  | 46       
|CanWest MediaWorks LP                 | 9.25%  | 8/1/2015      | 25,000           | USD                  | 25,000   
|Congoleum Corp.                       | 8.625% | 8/1/2008      | 190,000          | USD                  | 190,156  
|Fontainebleau Las Vegas Holdings LLC  | 11.0%  | 6/15/2015     | 25,000           | USD                  | 25,000   
|Idearc, Inc.                          | 8.0%   | 11/15/2016    | 55,000           | USD                  | 51,838   
|New ASAT (Finance) Ltd.               | 9.25%  | 2/1/2011      | 95,000           | USD                  | 83,256   
|Quebecor World, Inc.                  | 9.75%  | 1/15/2015     | 25,000           | USD                  | 25,000   
|R.H. Donnelley Corp.                  | 8.875% | 10/15/2017    | 75,000           | USD                  | 75,000   
|Radnor Holdings Corp.                 | 11.0%  | 3/15/2010     | 40,000           | USD                  | 25,775   
|Tribune Co.                           | 5.25%  | 6/4/2014      | 49,152           | USD                  | 49,122   
|Tropicana Entertainment LLC           | 9.625% | 12/15/2014    | 75,000           | USD                  | 55,245   
|Trump Entertainment Resorts, Inc.     | 8.5%   | 6/1/2015      | 5,000            | USD                  | 4,788    
|Young Broadcasting, Inc.              | 8.75%  | 1/15/2014     | 130,000          | USD                  | 111,175  
|                                      |        |               |                  |                      | 913,503  

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.

ADR: American Depositary Receipt

CVA: Certificaten van Aandelen

FDIC: Federal Deposit Insurance Corp.

FDR: Fiduciary Depositary Receipt

LIBOR: Represents the London InterBank Offered Rate.

MSCI: Morgan Stanley Capital International

PIK: Denotes that all or a portion of the income is paid in kind.

PPS: Price Protected Shares

Prime: Interest rate charged by banks to their most credit worthy customers.

REG S: Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of,
US persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of
1933.

REIT: Real Estate Investment Trust

RSP: Risparmio (Convertible Savings Shares)

SDR: Swedish Depositary Receipt

Included in the portfolio are investments in mortgage or asset-backed securities which are interests in separate pools of mortgages or assets.
Effective maturities of these investments may be shorter than stated maturities due to prepayments.  Some separate investments in the
Federal Home Loan Mortgage Corp. and Federal National Mortgage Association issues which have similar coupon rates have been aggregated
for presentation purposes in this investment portfolio.

At June 30, 2009, open futures contracts purchased were as follows:

|Futures                                 | Expiration
Date | Contracts | Aggregated
Face
Value ($) | Value ($)  | Unrealized
Appreciation/
(Depreciation) ($)
|--------------------------------------- | --------------- | --------- | ------------------------- | ---------- | -------------------------------------------
|10 Year Australian Treasury Bond        | 9/15/2009       | 44        | 3,652,808                 | 3,680,490  | 27,683                                     
|10 Year US Treasury Note                | 9/21/2009       | 119       | 13,884,329                | 13,835,609 | (48,720)                                   
|3 Year Australian Treasury Bond         | 9/15/2009       | 63        | 5,270,036                 | 5,252,035  | (18,001)                                   
|AEX Index                               | 7/17/2009       | 9         | 659,690                   | 642,519    | (17,171)                                   
|ASX SPI 200 Index                       | 9/17/2009       | 20        | 1,618,973                 | 1,571,713  | (47,260)                                   
|DJ Euro Stoxx 50 Index                  | 9/18/2009       | 5         | 169,955                   | 168,201    | (1,754)                                    
|Federal Republic of Germany Euro-Schatz | 9/8/2009        | 172       | 25,986,560                | 26,035,197 | 48,637                                     
|FTSE 100 Index                          | 9/18/2009       | 49        | 3,494,247                 | 3,400,331  | (93,916)                                   
|FTSE MIB Index                          | 9/18/2009       | 3         | 418,224                   | 401,663    | (16,561)                                   
|Hang Seng Index                         | 7/30/2009       | 19        | 2,146,941                 | 2,257,921  | 110,980                                    
|IBEX 35 Index                           | 7/17/2009       | 2         | 266,219                   | 272,630    | 6,411                                      
|Nikkei 225 Index                        | 9/10/2009       | 1         | 49,500                    | 49,725     | 225                                        
|Russell 2000 Mini Index                 | 9/18/2009       | 20        | 1,044,500                 | 1,014,400  | (30,100)                                   
|S&P 500 E-Mini Index                    | 9/18/2009       | 114       | 5,322,140                 | 5,218,350  | (103,790)                                  
|United Kingdom Long Gilt Bond           | 9/28/2009       | 37        | 7,155,717                 | 7,187,811  | 32,094                                     
|Total net unrealized depreciation       | (151,243)      

At June 30, 2009, open futures contracts sold were as follows:

|Futures                               | Expiration
Date | Contracts | Aggregated
Face
Value ($) | Value ($)  | Unrealized Appreciation/
(Depreciation) ($)
|------------------------------------- | --------------- | --------- | ------------------------- | ---------- | -------------------------------------------
|10 Year Canadian Government Bond      | 9/21/2009       | 7         | 723,355                   | 729,759    | (6,404)                                    
|10 Year Japanese Government Bond      | 9/10/2009       | 11        | 15,532,568                | 15,768,931 | (236,363)                                  
|2 Year US Treasury Note               | 9/30/2009       | 66        | 14,306,703                | 14,270,437 | 36,266                                     
|CAC 40 Index                          | 7/17/2009       | 6         | 270,399                   | 263,960    | 6,439                                      
|DAX Index                             | 9/18/2009       | 23        | 4,008,186                 | 3,887,594  | 120,592                                    
|DJ Euro Stoxx 50 Index                | 9/18/2009       | 10        | 339,910                   | 336,403    | 3,507                                      
|Federal Republic of Germany Euro-Bund | 9/8/2009        | 48        | 7,999,523                 | 8,153,135  | (153,612)                                  
|NASDAQ E-Mini 100 Index               | 9/18/2009       | 49        | 1,455,545                 | 1,446,725  | 8,820                                      
|Russell 2000 Mini Index               | 9/18/2009       | 49        | 2,559,270                 | 2,485,280  | 73,990                                     
|S&P TSE 60 Index                      | 9/17/2009       | 5         | 553,350                   | 539,139    | 14,211                                     
|TOPIX Index                           | 9/11/2009       | 24        | 2,297,234                 | 2,303,213  | (5,979)                                    
|Total net unrealized depreciation     | (138,533)      

At June 30, 2009, the Portfolio had the following open forward foreign currency exchange contracts:

|Contracts to Deliver          |            | In Exchange For |     | Settlement Date | Unrealized
Appreciation ($)
|----------------------------- | ---------- | --------------- | --- | --------------- | ---------------------------
|USD                           | 891,418    |                 | NZD | 1,406,000       |                            
|USD                           | 4,797,758  |                 | JPY | 469,830,000     |                            
|NOK                           | 3,022,000  |                 | USD | 478,577         |                            
|SEK                           | 16,841,000 |                 | USD | 2,206,601       |                            
|EUR                           | 4,136,000  |                 | USD | 5,822,495       |                            
|Total unrealized appreciation | 147,810   

|Contracts to Deliver          |            | In Exchange For |     | Settlement Date | Unrealized
Depreciation ($)
|----------------------------- | ---------- | --------------- | --- | --------------- | ---------------------------
|EUR                           | 128,100    |                 | USD | 177,159         |                            
|USD                           | 5,603,520  |                 | AUD | 6,939,000       |                            
|USD                           | 3,221,901  |                 | CAD | 3,553,000       |                            
|USD                           | 10,249,204 |                 | CHF | 11,014,000      |                            
|GBP                           | 1,545,000  |                 | USD | 2,536,674       |                            
|Total unrealized depreciation | (303,966) 

|Currency Abbreviations                                                                                                                                                                                                    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|AUD     Australian DollarCAD     Canadian DollarCHF     Swiss FrancEUR     EuroGBP     British PoundJPY     Japanese YenNOK     Norwegian KroneNZD     New Zealand DollarSEK     Swedish KronaUSD     United States Dollar

For information on the Portfolio's policy and additional disclosures regarding futures contracts and forward foreign currency exchange
contracts, please refer to the Derivatives section of Note A in the accompanying Notes to Financial Statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                          | Level 1           | Level 2          | Level 3     | Total            
|----------------------------------------------- | ----------------- | ---------------- | ----------- | -----------------
|Common Stock and/or Other Equity Investments(g) |                   |                  |             |                  
|Consumer Discretionary                          | $      11,465,145 | $      2,718,346 | $          | $      14,183,491
|Consumer Staples                                | 13,907,038        | 2,518,259        |            | 16,425,297       
|Energy                                          | 16,608,349        | 2,565,454        |            | 19,173,803       
|Financials                                      | 16,299,557        | 5,169,910        | 2,298       | 21,471,765       
|Health Care                                     | 20,522,823        | 3,268,373        |            | 23,791,196       
|Industrials                                     | 14,397,315        | 2,724,971        |            | 17,122,286       
|Information Technology                          | 24,426,905        | 2,522,414        |            | 26,949,319       
|Materials                                       | 7,518,429         | 2,406,575        |            | 9,925,004        
|Telecommunications                              | 4,894,348         | 2,546,476        |            | 7,440,824        
|Utilities                                       | 7,326,562         | 1,561,985        |            | 8,888,547        
|Exchange-Traded Funds                           | 15,941,880        |                 |            | 15,941,880       
|Closed-End Investment Company                   | 52,800            |                 |            | 52,800           
|Fixed Income(g)                                
|Corporate Bonds                                 |                  | 27,639,927       | 366,331     | 28,006,258       
|Asset-Backed                                    |                  | 926,165          |            | 926,165          
|Mortgage-Backed Securities Pass-Throughs        |                  | 28,753,837       |            | 28,753,837       
|Commercial Mortgage-Backed Securities           |                  | 2,089,174        |            | 2,089,174        
|Collateralized Mortgage Obligations             |                  | 628,551          |            | 628,551          
|Loan Participations & Assignments               |                  | 172,949          | 41,802      | 214,751          
|Preferred Securities                            |                  | 244,758          |            | 244,758          
|Government & Agency Obligations                 |                  | 39,664,259       |            | 39,664,259       
|Municipal Bonds and Notes                       |                  | 142,853          |            | 142,853          
|Short-Term Investments (g)                      |                  | 19,242,473       |            | 19,242,473       
|Derivatives (h)                                 |                  | 147,810          |            | 147,810          
|Total                                           | $   153,361,151   | $   147,655,519  | $   410,431 | $   301,427,101  

|Liabilities     |                  |                  |          |                 
|--------------- | ---------------- | ---------------- | -------- | ----------------
|Derivatives (h) | $      (289,776) | $      (303,966) | $       | $      (593,742)
|Total           | $   (289,776)    | $   (303,966)    | $       | $   (593,742)   

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                                     | Common Stock
and/or Other
Equity
Investments | Corporate Bonds | Loan
Participations and
Assignments | Other
Investments | Total        
|---------------------------------------------------------------------------------------------------- | -------------------------------------------- | --------------- | ----------------------------------- | ----------------- | -------------
|Balance as of December 31, 2008                                                                      | $      8,594                                 | $      18,568   | $      54,331                       | $      81,600     | $   163,093  
|Realized gains (loss)                                                                                | (2,688)                                      |                | (13,527)                            |                  | (16,215)     
|Change in unrealized appreciation
(depreciation)                                                     | (26,666)                                     | (169,625)       | 35,215                              | 35,387            | (125,689)    
|Amortization premium/discount                                                                        |                                             | 1,045           | 365                                 | 327               | 1,737        
|Net purchases (sales)                                                                                | 29,527                                       | 232,493         | (34,582)                            | (117,314)         | 110,124      
|Net transfers in (out) of Level 3                                                                    | (6,469)                                      | 283,850         |                                    |                  | 277,381      
|Balance as of June 30, 2009                                                                          | $   2,298                                    | $   366,331     | $   41,802                          | $                | $   410,431  
|Net change in unrealized
appreciation (depreciation) from
investments still held as of
June 30, 2009 | $   (29,923)                                 | $   (159,541)   | $   14,867                          | $                | $   (174,597)

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|Investments:Investments in securities, at value (cost $273,276,392)                                                                                                                        
|Investment in Cash Management QP Trust (cost $19,242,473)                                                                                                                                  
|Total investments, at value (cost $292,518,865)                                                                                                                                            
|Cash                                                                                                                                                                                       
|Foreign currency, at value (cost $645,109)                                                                                                                                                 
|Deposits with broker for open futures contracts                                                                                                                                            
|Receivable for investments sold                                                                                                                                                            
|Receivable for when-issued securities sold                                                                                                                                                 
|Receivable for Portfolio shares sold                                                                                                                                                       
|Dividends receivable                                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Unrealized appreciation on open forward currency exchange contracts                                                                                                                        
|Foreign taxes recoverable                                                                                                                                                                  
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable for investments purchased                                                                                                                                                          
|Payable for when-issued securities purchased                                                                                                                                               
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Payable for variation margin on open futures contracts                                                                                                                                     
|Net payable on closed forward currency exchange contracts                                                                                                                                  
|Unrealized depreciation on open forward foreign currency exchange contracts                                                                                                                
|Accrued management fee                                                                                                                                                                     
|Other accrued expenses and payables                                                                                                                                                        
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of                                                                                                                                                                      
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                  
|Futures                                                                                                                                                                                    
|Foreign currency                                                                                                                                                                           
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($299,650,973 ÷ 16,820,019 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $84,530)                                              
|Interest (net of foreign taxes withheld of $54)                                                          
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fee                                                                                            
|Services to shareholders                                                                                 
|Distribution service fee (Class B)                                                                       
|Professional fees                                                                                        
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Futures                                                                                                  
|Credit default swap contracts                                                                            
|Foreign currency                                                                                         
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Futures                                                                                                  
|Credit default swap contracts                                                                            
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                     
|-----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                      
|Operations:Net investment income (loss)                                                                                
|Net realized gain (loss)                                                                                               
|Change in net unrealized appreciation (depreciation)                                                                   
|Net increase (decrease) in net assets resulting from operations                                                        
|Distributions to shareholders from:Net investment income:Class A                                                       
|Class B                                                                                                                
|Total distributions                                                                                                    
|Portfolio share transactions:Class A
Proceeds from shares sold                                                         
|Shares issued to shareholders in reinvestment of distributions                                                         
|Cost of shares redeemed                                                                                                
|Shares converted*                                                                                                      
|Net increase (decrease) in net assets from Class A share transactions                                                  
|Class B
Proceeds from shares sold                                                                                      
|Shares issued to shareholders in reinvestment of distributions                                                         
|Cost of shares redeemed                                                                                                
|Shares converted*                                                                                                      
|Net increase (decrease) in net assets from Class B share transactions                                                  
|Increase (decrease) in net assets                                                                                      
|Net assets at beginning of period                                                                                      
|Net assets at end of period (including undistributed net investment income of $2,641,457 and
$10,418,830, respectively)
|Other Information                                                                                                      
|Class A
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Shares converted*                                                                                                      
|Net increase (decrease) in Class A shares                                                                              
|Shares outstanding at end of period                                                                                    
|Class B
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Shares converted*                                                                                                      
|Net increase (decrease) in Class B shares                                                                              
|Shares outstanding at end of period                                                                                    

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2009a     | 2008      | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   17.35 | $   24.81 | $   24.46 | $   22.75 | $   22.37 | $   21.32
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .23       | .61       | .74       | .69d      | .59       | .47      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | .94       | (7.20)    | .42       | 1.60      | .34       | .93      
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 1.17      | (6.59)    | 1.16      | 2.29      | .93       | 1.40     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | (.70)     | (.87)     | (.81)     | (.58)     | (.55)     | (.35)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $   17.82 | $   17.35 | $   24.81 | $   24.46 | $   22.75 | $   22.37
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 7.19**    | (27.33)c  | 4.84c     | 10.24c,d  | 4.30c     | 6.64     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 300       | 307       | 528       | 600       | 653       | 622      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | .69*      | .64       | .52       | .55       | .55       | .59      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | .69*      | .62       | .51       | .51       | .53       | .59      
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 2.72*     | 2.83      | 3.00      | 2.99d     | 2.66      | 2.18     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 129**     | 263       | 199       | 108       | 122       | 140      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.024 per share and an increase in the ratio of net investment income of 0.10%. Excluding this non-recurring income, total return
would have been 0.10% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Blue Chip VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .71% and 1.09% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. It may focus its
investments on certain economic sectors, thereby increasing its vulnerability to any single economic, political or regulatory
development. This may result in greater share price volatility. Derivatives may be more volatile and less liquid than traditional
securities, and the Portfolio could suffer losses on its derivative positions. Please read this Portfolio's prospectus for specific details
regarding its investments and risk profile.

Portfolio returns shown during the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement.
Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Blue Chip VIP
|------------------------------------------------------------
|[] DWS Blue Chip VIP  Class A
[]Russell 1000® Index        
|vs2_g10k10f0                                                
|Yearly periods ended June 30                                

|Comparative Results        
|---------------------------
|DWS Blue Chip VIP          
|Class A                    
|Average annual total return
|Russell 1000 Index         
|Average annual total return
|DWS Blue Chip VIP          
|Class B                    
|Average annual total return
|Russell 1000 Index         
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Blue Chip VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                  | Class A |  | Class B | 
|------------------------------------------ | ------- |  | ------- | 
|DWS Variable Series II  DWS Blue Chip VIP | .83%    |  | 1.09%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Blue Chip VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 97%     | 99%     
|Cash Equivalents                                                                         | 2%      |        
|Government & Agency Obligation                                                           | 1%      | 1%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Information Technology                          | 18%     | 16%     
|Health Care                                     | 15%     | 17%     
|Industrials                                     | 12%     | 14%     
|Financials                                      | 12%     | 11%     
|Consumer Staples                                | 11%     | 13%     
|Energy                                          | 11%     | 11%     
|Consumer Discretionary                          | 11%     | 10%     
|Materials                                       | 4%      | 2%      
|Telecommunication Services                      | 3%      | 4%      
|Utilities                                       | 3%      | 2%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 52. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Blue Chip VIP

|                                                    | Shares     | Value ($)
|--------------------------------------------------- | ---------- | ---------
|                                                    |           
|Common Stocks 97.0%                                
|Consumer Discretionary 10.3%                       
|Auto Components 0.1%                               
|Magna International, Inc. "A"                       | 3,500      | 147,840  
|Automobiles 0.1%                                   
|Honda Motor Co., Ltd. (ADR)                         | 3,000      | 82,110   
|Distributors 0.1%                                  
|Genuine Parts Co.                                   | 3,400      | 114,104  
|Diversified Consumer Services 0.1%                 
|Capella Education Co.*                              | 900        | 53,955   
|Hotels Restaurants & Leisure 1.8%                  
|Ctrip.com International Ltd. (ADR)*                 | 3,900      | 180,570  
|McDonald's Corp.                                    | 21,200     | 1,218,788
|Yum! Brands, Inc.                                   | 10,900     | 363,406  
|                                                    | 1,762,764 
|Household Durables 0.7%                            
|Garmin Ltd.                                         | 15,200     | 362,064  
|Leggett & Platt, Inc.                               | 16,100     | 245,203  
|Ryland Group, Inc.                                  | 2,400      | 40,224   
|                                                    | 647,491   
|Internet & Catalog Retail 0.4%                     
|Amazon.com, Inc.*                                   | 4,900      | 409,934  
|Media 3.4%                                         
|Comcast Corp. "A"                                   | 93,600     | 1,356,264
|Comcast Corp., Special "A"                          | 22,500     | 317,250  
|DISH Network Corp. "A"*                             | 10,300     | 166,963  
|The DIRECTV Group, Inc.*                            | 12,200     | 301,462  
|Time Warner Cable, Inc.                             | 10,181     | 322,432  
|Time Warner, Inc.                                   | 33,433     | 842,178  
|                                                    | 3,306,549 
|Multiline Retail 0.5%                              
|Macy's, Inc.                                        | 42,900     | 504,504  
|Specialty Retail 2.8%                              
|Children's Place Retail Stores, Inc.*               | 2,800      | 74,004   
|Gymboree Corp.*                                     | 3,800      | 134,824  
|RadioShack Corp.                                    | 27,500     | 383,900  
|Rent-A-Center, Inc.*                                | 6,100      | 108,763  
|Ross Stores, Inc.                                   | 9,900      | 382,140  
|The Gap, Inc.                                       | 30,600     | 501,840  
|TJX Companies, Inc.                                 | 35,800     | 1,126,268
|Tractor Supply Co.*                                 | 2,000      | 82,640   
|                                                    | 2,794,379 
|Textiles, Apparel & Luxury Goods 0.3%              
|Jones Apparel Group, Inc.                           | 14,800     | 158,804  
|Quiksilver, Inc.*                                   | 13,400     | 24,790   
|Under Armour, Inc. "A"* (a)                         | 3,200      | 71,616   
|Wolverine World Wide, Inc.                          | 3,800      | 83,828   
|                                                    | 339,038   
|Consumer Staples 10.5%                             
|Food & Staples Retailing 3.1%                      
|Kroger Co.                                          | 50,300     | 1,109,115
|Sysco Corp.                                         | 7,700      | 173,096  
|Wal-Mart Stores, Inc.                               | 36,800     | 1,782,592
|                                                    | 3,064,803 
|Food Products 2.9%                                 
|Archer-Daniels-Midland Co.                          | 63,500     | 1,699,895
|Bunge Ltd. (a)                                      | 13,700     | 825,425  
|                                                    | Shares     | Value ($)
|                                                    |           
|Chiquita Brands International, Inc.*                | 5,600      | 57,456   
|Darling International, Inc.*                        | 9,400      | 62,040   
|Fresh Del Monte Produce, Inc.*                      | 9,100      | 147,966  
|                                                    | 2,792,782 
|Household Products 1.9%                            
|Church & Dwight Co., Inc.                           | 1,800      | 97,758   
|Colgate-Palmolive Co.                               | 24,800     | 1,754,352
|                                                    | 1,852,110 
|Personal Products 0.3%                             
|Herbalife Ltd.                                      | 9,500      | 299,630  
|Tobacco 2.3%                                       
|Altria Group, Inc.                                  | 42,500     | 696,575  
|Lorillard, Inc.                                     | 7,100      | 481,167  
|Philip Morris International, Inc.                   | 25,200     | 1,099,224
|                                                    | 2,276,966 
|Energy 10.5%                                       
|Energy Equipment & Services 0.6%                   
|Exterran Holdings, Inc.*                            | 2,800      | 44,912   
|Helix Energy Solutions Group, Inc.*                 | 6,100      | 66,307   
|Noble Corp.                                         | 12,600     | 381,150  
|Oil States International, Inc.*                     | 2,800      | 67,788   
|                                                    | 560,157   
|Oil, Gas & Consumable Fuels 9.9%                   
|Alpha Natural Resources, Inc.*                      | 11,000     | 288,970  
|Apache Corp.                                        | 11,100     | 800,865  
|Cimarex Energy Co.                                  | 16,400     | 464,776  
|ConocoPhillips                                      | 45,100     | 1,896,906
|Encore Acquisition Co.*                             | 14,500     | 447,325  
|EXCO Resources, Inc.*                               | 5,300      | 68,476   
|ExxonMobil Corp.                                    | 16,340     | 1,142,329
|Frontline Ltd. (a)                                  | 11,300     | 275,268  
|Mariner Energy, Inc.*                               | 22,000     | 258,500  
|McMoRan Exploration Co.*                            | 18,600     | 110,856  
|Murphy Oil Corp.                                    | 16,100     | 874,552  
|Occidental Petroleum Corp.                          | 31,600     | 2,079,596
|Overseas Shipholding Group, Inc.                    | 2,800      | 95,312   
|Plains All American Pipeline LP                     | 1,700      | 72,335   
|Tesoro Corp.                                        | 11,500     | 146,395  
|Valero Energy Corp.                                 | 31,300     | 528,657  
|W&T Offshore, Inc.                                  | 15,800     | 153,892  
|                                                    | 9,705,010 
|Financials 11.4%                                   
|Capital Markets 1.1%                               
|Bank of New York Mellon Corp.                       | 21,400     | 627,234  
|Morgan Stanley                                      | 9,300      | 265,143  
|The Goldman Sachs Group, Inc.                       | 1,200      | 176,928  
|                                                    | 1,069,305 
|Commercial Banks 1.1%                              
|Barclays PLC (ADR)                                  | 4,600      | 84,824   
|Comerica, Inc.                                      | 3,900      | 82,485   
|KeyCorp                                             | 14,300     | 74,932   
|Marshall & Ilsley Corp.                             | 39,000     | 187,200  
|PNC Financial Services Group, Inc.                  | 3,300      | 128,073  
|Regions Financial Corp. (a)                         | 91,300     | 368,852  
|Zions Bancorp. (a)                                  | 10,300     | 119,068  
|                                                    | 1,045,434 
|                                                    | Shares     | Value ($)
|                                                    |           
|Consumer Finance 0.1%                              
|Capital One Financial Corp.                         | 6,300      | 137,844  
|Diversified Financial Services 5.0%                
|Bank of America Corp.                               | 142,400    | 1,879,680
|Citigroup, Inc. (a)                                 | 185,900    | 552,123  
|JPMorgan Chase & Co.                                | 70,100     | 2,391,111
|PHH Corp.*                                          | 4,900      | 89,082   
|                                                    | 4,911,996 
|Insurance 3.4%                                     
|ACE Ltd.                                            | 32,800     | 1,450,744
|Allied World Assurance Co. Holdings Ltd.            | 4,100      | 167,403  
|Arch Capital Group Ltd.*                            | 2,500      | 146,450  
|Berkshire Hathaway, Inc. "B"*                       | 300        | 868,719  
|Everest Re Group Ltd.                               | 1,500      | 107,355  
|First American Corp.                                | 4,600      | 119,186  
|Old Republic International Corp.                    | 11,000     | 108,350  
|The Travelers Companies, Inc.                       | 6,800      | 279,072  
|XL Capital Ltd. "A"                                 | 5,000      | 57,300   
|                                                    | 3,304,579 
|Real Estate Investment Trusts 0.6%                 
|Essex Property Trust, Inc. (REIT) (a)               | 1,400      | 87,122   
|Franklin Street Properties Corp. (REIT)             | 10,000     | 132,500  
|ProLogis (REIT)                                     | 4,800      | 38,688   
|Public Storage (REIT)                               | 1,200      | 78,576   
|Rayonier, Inc. (REIT)                               | 3,800      | 138,130  
|Simon Property Group, Inc. (REIT)                   | 1,740      | 89,488   
|Walter Investment Management Corp. (REIT)*          | 5,716      | 75,909   
|                                                    | 640,413   
|Real Estate Management & Development 0.1%          
|The St. Joe Co.*                                    | 2,400      | 63,576   
|Health Care 14.7%                                  
|Biotechnology 1.8%                                 
|Gilead Sciences, Inc.*                              | 32,300     | 1,512,932
|Myriad Genetics, Inc.*                              | 4,000      | 142,600  
|Myriad Pharmaceuticals, Inc.*                       | 1,000      | 4,650    
|PDL BioPharma, Inc.                                 | 14,000     | 110,600  
|                                                    | 1,770,782 
|Health Care Equipment & Supplies 1.4%              
|Baxter International, Inc.                          | 12,000     | 635,520  
|Becton, Dickinson & Co.                             | 7,900      | 563,349  
|Covidien PLC                                        | 5,400      | 202,176  
|                                                    | 1,401,045 
|Health Care Providers & Services 5.9%              
|Aetna, Inc.                                         | 64,400     | 1,613,220
|AmerisourceBergen Corp.                             | 5,400      | 95,796   
|Coventry Health Care, Inc.*                         | 14,700     | 275,037  
|Emergency Medical Services Corp. "A"*               | 1,100      | 40,502   
|Express Scripts, Inc.*                              | 23,700     | 1,629,375
|Humana, Inc.*                                       | 3,800      | 122,588  
|Kindred Healthcare, Inc.*                           | 7,600      | 94,012   
|Magellan Health Services, Inc.*                     | 3,200      | 105,024  
|McKesson Corp.                                      | 14,400     | 633,600  
|Medco Health Solutions, Inc.*                       | 24,600     | 1,122,006
|Universal Health Services, Inc. "B"                 | 1,700      | 83,045   
|                                                    | 5,814,205 
|Pharmaceuticals 5.6%                               
|Abbott Laboratories                                 | 18,200     | 856,128  
|Eli Lilly & Co.                                     | 45,500     | 1,576,120
|                                                    | Shares     | Value ($)
|                                                    |           
|Johnson & Johnson                                   | 12,000     | 681,600  
|Merck & Co., Inc.                                   | 2,900      | 81,084   
|Pfizer, Inc.                                        | 129,500    | 1,942,500
|Watson Pharmaceuticals, Inc.*                       | 9,900      | 333,531  
|                                                    | 5,470,963 
|Industrials 11.6%                                  
|Aerospace & Defense 5.6%                           
|Alliant Techsystems, Inc.*                          | 1,900      | 156,484  
|General Dynamics Corp.                              | 15,500     | 858,545  
|Goodrich Corp.                                      | 16,400     | 819,508  
|Honeywell International, Inc.                       | 7,200      | 226,080  
|L-3 Communications Holdings, Inc.                   | 6,000      | 416,280  
|Lockheed Martin Corp.                               | 16,700     | 1,346,855
|Northrop Grumman Corp.                              | 25,500     | 1,164,840
|Raytheon Co.                                        | 12,100     | 537,603  
|                                                    | 5,526,195 
|Air Freight & Logistics 0.5%                       
|United Parcel Service, Inc. "B"                     | 8,600      | 429,914  
|Commercial Services & Supplies 0.4%                
|R.R. Donnelley & Sons Co.                           | 8,600      | 99,932   
|The Brink's Co.                                     | 9,500      | 275,785  
|                                                    | 375,717   
|Construction & Engineering 1.3%                    
|EMCOR Group, Inc.*                                  | 16,900     | 340,028  
|Fluor Corp.                                         | 12,400     | 635,996  
|Foster Wheeler AG*                                  | 7,200      | 171,000  
|Tutor Perini Corp.*                                 | 6,800      | 118,048  
|                                                    | 1,265,072 
|Electrical Equipment 0.5%                          
|GrafTech International Ltd.*                        | 44,000     | 497,640  
|GT Solar International, Inc.*                       | 3,200      | 17,024   
|                                                    | 514,664   
|Machinery 1.7%                                     
|AGCO Corp.*                                         | 7,900      | 229,653  
|CNH Global NV*                                      | 2,200      | 30,888   
|Cummins, Inc.                                       | 5,600      | 197,176  
|Dover Corp.                                         | 2,300      | 76,107   
|Flowserve Corp.                                     | 6,600      | 460,746  
|Gardner Denver, Inc.*                               | 1,500      | 37,755   
|Oshkosh Corp.                                       | 3,400      | 49,436   
|Parker Hannifin Corp.                               | 12,100     | 519,816  
|Trinity Industries, Inc.                            | 3,300      | 44,946   
|                                                    | 1,646,523 
|Professional Services 0.7%                         
|Manpower, Inc.                                      | 15,900     | 673,206  
|Road & Rail 0.9%                                   
|Burlington Northern Santa Fe Corp.                  | 1,500      | 110,310  
|Norfolk Southern Corp.                              | 2,800      | 105,476  
|Ryder System, Inc.                                  | 23,000     | 642,160  
|Werner Enterprises, Inc.                            | 3,200      | 57,984   
|                                                    | 915,930   
|Information Technology 17.8%                       
|Communications Equipment 2.0%                      
|Cisco Systems, Inc.*                                | 19,300     | 359,752  
|QUALCOMM, Inc.                                      | 35,100     | 1,586,520
|                                                    | 1,946,272 
|Computers & Peripherals 6.1%                       
|Apple, Inc.*                                        | 10,000     | 1,424,300
|International Business Machines Corp.               | 21,900     | 2,286,798
|Lexmark International, Inc. "A"*                    | 4,500      | 71,325   
|                                                    | Shares     | Value ($)
|                                                    |           
|QLogic Corp.*                                       | 38,900     | 493,252  
|Seagate Technology                                  | 24,300     | 254,178  
|Western Digital Corp.*                              | 55,900     | 1,481,350
|                                                    | 6,011,203 
|Electronic Equipment, Instruments & Components 0.9%
|Arrow Electronics, Inc.*                            | 6,200      | 131,688  
|Avnet, Inc.*                                        | 11,700     | 246,051  
|Dolby Laboratories, Inc. "A"* (a)                   | 2,300      | 85,744   
|Flextronics International Ltd.*                     | 16,500     | 67,815   
|Ingram Micro, Inc. "A"*                             | 5,700      | 99,750   
|Jabil Circuit, Inc.                                 | 39,300     | 291,606  
|                                                    | 922,654   
|Internet Software & Services 1.8%                  
|Google, Inc. "A"*                                   | 3,600      | 1,517,724
|MercadoLibre, Inc.*                                 | 3,700      | 99,456   
|VeriSign, Inc.*                                     | 9,600      | 177,408  
|                                                    | 1,794,588 
|IT Services 3.0%                                   
|Accenture Ltd. "A"                                  | 29,100     | 973,686  
|Automatic Data Processing, Inc.                     | 25,200     | 893,088  
|Broadridge Financial Solutions, Inc.                | 4,200      | 69,636   
|Computer Sciences Corp.*                            | 19,500     | 863,850  
|SAIC, Inc.*                                         | 5,500      | 102,025  
|                                                    | 2,902,285 
|Software 4.0%                                      
|BMC Software, Inc.*                                 | 4,800      | 162,192  
|Check Point Software Technologies Ltd.*             | 9,200      | 215,924  
|Microsoft Corp.                                     | 128,100    | 3,044,937
|Shanda Interactive Entertainment Ltd. (ADR)* (a)    | 2,100      | 109,809  
|Symantec Corp.*                                     | 17,500     | 272,300  
|VMware, Inc. "A"*                                   | 5,000      | 136,350  
|                                                    | 3,941,512 
|Materials 4.3%                                     
|Chemicals 1.6%                                     
|Ashland, Inc.                                       | 19,100     | 535,755  
|Dow Chemical Co.                                    | 6,700      | 108,138  
|Terra Industries, Inc.                              | 38,900     | 942,158  
|                                                    | 1,586,051 
|Metals & Mining 2.0%                               
|Cliffs Natural Resources, Inc.                      | 43,700     | 1,069,339
|Gold Fields Ltd. (ADR)                              | 48,300     | 582,015  
|Walter Energy, Inc.                                 | 8,300      | 300,792  
|                                                    | 1,952,146 
|Paper & Forest Products 0.7%                       
|International Paper Co.                             | 45,100     | 682,363  
|Telecommunication Services 3.4%                    
|Diversified Telecommunication Services 3.2%        
|AT&T, Inc.                                          | 42,100     | 1,045,764
|Chunghwa Telecom Co., Ltd. (ADR)                    | 11,800     | 233,994  
|Tele Norte Leste Participacoes SA (ADR) (Preferred) | 7,200      | 107,064  
|                                                    | Shares     | Value ($)
|                                                    |           
|Verizon Communications, Inc.                        | 57,800     | 1,776,234
|                                                    | 3,163,056 
|Wireless Telecommunication Services 0.2%           
|Mobile TeleSystems (ADR)                            | 5,500      | 203,115  
|Utilities 2.5%                                     
|Electric Utilities 0.9%                            
|Duke Energy Corp.                                   | 5,300      | 77,327   
|Edison International                                | 16,100     | 506,506  
|Exelon Corp.                                        | 1,800      | 92,178   
|Pepco Holdings, Inc.                                | 5,200      | 69,888   
|Southern Co.                                        | 3,900      | 121,524  
|                                                    | 867,423   
|Gas Utilities 0.2%                                 
|Atmos Energy Corp.                                  | 1,700      | 42,568   
|ONEOK, Inc.                                         | 6,600      | 194,634  
|                                                    | 237,202   
|Independent Power Producers & Energy Traders 0.7%  
|AES Corp.*                                          | 46,400     | 538,704  
|Mirant Corp.*                                       | 6,300      | 99,162   
|                                                    | 637,866   
|Multi-Utilities 0.7%                               
|Dominion Resources, Inc.                            | 7,700      | 257,334  
|NiSource, Inc.                                      | 25,900     | 301,994  
|Sempra Energy                                       | 2,700      | 134,001  
|                                                    | 693,329   
|Total Common Stocks (Cost $99,105,742)              | 95,232,554

|                                                         | Principal
Amount ($) | Value ($)
|-------------------------------------------------------- | -------------------- | ---------
|                                                         |                     
|Government & Agency Obligation 0.5%                     
|US Treasury Obligation                                  
|US Treasury Bill, 0.15%**, 9/17/2009 (b) (Cost $480,844) | 481,000              | 480,810  

|                                                                 | Shares    | Value ($)
|---------------------------------------------------------------- | --------- | ---------
|                                                                 |          
|Securities Lending Collateral 2.0%                              
|Daily Assets Fund Institutional, 0.48% (c) (d) (Cost $1,981,685) | 1,981,685 | 1,981,685
|                                                                
|Cash Equivalents 2.6%                                           
|Cash Management QP Trust, 0.27% (c) (Cost $2,493,840)            | 2,493,840 | 2,493,840

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio(Cost $104,062,111)+ | 102.1           | 100,188,889
|Other Assets and Liabilities, Net              | (2.1)           | (2,041,627)
|Net Assets                                     | 100.0           | 98,147,262 

ADR: American Depositary Receipt

REIT: Real Estate Investment Trust

At June 30, 2009, open futures contracts purchased were as follows:

|Futures              | Expiration
Date | Contracts | Aggregate
Face
Value ($) | Value ($) | Unrealized
Depreciation ($)
|-------------------- | --------------- | --------- | ------------------------ | --------- | ---------------------------
|S&P 500 E-Mini Index | 9/18/2009       | 59        | 2,774,725                | 2,700,725 | (74,000)                   

For information on the Portfolio's policy and additional disclosures regarding futures contracts, please refer to the Derivatives section of
Note A in the accompanying Notes to Financial Statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1           | Level 2       | Level 3  | Total            
|------------------------------------------------ | ----------------- | ------------- | -------- | -----------------
|Common Stock and/or Other Equity Investments (e) | $      95,232,554 | $            | $       | $      95,232,554
|Short-Term Investments (e)                       | 1,981,685         | 2,974,650     |         | 4,956,335        
|Total                                            | $   97,214,239    | $   2,974,650 | $       | $   100,188,889  
|Liabilities                                      |                   |               |          |                  
|Derivatives (f)                                  | $      (74,000)   | $            | $       | $      (74,000)  
|Total                                            | $   (74,000)      | $            | $       | $   (74,000)     

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                    
|Investments:Investments in securities, at value (cost $99,586,586  including $1,870,464 of securities loaned)                                                                            
|Investment in Daily Assets Fund Institutional (cost $1,981,685)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $2,493,840)                                                                                                                                  
|Total investments, at value (cost $104,062,111)                                                                                                                                           
|Foreign currency, at value (cost $2,166)                                                                                                                                                  
|Dividends receivable                                                                                                                                                                      
|Interest receivable                                                                                                                                                                       
|Receivable for Portfolio shares sold                                                                                                                                                      
|Total assets                                                                                                                                                                              
|Liabilities                                                                                                                                                                               
|Payable for Portfolio shares redeemed                                                                                                                                                     
|Payable upon return of securities loaned                                                                                                                                                  
|Payable for daily variation margin on open futures contracts                                                                                                                              
|Accrued management fee                                                                                                                                                                    
|Other accrued expenses and payables                                                                                                                                                       
|Total liabilities                                                                                                                                                                         
|Net assets, at value                                                                                                                                                                      
|Net Assets Consist of                                                                                                                                                                     
|Undistributed net investment income                                                                                                                                                       
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                 
|Futures                                                                                                                                                                                   
|Foreign currency                                                                                                                                                                          
|Accumulated net realized gain (loss)                                                                                                                                                      
|Paid-in capital                                                                                                                                                                           
|Net assets, at value                                                                                                                                                                      
|Class A
Net Asset Value, offering and redemption price per share ($98,009,380 ÷ 12,898,873 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($137,882 ÷ 18,067 outstanding shares of beneficial interest,
no par value, unlimited number of shares authorized)       

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $3,732)                                               
|Interest                                                                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Services to shareholders                                                                                 
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses                                                                                           
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Futures                                                                                                  
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Futures                                                                                                  
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                  
|--------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                   
|Operations:Net investment income (loss)                                                                             
|Net realized gain (loss)                                                                                            
|Change in net unrealized appreciation (depreciation)                                                                
|Net increase (decrease) in net assets resulting from operations                                                     
|Distributions to shareholders from:Net investment income:Class A                                                    
|Class B                                                                                                             
|Net realized gains:Class A                                                                                          
|Class B                                                                                                             
|Total distributions                                                                                                 
|Portfolio share transactions:Class A
Proceeds from shares sold                                                      
|Reinvestment of distributions                                                                                       
|Cost of shares redeemed                                                                                             
|Net increase (decrease) in net assets from Class A share transactions                                               
|Class B
Proceeds from shares sold                                                                                   
|Reinvestment of distributions                                                                                       
|Cost of shares redeemed                                                                                             
|Net increase (decrease) in net assets from Class B share transactions                                               
|Increase (decrease) in net assets                                                                                   
|Net assets at beginning of period                                                                                   
|Net assets at end of period (including undistributed net investment income of $705,975 and
$1,989,745, respectively)
|Other Information                                                                                                   
|Class A
Shares outstanding at beginning of period                                                                   
|Shares sold                                                                                                         
|Shares issued to shareholders in reinvestment of distributions                                                      
|Shares redeemed                                                                                                     
|Net increase (decrease) in Class A shares                                                                           
|Shares outstanding at end of period                                                                                 
|Class B
Shares outstanding at beginning of period                                                                   
|Shares sold                                                                                                         
|Shares issued to shareholders in reinvestment of distributions                                                      
|Shares redeemed                                                                                                     
|Net increase (decrease) in Class B shares                                                                           
|Shares outstanding at end of period                                                                                 

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   7.25 | $   14.65 | $   16.17 | $   14.88 | $   13.65 | $   11.84
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .06      | .12       | .17       | .17d      | .14       | .13      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | .44      | (4.97)    | .36       | 2.07      | 1.22      | 1.76     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .50      | (4.85)    | .53       | 2.24      | 1.36      | 1.89     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | (.15)    | (.21)     | (.18)     | (.14)     | (.13)     | (.08)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |         | (2.34)    | (1.87)    | (.81)     |          |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | (.15)    | (2.55)    | (2.05)    | (.95)     | (.13)     | (.08)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $   7.60 | $   7.25  | $   14.65 | $   16.17 | $   14.88 | $   13.65
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 7.29**   | (38.49)c  | 3.50      | 15.65d    | 10.06     | 16.04    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 98       | 106       | 242       | 314       | 294       | 283      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | .83*     | .76       | .71       | .71       | .70       | .70      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | .83*     | .76       | .71       | .71       | .70       | .70      
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 1.61*    | 1.12      | 1.13      | 1.12d     | 1.00      | 1.08     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 41**     | 127       | 275       | 226       | 288       | 249      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.003 per share and an increase in the ratio of net investment income of 0.02%. Excluding this non-recurring income, total return
would have been 0.02% lower.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   7.26 | $   14.61 | $   16.12 | $   14.83 | $   13.60 | $   11.80
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .05      | .04       | .11       | .11d      | .09       | .09      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | .44      | (4.89)    | .36       | 2.07      | 1.22      | 1.74     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .49      | (4.85)    | .47       | 2.18      | 1.31      | 1.83     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | (.12)    | (.16)     | (.11)     | (.08)     | (.08)     | (.03)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |         | (2.34)    | (1.87)    | (.81)     |          |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | (.12)    | (2.50)    | (1.98)    | (.89)     | (.08)     | (.03)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $   7.63 | $   7.26  | $   14.61 | $   16.12 | $   14.83 | $   13.60
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 7.08**   | (38.48)c  | 3.15      | 15.19d    | 9.68      | 15.55    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | .13      | .13       | 11        | 46        | 44        | 37       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1.09*    | 1.22      | 1.09      | 1.09      | 1.09      | 1.08     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 1.09*    | 1.21      | 1.09      | 1.09      | 1.09      | 1.08     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 1.35*    | .67       | .75       | .74d      | .61       | .70      
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 41**     | 127       | 275       | 226       | 288       | 249      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.003 per share and an increase in the ratio of net investment income of 0.02%. Excluding this non-recurring income, total return
would have been 0.02% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Core Fixed Income VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .67% and 1.07% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio invests in individual bonds whose yields and market values fluctuate so that your investment may be worth more or less
than its original cost. Bond investments are subject to interest-rate risk such that when interest rates rise, the prices of the bonds,
and thus the value of the Portfolio, can decline and the investor can lose principal value. In the recent market environment,
mortgage-backed securities are experiencing increased volatility. Investments by the Portfolio in lower-rated bonds present greater risk
to principal and income than investments in higher-quality securities. Additionally, investing in foreign securities presents certain risks,
such as currency fluctuation and changes in political/economic conditions and market risks. All of these factors may result in greater
share price volatility. Please see this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns shown during the 1-year, 3-year, 5-year and 10- year periods reflect a fee waiver and/or expense reimbursement.
Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Core Fixed Income VIP               
|-----------------------------------------------------------------------------------
|[] DWS Core Fixed Income VIP  Class A
[]Barclays Capital U.S. Aggregate Bond Index
|vs2_g10k10e0                                                                       
|Yearly periods ended June 30                                                       

|Comparative Results                     
|----------------------------------------
|DWS Core Fixed Income VIP               
|Class A                                 
|Average annual total return             
|Barclays Capital US
Aggregate Bond Index
|Average annual total return             
|DWS Core Fixed Income VIP               
|Class B                                 
|Average annual total return             
|Barclays Capital US
Aggregate Bond Index
|Average annual total return             

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Core Fixed Income VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                          | Class A |  | Class B | 
|-------------------------------------------------- | ------- |  | ------- | 
|DWS Variable Series II  DWS Core Fixed Income VIP | .77%    |  | 1.17%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Core Fixed Income VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Mortgage-Backed Securities Pass-Throughs                                                 | 30%     | 21%     
|Corporate Bonds                                                                          | 26%     | 24%     
|Government & Agency Obligations                                                          | 15%     | 7%      
|Cash Equivalents                                                                         | 13%     |        
|Collateralized Mortgage Obligations                                                      | 6%      | 30%     
|Municipal Bonds and Notes                                                                | 5%      | 5%      
|Commercial Mortgage-Backed Securities                                                    | 5%      | 10%     
|Asset-Backed                                                                             |        | 2%      
|Preferred Securities                                                                     |        | 1%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Corporate Bonds and Preferred Security) | 6/30/09 | 12/31/08
|------------------------------------------------------------------------ | ------- | --------
|                                                                         |         |         
|Financials                                                               | 37%     | 39%     
|Consumer Discretionary                                                   | 17%     | 12%     
|Energy                                                                   | 12%     | 12%     
|Consumer Staples                                                         | 12%     | 6%      
|Utilities                                                                | 8%      | 16%     
|Telecommunication Services                                               | 5%      | 3%      
|Health Care                                                              | 5%      | 2%      
|Industrials                                                              | 2%      | 3%      
|Information Technology                                                   | 2%      | 3%      
|Materials                                                                |        | 4%      
|                                                                         | 100%    | 100%    

|Quality(Excludes Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|US Government and Agencies                      | 55%     | 38%     
|AAA*                                            | 11%     | 32%     
|AA                                              | 4%      | 2%      
|A                                               | 11%     | 9%      
|BBB                                             | 18%     | 19%     
|Not Rated                                       | 1%      |        
|                                                | 100%    | 100%    

|Effective Maturity(Excludes Cash Equivalents and Securities Lending Collateral) | 6/30/09 | 12/31/08
|------------------------------------------------------------------------------- | ------- | --------
|                                                                                |         |         
|Under 1 year                                                                    | 6%      | 1%      
|1-4.99 years                                                                    | 49%     | 44%     
|5-9.99 years                                                                    | 37%     | 37%     
|10-14.99 years                                                                  | 2%      | 4%      
|15 years or greater                                                             | 6%      | 14%     
|                                                                                | 100%    | 100%    

Asset allocation, sector diversification, quality and effective maturity are subject to change.

Weighted average effective maturity: 6.5 years and 7.9 years, respectively.

The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") credit
ratings. The ratings of Moody's and S&P represent their opinions as to the quality of the securities they rate. Ratings are relative and
subjective and are not absolute standards of quality. The Portfolio's quality does not remove market risk.

For more complete details about the Portfolio's investment portfolio, see page 66. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Core Fixed Income VIP

|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ----------
|                                                                                                                          |                                                               
|Corporate Bonds 28.1%                                                                                                    
|Consumer Discretionary 4.8%                                                                                              
|British Sky Broadcasting Group PLC, 144A, 9.5%, 11/15/2018                                                                | 605,000                                                        | 723,103   
|Comcast Cable Holdings LLC:                                                                                              
|                                                                                                                          | 7.875%, 8/1/2013                                               | 435,000   
|                                                                                                                          | 9.875%, 6/15/2022                                              | 250,000   
|                                                                                                                          | 10.125%, 4/15/2022                                             | 363,000   
|Cox Communications, Inc., 7.125%, 10/1/2012                                                                               | 550,000                                                        | 591,226   
|Fortune Brands, Inc.:                                                                                                    
|                                                                                                                          | 5.375%, 1/15/2016                                              | 300,000   
|                                                                                                                          | 6.375%, 6/15/2014                                              | 210,000   
|News America, Inc., 6.4%, 12/15/2035                                                                                      | 320,000                                                        | 280,075   
|Time Warner Cable, Inc.:                                                                                                 
|                                                                                                                          | 6.75%, 7/1/2018                                                | 122,000   
|                                                                                                                          | 6.75%, 6/15/2039                                               | 400,000   
|Time Warner Entertainment Co., LP, 10.15%, 5/1/2012                                                                       | 460,000                                                        | 515,374   
|Time Warner, Inc.:                                                                                                       
|                                                                                                                          | 7.625%, 4/15/2031                                              | 360,000   
|                                                                                                                          | 7.7%, 5/1/2032                                                 | 325,000   
|Viacom, Inc.:                                                                                                            
|                                                                                                                          | 6.25%, 4/30/2016                                               | 130,000   
|                                                                                                                          | 6.75%, 10/5/2037                                               | 550,000   
|Yum! Brands, Inc., 6.875%, 11/15/2037                                                                                     | 500,000                                                        | 504,000   
|                                                                                                                          | 6,122,297                                                     
|Consumer Staples 3.3%                                                                                                    
|Altria Group, Inc., 9.95%, 11/10/2038                                                                                     | 250,000                                                        | 288,581   
|Anheuser-Busch InBev Worldwide, Inc., 144A, 7.75%, 1/15/2019                                                              | 750,000                                                        | 820,242   
|ConAgra Foods, Inc., 7.0%, 4/15/2019                                                                                      | 350,000                                                        | 383,698   
|CVS Caremark Corp., 6.302%, 6/1/2037                                                                                      | 1,949,000                                                      | 1,442,260 
|Dr. Pepper Snapple Group, Inc., 6.82%, 5/1/2018                                                                           | 440,000                                                        | 465,307   
|Kroger Co.:                                                                                                              
|                                                                                                                          | 6.15%, 1/15/2020                                               | 200,000   
|                                                                                                                          | 7.0%, 5/1/2018 (a)                                             | 375,000   
|Safeway, Inc., 7.45%, 9/15/2027                                                                                           | 220,000                                                        | 232,163   
|                                                                                                                          | 4,240,405                                                     
|Energy 3.5%                                                                                                              
|Anadarko Petroleum Corp., 6.45%, 9/15/2036                                                                                | 290,000                                                        | 260,686   
|ConocoPhillips, 6.5%, 2/1/2039                                                                                            | 500,000                                                        | 532,216   
|DCP Midstream LLC, 144A, 9.75%, 3/15/2019                                                                                 | 330,000                                                        | 367,865   
|Devon Energy Corp., 6.3%, 1/15/2019                                                                                       | 700,000                                                        | 748,033   
|Enterprise Products Operating LLP, 7.5%, 2/1/2011                                                                         | 460,000                                                        | 482,142   
|Hess Corp., 8.125%, 2/15/2019                                                                                             | 390,000                                                        | 443,997   
|Kinder Morgan Energy Partners LP:                                                                                        
|                                                                                                                          | 5.625%, 2/15/2015                                              | 92,000    
|                                                                                                                          | 7.3%, 8/15/2033                                                | 300,000   
|Marathon Oil Corp., 7.5%, 2/15/2019                                                                                       | 320,000                                                        | 349,265   
|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|                                                                                                                          |                                                               
|ONEOK Partners LP, 8.625%, 3/1/2019                                                                                       | 415,000                                                        | 464,130   
|Talisman Energy, Inc., 7.75%, 6/1/2019 (a)                                                                                | 123,000                                                        | 136,259   
|TransCanada PipeLines Ltd., 7.625%, 1/15/2039                                                                             | 255,000                                                        | 297,611   
|                                                                                                                          | 4,463,358                                                     
|Financials 10.3%                                                                                                         
|American Express Co., 7.0%, 3/19/2018                                                                                     | 688,000                                                        | 668,074   
|Bank of America Corp.:                                                                                                   
|                                                                                                                          | 5.65%, 5/1/2018                                                | 865,000   
|                                                                                                                          | 5.75%, 12/1/2017                                               | 225,000   
|                                                                                                                          | Series L, 7.375%, 5/15/2014                                    | 74,000    
|                                                                                                                          | 7.625%, 6/1/2019                                               | 240,000   
|Bank of New York Mellon Corp., 4.3%, 5/15/2014                                                                            | 300,000                                                        | 304,837   
|BB&T Corp., 6.85%, 4/30/2019                                                                                              | 345,000                                                        | 358,788   
|Capital One Financial Corp., 7.375%, 5/23/2014                                                                            | 240,000                                                        | 247,483   
|Citigroup, Inc.:                                                                                                         
|                                                                                                                          | 4.125%, 2/22/2010                                              | 400,000   
|                                                                                                                          | 6.125%, 5/15/2018                                              | 350,000   
|                                                                                                                          | 8.5%, 5/22/2019                                                | 168,000   
|Corp. Andina de Fomento:                                                                                                 
|                                                                                                                          | 5.75%, 1/12/2017                                               | 295,000   
|                                                                                                                          | 6.875%, 3/15/2012                                              | 210,000   
|Deutsche Telekom International Finance BV:                                                                                |                                                               
|                                                                                                                          | 4.875%, 7/8/2014                                               | 100,000   
|                                                                                                                          | 6.0%, 7/8/2019 (a)                                             | 630,000   
|General Electric Capital Corp., 5.625%, 5/1/2018 (a)                                                                      | 980,000                                                        | 926,867   
|Hartford Financial Services Group, Inc., 5.25%, 10/15/2011                                                                | 200,000                                                        | 193,298   
|Jefferson-Pilot Corp., 4.75%, 1/30/2014                                                                                   | 80,000                                                         | 70,589    
|JPMorgan Chase & Co.:                                                                                                    
|                                                                                                                          | 4.65%, 6/1/2014                                                | 310,000   
|                                                                                                                          | 6.3%, 4/23/2019                                                | 640,000   
|MetLife, Inc.:                                                                                                           
|                                                                                                                          | 6.75%, 6/1/2016                                                | 190,000   
|                                                                                                                          | 7.717%, 2/15/2019                                              | 395,000   
|Morgan Stanley:                                                                                                          
|                                                                                                                          | Series F, 6.0%, 4/28/2015                                      | 490,000   
|                                                                                                                          | 7.3%, 5/13/2019                                                | 210,000   
|National City Corp., 4.0%, 2/1/2011                                                                                       | 580,000                                                        | 569,850   
|National Rural Utilities Cooperative Finance Corp., 10.375%, 11/1/2018                                                    | 645,000                                                        | 808,716   
|Principal Financial Group, Inc., 7.875%, 5/15/2014                                                                        | 525,000                                                        | 553,083   
|Prudential Financial, Inc.:                                                                                              
|                                                                                                                          | Series B, 5.1%, 9/20/2014                                      | 130,000   
|                                                                                                                          | 7.375%, 6/15/2019                                              | 50,000    
|Simon Property Group LP, (REIT), 6.75%, 5/15/2014 (a)                                                                     | 105,000                                                        | 105,504   
|Telefonica Emisiones SAU, 5.877%, 7/15/2019 (b)                                                                           | 145,000                                                        | 149,494   
|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|                                                                                                                          |                                                               
|The Goldman Sachs Group, Inc.:                                                                                           
|                                                                                                                          | 6.0%, 5/1/2014                                                 | 180,000   
|                                                                                                                          | 7.5%, 2/15/2019                                                | 730,000   
|US Bancorp.:                                                                                                             
|                                                                                                                          | LIBOR minus 1.46%, 0.00%, 12/11/2035                           | 265,000   
|                                                                                                                          | LIBOR minus 1.75%, 0.00%, 9/20/2036                            | 20,000    
|Verizon Wireless Capital LLC, 144A, 8.5%, 11/15/2018                                                                      | 300,000                                                        | 358,528   
|Wachovia Corp., Series G, 5.5%, 5/1/2013                                                                                  | 650,000                                                        | 671,453   
|                                                                                                                          | 13,073,734                                                    
|Health Care 1.3%                                                                                                         
|Express Scripts, Inc.:                                                                                                   
|                                                                                                                          | 6.25%, 6/15/2014                                               | 75,000    
|                                                                                                                          | 7.25%, 6/15/2019                                               | 50,000    
|McKesson Corp., 7.5%, 2/15/2019 (a)                                                                                       | 300,000                                                        | 337,845   
|Medco Health Solutions, Inc., 7.125%, 3/15/2018                                                                           | 740,000                                                        | 779,276   
|Merck & Co., Inc.:                                                                                                       
|                                                                                                                          | 5.0%, 6/30/2019                                                | 207,000   
|                                                                                                                          | 5.85%, 6/30/2039                                               | 48,000    
|Quest Diagnostics, Inc., 6.95%, 7/1/2037                                                                                  | 170,000                                                        | 170,834   
|                                                                                                                          | 1,681,353                                                     
|Industrials 0.5%                                                                                                         
|Waste Management, Inc., 6.375%, 3/11/2015                                                                                 | 570,000                                                        | 590,545   
|Information Technology 0.5%                                                                                              
|Dell, Inc., 5.875%, 6/15/2019                                                                                             | 200,000                                                        | 204,142   
|Oracle Corp.:                                                                                                            
|                                                                                                                          | 3.75%, 7/8/2014 (b)                                            | 145,000   
|                                                                                                                          | 5.0%, 7/8/2019 (b)                                             | 225,000   
|                                                                                                                          | 573,192                                                       
|Telecommunication Services 1.5%                                                                                          
|AT&T, Inc., 6.55%, 2/15/2039                                                                                              | 615,000                                                        | 613,907   
|Qwest Corp., 7.625%, 6/15/2015                                                                                            | 234,000                                                        | 219,960   
|Telecom Italia Capital SA:                                                                                               
|                                                                                                                          | 5.25%, 11/15/2013                                              | 445,000   
|                                                                                                                          | 6.175%, 6/18/2014                                              | 130,000   
|                                                                                                                          | 7.175%, 6/18/2019                                              | 120,000   
|Verizon Communications, Inc., 6.35%, 4/1/2019                                                                             | 350,000                                                        | 364,102   
|                                                                                                                          | 1,887,440                                                     
|Utilities 2.4%                                                                                                           
|DPL, Inc., 6.875%, 9/1/2011                                                                                               | 380,000                                                        | 399,319   
|DTE Energy Co., 7.625%, 5/15/2014                                                                                         | 148,000                                                        | 154,462   
|Pepco Holdings, Inc., 6.45%, 8/15/2012                                                                                    | 675,000                                                        | 702,377   
|Progress Energy, Inc., 7.05%, 3/15/2019 (a)                                                                               | 300,000                                                        | 332,850   
|Sempra Energy, 6.5%, 6/1/2016                                                                                             | 290,000                                                        | 302,714   
|Southern Co., 4.15%, 5/15/2014                                                                                            | 285,000                                                        | 286,134   
|Southwestern Public Service Co., Series G, 8.75%, 12/1/2018                                                               | 680,000                                                        | 817,128   
|                                                                                                                          | 2,994,984                                                     
|Total Corporate Bonds (Cost $34,329,256)                                                                                  | 35,627,308                                                    
|                                                                                                                         
|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|                                                                                                                          |                                                               
|Asset-Backed 0.0%                                                                                                        
|Home Equity Loans                                                                                                        
|Securitized Asset-Backed NIM Trust, "NIM", Series 2005-FR4, 144A, 6.0%, 1/25/2036* (Cost $459,643)                        | 459,930                                                        | 46        
|                                                                                                                         
|Mortgage-Backed Securities Pass-Throughs 32.6%                                                                           
|Federal Home Loan Mortgage Corp.:                                                                                        
|                                                                                                                          | 4.5%, 9/1/2020                                                 | 1,563,294 
|                                                                                                                          | 6.0%, with various maturities from 12/1/2034 until 3/1/2038    | 1,203,424 
|Federal National Mortgage Association:                                                                                    |                                                               
|                                                                                                                          | 4.5%, with various maturities from 8/1/2033 until 10/1/2033    | 2,566,933 
|                                                                                                                          | 5.0%, with various maturities from 7/1/2019 until 2/1/2038 (b) | 9,376,216 
|                                                                                                                          | 5.136%**, 9/1/2038                                             | 479,482   
|                                                                                                                          | 5.5%, with various maturities from 2/1/2024 until 9/1/2036 (b) | 18,206,647
|                                                                                                                          | 6.0%, 4/1/2024                                                 | 1,049,952 
|                                                                                                                          | 6.5%, with various maturities from 3/1/2017 until 4/1/2037     | 5,442,649 
|                                                                                                                          | 8.0%, 9/1/2015                                                 | 19,538    
|Total Mortgage-Backed Securities Pass-Throughs (Cost $40,136,123)                                                         | 41,390,101                                                    
|                                                                                                                         
|Commercial Mortgage-Backed Securities 5.0%                                                                               
|Banc of America Commercial Mortgage, Inc.:                                                                               
|                                                                                                                          | "A4", Series 2007-1, 5.451%, 1/15/2049                         | 855,000   
|                                                                                                                          | "A2", Series 2007-2, 5.634%, 4/10/2049                         | 325,000   
|                                                                                                                          | "A4", Series 2007-3, 5.837%**, 6/10/2049                       | 1,035,000 
|                                                                                                                          | "A4", Series 2007-2, 5.867%**, 4/10/2049                       | 675,000   
|Greenwich Capital Commercial Funding Corp., "A4", Series 2007-GG9, 5.444%, 3/10/2039                                      | 1,465,000                                                      | 1,167,773 
|GS Mortgage Securities Corp. II, "A4", Series 2006-GG8, 5.56%, 11/10/2039                                                 | 485,000                                                        | 395,569   
|JPMorgan Chase Commercial Mortgage Securities Corp.:                                                                     
|                                                                                                                          | "A4", Series 2007-LD12, 5.882%, 2/15/2051                      | 338,000   
|                                                                                                                          | "A2", Series 2007-LD11, 5.992%**, 6/15/2049                    | 1,790,000 
|Merrill Lynch Mortgage Trust, "ASB", Series 2007-C1, 6.022%**, 6/12/2050                                                  | 900,000                                                        | 752,310   
|Total Commercial Mortgage-Backed Securities (Cost $7,062,482)                                                             | 6,394,900                                                     
|                                                                                                                         
|Collateralized Mortgage Obligations 6.8%                                                                                 
|Fannie Mae Whole Loan, "1A1", Series 2004-W15, 6.0%, 8/25/2044                                                            | 844,696                                                        | 892,927   
|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|                                                                                                                          |                                                               
|Federal Home Loan Mortgage Corp.:                                                                                        
|                                                                                                                          | "LN", Series 3145, 4.5%, 10/15/2034                            | 1,505,809 
|                                                                                                                          | "BG", Series 2869, 5.0%, 7/15/2033                             | 335,000   
|                                                                                                                          | "PE", Series 2165, 6.0%, 6/15/2029                             | 1,160,571 
|Federal National Mortgage Association:                                                                                   
|                                                                                                                          | "QD", Series 2005-29, 5.0%, 8/25/2033                          | 435,000   
|                                                                                                                          | "HE", Series 2005-22, 5.0%, 10/25/2033                         | 1,540,000 
|                                                                                                                          | "PG", Series 2002-3, 5.5%, 2/25/2017                           | 364,451   
|                                                                                                                          | "PH", Series 1999-19, 6.0%, 5/25/2029                          | 1,102,106 
|                                                                                                                          | "Z", Series 2001-14, 6.0%, 5/25/2031                           | 723,867   
|MASTR Alternative Loans Trust, "5A1", Series 2005-1, 5.5%, 1/25/2020                                                      | 415,639                                                        | 345,890   
|Total Collateralized Mortgage Obligations (Cost $8,337,925)                                                               | 8,676,654                                                     
|                                                                                                                         
|Municipal Bonds and Notes 5.5%                                                                                           
|Arizona, Salt River Project, Agricultural Improvement & Power District Electric Systems Revenue, Series A,
5.0%, 1/1/2038 | 480,000                                                        | 480,989   
|Florida, State Board of Education, Capital Outlay 2006, Series E, 5.0%, 6/1/2035                                          | 500,000                                                        | 495,105   
|Glendale, AZ, Municipal Property Corp., Excise Tax Revenue, Series B, 6.157%, 7/1/2033 (c)                                | 420,000                                                        | 390,365   
|Jicarilla, NM, Sales & Special Tax Revenue, Apache Nation Revenue, 144A, 5.2%, 12/1/2013                                  | 945,000                                                        | 956,368   
|Miami-Dade County, FL, Educational Facilities Authority Revenue, University of Miami, Series B, 6.1%,
4/1/2015            | 965,000                                                        | 1,010,693 
|Michigan, Western Michigan University Revenue, 4.41%, 11/15/2014 (c)                                                      | 885,000                                                        | 877,115   
|New Jersey, Economic Development Authority Revenue, Series B, 6.5%, 11/1/2014 (c)                                         | 585,000                                                        | 646,273   
|New Jersey, State Educational Facilities Authority Revenue, NJ City University, Series F, 6.85%, 7/1/2036 (c)             | 395,000                                                        | 405,025   
|New Jersey, State Turnpike Authority Revenue, Build America Bonds, Series F, 7.414%, 1/1/2040                             | 240,000                                                        | 285,706   
|Newark, NJ, Pension Obligation, 5.853%, 4/1/2022 (c)                                                                      | 865,000                                                        | 815,738   
|                                                                                                                          | Principal
Amount ($)                                           | Value ($) 
|                                                                                                                          |                                                               
|Texas, Pharr-San Juan-Alamo Independent School District, School Building, 5.0%, 2/1/2038                                  | 295,000                                                        | 296,622   
|Texas, Eagle Mountain & Saginaw Independent School District, School Building, 5.0%, 8/15/2038                             | 315,000                                                        | 317,507   
|Total Municipal Bonds and Notes (Cost $6,902,173)                                                                         | 6,977,506                                                     
|                                                                                                                         
|Government & Agency Obligations 15.6%                                                                                    
|Other Government Related 7.3%                                                                                            
|American Express Bank FSB, FDIC Guaranteed, 3.15%, 12/9/2011 (a)                                                          | 1,800,000                                                      | 1,863,794 
|Citigroup, Inc., FDIC Guaranteed, 2.875%, 12/9/2011                                                                       | 1,800,000                                                      | 1,851,642 
|John Deere Capital Corp., Series D, FDIC Guaranteed, 2.875%, 6/19/2012 (a)                                                | 1,800,000                                                      | 1,844,440 
|JPMorgan Chase & Co., FDIC Guaranteed, 2.125%, 12/26/2012 (a)                                                             | 1,800,000                                                      | 1,790,896 
|KeyBank NA, FDIC Guaranteed, 3.2%, 6/15/2012 (a)                                                                          | 1,800,000                                                      | 1,860,782 
|                                                                                                                          | 9,211,554                                                     
|US Treasury Obligations 8.3%                                                                                             
|US Treasury Notes:                                                                                                       
|                                                                                                                          | 1.75%, 1/31/2014 (a)                                           | 6,000,000 
|                                                                                                                          | 3.125%, 5/15/2019 (a)                                          | 4,500,000 
|                                                                                                                          | 4.875%, 5/31/2011                                              | 300,000   
|                                                                                                                          | 10,505,197                                                    
|Total Government & Agency Obligations (Cost $19,744,424)                                                                  | 19,716,751                                                    
|                                                                                                                         
|Preferred Security 0.3%                                                                                                  
|Financials                                                                                                               
|PNC Preferred Funding Trust I, 144A, 8.7%, 3/15/2013 (d) (Cost $294,063)                                                  | 400,000                                                        | 328,004   

|                                                                   | Shares     | Value ($) 
|------------------------------------------------------------------ | ---------- | ----------
|                                                                   |           
|Securities Lending Collateral 15.2%                               
|Daily Assets Fund Institutional, 
0.48% (e) (f) (Cost $19,213,433) | 19,213,433 | 19,213,433
|Cash Equivalents 13.9%                                            
|Cash Management QP Trust, 0.27% (e) (Cost $17,635,001)             | 17,635,001 | 17,635,001

|                                               | % of Net
Assets | Value ($)   
|---------------------------------------------- | --------------- | ------------
|                                               |                
|Total Investment Portfolio(Cost $154,114,523)+ | 123.0           | 155,959,704 
|Other Assets and Liabilities, Net              | (23.0)          | (29,185,639)
|Net Assets                                     | 100.0           | 126,774,065 

|Securities                                                 | Coupon | Maturity Date | Principal
Amount ($) | Acquisition
Cost ($) | Value ($)
|---------------------------------------------------------- | ------ | ------------- | -------------------- | -------------------- | ---------
|Securitized Asset-Backed NIM Trust, "NIM",
Series 2005-FR4 | 6.0%   | 1/25/2036     | 459,930              | 459,643              | 46       

|Insurance Coverage                 | As a % of Total
Investment Portfolio
|---------------------------------- | ------------------------------------
|Ambac Financial Group, Inc.        | 0.5                                 
|Assured Guaranty Corp.             | 0.7                                 
|Financial Security Assurance, Inc. | 0.8                                 

Many insurers who have traditionally guaranteed payment of municipal issues have been downgraded by the major rating agencies. As a
result, most insured issues are now trading on the basis of the underlying credits.

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.

FDIC: Federal Deposit Insurance Corp.

FSB: Federal Savings Bank

LIBOR: Represents the London InterBank Offered Rate.

REIT: Real Estate Investment Trust

Included in the portfolio are investments in mortgage or asset-backed securities which are interests in separate pools of mortgages or assets.
Effective maturities of these investments may be shorter than stated maturities due to prepayments. Some separate investments in the
Federal Home Loan Mortgage Corp. and Federal National Mortgage Association issues which have similar coupon rates have been aggregated
for presentation purposes in the investment portfolio.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                   | Level 1        | Level 2           | Level 3  | Total            
|---------------------------------------- | -------------- | ----------------- | -------- | -----------------
|Fixed Income (g)                         |                |                   |          |                  
|Corporate Bonds                          | $             | $      35,627,308 | $       | $      35,627,308
|Asset Backed                             |               | 46                |         | 46               
|Mortgage-Backed Securities Pass-Throughs |               | 41,390,101        |         | 41,390,101       
|Commercial Mortgage-Backed Securities    |               | 6,394,900         |         | 6,394,900        
|Collateral Mortgage Obligations          |               | 8,676,654         |         | 8,676,654        
|Municipal Bonds and Notes                |               | 6,977,506         |         | 6,977,506        
|Government & Agency Obligations          |               | 19,716,751        |         | 19,716,751       
|Preferred Security                       |               | 328,004           |         | 328,004          
|Short-Term Investments (g)               | 19,213,433     | 17,635,001        |         | 36,848,434       
|Total                                    | $   19,213,433 | $   136,746,271   | $       | $   155,959,704  

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                 | Preferred
Security | Preferred Stock | Total      
|-------------------------------------------------------------------------------- | ------------------ | --------------- | -----------
|Balance as of December 31, 2008                                                  | $      50,000      | $      147,119  | $   197,119
|Realized gains (loss)                                                            | (158,675)          | (312,002)       | (470,677)  
|Change in unrealized appreciation (depreciation)                                 | 183,675            | 207,067         | 390,742    
|Amortization premium/discount                                                    |                   |                |           
|Net purchases (sales)                                                            | (75,000)           | (42,184)        | (117,184)  
|Net transfers in (out) of Level 3                                                |                   |                |           
|Balance as of June 30, 2009                                                      | $                 | $              | $         
|Net change in unrealized appreciation (depreciation) from investments
still held | $                 | $              | $         

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                              
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                           
|Investments:Investments in securities, at value (cost $117,266,089)  including $18,696,764 of securities loaned                                                                 
|Investment in Daily Assets Fund Institutional (cost $19,213,433)*                                                                                                                
|Investment in Cash Management QP Trust (cost $17,635,001)                                                                                                                        
|Total investments, at value (cost $154,114,523)                                                                                                                                  
|Cash                                                                                                                                                                             
|Receivable for Portfolio shares sold                                                                                                                                             
|Interest receivable                                                                                                                                                              
|Foreign taxes recoverable                                                                                                                                                        
|Total assets                                                                                                                                                                     
|Liabilities                                                                                                                                                                      
|Payable upon return of securities loaned                                                                                                                                         
|Payable for investments purchased                                                                                                                                                
|Payable for when-issued and delayed delivery securities purchased                                                                                                                
|Payable for Portfolio shares redeemed                                                                                                                                            
|Accrued management fee                                                                                                                                                           
|Other accrued expenses and payables                                                                                                                                              
|Total liabilities                                                                                                                                                                
|Net assets, at value                                                                                                                                                             
|Net Assets Consist of                                                                                                                                                            
|Undistributed net investment income                                                                                                                                              
|Net unrealized appreciation (depreciation) on investments                                                                                                                        
|Accumulated net realized gain (loss)                                                                                                                                             
|Paid-in capital                                                                                                                                                                  
|Net assets, at value                                                                                                                                                             
|Class A
Net Asset Value, offering and redemption price per share ($95,699,322 ÷ 11,441,180 outstanding shares of beneficial
interest, no par value, 24,742,586 shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($31,074,743 ÷ 3,712,160 outstanding shares of beneficial
interest, no par value, 7,316,641 shares authorized)  

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends                                                                                         
|Interest                                                                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Record keeping fees (Class B)                                                                            
|Professional fees                                                                                        
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Futures                                                                                                  
|Payments by affiliates (see Note I)                                                                      
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Futures                                                                                                  
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                     
|-----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                      
|Operations:Net investment income (loss)                                                                                
|Net realized gain (loss)                                                                                               
|Change in net unrealized appreciation (depreciation)                                                                   
|Net increase (decrease) in net assets resulting from operations                                                        
|Distributions to shareholders from:Net investment income:Class A                                                       
|Class B                                                                                                                
|Total distributions                                                                                                    
|Portfolio share transactions:Class A
Proceeds from shares sold                                                         
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class A share transactions                                                  
|Class B
Proceeds from shares sold                                                                                      
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class B share transactions                                                  
|Increase (decrease) in net assets                                                                                      
|Net assets at beginning of period                                                                                      
|Net assets at end of period (including undistributed net investment income of $3,315,951 and
$11,316,317, respectively)
|Other Information                                                                                                      
|Class A
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class A shares                                                                              
|Shares outstanding at end of period                                                                                    
|Class B
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class B shares                                                                              
|Shares outstanding at end of period                                                                                    

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Date                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                     | $   8.90 | $   11.82 | $   11.86 | $   11.81 | $   12.07 | $   12.16
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                         | .22      | .57       | .56       | .53       | .47       | .50      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                  | .00***   | (2.72)    | (.08)     | (.05)     | (.21)     | .05      
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                         | .22      | (2.15)    | .48       | .48       | .26       | .55      
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                           | (.76)    | (.77)     | (.52)     | (.43)     | (.41)     | (.43)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                       |         |          |          | (.00)***  | (.11)     | (.21)    
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                      | (.76)    | (.77)     | (.52)     | (.43)     | (.52)     | (.64)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                           | $   8.36 | $   8.90  | $   11.82 | $   11.86 | $   11.81 | $   12.07
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.68d**  | (19.33)c  | 4.17      | 4.26      | 2.25      | 4.53     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                      
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                   | 96       | 110       | 186       | 277       | 252       | 210      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                          | .77*     | .70       | .66       | .68       | .67       | .66      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                           | .77*     | .70       | .66       | .68       | .67       | .66      
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                | 5.18*    | 5.36      | 4.78      | 4.56      | 3.96      | 4.18     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                              | 156**    | 215       | 209       | 198       | 241       | 176      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal returns would have been lower had certain expenses not been reduced.dIncludes a reimbursement from the Advisor to reimburse the effect of losses incurred as the result of certain operation errors during the
period. Excluding this reimbursement, total return would have been 0.02% lower.*Annualized**Not annualized***Amount is less than $.005.

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                     | $   8.88 | $   11.80 | $   11.84 | $   11.78 | $   12.04 | $   12.13
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                         | .20      | .53       | .51       | .49       | .42       | .45      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                  | .01      | (2.73)    | (.08)     | (.05)     | (.21)     | .05      
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                         | .21      | (2.20)    | .43       | .44       | .21       | .50      
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                           | (.72)    | (.72)     | (.47)     | (.38)     | (.36)     | (.38)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                       |         |          |          | (.00)***  | (.11)     | (.21)    
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                      | (.72)    | (.72)     | (.47)     | (.38)     | (.47)     | (.59)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                           | $   8.37 | $   8.88  | $   11.80 | $   11.84 | $   11.78 | $   12.04
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.59d**  | (19.71)c  | 3.75      | 3.89      | 1.85      | 4.10     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                      
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                   | 31       | 32        | 69        | 82        | 89        | 88       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                          | 1.17*    | 1.10      | 1.05      | 1.07      | 1.07      | 1.03     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                           | 1.17*    | 1.09      | 1.05      | 1.07      | 1.07      | 1.03     
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                | 4.78*    | 4.97      | 4.39      | 4.17      | 3.56      | 3.81     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                              | 156**    | 215       | 209       | 198       | 241       | 176      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal returns would have been lower had certain expenses not been reduced.dIncludes a reimbursement from the Advisor to reimburse the effect of losses incurred as the result of certain operation errors during the
period. Excluding this reimbursement, total return would have been 0.02% lower.*Annualized**Not annualized***Amount is less than $.005.

Performance SummaryJune 30, 2009

DWS Diversified International Equity VIP (formerly DWS International Select Equity VIP)

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is .99% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Additionally,
investing in foreign securities presents certain risks, such as currency fluctuation, political and economic changes and market risks.
This may result in greater share price volatility. Please read this Portfolio's prospectus for specific details regarding its investments and
risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement for
Class A shares. Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Diversified International Equity VIP               
|--------------------------------------------------------------------------------------------------
|[] DWS Diversified International Equity VIP  Class A
[]MSCI EAFE® + EMF Index
[]MSCI EAFE®  Index
|vs2_g10k10d0                                                                                      
|Yearly periods ended June 30                                                                      

|Comparative Results                     
|----------------------------------------
|DWS Diversified International Equity VIP
|Class A                                 
|Average annual total return             
|MSCI EAFE + EMF Index                   
|Average annual total return             
|MSCI EAFE Index                         
|Average annual total return             

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Diversified International Select Equity VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratio                                                 | Class A | 
|------------------------------------------------------------------------ | ------- | 
|DWS Variable Series II  DWS Diversified International Select Equity VIP | 1.01%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Diversified International Equity VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 94%     | 95%     
|Exchange-Traded Fund                                                                     | 3%      | 5%      
|Cash Equivalents                                                                         | 2%      |        
|Preferred Stocks                                                                         | 1%      |        
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Investment Portfolio excluding Exchange-Traded Fund, Cash Equivalents
and Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------------------------------------------------------------------------------------------------- | ------- | --------
|                                                                                                                                          |         |         
|Telecommunication Services                                                                                                                | 16%     | 14%     
|Consumer Staples                                                                                                                          | 14%     | 10%     
|Health Care                                                                                                                               | 14%     | 21%     
|Financials                                                                                                                                | 10%     | 19%     
|Consumer Discretionary                                                                                                                    | 9%      |        
|Utilities                                                                                                                                 | 9%      | 4%      
|Industrials                                                                                                                               | 8%      | 8%      
|Materials                                                                                                                                 | 8%      | 7%      
|Energy                                                                                                                                    | 6%      | 11%     
|Information Technology                                                                                                                    | 6%      | 6%      
|                                                                                                                                          | 100%    | 100%    

|Geographical Diversification(As a % of Investment Portfolio excluding Exchange-Traded Fund, Cash
Equivalents and Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------------------------------------------------------------------------------------------------------- | ------- | --------
|                                                                                                                                                |         |         
|Continental Europe                                                                                                                              | 57%     | 59%     
|Japan                                                                                                                                           | 18%     | 24%     
|United Kingdom                                                                                                                                  | 9%      | 7%      
|Australia                                                                                                                                       | 6%      |        
|Canada                                                                                                                                          | 5%      | 1%      
|Asia (excluding Japan)                                                                                                                          | 5%      | 6%      
|Latin America                                                                                                                                   |        | 2%      
|Russia                                                                                                                                          |        | 1%      
|                                                                                                                                                | 100%    | 100%    

Asset allocation, sector and geographical diversifications are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 80. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Diversified International Equity VIP

|                                                                                | Shares     | Value ($)
|------------------------------------------------------------------------------- | ---------- | ---------
|                                                                                |           
|Common Stocks 92.9%                                                            
|Australia 5.7%                                                                 
|AGL Energy Ltd.                                                                 | 82,582     | 890,567  
|Australia & New Zealand Banking Group Ltd.                                      | 3,822      | 50,526   
|BHP Billiton Ltd.                                                               | 10,497     | 287,696  
|Brambles Ltd.                                                                   | 19,965     | 95,513   
|Coca-Cola Amatil Ltd.                                                           | 6,331      | 43,858   
|Cochlear Ltd.                                                                   | 1,572      | 73,021   
|Commonwealth Bank of Australia                                                  | 2,596      | 81,169   
|Crown Ltd.                                                                      | 15,188     | 88,505   
|CSL Ltd.                                                                        | 14,306     | 369,751  
|CSR Ltd.                                                                        | 30,700     | 41,806   
|Fairfax Media Ltd. (a)                                                          | 69,502     | 68,034   
|Foster's Group Ltd.                                                             | 16,834     | 69,773   
|Leighton Holdings Ltd.                                                          | 2,589      | 48,746   
|Macquarie Infrastructure Group (Units)                                          | 45,344     | 52,076   
|National Australia Bank Ltd.                                                    | 3,501      | 63,032   
|Newcrest Mining Ltd.                                                            | 1,579      | 38,692   
|Origin Energy Ltd.                                                              | 9,638      | 113,410  
|Paladin Energy Ltd.*                                                            | 7,326      | 28,846   
|Qantas Airways Ltd.                                                             | 27,721     | 44,718   
|QBE Insurance Group Ltd.                                                        | 2,063      | 32,917   
|Rio Tinto Ltd.                                                                  | 900        | 37,667   
|Santos Ltd.                                                                     | 9,683      | 113,751  
|Sonic Healthcare Ltd.                                                           | 9,481      | 93,863   
|SP Ausnet                                                                       | 251,683    | 155,728  
|TABCORP Holdings Ltd.                                                           | 18,765     | 107,986  
|Tatts Group Ltd.                                                                | 35,379     | 72,571   
|Telstra Corp., Ltd.                                                             | 188,708    | 514,902  
|Toll Holdings Ltd.                                                              | 10,964     | 54,396   
|Transurban Group (Units)                                                        | 19,529     | 65,037   
|Wesfarmers Ltd.                                                                 | 8,252      | 150,217  
|Westfield Group (REIT) (Units)                                                  | 5,712      | 52,027   
|Westpac Banking Corp.                                                           | 5,844      | 94,663   
|Woodside Petroleum Ltd.                                                         | 5,329      | 184,658  
|Woolworths Ltd.                                                                 | 9,522      | 201,346  
|WorleyParsons Ltd.                                                              | 2,509      | 47,801   
|(Cost $4,091,323)                                                               | 4,529,269 
|Austria 1.1%                                                                   
|Erste Group Bank AG                                                             | 8,080      | 219,533  
|OMV AG                                                                          | 12,665     | 474,791  
|Raiffeisen International Bank-Holding AG                                        | 2,709      | 94,077   
|Vienna Insurance Group                                                          | 1,886      | 81,973   
|(Cost $734,898)                                                                 | 870,374   
|Belgium 2.7%                                                                   
|Anheuser-Busch InBev NV                                                         | 8,274      | 299,540  
|Belgacom SA                                                                     | 21,190     | 677,423  
|Colruyt SA                                                                      | 173        | 39,480   
|Compagnie Nationale a Portefeuille                                              | 907        | 43,848   
|Delhaize Group                                                                  | 1,198      | 84,348   
|Dexia SA* (a)                                                                   | 9,179      | 69,606   
|Fortis*                                                                         | 35,721     | 121,788  
|Groupe Bruxelles Lambert SA                                                     | 1,322      | 96,815   
|KBC GROEP NV*                                                                   | 2,869      | 52,338   
|Mobistar SA                                                                     | 4,408      | 272,088  
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Solvay SA                                                                       | 2,899      | 244,591  
|Umicore                                                                         | 6,375      | 145,202  
|(Cost $2,013,207)                                                               | 2,147,067 
|Bermuda 0.1%                                                                   
|Seadrill Ltd. (Cost $46,052)                                                    | 4,400      | 63,223   
|Canada 4.9%                                                                    
|Agnico-Eagle Mines Ltd.                                                         | 700        | 36,873   
|Bank of Montreal                                                                | 1,000      | 42,144   
|Bank of Nova Scotia                                                             | 2,100      | 78,392   
|Barrick Gold Corp.                                                              | 2,600      | 87,512   
|BCE, Inc.                                                                       | 9,800      | 202,210  
|Bombardier, Inc. "B"                                                            | 16,500     | 48,940   
|Canadian Imperial Bank of Commerce                                              | 700        | 35,092   
|Canadian National Railway Co.                                                   | 4,300      | 184,732  
|Canadian Natural Resources Ltd.                                                 | 1,400      | 73,650   
|Canadian Pacific Railway Ltd.                                                   | 2,100      | 83,736   
|Canadian Tire Corp., Ltd. "A"                                                   | 1,300      | 61,471   
|Canadian Utilities Ltd. "A"                                                     | 3,900      | 127,245  
|EnCana Corp.                                                                    | 1,500      | 74,371   
|Fortis, Inc.                                                                    | 8,200      | 179,136  
|George Weston Ltd.                                                              | 1,300      | 65,204   
|Goldcorp, Inc.                                                                  | 2,300      | 79,946   
|Imperial Oil Ltd.                                                               | 2,100      | 81,462   
|Kinross Gold Corp.                                                              | 2,300      | 41,921   
|Loblaw Companies Ltd.                                                           | 2,600      | 77,677   
|Magna International, Inc. "A"                                                   | 2,053      | 87,104   
|Manulife Financial Corp.                                                        | 2,800      | 48,603   
|Metro, Inc. "A"                                                                 | 2,200      | 71,912   
|Petro-Canada                                                                    | 1,500      | 57,929   
|Potash Corp. of Saskatchewan, Inc.                                              | 900        | 83,953   
|Research In Motion Ltd.*                                                        | 5,000      | 355,414  
|Ritchie Bros. Auctioneers, Inc.                                                 | 1,100      | 25,818   
|Rogers Communications, Inc. "B"                                                 | 6,600      | 169,660  
|Royal Bank of Canada                                                            | 2,100      | 85,885   
|Saputo, Inc.                                                                    | 4,200      | 87,636   
|Shaw Communications, Inc. "B"                                                   | 6,100      | 102,685  
|Shoppers Drug Mart Corp.                                                        | 5,000      | 214,891  
|SNC-Lavalin Group, Inc.                                                         | 2,300      | 84,731   
|Suncor Energy, Inc.                                                             | 2,300      | 69,940   
|Teck Resources Ltd. "B"*                                                        | 2,600      | 41,465   
|Telus Corp.                                                                     | 2,200      | 56,742   
|Thomson Reuters Corp.                                                           | 82,00      | 238,636  
|Toronto-Dominion Bank                                                           | 1,400      | 72,326   
|TransAlta Corp.                                                                 | 10,600     | 203,315  
|Viterra, Inc.*                                                                  | 4,900      | 42,548   
|Yamana Gold, Inc.                                                               | 3,600      | 32,003   
|(Cost $3,588,219)                                                               | 3,894,910 
|Cyprus 0.1%                                                                    
|Bank of Cyprus Public Co., Ltd. (Cost $53,088)                                  | 8,464      | 47,197   
|Denmark 4.0%                                                                   
|A P Moller-Maersk AS "A"                                                        | 10         | 58,742   
|A P Moller-Maersk AS "B"                                                        | 19         | 114,090  
|Carlsberg AS "B"                                                                | 6,715      | 431,627  
|Coloplast AS "B"                                                                | 1,411      | 97,218   
|Danske Bank AS*                                                                 | 15,916     | 274,730  
|DSV AS*                                                                         | 3,456      | 42,923   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|H. Lundbeck AS                                                                  | 3,649      | 69,510   
|Novo Nordisk AS "B" (a)                                                         | 29,139     | 1,583,764
|Topdanmark AS*                                                                  | 619        | 72,341   
|Trygvesta AS                                                                    | 1,215      | 71,681   
|Vestas Wind Systems AS*                                                         | 3,303      | 237,446  
|William Demant Holding AS*                                                      | 1,515      | 78,414   
|(Cost $3,001,000)                                                               | 3,132,486 
|Finland 2.5%                                                                   
|Fortum Oyj                                                                      | 19,834     | 452,406  
|Kone Oyj "B"                                                                    | 7,093      | 217,838  
|Metso Corp.                                                                     | 5,459      | 102,254  
|Nokia Oyj                                                                       | 15,968     | 233,032  
|Outokumpu Oyj                                                                   | 4,876      | 84,449   
|Pohjola Bank PLC "A"                                                            | 7,147      | 57,162   
|Rautaruukki Oyj                                                                 | 3,581      | 71,616   
|Sampo Oyj "A"                                                                   | 17,518     | 330,572  
|Stora Enso Oyj "R"*                                                             | 22,082     | 116,529  
|UPM-Kymmene Oyj                                                                 | 19,417     | 169,226  
|Wartsila Corp.                                                                  | 3,608      | 116,547  
|(Cost $1,866,617)                                                               | 1,951,631 
|France 7.7%                                                                    
|Air Liquide SA                                                                  | 1,149      | 105,215  
|Alcatel-Lucent*                                                                 | 36,627     | 92,293   
|Alstom SA                                                                       | 744        | 44,035   
|Atos Origin SA*                                                                 | 1,193      | 40,504   
|AXA SA                                                                          | 4,136      | 78,192   
|BNP Paribas                                                                     | 2,132      | 138,354  
|Bouygues SA                                                                     | 1,062      | 39,937   
|Cap Gemini                                                                      | 2,296      | 84,805   
|Carrefour SA                                                                    | 10,580     | 452,585  
|Casino Guichard-Perrachon SA                                                    | 996        | 67,275   
|Compagnie de Saint-Gobain                                                       | 1,739      | 58,146   
|Credit Agricole SA                                                              | 3,149      | 39,441   
|DANONE SA                                                                       | 8,526      | 421,644  
|Dassault Systemes SA                                                            | 1,725      | 76,275   
|Electricite de France                                                           | 964        | 47,008   
|Essilor International SA                                                        | 4,349      | 207,613  
|France Telecom SA                                                               | 38,280     | 869,730  
|GDF Suez                                                                        | 4,592      | 171,547  
|Iliad SA                                                                        | 426        | 41,379   
|L'Oreal SA                                                                      | 3,894      | 291,537  
|Lafarge SA* (a)                                                                 | 1,526      | 103,611  
|LVMH Moet Hennessy Louis Vuitton SA                                             | 783        | 59,931   
|Neopost SA                                                                      | 671        | 60,339   
|Pernod Ricard SA                                                                | 3,147      | 198,677  
|Sanofi-Aventis                                                                  | 23,578     | 1,386,650
|Schneider Electric SA                                                           | 875        | 66,920   
|Societe Generale                                                                | 1,396      | 76,165   
|Suez Environnement SA                                                           | 1,869      | 32,775   
|Total SA                                                                        | 7,627      | 413,095  
|Unibail-Rodamco (REIT)                                                          | 386        | 57,642   
|Veolia Environnement                                                            | 2,122      | 62,690   
|Vinci SA                                                                        | 1,568      | 70,372   
|Vivendi                                                                         | 3,089      | 73,995   
|(Cost $5,836,315)                                                               | 6,030,377 
|Germany 5.1%                                                                   
|Allianz SE (Registered)                                                         | 1,458      | 134,824  
|BASF SE                                                                         | 3,961      | 157,990  
|Bayer AG                                                                        | 3,157      | 169,518  
|Bayerische Motoren Werke (BMW) AG                                               | 1,555      | 58,728   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Beiersdorf AG                                                                   | 6,582      | 310,277  
|Celesio AG                                                                      | 905        | 20,801   
|Daimler AG (Registered)                                                         | 3,529      | 127,686  
|Deutsche Boerse AG                                                              | 688        | 53,474   
|Deutsche Post AG (Registered)                                                   | 3,555      | 46,465   
|Deutsche Telekom AG (Registered)                                                | 80,246     | 948,391  
|E.ON AG                                                                         | 5,143      | 182,547  
|Fresenius Medical Care AG & Co. KGaA                                            | 1,077      | 48,065   
|Henkel AG & Co. KGaA                                                            | 8,826      | 237,991  
|K+S AG                                                                          | 629        | 35,433   
|Linde AG                                                                        | 769        | 63,223   
|MAN SE                                                                          | 642        | 39,486   
|Merck KGaA                                                                      | 430        | 43,839   
|Metro AG                                                                        | 8,267      | 395,184  
|Muenchener Rueckversicherungs-Gesellschaft AG (Registered)                      | 858        | 116,040  
|RWE AG                                                                          | 1,218      | 96,154   
|SAP AG                                                                          | 6,882      | 277,454  
|Siemens AG (Registered)                                                         | 2,793      | 193,360  
|Suedzucker AG                                                                   | 4,820      | 98,035   
|ThyssenKrupp AG                                                                 | 1,702      | 42,405   
|Volkswagen AG                                                                   | 384        | 129,991  
|(Cost $3,818,568)                                                               | 4,027,361 
|Greece 0.9%                                                                    
|Alpha Bank AE*                                                                  | 4,907      | 53,023   
|EFG Eurobank Ergasias*                                                          | 4,347      | 45,284   
|Marfin Investment Group SA*                                                     | 8,510      | 36,259   
|National Bank of Greece SA*                                                     | 3,627      | 99,373   
|OPAP SA                                                                         | 14,842     | 394,175  
|Piraeus Bank SA                                                                 | 4,885      | 48,152   
|(Cost $745,979)                                                                 | 676,266   
|Hong Kong 2.4%                                                                 
|Cheung Kong (Holdings) Ltd.                                                     | 10,000     | 114,385  
|Cheung Kong Infrastructure Holdings Ltd.                                        | 7,000      | 24,413   
|CLP Holdings Ltd.                                                               | 29,000     | 192,560  
|Esprit Holdings Ltd.                                                            | 31,200     | 174,522  
|Genting Singapore PLC* (a)                                                      | 213,000    | 99,994   
|Hang Seng Bank Ltd.                                                             | 3,800      | 53,701   
|Hong Kong & China Gas Co., Ltd.                                                 | 64,000     | 134,515  
|Hong Kong Exchanges & Clearing Ltd.                                             | 4,700      | 72,978   
|Hongkong Electric Holdings Ltd.                                                 | 17,500     | 97,459   
|Hutchison Whampoa Ltd.                                                          | 44,000     | 286,032  
|Li & Fung Ltd.                                                                  | 58,000     | 153,921  
|MTR Corp., Ltd.                                                                 | 34,000     | 102,547  
|Noble Group Ltd.                                                                | 19,000     | 23,788   
|NWS Holdings Ltd.                                                               | 20,000     | 36,000   
|Shangri-La Asia Ltd.                                                            | 46,000     | 68,191   
|Sun Hung Kai Properties Ltd.                                                    | 8,000      | 99,885   
|Swire Pacific Ltd. "A"                                                          | 9,000      | 89,636   
|Yue Yuen Industrial (Holdings) Ltd.                                             | 20,500     | 45,931   
|(Cost $1,707,840)                                                               | 1,870,458 
|Ireland 0.6%                                                                   
|CRH PLC                                                                         | 19,185     | 439,838  
|Experian PLC                                                                    | 6,430      | 48,188   
|(Cost $364,237)                                                                 | 488,026   
|Italy 3.6%                                                                     
|A2A SpA                                                                         | 20,926     | 38,271   
|Assicurazioni Generali SpA                                                      | 3,242      | 67,663   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Atlantia SpA                                                                    | 6,106      | 123,574  
|Enel SpA                                                                        | 55,283     | 269,320  
|Eni SpA                                                                         | 15,304     | 363,054  
|Fiat SpA*                                                                       | 17,352     | 176,031  
|Finmeccanica SpA                                                                | 9,616      | 135,691  
|Intesa Sanpaolo*                                                                | 25,029     | 81,148   
|Lottomatica SpA (a)                                                             | 2,726      | 52,631   
|Luxottica Group SpA*                                                            | 2,649      | 55,093   
|Mediaset SpA                                                                    | 18,588     | 104,527  
|Prysmian SpA                                                                    | 2,915      | 43,913   
|Saipem SpA                                                                      | 2,103      | 51,335   
|Snam Rete Gas SpA                                                               | 16,640     | 73,199   
|Telecom Italia SpA                                                              | 474,896    | 657,733  
|Telecom Italia SpA (RSP)                                                        | 281,593    | 276,880  
|Terna-Rete Elettrica Nationale SpA                                              | 20,403     | 68,049   
|UBI Banca-Unione di Banche Italiane ScpA                                        | 3,919      | 51,158   
|UniCredit SpA                                                                   | 44,878     | 114,976  
|(Cost $2,655,137)                                                               | 2,804,246 
|Japan 17.1%                                                                    
|AEON Co., Ltd.                                                                  | 11,300     | 111,308  
|Ajinomoto Co., Inc.                                                             | 14,000     | 110,629  
|Alfresa Holdings Corp.                                                          | 1,000      | 46,027   
|Asahi Breweries Ltd.                                                            | 8,700      | 124,935  
|Asahi Kasei Corp.                                                               | 18,000     | 91,212   
|Astellas Pharma, Inc.                                                           | 7,900      | 279,060  
|Canon, Inc.                                                                     | 4,400      | 143,207  
|Central Japan Railway Co.                                                       | 8          | 49,154   
|Chubu Electric Power Co., Inc.                                                  | 10,000     | 231,159  
|Chugai Pharmaceutical Co., Ltd.                                                 | 3,700      | 70,495   
|Chugoku Electric Power Co., Inc.                                                | 3,500      | 73,066   
|Cosmo Oil Co., Ltd.                                                             | 21,000     | 71,169   
|Daiichi Sankyo Co., Ltd.                                                        | 12,400     | 221,883  
|Dainippon Sumitomo Pharma Co., Ltd.                                             | 4,400      | 38,450   
|Denso Corp.                                                                     | 2,600      | 66,278   
|East Japan Railway Co.                                                          | 1,326      | 79,847   
|Eisai Co., Ltd.                                                                 | 4,300      | 152,999  
|Electric Power Development Co., Ltd.                                            | 2,600      | 73,682   
|FamilyMart Co., Ltd.                                                            | 2,100      | 65,819   
|Fanuc Ltd.                                                                      | 900        | 71,812   
|FUJIFILM Holdings Corp.                                                         | 3,500      | 110,419  
|Fujitsu Ltd.                                                                    | 13,000     | 70,444   
|Hisamitsu Pharmaceutical Co., Inc.                                              | 1,600      | 49,700   
|Hitachi Ltd.                                                                    | 18,000     | 55,750   
|Hokkaido Electric Power Co., Inc.                                               | 3,500      | 65,536   
|Hokuriku Electric Power Co.                                                     | 2,800      | 64,005   
|Honda Motor Co., Ltd.                                                           | 4,200      | 115,001  
|HOYA                                                                            | 2,900      | 58,065   
|Idemitsu Kosan Co., Ltd.                                                        | 700        | 59,851   
|INPEX Corp.                                                                     | 17         | 135,409  
|ITOCHU Corp.                                                                    | 9,000      | 62,162   
|Japan Petroleum Exploration Co., Ltd.                                           | 1,300      | 71,728   
|Japan Tobacco, Inc.                                                             | 88         | 274,292  
|JFE Holdings, Inc.                                                              | 3,800      | 126,921  
|Kansai Electric Power Co., Inc.                                                 | 11,600     | 255,990  
|Kao Corp.                                                                       | 10,000     | 217,933  
|KDDI Corp.                                                                      | 79         | 418,839  
|Keyence Corp.                                                                   | 300        | 61,053   
|Kikkoman Corp.                                                                  | 6,000      | 60,060   
|Kirin Holdings Co., Ltd.                                                        | 17,000     | 237,324  
|Kobe Steel Ltd.                                                                 | 47,000     | 86,857   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Komatsu Ltd.                                                                    | 5,900      | 90,549   
|Kyocera Corp.                                                                   | 1,000      | 75,014   
|Kyowa Hakko Kirin Co., Ltd.                                                     | 8,000      | 90,226   
|Kyushu Electric Power Co., Inc.                                                 | 5,800      | 124,831  
|Lawson, Inc.                                                                    | 1,900      | 83,495   
|Mediceo Paltac Holdings Co., Ltd.                                               | 4,300      | 49,204   
|MEIJI Holdings Co., Ltd.*                                                       | 1,800      | 72,343   
|Mitsubishi Chemical Holdings Corp.                                              | 16,500     | 69,607   
|Mitsubishi Corp.                                                                | 4,800      | 88,153   
|Mitsubishi Electric Corp.                                                       | 11,000     | 69,214   
|Mitsubishi Estate Co., Ltd.                                                     | 5,000      | 82,830   
|Mitsubishi Heavy Industries Ltd.                                                | 18,000     | 74,250   
|Mitsubishi Tanabe Pharma Corp.                                                  | 5,000      | 57,462   
|Mitsubishi UFJ Financial Group, Inc.                                            | 31,200     | 191,792  
|Mitsui & Co., Ltd.                                                              | 7,100      | 83,641   
|Mitsui Fudosan Co., Ltd.                                                        | 6,000      | 103,949  
|Mitsui O.S.K. Lines Ltd.                                                        | 10,000     | 64,514   
|Mitsui Sumitomo Insurance Group Holdings, Inc.                                  | 2,400      | 62,585   
|Mizuho Financial Group, Inc. (a)                                                | 36,100     | 83,961   
|Murata Manufacturing Co., Ltd.                                                  | 1,800      | 76,292   
|Nidec Corp.                                                                     | 800        | 48,342   
|Nintendo Co., Ltd.                                                              | 400        | 110,082  
|Nippon Meat Packers, Inc.                                                       | 5,000      | 63,059   
|Nippon Mining Holdings, Inc.                                                    | 18,500     | 95,480   
|Nippon Oil Corp.                                                                | 26,000     | 153,037  
|Nippon Steel Corp.                                                              | 34,000     | 129,668  
|Nippon Telegraph & Telephone Corp.                                              | 13,609     | 553,722  
|Nissan Motor Co., Ltd.                                                          | 11,700     | 70,636   
|Nisshin Seifun Group, Inc.                                                      | 6,000      | 71,234   
|Nissin Foods Holdings Co., Ltd.                                                 | 1,800      | 54,531   
|Nitto Denko Corp.                                                               | 1,900      | 57,573   
|Nomura Holdings, Inc.                                                           | 12,000     | 100,537  
|NTT DoCoMo, Inc.                                                                | 408        | 595,898  
|OJI Paper Co., Ltd.                                                             | 11,000     | 47,212   
|Olympus Corp.                                                                   | 5,000      | 117,493  
|Ono Pharmaceutical Co., Ltd.                                                    | 2,000      | 88,485   
|Osaka Gas Co., Ltd.                                                             | 30,000     | 95,750   
|Panasonic Corp.                                                                 | 5,600      | 75,113   
|Resona Holdings, Inc.                                                           | 2,600      | 36,445   
|Ricoh Co., Ltd.                                                                 | 6,000      | 76,858   
|Santen Pharmaceutical Co., Ltd.                                                 | 2,000      | 60,829   
|Sapporo Holdings Ltd.                                                           | 12,000     | 68,443   
|Seven & I Holdings Co., Ltd.                                                    | 15,400     | 361,302  
|Sharp Corp.                                                                     | 5,000      | 51,588   
|Shikoku Electric Power Co., Inc.                                                | 2,400      | 71,647   
|Shin-Etsu Chemical Co., Ltd.                                                    | 2,400      | 110,845  
|Shionogi & Co., Ltd.                                                            | 5,000      | 96,589   
|Shiseido Co., Ltd.                                                              | 8,000      | 130,896  
|Showa Shell Sekiyu KK                                                           | 7,100      | 74,838   
|SOFTBANK Corp.                                                                  | 20,500     | 398,109  
|Sony Corp.                                                                      | 3,700      | 95,580   
|Sumitomo Chemical Co., Ltd.                                                     | 14,000     | 62,753   
|Sumitomo Corp.                                                                  | 5,300      | 53,595   
|Sumitomo Metal Industries Ltd.                                                  | 26,000     | 68,666   
|Sumitomo Metal Mining Co., Ltd.                                                 | 4,000      | 56,248   
|Sumitomo Mitsui Financial Group, Inc.                                           | 2,500      | 101,096  
|Suzuken Co., Ltd.                                                               | 1,900      | 54,940   
|Taisho Pharmaceutical Co., Ltd.                                                 | 3,000      | 56,778   
|Takeda Pharmaceutical Co., Ltd.                                                 | 12,800     | 497,365  
|Terumo Corp.                                                                    | 2,700      | 118,855  
|Tohoku Electric Power Co., Inc.                                                 | 6,600      | 137,947  
|Tokio Marine Holdings, Inc.                                                     | 3,000      | 82,394   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Tokyo Electric Power Co., Inc.                                                  | 19,100     | 490,947  
|Tokyo Electron Ltd.                                                             | 1,300      | 62,439   
|Tokyo Gas Co., Ltd.                                                             | 31,000     | 110,826  
|TonenGeneral Sekiyu KK                                                          | 8,000      | 81,300   
|Toray Industries, Inc.                                                          | 14,000     | 71,091   
|Toshiba Corp.                                                                   | 18,000     | 64,795   
|Toyo Suisan Kaisha Ltd.                                                         | 2,000      | 41,278   
|Toyota Motor Corp.                                                              | 8,200      | 309,995  
|Tsumura & Co.                                                                   | 1,500      | 46,740   
|Unicharm Corp.                                                                  | 900        | 68,706   
|UNY Co., Ltd.                                                                   | 8,800      | 74,862   
|Yakult Honsha Co., Ltd.                                                         | 2,500      | 47,630   
|Yamazaki Baking Co., Ltd.                                                       | 4,000      | 45,120   
|(Cost $12,711,664)                                                              | 13,491,629
|Luxembourg 0.4%                                                                
|ArcelorMittal                                                                   | 6,357      | 208,775  
|Millicom International Cellular SA (SDR)*                                       | 1,383      | 78,391   
|Tenaris SA                                                                      | 3,020      | 40,827   
|(Cost $242,175)                                                                 | 327,993   
|Netherlands 6.6%                                                               
|AEGON NV                                                                        | 18,419     | 113,289  
|Akzo Nobel NV                                                                   | 4,634      | 203,919  
|ASML Holding NV                                                                 | 14,817     | 321,384  
|Fugro NV (CVA)                                                                  | 811        | 33,676   
|Heineken Holding NV                                                             | 913        | 29,047   
|Heineken NV                                                                     | 4,584      | 170,314  
|ING Groep NV (CVA)                                                              | 23,387     | 235,393  
|Koninklijke (Royal) KPN NV                                                      | 70,081     | 965,422  
|Koninklijke (Royal) Philips Electronics NV                                      | 12,592     | 232,843  
|Koninklijke Ahold NV                                                            | 26,379     | 303,120  
|Koninklijke DSM NV                                                              | 3,338      | 104,586  
|Randstad Holding NV*                                                            | 1,690      | 46,911   
|Reed Elsevier NV (a)                                                            | 74,775     | 824,641  
|Royal Dutch Shell PLC "A"                                                       | 3,199      | 80,116   
|Royal Dutch Shell PLC "B"                                                       | 2,437      | 61,525   
|TNT NV                                                                          | 4,989      | 97,173   
|Unilever NV (CVA)                                                               | 33,721     | 813,813  
|Wolters Kluwer NV                                                               | 31,215     | 546,202  
|(Cost $4,866,598)                                                               | 5,183,374 
|Norway 2.4%                                                                    
|DnB NOR ASA*                                                                    | 44,800     | 343,011  
|Norsk Hydro ASA*                                                                | 44,400     | 229,081  
|Orkla ASA                                                                       | 25,600     | 186,496  
|Renewable Energy Corp. AS* (a)                                                  | 8,600      | 67,243   
|StatoilHydro ASA                                                                | 18,700     | 369,398  
|Telenor ASA*                                                                    | 56,500     | 436,171  
|Yara International ASA                                                          | 9,650      | 270,241  
|(Cost $1,693,593)                                                               | 1,901,641 
|Portugal 0.3%                                                                  
|Brisa Auto-Estrades de Portugal SA                                              | 5,209      | 37,496   
|EDP  Energias de Portugal SA                                                   | 50,602     | 198,544  
|Portugal Telecom, SGPS, SA (Registered)                                         | 1,798      | 17,608   
|(Cost $229,728)                                                                 | 253,648   
|Singapore 1.8%                                                                 
|Capitaland Ltd.                                                                 | 20,000     | 50,796   
|ComfortDelGro Corp., Ltd.                                                       | 47,000     | 41,496   
|DBS Group Holdings Ltd.                                                         | 10,000     | 81,155   
|Fraser and Neave Ltd.                                                           | 23,000     | 61,879   
|Jardine Cycle & Carriage Ltd.                                                   | 6,000      | 79,419   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Keppel Corp., Ltd.                                                              | 18,000     | 85,458   
|Oversea-Chinese Banking Corp., Ltd.                                             | 17,000     | 78,174   
|SembCorp Industries Ltd.                                                        | 19,000     | 39,500   
|SembCorp Marine Ltd.                                                            | 17,000     | 31,326   
|Singapore Airlines Ltd.                                                         | 9,000      | 82,454   
|Singapore Exchange Ltd.                                                         | 7,000      | 34,199   
|Singapore Press Holdings Ltd.                                                   | 96,000     | 209,009  
|Singapore Technologies Engineering Ltd.                                         | 25,000     | 42,198   
|Singapore Telecommunications Ltd.                                               | 199,000    | 410,643  
|United Overseas Bank Ltd.                                                       | 9,000      | 90,914   
|(Cost $1,158,064)                                                               | 1,418,620 
|Spain 3.9%                                                                     
|Abertis Infraestructuras SA                                                     | 5,893      | 110,997  
|Acciona SA                                                                      | 250        | 30,731   
|ACS, Actividades de Construccion y Servicios SA                                 | 2,895      | 146,788  
|Banco Bilbao Vizcaya Argentaria SA                                              | 7,910      | 99,677   
|Banco Santander SA                                                              | 17,544     | 211,721  
|Cintra Concesiones de Infraestructuras de Transporte SA                         | 6,997      | 43,514   
|EDP Renovaveis SA*                                                              | 5,961      | 61,146   
|Enagas                                                                          | 2,258      | 44,445   
|Fomento de Construcciones y Contratas SA                                        | 1,496      | 61,445   
|Gamesa Corp. Tecnologica SA                                                     | 3,474      | 65,953   
|Gas Natural SDG SA                                                              | 2,049      | 37,320   
|Grupo Ferrovial SA                                                              | 1,664      | 53,549   
|Iberdrola Renovables SA*                                                        | 13,050     | 59,724   
|Iberdrola SA (a)                                                                | 19,642     | 159,742  
|Indra Sistemas SA                                                               | 3,102      | 67,205   
|Industria de Diseno Textil SA                                                   | 6,223      | 299,061  
|Red Electrica Corporacion SA                                                    | 1,144      | 51,759   
|Repsol YPF SA                                                                   | 22,823     | 511,798  
|Telefonica SA                                                                   | 40,915     | 927,747  
|Zardoya Otis SA                                                                 | 3,050      | 63,749   
|(Cost $2,591,868)                                                               | 3,108,071 
|Sweden 3.7%                                                                    
|AB SKF "B"                                                                      | 4,482      | 55,400   
|Atlas Copco AB "A"                                                              | 5,936      | 59,523   
|Electrolux AB "B"*                                                              | 4,895      | 68,615   
|Hennes & Mauritz AB "B"                                                         | 6,426      | 321,246  
|Holmen AB "B"                                                                   | 2,160      | 47,189   
|Husqvarna AB "B"*                                                               | 7,799      | 42,826   
|Investor AB "B"                                                                 | 3,621      | 56,008   
|Nordea Bank AB                                                                  | 26,797     | 212,617  
|Sandvik AB                                                                      | 8,730      | 65,046   
|Skandinaviska Enskilda Banken AB "A"*                                           | 12,179     | 53,531   
|SSAB AB "A"                                                                     | 8,814      | 102,609  
|SSAB AB "B"                                                                     | 4,185      | 45,055   
|Svenska Cellulosa AB "B"                                                        | 23,091     | 242,995  
|Svenska Handelsbanken AB "A"                                                    | 4,099      | 77,455   
|Swedish Match AB                                                                | 686        | 11,151   
|Tele2 AB "B"                                                                    | 6,376      | 64,586   
|Telefonaktiebolaget LM Ericsson "B"                                             | 117,090    | 1,145,287
|TeliaSonera AB                                                                  | 34,920     | 183,687  
|Volvo AB "B"                                                                    | 8,978      | 55,634   
|(Cost $2,643,729)                                                               | 2,910,460 
|Switzerland 7.4%                                                               
|ABB Ltd. (Registered)*                                                          | 10,782     | 169,714  
|Actelion Ltd. (Registered)*                                                     | 1,036      | 54,327   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Adecco SA (Registered)                                                          | 824        | 34,411   
|Aryzta AG*                                                                      | 1,064      | 34,225   
|Compagnie Financiere Richemont SA "A"                                           | 9,395      | 195,752  
|Credit Suisse Group AG (Registered)                                             | 2,818      | 128,641  
|Geberit AG (Registered)*                                                        | 332        | 40,918   
|Givaudan SA (Registered)*                                                       | 102        | 62,483   
|Holcim Ltd. (Registered)                                                        | 2,125      | 121,046  
|Julius Baer Holding AG (Registered)                                             | 869        | 33,882   
|Lonza Group AG (Registered)                                                     | 466        | 46,281   
|Nestle SA (Registered)                                                          | 37,335     | 1,409,066
|Nobel Biocare Holding AG (Registered)                                           | 1,356      | 29,726   
|Novartis AG (Registered)                                                        | 17,372     | 705,798  
|Roche Holding AG (Genusschein)                                                  | 6,313      | 858,876  
|SGS SA (Registered)*                                                            | 43         | 53,396   
|Sonova Holding AG (Registered)*                                                 | 458        | 37,273   
|STMicroelectronics NV                                                           | 11,759     | 88,214   
|Swatch Group AG                                                                 | 635        | 102,109  
|Swatch Group AG (Registered)                                                    | 1,256      | 41,183   
|Swiss Re (Registered)                                                           | 1,091      | 36,096   
|Swisscom AG (Registered)                                                        | 3,207      | 985,032  
|Syngenta AG (Registered)                                                        | 1,097      | 254,739  
|Synthes, Inc.                                                                   | 531        | 51,401   
|UBS AG (Registered)*                                                            | 7,534      | 92,176   
|Xstrata PLC                                                                     | 5,096      | 56,203   
|Zurich Financial Services AG                                                    | 398        | 70,450   
|(Cost $5,157,010)                                                               | 5,793,418 
|United Kingdom 7.9%                                                            
|Anglo American PLC                                                              | 3,853      | 112,433  
|AstraZeneca PLC                                                                 | 16,446     | 724,239  
|Autonomy Corp. PLC*                                                             | 11,080     | 262,537  
|BAE Systems PLC                                                                 | 22,809     | 127,321  
|Barclays PLC                                                                    | 11,766     | 54,803   
|BG Group PLC                                                                    | 3,589      | 60,302   
|BHP Billiton PLC                                                                | 5,353      | 120,914  
|BP PLC                                                                          | 22,383     | 177,120  
|British American Tobacco PLC                                                    | 3,477      | 96,053   
|British Sky Broadcasting Group PLC                                              | 6,799      | 51,004   
|BT Group PLC                                                                    | 67,217     | 112,528  
|Cable & Wireless                                                                | 24,059     | 52,802   
|Cadbury PLC                                                                     | 4,148      | 35,434   
|Capita Group PLC                                                                | 5,549      | 65,418   
|Centrica PLC                                                                    | 34,012     | 124,984  
|Compass Group PLC                                                               | 11,814     | 66,572   
|Diageo PLC                                                                      | 5,373      | 77,161   
|Drax Group PLC                                                                  | 3,469      | 25,109   
|GlaxoSmithKline PLC                                                             | 57,642     | 1,015,050
|HSBC Holdings PLC                                                               | 20,151     | 167,286  
|Imperial Tobacco Group PLC                                                      | 2,341      | 60,888   
|International Power PLC                                                         | 14,339     | 56,297   
|Kingfisher PLC                                                                  | 14,696     | 43,082   
|Marks & Spencer Group PLC                                                       | 8,450      | 42,648   
|National Grid PLC                                                               | 15,891     | 143,322  
|Next PLC                                                                        | 1,325      | 32,110   
|Pearson PLC                                                                     | 7,145      | 71,768   
|Reckitt Benckiser Group PLC                                                     | 836        | 38,100   
|Reed Elsevier PLC                                                               | 9,798      | 73,057   
|Rio Tinto PLC                                                                   | 2,396      | 83,412   
|Rolls-Royce Group PLC*                                                          | 15,284     | 91,132   
|SABMiller PLC                                                                   | 2,538      | 51,667   
|Scottish & Southern Energy PLC                                                  | 6,560      | 123,161  
|Severn Trent PLC                                                                | 3,170      | 57,177   
|Shire PLC                                                                       | 6,752      | 93,125   
|                                                                                | Shares     | Value ($)
|                                                                                |           
|Smith & Nephew PLC                                                              | 10,523     | 78,015   
|Smiths Group PLC                                                                | 3,914      | 45,296   
|Standard Chartered PLC                                                          | 3,333      | 62,776   
|Tesco PLC                                                                       | 17,554     | 102,316  
|The Sage Group PLC                                                              | 81,157     | 238,346  
|Thomson Reuters PLC                                                             | 1,158      | 33,042   
|Unilever PLC                                                                    | 2,292      | 53,784   
|United Utilities Group PLC                                                      | 8,616      | 70,570   
|Vodafone Group PLC                                                              | 428,850    | 828,955  
|William Morrison Supermarkets PLC                                               | 8,072      | 31,453   
|Wolseley PLC*                                                                   | 2,367      | 45,251   
|WPP PLC                                                                         | 9,498      | 63,172   
|(Cost $5,608,484)                                                               | 6,242,992 
|Total Common Stocks (Cost $67,425,393)                                          | 73,164,737
|                                                                               
|Preferred Stocks 0.6%                                                          
|Germany                                                                        
|Fresenius SE                                                                    | 632        | 34,152   
|Henkel AG & Co. KGaA                                                            | 12,356     | 386,057  
|Volkswagen AG                                                                   | 513        | 35,894   
|Total Preferred Stocks (Cost $429,423)                                          | 456,103   
|                                                                               
|Rights 0.0%                                                                    
|Italy 0.0%                                                                     
|UBI Banca-Unione di Banche Italiane ScpA, Expiration Date 7/3/2009* (Cost $724) | 3,919      | 268      
|Norway 0.0%                                                                    
|Renewable Energy Corp. AS, Expiration Date 7/13/2009* (Cost $10,806)            | 2,965      | 10,605   
|Total Rights (Cost $11,530)                                                     | 10,873    
|                                                                               
|Warrants 0.0%                                                                  
|Italy                                                                          
|UBI Banca-Unione di Banche Italiane ScpA, Expiration Date 6/30/2011* (Cost $0)  | 4,982      | 6,625    
|                                                                               
|Exchange-Traded Fund 2.9%                                                      
|Vanguard Emerging Markets (Cost $2,043,432)                                     | 72,300     | 2,300,586

|                                                         | Principal
Amount ($) | Value ($)
|-------------------------------------------------------- | -------------------- | ---------
|                                                         |                     
|Government & Agency Obligation 0.3%                     
|US Treasury Obligation                                  
|US Treasury Bill, 0.16%**, 9/17/2009 (b) (Cost $221,924) | 222,000              | 221,913  

|                                                                 | Shares    | Value ($)
|---------------------------------------------------------------- | --------- | ---------
|                                                                 |          
|Securities Lending Collateral 3.8%                              
|Daily Assets Fund Institutional, 0.48% (c) (d) (Cost $2,990,217) | 2,990,217 | 2,990,217
|                                                                
|Cash Equivalents 2.4%                                           
|Cash Management QP Trust, 0.27% (c) (Cost $1,892,707)            | 1,892,707 | 1,892,707

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio (Cost $75,014,626)+ | 102.9           | 81,043,761 
|Other Assets and Liabilities, Net              | (2.9)           | (2,314,120)
|Net Assets                                     | 100.0           | 78,729,641 

CVA: Certificaten Van Aandelen

REIT: Real Estate Investment Trust

RSP: Risparmio (Convertible Savings Shares)

SDR: Swedish Depositary Receipt

At June 30, 2009, open futures contracts purchased were as follows:

|Futures                           | Expiration
Date | Contracts | Aggregated
Face
Value ($) | Value ($) | Unrealized 
Depreciation ($)
|--------------------------------- | --------------- | --------- | ------------------------- | --------- | ----------------------------
|ASX SPI 200 Index                 | 9/17/2009       | 3         | 238,302                   | 235,757   | (2,545)                     
|DJ Euro Stoxx 50 Index            | 9/18/2009       | 33        | 1,113,371                 | 1,110,130 | (3,241)                     
|FTSE 100 Index                    | 9/18/2009       | 2         | 140,813                   | 138,789   | (2,024)                     
|Nikkei 225 Index                  | 9/10/2009       | 7         | 348,454                   | 348,075   | (379)                       
|S&P TSE 60 Index                  | 9/17/2009       | 1         | 109,741                   | 107,828   | (1,913)                     
|Total net unrealized depreciation | (10,102)       

For information on the Portfolio's policy and additional disclosures regarding futures contracts, please refer to the Derivatives section of Note
A in the accompanying Notes to Financial Statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1         | Level 2           | Level 3   | Total             
|------------------------------------------------ | --------------- | ----------------- | --------- | ------------------
|Common Stock and/or Other Equity Investments (e) |                 |                   |           |                   
|Australia                                        | $              | $      $4,529,269 | $        | $        4,529,269
|Austria                                          |                | 870,374           |          | 870,374           
|Belgium                                          |                | 2,147,067         |          | 2,147,067         
|Bermuda                                          |                | 63,223            |          | 63,223            
|Canada                                           | 3,894,910       |                  |          | 3,894,910         
|Cyprus                                           |                | 47,197            |          | 47,197            
|Denmark                                          |                | 3,132,486         |          | 3,132,486         
|Finland                                          |                | 1,951,631         |          | 1,951,631         
|France                                           |                | 6,030,377         |          | 6,030,377         
|Germany                                          |                | 4,483,464         |          | 4,483,464         
|Greece                                           |                | 676,266           |          | 676,266           
|Hong Kong                                        |                | 1,870,458         |          | 1,870,458         
|Ireland                                          |                | 488,026           |          | 488,026           
|Italy                                            |                | 2,804,514         | 6,625     | 2,811,139         
|Japan                                            |                | 13,491,629        |          | 13,491,629        
|Luxembourg                                       |                | 327,993           |          | 327,993           
|Netherlands                                      |                | 5,183,374         |          | 5,183,374         
|Norway                                           |                | 1,912,246         |          | 1,912,246         
|Portugal                                         |                | 253,648           |          | 253,648           
|Singapore                                        |                | 1,418,620         |          | 1,418,620         
|Spain                                            |                | 3,108,071         |          | 3,108,071         
|Sweden                                           |                | 2,910,460         |          | 2,910,460         
|Switzerland                                      |                | 5,793,418         |          | 5,793,418         
|United Kingdom                                   |                | 6,242,992         |          | 6,242,992         
|Exchange-Traded Fund                             | 2,300,586       |                  |          | 2,300,586         
|Short-Term Investments (e)                       | 2,990,217       | 2,114,620         |          | 5,104,837         
|Total                                            | $   9,185,713   | $   71,851,423    | $   6,625 | $   81,043,761    
|Liabilities                                      |                 |                   |           |                   
|Derivatives(f)                                   | $      (10,102) | $                | $        | $      (10,102)   
|Total                                            | $   (10,102)    | $                | $        | $   (10,102)      

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                                     | Common Stock
and/or Other
Equity
Investments
|---------------------------------------------------------------------------------------------------- | --------------------------------------------
|Level 3 Reconciliation                                                                               | Italy                                       
|Balance as of December 31, 2008                                                                      | $                                          
|Realized gains (loss)                                                                                |                                            
|Change in unrealized appreciation (depreciation)                                                     | 6,625                                       
|Amortization premium/discount                                                                        |                                            
|Net purchase (sales)                                                                                 | 0                                           
|Net transfers in (out) of Level 3                                                                    |                                            
|Balance as of June 30, 2009                                                                          | $   6,625                                   
|Net change in unrealized appreciation (depreciation) from investments still held as of June 30, 2009 | $   6,625                                   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                    
|Investments:Investments in securities, at value (cost $70,131,702)  including $2,814,665 of securities loaned                                                                            
|Investment in Daily Assets Fund Institutional (cost $2,990,217)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $1,892,707)                                                                                                                                  
|Total investments, at value (cost $75,014,626)                                                                                                                                            
|Cash                                                                                                                                                                                      
|Foreign currency, at value (cost $765,986)                                                                                                                                                
|Dividends receivable                                                                                                                                                                      
|Interest receivable                                                                                                                                                                       
|Foreign taxes recoverable                                                                                                                                                                 
|Receivable for variation margin on open futures contracts                                                                                                                                 
|Other assets                                                                                                                                                                              
|Total assets                                                                                                                                                                              
|Liabilities                                                                                                                                                                               
|Payable upon return of securities loaned                                                                                                                                                  
|Payable for Portfolio shares redeemed                                                                                                                                                     
|Accrued management fee                                                                                                                                                                    
|Other accrued expenses and payables                                                                                                                                                       
|Total liabilities                                                                                                                                                                         
|Net assets, at value                                                                                                                                                                      
|Net Assets Consist of                                                                                                                                                                     
|Undistributed net investment income                                                                                                                                                       
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                 
|Futures                                                                                                                                                                                   
|Foreign currency                                                                                                                                                                          
|Accumulated net realized gain (loss)                                                                                                                                                      
|Paid-in capital                                                                                                                                                                           
|Net assets, at value                                                                                                                                                                      
|Class A
Net Asset Value, offering and redemption price per share ($78,729,641 ÷ 12,920,437 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $196,187)                                             
|Interest                                                                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Services to shareholders                                                                                 
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Futures                                                                                                  
|Foreign currency                                                                                         
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Futures                                                                                                  
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                    
|----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                     
|Operations:Net investment income (loss)                                                                               
|Net realized gain (loss)                                                                                              
|Change in net unrealized appreciation (depreciation)                                                                  
|Net increase (decrease) in net assets resulting from operations                                                       
|Distributions to shareholders from:Net investment income:Class A                                                      
|Class B                                                                                                               
|Net realized gains:Class A                                                                                            
|Class B                                                                                                               
|Total distributions                                                                                                   
|Portfolio share transactions:Class A
Proceeds from shares sold                                                        
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Shares converted*                                                                                                     
|Net increase (decrease) in net assets from Class A share transactions                                                 
|Class B
Proceeds from shares sold                                                                                     
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Shares converted*                                                                                                     
|Net increase (decrease) in net assets from Class B share transactions                                                 
|Increase (decrease) in net assets                                                                                     
|Net assets at beginning of period                                                                                     
|Net assets at end of period (including undistributed net investment income of $1,043,461 and
$5,131,928, respectively)
|Other Information                                                                                                     
|Class A
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Shares converted*                                                                                                     
|Net increase (decrease) in Class A shares                                                                             
|Shares outstanding at end of period                                                                                   
|Class B
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Shares converted*                                                                                                     
|Net increase (decrease) in Class B shares                                                                             
|Shares outstanding at end of period                                                                                   

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 2009a    | 2008       | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | $   6.22 | $   16.76  | $   16.31 | $   13.25 | $   11.91 | $   10.18
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | .08      | .33e       | .25       | .24c      | .20       | .17      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | .19      | (6.67)     | 2.24      | 3.11      | 1.48      | 1.67     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | .27      | (6.34)     | 2.49      | 3.35      | 1.68      | 1.84     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | (.40)    | (.13)      | (.46)     | (.29)     | (.34)     | (.11)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |         | (4.07)     | (1.58)    |          |          |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | (.40)    | (4.20)     | (2.04)    | (.29)     | (.34)     | (.11)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | $   6.09 | $   6.22   | $   16.76 | $   16.31 | $   13.25 | $   11.91
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 5.74**   | (48.81)d,f | 16.71     | 25.56     | 14.51     | 18.25    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 79       | 91         | 236       | 223       | 196       | 184      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.01*    | 1.02       | .93       | .88       | .87       | .89      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 1.01*    | 1.01       | .93       | .88       | .87       | .89      
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 2.90*    | 3.04e      | 1.53      | 1.65c     | 1.59      | 1.58     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 138**    | 132        | 117       | 122       | 93        | 88       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cNet investment income per share and the ratio of net investment income without non-recurring dividend income amounting to $0.20 per
share and 1.39% of average daily net assets, respectively.dTotal return would have been lower had certain expenses not been reimbursed.eNet investment income per share and ratio of net investment income include non-recurring dividend income amounting to $0.16 per
share and 1.49% of average daily net assets, respectively.fIncludes a reimbursement from the Advisor to reimburse the effect of losses incurred as the result of certain operation errors during the
period. Excluding this reimbursement, total return would have been 0.14% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Dreman Small Mid Cap Value VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .79% and 1.15% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk. Stocks of small and medium-sized companies involve greater risk than securities of
larger, more-established companies, as they often have limited product lines, markets or financial resources and may be exposed to
more erratic and abrupt market movements. Small and mid-cap company stocks tend to experience steeper price fluctuations 
down as well as up  than stocks of larger companies. Small and mid-cap company stocks are typically less liquid than large
company stocks. The Portfolio may focus its investments on certain economic sectors, thereby increasing its vulnerability to any
single economic, political, or regulatory development. This may result in greater share price volatility. Please read this Portfolio's
prospectus for specific details regarding this product's investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement. Without
this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Dreman Small Mid Cap Value VIP
|-----------------------------------------------------------------------------
|[] DWS Dreman Small Mid Cap Value VIP  Class A
[]Russell 2500 Value Index  
|vs2_g10k10c0                                                                 
|Yearly periods ended June 30                                                 

|Comparative Results               
|----------------------------------
|DWS Dreman Small Mid Cap Value VIP
|Class A                           
|Average annual total return       
|Russell 2500 Value Index          
|Average annual total return       
|DWS Dreman Small Mid Cap Value VIP
|Class B                           
|Average annual total return       
|Russell 2500 Value Index          
|Average annual total return       

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Dreman Small Mid Cap Value VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                                   | Class A |  | Class B | 
|----------------------------------------------------------- | ------- |  | ------- | 
|DWS Variable Series II  DWS Dreman Small Mid Cap Value VIP | .83%    |  | 1.18%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Dreman Small Mid Cap Value VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 98%     | 99%     
|Cash Equivalents                                                                         | 2%      | 1%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Financials                                      | 18%     | 22%     
|Industrials                                     | 15%     | 23%     
|Information Technology                          | 13%     | 9%      
|Consumer Discretionary                          | 12%     | 6%      
|Health Care                                     | 12%     | 11%     
|Consumer Staples                                | 9%      | 12%     
|Energy                                          | 7%      | 6%      
|Utilities                                       | 7%      | 5%      
|Materials                                       | 6%      | 4%      
|Telecommunications Services                     | 1%      | 2%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 98. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Dreman Small Mid Cap Value VIP

|                                                                  | Shares      | Value ($) 
|----------------------------------------------------------------- | ----------- | ----------
|                                                                  |            
|Common Stocks 97.8%                                              
|Consumer Discretionary 12.1%                                     
|Auto Components 1.1%                                             
|Autoliv, Inc. (a)                                                 | 80,500      | 2,315,985 
|Diversified Consumer Services 1.7%                               
|Regis Corp.                                                       | 208,550     | 3,630,856 
|Hotels Restaurants & Leisure 2.6%                                
|Brinker International, Inc.                                       | 155,700     | 2,651,571 
|International Speedway Corp. "A"                                  | 116,300     | 2,978,443 
|                                                                  | 5,630,014  
|Household Durables 1.4%                                          
|Garmin Ltd. (a)                                                   | 130,700     | 3,113,274 
|Leisure Equipment & Products 1.8%                                
|Mattel, Inc.                                                      | 239,800     | 3,848,790 
|Media 1.2%                                                       
|CBS Corp. "B"                                                     | 386,600     | 2,675,272 
|Specialty Retail 1.1%                                            
|The Men's Wearhouse, Inc. (a)                                     | 131,550     | 2,523,129 
|Textiles, Apparel & Luxury Goods 1.2%                            
|Hanesbrands, Inc.* (a)                                            | 178,100     | 2,673,281 
|Consumer Staples 9.0%                                            
|Food & Staples Retailing 1.4%                                    
|Ruddick Corp. (a)                                                 | 133,350     | 3,124,391 
|Food Products 5.7%                                               
|Del Monte Foods Co.                                               | 376,275     | 3,529,459 
|Ralcorp Holdings, Inc.*                                           | 47,400      | 2,887,608 
|Sanderson Farms, Inc. (a)                                         | 60,600      | 2,727,000 
|The J.M. Smucker Co.                                              | 69,800      | 3,396,468 
|                                                                  | 12,540,535 
|Tobacco 1.9%                                                     
|Vector Group Ltd. (a)                                             | 281,660     | 4,024,921 
|Energy 7.0%                                                      
|Energy Equipment & Services 3.7%                                 
|Atwood Oceanics, Inc.* (a)                                        | 106,925     | 2,663,502 
|Superior Energy Services, Inc.*                                   | 166,450     | 2,874,591 
|Tidewater, Inc.                                                   | 60,900      | 2,610,783 
|                                                                  | 8,148,876  
|Oil, Gas & Consumable Fuels 3.3%                                 
|Arch Coal, Inc. (a)                                               | 136,000     | 2,090,320 
|Forest Oil Corp.*                                                 | 143,200     | 2,136,544 
|Newfield Exploration Co.*                                         | 93,100      | 3,041,577 
|                                                                  | 7,268,441  
|Financials 17.1%                                                 
|Capital Markets 2.3%                                             
|Ameriprise Financial, Inc.                                        | 103,800     | 2,519,226 
|Raymond James Financial, Inc. (a)                                 | 152,100     | 2,617,641 
|                                                                  | 5,136,867  
|Commercial Banks 2.9%                                            
|Bank of Hawaii Corp. (a)                                          | 66,200      | 2,371,946 
|BOK Financial Corp. (a)                                           | 69,800      | 2,629,366 
|National Penn Bancshares, Inc. (a)                                | 273,800     | 1,262,218 
|                                                                  | 6,263,530  
|Insurance 7.5%                                                   
|Arch Capital Group Ltd.*                                          | 41,200      | 2,413,496 
|Argo Group International Holdings Ltd.*                           | 81,188      | 2,291,125 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Endurance Specialty Holdings Ltd.                                 | 85,950      | 2,518,335 
|Hanover Insurance Group, Inc.                                     | 95,800      | 3,650,938 
|HCC Insurance Holdings, Inc.                                      | 85,950      | 2,063,660 
|IPC Holdings Ltd.                                                 | 6,229       | 170,301   
|Platinum Underwriters Holdings Ltd.                               | 81,450      | 2,328,655 
|Willis Group Holdings Ltd.                                        | 39,659      | 1,020,426 
|                                                                  | 16,456,936 
|Real Estate Investment Trusts 4.4%                               
|Alexandria Real Estate Equities, Inc. (REIT) (a)                  | 46,500      | 1,664,235 
|Hospitality Properties Trust (REIT) (a)                           | 166,500     | 1,979,685 
|MFA Financial, Inc. (REIT)                                        | 451,000     | 3,120,920 
|Ventas, Inc. (REIT) (a)                                           | 96,700      | 2,887,462 
|                                                                  | 9,652,302  
|Health Care 11.6%                                                
|Health Care Equipment & Supplies 2.5%                            
|Inverness Medical Innovations, Inc.* (a)                          | 84,100      | 2,992,278 
|Teleflex, Inc.                                                    | 53,700      | 2,407,371 
|                                                                  | 5,399,649  
|Health Care Providers & Services 7.6%                            
|Amedisys, Inc.* (a)                                               | 85,000      | 2,806,700 
|AmSurg Corp.*                                                     | 174,500     | 3,741,280 
|Healthspring, Inc.*                                               | 260,400     | 2,827,944 
|LifePoint Hospitals, Inc.* (a)                                    | 119,000     | 3,123,750 
|Lincare Holdings, Inc.* (a)                                       | 179,900     | 4,231,248 
|                                                                  | 16,730,922 
|Life Sciences Tools & Services 1.5%                              
|Mettler-Toledo International, Inc.*                               | 43,000      | 3,317,450 
|Industrials 14.5%                                                
|Aerospace & Defense 1.2%                                         
|Alliant Techsystems, Inc.* (a)                                    | 31,300      | 2,577,868 
|Commercial Services & Supplies 1.6%                              
|The Brink's Co.                                                   | 118,100     | 3,428,443 
|Construction & Engineering 2.5%                                  
|Fluor Corp.                                                       | 51,900      | 2,661,951 
|URS Corp.*                                                        | 57,300      | 2,837,496 
|                                                                  | 5,499,447  
|Electrical Equipment 2.5%                                        
|General Cable Corp.* (a)                                          | 75,200      | 2,826,016 
|Hubbell, Inc. "B"                                                 | 80,500      | 2,580,830 
|                                                                  | 5,406,846  
|Industrial Conglomerates 1.4%                                    
|McDermott International, Inc.*                                    | 157,500     | 3,198,825 
|Machinery 2.9%                                                   
|Crane Co.                                                         | 112,800     | 2,516,568 
|Joy Global, Inc. (a)                                              | 107,400     | 3,836,328 
|                                                                  | 6,352,896  
|Road & Rail 2.4%                                                 
|Genesee & Wyoming, Inc. "A"* (a)                                  | 102,000     | 2,704,020 
|Ryder System, Inc. (a)                                            | 95,775      | 2,674,038 
|                                                                  | 5,378,058  
|Information Technology 12.3%                                     
|Communications Equipment 3.2%                                    
|Arris Group, Inc.*                                                | 291,700     | 3,547,072 
|CommScope, Inc.* (a)                                              | 130,700     | 3,432,182 
|                                                                  | 6,979,254  
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Electronic Equipment, Instruments & Components 4.3%              
|Anixter International, Inc.* (a)                                  | 93,100      | 3,499,629 
|Arrow Electronics, Inc.*                                          | 142,300     | 3,022,452 
|Jabil Circuit, Inc.                                               | 389,800     | 2,892,316 
|                                                                  | 9,414,397  
|IT Services 2.4%                                                 
|Alliance Data Systems Corp.* (a)                                  | 64,400      | 2,652,636 
|Amdocs Ltd.*                                                      | 121,700     | 2,610,465 
|                                                                  | 5,263,101  
|Semiconductors & Semiconductor Equipment 1.2%                    
|Microsemi Corp.*                                                  | 186,100     | 2,568,180 
|Software 1.2%                                                    
|Jack Henry & Associates, Inc.                                     | 128,850     | 2,673,637 
|Materials 6.1%                                                   
|Chemicals 2.5%                                                   
|CF Industries Holdings, Inc.                                      | 31,300      | 2,320,582 
|Lubrizol Corp.                                                    | 66,200      | 3,131,922 
|                                                                  | 5,452,504  
|Containers & Packaging 1.2%                                      
|Owens-Illinois, Inc.*                                             | 94,900      | 2,658,149 
|Metals & Mining 2.4%                                             
|Coeur d'Alene Mines Corp.* (a)                                    | 196,900     | 2,421,870 
|Reliance Steel & Aluminum Co. (a)                                 | 73,400      | 2,817,826 
|                                                                  | 5,239,696  
|Telecommunication Services 1.3%                                  
|Diversified Telecommunication Services                           
|Windstream Corp.                                                  | 327,500     | 2,737,900 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Utilities 6.8%                                                   
|Electric Utilities 3.0%                                          
|ALLETE, Inc. (a)                                                  | 95,750      | 2,752,813 
|IDACORP, Inc.                                                     | 148,550     | 3,883,097 
|                                                                  | 6,635,910  
|Gas Utilities 1.3%                                               
|ONEOK, Inc.                                                       | 96,700      | 2,851,683 
|Multi-Utilities 2.5%                                             
|Ameren Corp.                                                      | 120,100     | 2,989,289 
|Integrys Energy Group, Inc. (a)                                   | 77,900      | 2,336,221 
|                                                                  | 5,325,510  
|Total Common Stocks (Cost $234,576,692)                           | 214,117,725
|                                                                 
|Securities Lending Collateral 28.4%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $62,258,394) | 62,258,394  | 62,258,394
|                                                                 
|Cash Equivalents 2.4%                                            
|Cash Management QP Trust, 0.27% (b) (Cost $5,357,114)             | 5,357,114   | 5,357,114 

|                                               | % of Net
Assets | Value ($)   
|---------------------------------------------- | --------------- | ------------
|                                               |                
|Total Investment Portfolio(Cost $302,192,200)+ | 128.6           | 281,733,233 
|Other Assets and Liabilities, Net              | (28.6)          | (62,703,991)
|Net Assets                                     | 100.0           | 219,029,242 

REIT: Real Estate Investment Trust

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1            | Level 2       | Level 3  | Total             
|------------------------------------------------ | ------------------ | ------------- | -------- | ------------------
|Common Stock and/or Other Equity Investments (d) | $      214,117,725 | $            | $       | $      214,117,725
|Short-Term Investments (d)                       | 62,258,394         | 5,357,114     |         | 67,615,508        
|Total                                            | $   276,376,119    | $   5,357,114 | $       | $   281,733,233   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|Investments:Investments in securities, at value (cost $234,576,692  including $60,563,629 of securities loaned)                                                                           
|Investment in Daily Assets Fund Institutional (cost $62,258,394)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $5,357,114)                                                                                                                                   
|Total investments, at value (cost $302,192,200)                                                                                                                                            
|Cash                                                                                                                                                                                       
|Receivable for investments sold                                                                                                                                                            
|Dividends receivable                                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Receivable for Portfolio shares sold                                                                                                                                                       
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable upon return of securities loaned                                                                                                                                                   
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Accrued management fee                                                                                                                                                                     
|Accrued expenses and payables                                                                                                                                                              
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of:                                                                                                                                                                     
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on investments                                                                                                                                  
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($197,059,537 ÷ 25,132,403 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($21,969,705 ÷ 2,798,750 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)  

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends                                                                                         
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Record keeping fees (Class B)                                                                            
|Services to shareholders                                                                                 
|Professional fees                                                                                        
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses                                                                                           
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from investments                                                                
|Payments by affiliates (see Note I)                                                                      
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                    
|----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                     
|Operations:Net investment income (loss)                                                                               
|Net realized gain (loss)                                                                                              
|Change in net unrealized appreciation (depreciation)                                                                  
|Net increase (decrease) in net assets resulting from operations                                                       
|Distributions to shareholders from:Net investment income:Class A                                                      
|Class B                                                                                                               
|Distributions to shareholders from:Net realized gains:Class A                                                         
|Class B                                                                                                               
|Total distributions                                                                                                   
|Portfolio share transactions:Class A
Proceeds from shares sold                                                        
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class A share transactions                                                 
|Class B
Proceeds from shares sold                                                                                     
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class B share transactions                                                 
|Increase (decrease) in net assets                                                                                     
|Net assets at beginning of period                                                                                     
|Net assets at end of period (including undistributed net investment income of $1,267,241 and
$4,324,008, respectively)
|Other Information                                                                                                     
|Class A
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class A shares                                                                             
|Shares outstanding at end of period                                                                                   
|Class B
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class B shares                                                                             
|Shares outstanding at end of period                                                                                   

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | $   7.93 | $   20.12 | $   22.93 | $   19.98 | $   20.05 | $   16.06
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .05      | .13       | .18       | .15       | .19       | .17      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .02c     | (4.92)    | .54       | 4.69      | 1.67      | 3.98     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | .07      | (4.79)    | .72       | 4.84      | 1.86      | 4.15     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | (.16)    | (.29)     | (.23)     | (.18)     | (.15)     | (.16)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         | (7.11)    | (3.30)    | (1.71)    | (1.78)    |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (.16)    | (7.40)    | (3.53)    | (1.89)    | (1.93)    | (.16)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | $   7.84 | $   7.93  | $   20.12 | $   22.93 | $   19.98 | $   20.05
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 1.28**   | (33.42)d  | 3.06      | 25.06     | 10.25     | 26.03    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 197      | 223       | 468       | 562       | 493       | 467      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | .83*     | .83       | .78       | .79       | .79       | .79      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | .83*     | .82       | .78       | .79       | .79       | .79      
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 1.35*    | 1.13      | .85       | .71       | .96       | .96      
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 43**     | 49        | 110       | 52        | 61        | 73       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cThe amount of net realized and unrealized gain shown for a share outstanding for the period ended June 30, 2009 does not correspond
with the aggregate net loss on investments for the period due to the timing of sales and repurchases of Portfolio shares in relation to
fluctuating market values on the investments on the Portfolio.dTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | $   7.92 | $   20.08 | $   22.88 | $   19.93 | $   20.01 | $   16.03
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .04      | .09       | .10       | .07       | .11       | .10      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .03c     | (4.92)    | .54       | 4.67      | 1.66      | 3.97     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | .07      | (4.83)    | .64       | 4.74      | 1.77      | 4.07     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | (.14)    | (.22)     | (.14)     | (.08)     | (.07)     | (.09)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         | (7.11)    | (3.30)    | (1.71)    | (1.78)    |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (.14)    | (7.33)    | (3.44)    | (1.79)    | (1.85)    | (.09)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | $   7.85 | $   7.92  | $   20.08 | $   22.88 | $   19.93 | $   20.01
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 1.18**   | (33.67)d  | 2.67      | 24.59     | 9.78      | 25.52    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 22       | 24        | 34        | 90        | 83        | 71       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 1.18*    | 1.18      | 1.16      | 1.17      | 1.19      | 1.16     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 1.18*    | 1.17      | 1.16      | 1.17      | 1.19      | 1.16     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 1.00*    | .78       | .47       | .33       | .56       | .59      
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 43**     | 49        | 110       | 52        | 61        | 73       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cThe amount of net realized and unrealized gain shown for a share outstanding for the period ended June 30, 2009 does not correspond
with the aggregate net loss on investments for the period due to the timing of sales and repurchases of Portfolio shares in relation to
fluctuating market values on the investments on the Portfolio.dTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Global Thematic VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are 1.42% and 1.77% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Additionally,
investing in foreign securities presents certain risks, such as currency fluctuation, political and economic changes and market risks.
This may result in greater share price volatility. Please read this Portfolio's prospectus for specific details regarding its investments and
risk profile.

Portfolio returns shown for all periods reflect a fee waiver and/or expense reimbursement. Without this waiver/reimbursement,
returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Global Thematic VIP
|------------------------------------------------------------------
|[] DWS Global Thematic VIP  Class A
[]MSCI World Index           
|vs2_g10k10b0                                                      
|Yearly periods ended June 30                                      

|Comparative Results        
|---------------------------
|DWS Global Thematic VIP    
|Class A                    
|Average annual total return
|MSCI World Index           
|Average annual total return
|DWS Global Thematic VIP    
|Class B                    
|Average annual total return
|MSCI World Index           
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Global Thematic VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had it
not done so, expenses would have been higher. The example in the table is based on an investment of $1,000
invested at the beginning of the six-month period and held for the entire period(January 1, 2009 to June 30,
2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                        | Class A |  | Class B | 
|------------------------------------------------ | ------- |  | ------- | 
|DWS Variable Series II  DWS Global Thematic VIP | 1.06%   |  | 1.41%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Global Thematic VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 93%     | 95%     
|Participatory Notes                                                                      | 3%      | 1%      
|Cash Equivalents                                                                         | 2%      | 1%      
|Exchange-Traded Funds                                                                    | 2%      | 2%      
|Preferred Stocks                                                                         |        | 1%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Investment Portfolio excluding Exchange-Traded Funds, Cash Equivalents
and Securities Lending Collateral) | 6/30/09 | 12/31/08
|------------------------------------------------------------------------------------------------------------------------------------------ | ------- | --------
|                                                                                                                                           |         |         
|Financials                                                                                                                                 | 19%     | 16%     
|Health Care                                                                                                                                | 15%     | 18%     
|Consumer Staples                                                                                                                           | 14%     | 13%     
|Industrials                                                                                                                                | 11%     | 16%     
|Energy                                                                                                                                     | 11%     | 11%     
|Telecommunication Services                                                                                                                 | 8%      | 5%      
|Consumer Discretionary                                                                                                                     | 8%      | 8%      
|Materials                                                                                                                                  | 6%      | 7%      
|Information Technology                                                                                                                     | 6%      | 6%      
|Utilities                                                                                                                                  | 2%      |        
|                                                                                                                                           | 100%    | 100%    

|Geographical Diversification(As a % of Investment Portfolio excluding Participatory Notes, Cash
Equivalents and Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------------------------------------------------------------- | ------- | --------
|                                                                                                                                               |         |         
|United States                                                                                                                                  | 42%     | 40%     
|Continental Europe                                                                                                                             | 23%     | 24%     
|Asia (excluding Japan)                                                                                                                         | 10%     | 11%     
|United Kingdom                                                                                                                                 | 8%      | 5%      
|Japan                                                                                                                                          | 6%      | 5%      
|Latin America                                                                                                                                  | 5%      | 9%      
|Middle East                                                                                                                                    | 1%      | 2%      
|Bermuda                                                                                                                                        | 1%      | 1%      
|Canada                                                                                                                                         | 1%      | 2%      
|Africa                                                                                                                                         | 1%      |        
|Other                                                                                                                                          | 2%      | 1%      
|                                                                                                                                               | 100%    | 100%    

Asset allocation, sector and geographical diversifications are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 109. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Global Thematic VIP

|                                                                                                              | Shares     | Value ($)
|------------------------------------------------------------------------------------------------------------- | ---------- | ---------
|                                                                                                              |           
|Common Stocks 94.7%                                                                                          
|Australia 2.3%                                                                                               
|IOOF Holdings Ltd.                                                                                            | 92,575     | 309,801  
|Newcrest Mining Ltd.                                                                                          | 9,700      | 237,690  
|Telstra Corp., Ltd.                                                                                           | 303,500    | 828,120  
|(Cost $1,555,322)                                                                                             | 1,375,611 
|Austria 0.4%                                                                                                 
|Flughafen Wien AG                                                                                             | 6,300      | 255,818  
|Raiffeisen International Bank-Holding AG                                                                      | 208        | 7,223    
|(Cost $610,599)                                                                                               | 263,041   
|Belgium 1.1%                                                                                                 
|Anheuser-Busch InBev NV (Cost $540,277)                                                                       | 18,434     | 667,358  
|Bermuda 1.1%                                                                                                 
|Lazard Ltd. "A" (Cost $635,311)                                                                               | 23,600     | 635,312  
|Brazil 3.6%                                                                                                  
|All America Latina Logistica (Units)                                                                          | 53,200     | 327,698  
|Cia Brasileira de Meios de Pagamento*                                                                         | 54,300     | 466,933  
|Santos Brasil Participacoes SA (Units)                                                                        | 138,800    | 779,178  
|SLC Agricola SA                                                                                               | 65,800     | 621,230  
|(Cost $2,872,114)                                                                                             | 2,195,039 
|Canada 0.8%                                                                                                  
|Goldcorp, Inc.                                                                                                | 5,300      | 184,223  
|Viterra, Inc.*                                                                                                | 36,600     | 317,809  
|(Cost $636,067)                                                                                               | 502,032   
|China 2.1%                                                                                                   
|Bawang International*                                                                                         | 40,000     | 12,284   
|Industrial & Commercial Bank of China Ltd. "H"                                                                | 1,400,000  | 974,058  
|SINA Corp.*                                                                                                   | 9,900      | 291,852  
|(Cost $1,051,256)                                                                                             | 1,278,194 
|Finland 0.4%                                                                                                 
|Sampo Oyj "A" (Cost $196,988)                                                                                 | 12,400     | 233,993  
|France 0.7%                                                                                                  
|BNP Paribas                                                                                                   | 245        | 15,899   
|Total SA                                                                                                      | 7,992      | 432,864  
|(Cost $424,647)                                                                                               | 448,763   
|Germany 8.4%                                                                                                 
|Allianz SE (Registered)                                                                                       | 6,616      | 611,793  
|Daimler AG (Registered)                                                                                       | 12,500     | 452,274  
|Deutsche Lufthansa AG (Registered)                                                                            | 48,400     | 608,407  
|Deutsche Post AG (Registered)                                                                                 | 41,500     | 542,416  
|Deutsche Telekom AG (Registered)                                                                              | 71,500     | 845,026  
|E.ON AG                                                                                                       | 27,800     | 986,743  
|Fresenius Medical Care AG & Co. KGaA                                                                          | 16,900     | 754,221  
|Siemens AG (Registered)                                                                                       | 4,100      | 283,844  
|(Cost $4,894,234)                                                                                             | 5,084,724 
|Hong Kong 2.7%                                                                                               
|China Mobile Ltd.                                                                                             | 41,000     | 411,122  
|China Mobile Ltd. (ADR)                                                                                       | 8,200      | 410,656  
|GOME Electrical Appliances Holdings Ltd.                                                                      | 1,974,000  | 486,492  
|                                                                                                              | Shares     | Value ($)
|                                                                                                              |           
|Hongkong & Shanghai Hotels Ltd.                                                                               | 326,242    | 319,698  
|(Cost $2,344,935)                                                                                             | 1,627,968 
|India 1.6%                                                                                                   
|Bharat Electronics Ltd.                                                                                       | 3,477      | 94,717   
|Hindustan Unilever Ltd.                                                                                       | 56,600     | 317,407  
|Infosys Technologies Ltd.                                                                                     | 9,800      | 362,781  
|ITC Ltd.                                                                                                      | 43,800     | 175,246  
|(Cost $840,548)                                                                                               | 950,151   
|Israel 1.3%                                                                                                  
|Teva Pharmaceutical Industries Ltd. (ADR) (a) (Cost $621,759)                                                 | 15,400     | 759,836  
|Italy 1.4%                                                                                                   
|Gemina SpA*                                                                                                   | 443,383    | 327,209  
|Parmalat SpA                                                                                                  | 205,584    | 496,767  
|(Cost $1,083,029)                                                                                             | 823,976   
|Japan 6.0%                                                                                                   
|Mitsubishi Estate Co., Ltd.                                                                                   | 27,000     | 447,281  
|Mitsubishi UFJ Financial Group, Inc.                                                                          | 63,200     | 388,502  
|Mitsui & Co., Ltd.                                                                                            | 45,000     | 530,122  
|Mitsui Fudosan Co., Ltd.                                                                                      | 26,000     | 450,445  
|NTT DoCoMo, Inc.                                                                                              | 247        | 360,752  
|Seven & I Holdings Co., Ltd.                                                                                  | 12,000     | 281,534  
|Shin-Etsu Chemical Co., Ltd.                                                                                  | 7,400      | 341,771  
|Toyota Motor Corp.                                                                                            | 21,600     | 816,573  
|(Cost $3,368,303)                                                                                             | 3,616,980 
|Kazakhstan 0.1%                                                                                              
|Kazakhstan Kagazy PLC (GDR) 144A*                                                                             | 181,200    | 41,676   
|Steppe Cement Ltd.*                                                                                           | 47,722     | 30,970   
|(Cost $1,109,216)                                                                                             | 72,646    
|Korea 0.5%                                                                                                   
|KT&G Corp. (Cost $315,311)                                                                                    | 5,651      | 319,178  
|Luxembourg 0.9%                                                                                              
|ArcelorMittal (Cost $417,141)                                                                                 | 17,099     | 561,560  
|Malaysia 0.7%                                                                                                
|AMMB Holdings Bhd. (Cost $310,701)                                                                            | 457,900    | 438,944  
|Mexico 0.0%                                                                                                  
|Banco Compartamos SA de CV (Cost $590)                                                                        | 200        | 644      
|Netherlands 2.5%                                                                                             
|QIAGEN NV* (a)                                                                                                | 50,200     | 931,763  
|Royal Dutch Shell PLC "A"                                                                                     | 23,666     | 592,695  
|(Cost $1,356,386)                                                                                             | 1,524,458 
|Panama 0.7%                                                                                                  
|Copa Holdings SA "A" (Cost $361,800)                                                                          | 10,600     | 432,692  
|Russia 1.1%                                                                                                  
|Far Eastern Shipping Co.*                                                                                     | 689,000    | 254,930  
|Globaltrans Investment PLC (GDR) 144A*                                                                        | 47,000     | 188,000  
|Globaltrans Investment PLC (GDR) REG S*                                                                       | 10,350     | 41,400   
|Novorossiysk Sea Trade Port (GDR) 144A                                                                        | 17,300     | 166,080  
|(Cost $1,760,700)                                                                                             | 650,410   
|                                                                                                              | Shares     | Value ($)
|                                                                                                              |           
|Singapore 0.3%                                                                                               
|Food Empire Holdings Ltd. (Cost $354,177)                                                                     | 700,000    | 156,847  
|South Africa 0.8%                                                                                            
|AngloGold Ashanti Ltd.                                                                                        | 6,946      | 254,723  
|Gold Fields Ltd.                                                                                              | 18,900     | 228,140  
|(Cost $416,729)                                                                                               | 482,863   
|Spain 0.7%                                                                                                   
|Grifols SA (Cost $348,231)                                                                                    | 22,288     | 394,188  
|Switzerland 4.4%                                                                                             
|Julius Baer Holding AG (Registered)                                                                           | 10,802     | 421,170  
|Nestle SA (Registered)                                                                                        | 35,012     | 1,321,393
|Roche Holding AG (Genusschein)                                                                                | 3,265      | 444,199  
|UBS AG (Registered)*                                                                                          | 36,639     | 447,529  
|(Cost $2,431,442)                                                                                             | 2,634,291 
|Taiwan 0.6%                                                                                                  
|Asustek Computer, Inc. (Cost $380,536)                                                                        | 303,000    | 391,565  
|Thailand 0.9%                                                                                                
|Bangkok Bank PCL (Foreign Registered)                                                                         | 28,900     | 94,286   
|Kasikornbank PCL (Foreign Registered)                                                                         | 45,600     | 96,140   
|Seamico Securities PCL (Foreign Registered)                                                                   | 1,439,300  | 92,095   
|Siam City Bank PCL (Foreign Registered)                                                                       | 523,300    | 250,360  
|(Cost $607,536)                                                                                               | 532,881   
|Turkey 0.6%                                                                                                  
|Turkcell Iletisim Hizmetleri AS (ADR) (Cost $348,000)                                                         | 26,500     | 367,290  
|United Kingdom 7.3%                                                                                          
|Aberdeen Asset Management PLC                                                                                 | 199,236    | 406,505  
|BAE Systems PLC                                                                                               | 95,857     | 535,077  
|BG Group PLC                                                                                                  | 10,816     | 181,730  
|BHP Billiton PLC                                                                                              | 10,255     | 231,640  
|G4S PLC                                                                                                       | 81,875     | 281,557  
|GlaxoSmithKline PLC                                                                                           | 58,587     | 1,031,691
|Imperial Tobacco Group PLC                                                                                    | 21,020     | 546,714  
|Rio Tinto PLC                                                                                                 | 6,951      | 241,986  
|Standard Chartered PLC                                                                                        | 29,231     | 550,554  
|Vodafone Group PLC                                                                                            | 222,125    | 429,362  
|(Cost $4,153,954)                                                                                             | 4,436,816 
|United States 38.7%                                                                                          
|Anadarko Petroleum Corp.                                                                                      | 17,550     | 796,594  
|Apache Corp.                                                                                                  | 7,800      | 562,770  
|Apple, Inc.*                                                                                                  | 2,400      | 341,832  
|AT&T, Inc.                                                                                                    | 12,100     | 300,564  
|Bank of America Corp. (a)                                                                                     | 87,000     | 1,148,400
|Berkshire Hathaway, Inc. "A"*                                                                                 | 6          | 540,000  
|Carnival Corp. (Units)                                                                                        | 8,000      | 206,160  
|ConocoPhillips                                                                                                | 10,700     | 450,042  
|CVS Caremark Corp.                                                                                            | 36,200     | 1,153,694
|Dell, Inc.*                                                                                                   | 24,000     | 329,520  
|Devon Energy Corp.                                                                                            | 8,700      | 474,150  
|Expedia, Inc.*                                                                                                | 18,300     | 276,513  
|ExxonMobil Corp.                                                                                              | 17,900     | 1,251,389
|General Electric Co.                                                                                          | 52,200     | 611,784  
|Hess Corp.                                                                                                    | 12,000     | 645,000  
|Hewlett-Packard Co.                                                                                           | 10,300     | 398,095  
|Illumina, Inc.*                                                                                               | 8,300      | 323,202  
|                                                                                                              | Shares     | Value ($)
|                                                                                                              |           
|Kellogg Co.                                                                                                   | 13,500     | 628,695  
|Laboratory Corp. of America Holdings*                                                                         | 15,200     | 1,030,408
|Legg Mason, Inc.                                                                                              | 27,200     | 663,136  
|Life Technologies Corp.* (a)                                                                                  | 22,300     | 930,356  
|Mattel, Inc.                                                                                                  | 27,000     | 433,350  
|McDonald's Corp.                                                                                              | 18,200     | 1,046,318
|Microsoft Corp.                                                                                               | 34,200     | 812,934  
|Monsanto Co.                                                                                                  | 12,000     | 892,080  
|Morgan Stanley                                                                                                | 7,000      | 199,570  
|Mylan, Inc.*                                                                                                  | 64,850     | 846,292  
|Myriad Genetics, Inc.*                                                                                        | 13,400     | 477,710  
|Myriad Pharmaceuticals, Inc.*                                                                                 | 3,375      | 15,694   
|Oracle Corp.                                                                                                  | 13,300     | 284,886  
|Owens-Illinois, Inc.*                                                                                         | 18,550     | 519,586  
|Perot Systems Corp. "A"*                                                                                      | 6,200      | 88,846   
|Pfizer, Inc.                                                                                                  | 66,775     | 1,001,625
|Philip Morris International, Inc.                                                                             | 13,400     | 584,508  
|Procter & Gamble Co.                                                                                          | 9,600      | 490,560  
|SAIC, Inc.*                                                                                                   | 2,200      | 40,810   
|State Street Corp.                                                                                            | 6,300      | 297,360  
|The Blackstone Group LP                                                                                       | 28,100     | 296,174  
|Unisys Corp.*                                                                                                 | 71,500     | 107,965  
|Verizon Communications, Inc.                                                                                  | 19,200     | 590,016  
|Wal-Mart Stores, Inc.                                                                                         | 8,000      | 387,520  
|Walt Disney Co.                                                                                               | 20,000     | 466,600  
|Williams Companies, Inc.                                                                                      | 32,800     | 512,008  
|(Cost $21,521,498)                                                                                            | 23,454,716
|Total Common Stocks (Cost $57,869,337)                                                                        | 57,314,967
|                                                                                                             
|Participatory Notes 2.8%                                                                                     
|Commercial International Bank (issuer Merrill Lynch International & Co.), Expiration Date 5/9/2011*           | 4,336      | 37,463   
|Doha Bank QSC (issuer Merrill Lynch International & Co.), Expiration Date 5/24/2010*                          | 3,545      | 35,769   
|Dubai Financial Market (issuer Merrill Lynch International & Co.), Expiration Date 5/24/2010*                 | 87,265     | 38,536   
|Merrill Lynch Frontier Index Trust (issuer Merrill Lynch International & Co.), Expiration Date 2/27/2010*     | 9,700      | 412,541  
|Mobile Telecommunications Co. (issuer Merrill Lynch International & Co.), Expiration Date 12/6/2010*          | 55,000     | 224,499  
|National Bank of Abu Dhabi (issuer Merrill Lynch International & Co.), Expiration Date 1/12/2010*             | 13,696     | 36,295   
|Oil & Gas Development Co., Ltd. (issuer Merrill Lynch International & Co.), 144A, Expiration Date 10/18/2011* | 194,800    | 187,748  
|Pakistan Petroleum Ltd. (issuer Merrill Lynch International & Co.), 144A, Expiration Date 10/18/2011*         | 83,500     | 194,764  
|Qatar Electricity & Water Co. (issuer Merrill Lynch International & Co.), Expiration Date 5/24/2010*          | 1,373      | 37,721   
|Qatar National Bank (issuer Merrill Lynch International & Co.), Expiration Date 7/26/2010*                    | 1,145      | 37,561   
|Riyad Bank (issuer HSBC Bank PLC), Expiration Date 6/11/2012*                                                 | 11,300     | 73,972   
|                                                                                                              | Shares     | Value ($)
|                                                                                                              |           
|Samba Financial Group (issuer HSBC Bank PLC), Expiration Date 4/30/2012*                                      | 5,800      | 64,646   
|Saudi Basic Industrial Corp. (issuer HSBC Bank PLC), Expiration Date 3/26/2012*                               | 13,000     | 217,519  
|Saudi Telecom Co. (issuer HSBC Bank PLC), Expiration Date 5/21/2012*                                          | 5,200      | 71,409   
|Total Participatory Notes (Cost $2,217,837)                                                                   | 1,670,443 
|                                                                                                             
|Rights 0.0%                                                                                                  
|United Kingdom                                                                                               
|Rio Tinto PLC, Expiration Date 7/1/2009* (Cost $27,879)                                                       | 2,265      | 26,010   
|                                                                                                             
|Exchange-Traded Fund 2.1%                                                                                    
|United States                                                                                                
|iShares Nasdaq Biotechnology Index Fund* (a) (Cost $1,237,510)                                                | 17,825     | 1,296,947
|                                                                                                              | Shares     | Value ($)
|                                                                                                              |           
|Call Options Purchased 0.0%                                                                                  
|United States                                                                                                
|General Electric Co., Expiration Date 1/16/2010, Strike Price $30.0 (Cost $212,773)                           | 510        | 2,040    
|                                                                                                             
|Securities Lending Collateral 7.2%                                                                           
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $4,377,425)                                              | 4,377,425  | 4,377,425
|                                                                                                             
|Cash Equivalents 2.3%                                                                                        
|Cash Management QP Trust, 0.27% (b) (Cost $1,366,832)                                                         | 1,366,832  | 1,366,832

|                                              | % of Net
Assets | Value ($)  
|--------------------------------------------- | --------------- | -----------
|                                              |                
|Total Investment Portfolio(Cost $67,309,593)+ | 109.1           | 66,054,664 
|Other Assets and Liabilities, Net             | (9.1)           | (5,522,706)
|Net Assets                                    | 100.0           | 60,531,958 

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions exempt
from registration, normally to qualified institutional buyers.

ADR: American Depositary Receipt

GDR: Global Depositary Receipt

REG S: Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of,
US persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of
1933.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1        | Level 2          | Level 3  | Total           
|------------------------------------------------ | -------------- | ---------------- | -------- | ----------------
|Common Stock and/or Other Equity Investments (d) |                |                  |          |                 
|Australia                                        | $             | $      1,375,611 | $       | $      1,375,611
|Austria                                          |               | 263,041          |         | 263,041         
|Belgium                                          |               | 667,358          |         | 667,358         
|Bermuda                                          | 635,312        |                 |         | 635,312         
|Brazil                                           | 2,195,039      |                 |         | 2,195,039       
|Canada                                           | 502,032        |                 |         | 502,032         
|China                                            | 291,852        | 986,342          |         | 1,278,194       
|Finland                                          |               | 233,993          |         | 233,993         
|France                                           |               | 448,763          |         | 448,763         
|Germany                                          |               | 5,084,724        |         | 5,084,724       
|Hong Kong                                        | 410,656        | 1,217,312        |         | 1,627,968       
|India                                            |               | 950,151          |         | 950,151         
|Israel                                           | 759,836        |                 |         | 759,836         
|Italy                                            |               | 823,976          |         | 823,976         
|Japan                                            |               | 3,616,980        |         | 3,616,980       
|Kazakhstan                                       |               | 72,646           |         | 72,646          
|Korea                                            |               | 319,178          |         | 319,178         
|Luxembourg                                       |               | 561,560          |         | 561,560         
|Malaysia                                         |               | 438,944          |         | 438,944         
|Mexico                                           | 644            |                 |         | 644             
|Netherlands                                      |               | 1,524,458        |         | 1,524,458       
|Panama                                           | 432,692        |                 |         | 432,692         
|Russia                                           | 41,400         | 609,010          |         | 650,410         
|Singapore                                        |               | 156,847          |         | 156,847         
|South Africa                                     |               | 482,863          |         | 482,863         
|Spain                                            |               | 394,188          |         | 394,188         
|Switzerland                                      | 365,079        | 2,269,212        |         | 2,634,291       
|Taiwan                                           |               | 391,565          |         | 391,565         
|Thailand                                         |               | 532,881          |         | 532,881         
|Turkey                                           | 367,290        |                 |         | 367,290         
|United Kingdom                                   |               | 4,462,826        |         | 4,462,826       
|United States                                    | 24,751,663     |                 |         | 24,751,663      
|Participatory Notes                              |               | 1,670,443        |         | 1,670,443       
|Short-Term Investments (d)                       | 4,377,425      | 1,366,832        |         | 5,744,257       
|Derivatives (e)                                  | 2,040          |                 |         | 2,040           
|Total                                            | $   35,132,960 | $   30,921,704   | $       | $   66,054,664  

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                 | Common Stock
and/or Other
Equity
Investments
|-------------------------------------------------------------------------------- | --------------------------------------------
|Level 3 Reconciliation                                                           | Hong Kong                                   
|Balance as of December 31, 2008                                                  | $      344,346                              
|Realized gains (loss)                                                            | (54,879)                                    
|Change in unrealized appreciation (depreciation)                                 | 237,628                                     
|Amortization premium/discount                                                    |                                            
|Net purchase (sales)                                                             | (40,603)                                    
|Net transfers in (out) of Level 3                                                | (486,492)                                   
|Balance as of June 30, 2009                                                      | $                                          
|Net change in unrealized appreciation (depreciation) from investments still held | $                                          

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                      
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                   
|Investments:Investments in securities, at value (cost $61,565,336)  including $4,268,441 of securities loaned                                                                           
|Investment in Daily Assets Fund Institutional (cost $4,377,425)*                                                                                                                         
|Investment in Cash Management QP Trust (cost $1,366,832)                                                                                                                                 
|Total investments, at value (cost $67,309,593)                                                                                                                                           
|Foreign currency, at value (cost $207,419)                                                                                                                                               
|Receivable for investments sold                                                                                                                                                          
|Receivable for Portfolio shares sold                                                                                                                                                     
|Dividends receivable                                                                                                                                                                     
|Interest receivable                                                                                                                                                                      
|Foreign taxes recoverable                                                                                                                                                                
|Other assets                                                                                                                                                                             
|Total assets                                                                                                                                                                             
|Liabilities                                                                                                                                                                              
|Cash overdraft                                                                                                                                                                           
|Payable upon return of securities loaned                                                                                                                                                 
|Payable for investments purchased                                                                                                                                                        
|Payable for Portfolio shares redeemed                                                                                                                                                    
|Deferred foreign taxes payable                                                                                                                                                           
|Accrued management fee                                                                                                                                                                   
|Accrued expenses and payables                                                                                                                                                            
|Total liabilities                                                                                                                                                                        
|Net assets, at value                                                                                                                                                                     
|Net Assets Consist of                                                                                                                                                                    
|Undistributed net investment income                                                                                                                                                      
|Net unrealized appreciation (depreciation) on:Investments (net of deferred foreign taxes of $29,833)                                                                                     
|Foreign currency                                                                                                                                                                         
|Accumulated net realized gain (loss)                                                                                                                                                     
|Paid-in capital                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                     
|Class A
Net Asset Value, offering and redemption price per share ($56,147,500 ÷ 8,485,459 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($4,384,458 ÷ 660,708 outstanding shares of beneficial interest,
no par value, unlimited number of shares authorized)   

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                                    
|--------------------------------------------------------------------------------------------------------------
|Investment Income                                                                                             
|Income:Dividends (net of foreign taxes withheld of $67,884)                                                   
|Interest                                                                                                      
|Interest  Cash Management QP Trust                                                                           
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates     
|Total Income                                                                                                  
|Expenses:Management fee                                                                                       
|Administration fee                                                                                            
|Services to shareholders                                                                                      
|Custodian fees                                                                                                
|Distribution service fee (Class B)                                                                            
|Record keeping fees (Class B)                                                                                 
|Legal fees                                                                                                    
|Audit and tax fees                                                                                            
|Trustees' fees and expenses                                                                                   
|Reports to shareholders                                                                                       
|Other                                                                                                         
|Total expenses before expense reductions                                                                      
|Expense reductions                                                                                            
|Total expenses after expense reductions                                                                       
|Net investment income (loss)                                                                                  
|Realized and Unrealized Gain (Loss)                                                                           
|Net realized gain (loss) from:Investments                                                                     
|Foreign currency                                                                                              
|                                                                                                              
|Change in net unrealized appreciation (depreciation) on:Investments (net of deferred foreign taxes of $29,833)
|Foreign currency                                                                                              
|                                                                                                              
|Net gain (loss)                                                                                               
|Net increase (decrease) in net assets resulting from operations                                               

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                
|------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                 
|Operations:Net investment income (loss)                                                                           
|Net realized gain (loss)                                                                                          
|Change in net unrealized appreciation (depreciation)                                                              
|Net increase (decrease) in net assets resulting from operations                                                   
|Distributions to shareholders from:Net investment income:Class A                                                  
|Class B                                                                                                           
|Net realized gains:Class A                                                                                        
|Class B                                                                                                           
|Total distributions                                                                                               
|Portfolio share transactions:Class A
Proceeds from shares sold                                                    
|Reinvestment of distributions                                                                                     
|Cost of shares redeemed                                                                                           
|Net increase (decrease) in net assets from Class A share transactions                                             
|Class B
Proceeds from shares sold                                                                                 
|Reinvestment of distributions                                                                                     
|Cost of shares redeemed                                                                                           
|Net increase (decrease) in net assets from Class B share transactions                                             
|Increase (decrease) in net assets                                                                                 
|Net assets at beginning of period                                                                                 
|Net assets at end of period (including undistributed net investment income of
$577,095 and $932,658, respectively)
|Other Information                                                                                                 
|Class A
Shares outstanding at beginning of period                                                                 
|Shares sold                                                                                                       
|Shares issued to shareholders in reinvestment of distributions                                                    
|Shares redeemed                                                                                                   
|Net increase (decrease) in Class A shares                                                                         
|Shares outstanding at end of period                                                                               
|Class B
Shares outstanding at beginning of period                                                                 
|Shares sold                                                                                                       
|Shares issued to shareholders in reinvestment of distributions                                                    
|Shares redeemed                                                                                                   
|Net increase (decrease) in Class B shares                                                                         
|Shares outstanding at end of period                                                                               

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   5.84 | $   15.66 | $   17.39 | $   14.44 | $   11.78 | $   10.39
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | .06      | .11       | .14       | .15d      | .12       | .04      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | .82      | (5.83)    | .88       | 4.02      | 2.58      | 1.48     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .88      | (5.72)    | 1.02      | 4.17      | 2.70      | 1.52     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | (.10)    | (.19)     | (.11)     | (.09)     | (.04)     | (.13)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |         | (3.91)    | (2.64)    | (1.13)    |          |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | (.10)    | (4.10)    | (2.75)    | (1.22)    | (.04)     | (.13)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $   6.62 | $   5.84  | $   15.66 | $   17.39 | $   14.44 | $   11.78
|Total Return (%)c                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 15.55**  | (47.75)   | 6.29      | 30.14d    | 22.94     | 14.76    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 56       | 59        | 151       | 143       | 85        | 63       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1.60*    | 1.47      | 1.44      | 1.38      | 1.41      | 1.44     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 1.06*    | 1.09      | 1.11      | 1.04      | 1.28      | 1.43     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 2.21*    | 1.09      | .82       | .92d      | .98       | .38      
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 105**    | 229       | 191       | 136       | 95        | 81       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.004 per share and an increase in the ratio of net investment income of 0.03%. Excluding this non-recurring income, total return
would have been 0.02% lower.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | $   5.85 | $   15.66 | $   17.38 | $   14.43 | $   11.78 | $   10.38
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | .05      | .07       | .07       | .09d      | .07       | .00e     
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | .82      | (5.83)    | .90       | 4.02      | 2.58      | 1.48     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .87      | (5.76)    | .97       | 4.11      | 2.65      | 1.48     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (.08)    | (.14)     | (.05)     | (.03)     |          | (.08)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |         | (3.91)    | (2.64)    | (1.13)    |          |         
|Total distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | (.08)    | (4.05)    | (2.69)    | (1.16)    |          | (.08)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | $   6.64 | $   5.85  | $   15.66 | $   17.38 | $   14.43 | $   11.78
|Total Return (%)c                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 15.28**  | (47.87)   | 5.84      | 29.65d    | 22.50     | 14.33    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 4        | 4         | 10        | 25        | 20        | 13       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 1.95*    | 1.82      | 1.81      | 1.76      | 1.79      | 1.84     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 1.41*    | 1.45      | 1.47      | 1.43      | 1.65      | 1.83     
|Ratio of net investment income (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 1.86*    | .73       | .46       | .53d      | .61       | .02      
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 105**    | 229       | 191       | 136       | 95        | 81       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.004 per share and an increase in the ratio of net investment income of 0.03%. Excluding this non-recurring income, total return
would have been 0.02% lower.eAmount is less than $.005 per share.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Government & Agency Securities VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .63% and .98% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

The guarantee on US Government Guaranteed Securities relates only to the prompt payment of principal and interest and does not
remove market risks. Additionally, yields will fluctuate in response to changing interest rates and may be affected by the prepayment
of mortgage-backed securities. Bond investments are subject to interest-rate risk such that when interest rates rise, the prices of the
bonds, and thus the value of the investment, can decline and the investor can lose principal value. In the current market environment,
mortgage-backed securities are experiencing increased volatility. Please read this Portfolio's prospectus for specific details regarding
its investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year, 10-year/Life of Class periods reflect a fee waiver and/or expense reimbursement.
Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Government & Agency Securities VIP
|---------------------------------------------------------------------------------
|[] DWS Government & Agency Securities VIP  Class A
[]Barclays Capital GNMA Index
|vs2_g10k10a0                                                                     
|Yearly periods ended June 30                                                     

|Comparative Results                   
|--------------------------------------
|DWS Government & Agency Securities VIP
|Class A                               
|Average annual total return           
|Barclays Capital
GNMA Index           
|Average annual total return           
|DWS Government & Agency Securities VIP
|Class B                               
|Average annual total return           
|Barclays Capital
GNMA Index           
|Average annual total return           

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Government & Agency Securities VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                                       | Class A |  | Class B | 
|--------------------------------------------------------------- | ------- |  | ------- | 
|DWS Variable Series II  DWS Government & Agency Securities VIP | .62%    |  | .97%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Government & Agency Securities VIP

|Asset Allocation(As a % of Investment Portfolio) | 6/30/09 | 12/31/08
|------------------------------------------------ | ------- | --------
|                                                 |         |         
|Mortgage-Backed Securities Pass-Throughs         | 72%     | 65%     
|Collateralized Mortgage Obligation               | 12%     | 17%     
|Government & Agency Obligations                  | 12%     | 14%     
|Cash Equivalents                                 | 4%      | 4%      
|                                                 | 100%    | 100%    

|Quality                    | 6/30/09 | 12/31/08
|-------------------------- | ------- | --------
|                           |         |         
|US Government and Agencies | 96%     | 92%     
|AAA*                       | 4%      | 6%      
|Not Rated                  |        | 2%      
|                           | 100%    | 100%    

|Interest Rate Sensitivity | 6/30/09   | 12/31/08 
|------------------------- | --------- | ---------
|                          |           |          
|Effective Maturity        | 5.3 years | 3.4 years
|Average Duration          | 3.5 years | 1.0 years

Asset allocation, quality and interest rate sensitivity are subject to change.

The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") credit
ratings. The ratings of Moody's and S&P represent their opinions as to the quality of the securities they rate. Ratings are relative and
subjective and are not absolute standards of quality. The Portfolio's quality does not remove market risk.

For more complete details about the Portfolio's investment portfolio, see page 122. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Government & Agency Securities VIP

|                                                                   | Principal
Amount ($) | Value ($) 
|------------------------------------------------------------------ | -------------------- | ----------
|                                                                   |                     
|Mortgage-Backed Securities 
Pass-Throughs 84.0%                   
|Federal Home Loan Mortgage Corp.:                                 
|4.5%, 5/1/2019                                                     | 38,368               | 39,808    
|5.5%, with various maturities from 2/1/2017 until 6/1/2035 (a)     | 20,032,175           | 20,673,098
|6.5%, 9/1/2032                                                     | 128,979              | 138,164   
|7.0%, with various maturities from 6/1/2032 until 5/1/2038         | 2,706,939            | 2,936,067 
|8.5%, 7/1/2030                                                     | 2,185                | 2,440     
|Federal National Mortgage Association:                            
|5.0%, 10/1/2033                                                    | 506,312              | 517,862   
|5.5%, 4/1/2035 (a)                                                 | 15,000,000           | 15,480,468
|6.5%, 1/1/2038                                                     | 1,763,398            | 1,880,843 
|7.0%, with various maturities from 9/1/2013 until 10/1/2037        | 762,796              | 829,679   
|8.0%, 12/1/2024                                                    | 10,755               | 11,824    
|Government National Mortgage Association:                         
|4.5%, 10/1/2038 (a)                                                | 2,000,000            | 1,995,625 
|5.0%, with various maturities from 12/15/2032 until 3/15/2039 (a)  | 19,254,939           | 19,785,513
|5.5%, with various maturities from 10/15/2032 until 1/15/2039 (a)  | 37,476,479           | 38,982,425
|6.0%, with various maturities from 4/15/2013 until 2/15/2039 (a)   | 39,340,611           | 41,447,604
|6.5%, with various maturities from 3/15/2014 until 2/15/2039       | 7,757,364            | 8,298,492 
|7.0%, with various maturities from 10/15/2026 until 11/15/2038     | 5,304,369            | 5,722,208 
|7.5%, with various maturities from 4/15/2026 until 1/15/2037       | 1,666,291            | 1,818,193 
|9.5%, with various maturities from 7/15/2016 until 12/15/2022      | 47,856               | 53,427    
|10.0%, with various maturities from 2/15/2016 until 3/15/2016      | 14,225               | 16,085    
|Total Mortgage-Backed Securities Pass-Throughs (Cost $156,674,570) | 160,629,825         
|                                                                  
|Collateralized Mortgage Obligations 13.8%                         
|FannieMae Grantor Trust, "A2", Series 2001-T10, 7.5%, 12/25/2041   | 3,570                | 3,813     
|Federal Home Loan Mortgage Corp.:                                 
|"AF", Series 2892, 0.619%*, 5/15/2021                              | 737,723              | 738,946   
|"FO", Series 2418, 1.219%*, 2/15/2032                              | 730,148              | 740,757   
|"FA", Series 2419, 1.319%*, 2/15/2032                              | 706,236              | 716,405   
|"FA", Series 2436, 1.319%*, 3/15/2032                              | 796,470              | 807,222   
|"FD", Series 3519, 1.769%*, 2/15/2038                              | 966,756              | 987,492   
|"BI", Series 3499, Interest Only, 4.0%, 9/15/2021                  | 2,621,186            | 203,466   
|"GZ", Series 2906, 5.0%, 9/15/2034                                 | 1,564,672            | 1,446,912 
|"SL", Series 2882, Interest Only, 6.881%**, 10/15/2034             | 1,121,392            | 120,166   
|                                                                   | Principal
Amount ($) | Value ($) 
|                                                                   |                     
|"ST", Series 2411, Interest Only, 8.431%**, 6/15/2021              | 3,680,731            | 397,057   
|Federal National Mortgage Association:                            
|"FA", Series G92-53, 1.094%*, 9/25/2022                            | 1,620,195            | 1,612,238 
|"OF", Series 2001-60, 1.264%*, 10/25/2031                          | 331,814              | 337,188   
|"FB", Series 2002-30, 1.314%*, 8/25/2031                           | 726,952              | 738,299   
|"FG", Series 2002-66, 1.314%*, 9/25/2032                           | 1,145,861            | 1,161,797 
|"25", Series 351, Interest Only, 4.5%, 5/1/2019                    | 776,821              | 99,301    
|"20", Series 334, Interest Only, 5.0%, 3/1/2018                    | 593,730              | 66,806    
|"21", Series 334, Interest Only, 5.0%, 3/1/2018                    | 393,096              | 44,252    
|''23", Series 339, Interest Only, 5.0%, 7/1/2018                   | 812,656              | 91,489    
|"ZA", Series 2008-24, 5.0%, 4/25/2038                              | 556,474              | 502,463   
|"AN", Series 2007-108, 8.844%*, 11/25/2037                         | 2,142,770            | 2,237,389 
|Government National Mortgage Association:                         
|"FH", Series 1999-18, 0.568%*, 5/16/2029                           | 2,422,481            | 2,409,518 
|"FE", Series 2003-57, 0.618%*, 3/16/2033                           | 140,297              | 139,423   
|"FB", Series 2001-28, 0.818%*, 6/16/2031                           | 624,934              | 627,404   
|"KE", Series 2004-19, 5.0%, 3/16/2034                              | 500,000              | 479,082   
|"ZM", Series 2004-24, 5.0%, 4/20/2034                              | 1,941,113            | 1,838,178 
|"LE", Series 2004-87, 5.0%, 10/20/2034                             | 1,000,000            | 941,929   
|"ZB", Series 2005-15, 5.0%, 2/16/2035                              | 1,365,508            | 1,284,576 
|"CK", Series 2007-31, 5.0%, 5/16/2037                              | 1,000,000            | 985,908   
|"AI", Series 2008-46, Interest Only, 5.5%, 5/16/2023               | 812,973              | 105,787   
|"AI", Series 2008-51, Interest Only, 5.5%, 5/16/2023               | 1,710,986            | 214,143   
|"ZA", Series 2006-7, 5.5%, 2/20/2036                               | 2,041,210            | 2,008,975 
|"SA", Series 2002-65, Interest Only, 5.935%**, 9/20/2032           | 3,942,452            | 357,612   
|"SF", Series 2002-63, Interest Only, 5.962%**, 9/16/2032           | 2,750,752            | 191,812   
|"PH" Series 2002- 84, 6.0%, 11/16/2032                             | 500,000              | 521,056   
|"SJ", Series 2004-22, Interest Only, 6.285%**, 4/20/2034           | 4,682,867            | 220,214   
|"DI", Series 2008-93, Interest Only, 6.5%, 9/20/2038               | 1,630,076            | 269,764   
|"KS", Series 2004-96, Interest Only, 6.685%**, 7/20/2034           | 659,292              | 59,231    
|"SY", Series 2004-47, Interest Only, 6.742%**, 1/16/2034           | 996,606              | 84,722    
|"QS", Series 2003-34, Interest Only, 6.835%**, 3/20/2033           | 527,587              | 54,195    
|"SN", Series 2005-68, Interest Only, 6.881%**, 1/17/2034           | 3,747,899            | 278,081   
|                                                                   | Principal
Amount ($) | Value ($) 
|                                                                   |                     
|"IC", Series 1997-4, Interest Only, 7.5%, 3/16/2027                | 1,141,553            | 194,247   
|"SA", Series 1999-30, Interest Only, 7.682%**, 4/16/2029           | 1,005,257            | 80,506    
|"SJ", Series 1999-43, Interest Only, 7.682%**, 11/16/2029          | 305,434              | 36,519    
|Total Collateralized Mortgage Obligations (Cost $24,332,129)       | 26,436,340          
|                                                                  
|Government & Agency Obligations 13.6%                             
|Other Government Related 2.0%                                     
|Citibank NA, FDIC Guaranteed, 1.016%*, 5/7/2012                    | 2,800,000            | 2,793,205 
|JPMorgan Chase & Co.:                                             
|Series 3, FDIC Guaranteed, 0.854%*, 12/26/2012                     | 463,000              | 467,630   
|FDIC Guaranteed, 0.859%*, 6/15/2012                                | 537,000              | 543,021   
|                                                                   | 3,803,856           
|US Government Sponsored Agencies 11.0%                            
|Federal Home Loan Bank:                                           
|3.625%, 10/18/2013                                                 | 18,000,000           | 18,611,190
|7.2%*, 3/18/2024                                                   | 560,000              | 513,800   
|                                                                   | Principal
Amount ($) | Value ($) 
|                                                                   |                     
|Federal National Mortgage Association, 8.45%*, 2/27/2023           | 2,000,000            | 1,980,000 
|                                                                   | 21,104,990          
|US Treasury Obligations 0.6%                                      
|US Treasury Bills:                                                
|0.15%***, 9/17/2009 (b)                                            | 912,000              | 911,641   
|0.16%***, 8/27/2009 (b)                                            | 75,000               | 74,984    
|0.24%***, 7/9/2009 (b)                                             | 58,000               | 57,999    
|                                                                   | 1,044,624           
|Total Government & Agency Obligations (Cost $25,886,752)           | 25,953,470          
|                                                                  
|                                                                   | Shares               | Value ($) 
|                                                                   |                     
|Cash Equivalents 5.2%                                             
|Cash Management QP Trust, 0.27% (c) (Cost $9,919,943)              | 9,919,943            | 9,919,943 

|                                               | % of Net
Assets | Value ($)   
|---------------------------------------------- | --------------- | ------------
|                                               |                
|Total Investment Portfolio(Cost $216,813,394)+ | 116.6           | 222,939,578 
|Other Assets and Liabilities, Net              | (16.6)          | (31,687,279)
|Net Assets                                     | 100.0           | 191,252,299 

FDIC: Federal Deposit Insurance Corp.

Interest Only: Interest Only (IO) bonds represent the "interest only" portion of payments on a pool of underlying mortgages or
mortgage-backed securities. IO securities are subject to prepayment risk of the pool of underlying mortgages.

Included in the portfolio are investments in mortgage or asset-backed securities which are interests in separate pools of mortgages or assets.
Effective maturities of these investments may be shorter than stated maturities due to prepayments. Some separate investments in the
Federal Home Loan Mortgage Corp., Federal National Mortgage Association and Government National Mortgage Association issues which
have similar coupon rates have been aggregated for presentation purposes in this investment portfolio.

At June 30, 2009, open futures contracts purchased were as follows:

|Futures                  | Expiration
Date | Contracts | Aggregate
Face
Value ($) | Value ($) | Unrealized
Appreciation ($)
|------------------------ | --------------- | --------- | ------------------------ | --------- | ---------------------------
|10 Year US Treasury Note | 9/21/2009       | 25        | 2,896,945                | 2,906,641 | 9,696                      

At June 30, 2009, open futures contracts sold were as follows:

|Futures                 | Expiration
Date | Contracts | Aggregate
Face
Value ($) | Value ($)  | Unrealized
Depreciation ($)
|----------------------- | --------------- | --------- | ------------------------ | ---------- | ---------------------------
|2 Year US Treasury Note | 9/30/2009       | 70        | 15,046,719               | 15,135,313 | (88,594)                   

At June 30, 2009, open interest rate swap contracts were as follows:

|Effective/
Expiration Dates   | Notional 
Amount ($) | Cash Flows 
Paid by the Portfolio | Cash Flows 
Received by the Portfolio | Unrealized 
Appreciation ($)
|----------------------------- | -------------------- | --------------------------------- | ------------------------------------- | ----------------------------
|4/20/2009
4/20/2024           | 1,000,0001           | Fixed  7.5%                      | Floating  LIBOR                      | 11,649                      
|5/15/2009
5/15/2024           | 1,000,0001           | Fixed  7.5%                      | Floating  LIBOR                      | 7,312                       
|Total unrealized appreciation | 18,961              

At June 30, 2009, open total return swap contracts were as follows:

|Effective/
Expiration Dates | Notional 
Amount ($) | Fixed Cash
Flows Paid
by the
Portfolio | Reference Entity                    | Value ($) | Upfront Premiums
Paid/(Received) ($) | Unrealized 
Depreciation ($)
|--------------------------- | -------------------- | -------------------------------------- | ----------------------------------- | --------- | ------------------------------------ | ----------------------------
|6/1/2009
6/1/2012           | 9,000,0002           | 0.425%                                 | Global Interest Rate Strategy
Index | (101,779) | 18,000                               | (122,967)                   

LIBOR: Represents the London InterBank Offered Rate.

Counterparties:

For information on the Portfolio's policy and additional disclosures regarding futures contracts, interest rate swaps and total return swap
contracts, please refer to the Derivatives section of Note A in the accompanying Notes to Financial Statements.

The accompanying notes are an integral part of the financial statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                                               | Level 1         | Level 2            | Level 3     | Total             
|-------------------------------------------------------------------- | --------------- | ------------------ | ----------- | ------------------
|Fixed-Income Investments (d)Mortgage-Backed Securities Pass-Throughs | $              | $      160,629,825 | $          | $      160,629,825
|Collateralized Mortgage Obligations                                  |                | 26,436,340         |            | 26,436,340        
|Government & Agency Obligations                                      |                | 25,439,669         | 513,800     | 25,953,469        
|Short-Term Investments (d)                                           |                | 9,919,943          |            | 9,919,943         
|Derivatives(e)                                                       |                | 18,961             |            | 18,961            
|Total                                                                | $              | $   222,444,738    | $   513,800 | $   222,958,538   
|Liabilities                                                          |                 |                    |             |                   
|Derivatives(e)                                                       | $      (78,898) | $      (122,967)   | $          | $      (201,865)  
|Total                                                                | $   (78,898)    | $   (122,967)      | $          | $   (201,865)     

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                                     | Government &
Agency
Obligations
|---------------------------------------------------------------------------------------------------- | -------------------------------
|Balance as of December 31, 2008                                                                      | $                             
|Realized gains (loss)                                                                                |                               
|Change in unrealized appreciation (depreciation)                                                     | (46,200)                       
|Amortization premium/discount                                                                        |                               
|Net purchases (sales)                                                                                | 560,000                        
|Net transfers in (out) of Level 3                                                                    |                               
|Balance as of June 30, 2009                                                                          | $   513,800                    
|Net change in unrealized appreciation (depreciation) from investments still held as of June 30, 2009 | $   (46,200)                   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|InvestmentsInvestments in securities, at value (cost $206,893,451)                                                                                                                         
|Investments in Cash Management QP Trust (cost $9,919,943)                                                                                                                                  
|Total investments, at value (cost $216,813,394)                                                                                                                                            
|Cash                                                                                                                                                                                       
|Receivable for when-issued and delayed delivery securities sold                                                                                                                            
|Unrealized appreciation on open swap contracts                                                                                                                                             
|Receivable for variation margin on open futures contracts                                                                                                                                  
|Receivable for Portfolio shares sold                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Other assets                                                                                                                                                                               
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable for when-issued and delayed delivery securities purchased                                                                                                                          
|Payable for investments purchased                                                                                                                                                          
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Unrealized depreciation on open swap contracts                                                                                                                                             
|Accrued management fee                                                                                                                                                                     
|Other accrued expenses and payables                                                                                                                                                        
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of                                                                                                                                                                      
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                  
|Futures                                                                                                                                                                                    
|Swap contracts                                                                                                                                                                             
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($184,318,208 ÷ 14,944,835 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($6,934,091 ÷ 562,395 outstanding shares of beneficial interest,
no par value, unlimited number of shares authorized)     

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)
|--------------------------------------------------------------------------
|Investment Income                                                         
|Income:Interest                                                           
|Interest  Cash Management QP Trust                                       
|Total Income                                                              
|Expenses:Management fee                                                   
|Administration fee                                                        
|Custodian fee                                                             
|Distribution service fee (Class B)                                        
|Services to shareholders                                                  
|Record keeping fees (Class B)                                             
|Professional fees                                                         
|Trustees' fees and expenses                                               
|Reports to shareholders                                                   
|Other                                                                     
|Total expenses                                                            
|Net investment income                                                     
|Realized and Unrealized Gain (Loss)                                       
|Net realized gain (loss) from:Investments                                 
|Futures                                                                   
|                                                                          
|Change in net unrealized appreciation (depreciation) on:Investments       
|Futures                                                                   
|Swap contracts                                                            
|                                                                          
|Net gain (loss)                                                           
|Net increase (decrease) in net assets resulting from operations           

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                    
|----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                     
|Operations:Net investment income                                                                                      
|Net realized gain (loss)                                                                                              
|Change in net unrealized appreciation (depreciation)                                                                  
|Net increase (decrease) in net assets resulting from operations                                                       
|Distributions to shareholders from:Net investment income:Class A                                                      
|Class B                                                                                                               
|Total distributions                                                                                                   
|Portfolio share transactions:Class A
Proceeds from shares sold                                                        
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class A share transactions                                                 
|Class B
Proceeds from shares sold                                                                                     
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class B share transactions                                                 
|Increase (decrease) in net assets                                                                                     
|Net assets at beginning of period                                                                                     
|Net assets at end of period (including undistributed net investment income of $3,661,467 and
$9,842,645, respectively)
|Other Information                                                                                                     
|Class A
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class A shares                                                                             
|Shares outstanding at end of period                                                                                   
|Class B
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class B shares                                                                             
|Shares outstanding at end of period                                                                                   

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                 | 2009a     | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   12.40 | $   12.38 | $   12.28 | $   12.26 | $   12.55 | $   12.54
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                 | .22       | .56       | .58       | .55       | .51       | .44      
|Net realized and unrealized gain (loss)                                                                                                                                                                          | .30       | .04       | .12       | (.06)     | (.20)     | .03      
|Total from investment operations                                                                                                                                                                                 | .52       | .60       | .70       | .49       | .31       | .47      
|Less distributions from:
Net investment income                                                                                                                                                                   | (.59)     | (.58)     | (.60)     | (.47)     | (.50)     | (.35)    
|Net realized gains                                                                                                                                                                                               |          |          |          |          | (.10)     | (.11)    
|Total distributions                                                                                                                                                                                              | (.59)     | (.58)     | (.60)     | (.47)     | (.60)     | (.46)    
|Net asset value, end of period                                                                                                                                                                                   | $   12.33 | $   12.40 | $   12.38 | $   12.28 | $   12.26 | $   12.55
|Total Return (%)                                                                                                                                                                                                 | 4.27**    | 4.93c     | 5.95c     | 4.16      | 2.57      | 3.75     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 184       | 211       | 199       | 211       | 243       | 280      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | .62*      | .66       | .66       | .67       | .63       | .61      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                   | .62*      | .65       | .63       | .67       | .63       | .61      
|Ratio of net investment income (loss) (%)                                                                                                                                                                        | 3.62*     | 4.58      | 4.77      | 4.56      | 4.17      | 3.59     
|Portfolio turnover rate (%)                                                                                                                                                                                      | 436**     | 543       | 465       | 241       | 191       | 226      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                 | 2009a     | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   12.37 | $   12.35 | $   12.25 | $   12.23 | $   12.52 | $   12.51
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                 | .20       | .52       | .53       | .50       | .47       | .40      
|Net realized and unrealized gain (loss)                                                                                                                                                                          | .31       | .03       | .12       | (.06)     | (.21)     | .02      
|Total from investment operations                                                                                                                                                                                 | .51       | .55       | .65       | .44       | .26       | .42      
|Less distributions from:
Net investment income                                                                                                                                                                   | (.55)     | (.53)     | (.55)     | (.42)     | (.45)     | (.30)    
|Net realized gains                                                                                                                                                                                               |          |          |          |          | (.10)     | (.11)    
|Total distributions                                                                                                                                                                                              | (.55)     | (.53)     | (.55)     | (.42)     | (.55)     | (.41)    
|Net asset value, end of period                                                                                                                                                                                   | $   12.33 | $   12.37 | $   12.35 | $   12.25 | $   12.23 | $   12.52
|Total Return (%)                                                                                                                                                                                                 | 4.15**    | 4.60c     | 5.43c     | 3.74      | 2.24      | 3.36     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 7         | 8         | 5         | 33        | 47        | 49       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | .97*      | 1.00      | 1.04      | 1.07      | 1.02      | 1.00     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                   | .97*      | 1.00      | 1.01      | 1.07      | 1.02      | 1.00     
|Ratio of net investment income (%)                                                                                                                                                                               | 3.27*     | 4.24      | 4.39      | 4.16      | 3.78      | 3.21     
|Portfolio turnover rate (%)                                                                                                                                                                                      | 436**     | 543       | 465       | 241       | 191       | 226      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS High Income VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying portfolio,
their performance will differ.

The total annual portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .71% and 1.05% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

Investing in foreign securities presents certain risks, such as currency fluctuation, political and economic changes and market risks.
Additionally, the Portfolio may invest in lower-quality and nonrated securities which present greater risk of loss of principal and interest
than higher-quality securities. All of these factors may result in greater share price volatility. Bond investments are subject to
interest-rate risk such that when interest rates rise, the prices of the bonds, and thus the value of the investment, can decline and the
investor can lose principal value. Please read this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement. Without
this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS High Income VIP   
|-----------------------------------------------------------------
|[] DWS High Income VIP  Class A
[]Credit Suisse High Yield Index
|vs2_g10k1090                                                     
|Yearly periods ended June 30                                     

|Comparative Results           
|------------------------------
|DWS High Income VIP           
|Class A                       
|Average annual total return   
|Credit Suisse High Yield
Index
|Average annual total return   
|DWS High Income VIP           
|Class B                       
|Average annual total return   
|Credit Suisse High Yield
Index
|Average annual total return   

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS High Income VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                    | Class A |  | Class B | 
|-------------------------------------------- | ------- |  | ------- | 
|DWS Variable Series II  DWS High Income VIP | .75%    |  | 1.03%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS High Income VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Corporate Bonds                                                                          | 92%     | 84%     
|Loan Participations and Assignments                                                      | 6%      | 7%      
|Cash Equivalents                                                                         | 1%      | 9%      
|Preferred Securities                                                                     | 1%      |        
|                                                                                         | 100%    | 100%    

|Sector Diversification(Excludes Cash Equivalents and Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------------------------------------------- | ------- | --------
|                                                                                    |         |         
|Financials                                                                          | 17%     | 10%     
|Consumer Discretionary                                                              | 16%     | 13%     
|Energy                                                                              | 13%     | 15%     
|Materials                                                                           | 12%     | 12%     
|Telecommunication Services                                                          | 12%     | 12%     
|Utilities                                                                           | 11%     | 11%     
|Industrials                                                                         | 7%      | 10%     
|Health Care                                                                         | 6%      | 9%      
|Information Technology                                                              | 3%      | 4%      
|Consumer Staples                                                                    | 3%      | 4%      
|                                                                                    | 100%    | 100%    

|Quality(Excludes Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Cash Equivalents                                | 2%      | 8%      
|A                                               | 1%      |        
|BBB                                             | 7%      | 12%     
|BB                                              | 34%     | 35%     
|B                                               | 36%     | 31%     
|CCC                                             | 14%     | 7%      
|CC                                              |        | 3%      
|D                                               | 3%      | 1%      
|Not Rated                                       | 3%      | 3%      
|                                                | 100%    | 100%    

|Effective Maturity(Excludes Cash Equivalents and Securities Lending Collateral) | 6/30/09 | 12/31/08
|------------------------------------------------------------------------------- | ------- | --------
|                                                                                |         |         
|Under 1 year                                                                    | 7%      | 5%      
|1-4.99 years                                                                    | 45%     | 41%     
|5-9.99 years                                                                    | 47%     | 50%     
|10-14.99 years                                                                  |        | 1%      
|15 years or greater                                                             | 1%      | 3%      
|                                                                                | 100%    | 100%    

|Interest Rate Sensitivity | 6/30/09   | 12/31/08 
|------------------------- | --------- | ---------
|                          |           |          
|Effective maturity        | 4.8 years | 5.6 years
|Average duration          | 3.7 years | 3.7 years

Asset allocation, sector diversification, quality, effective maturity and interest rate sensitivity are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 133. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS High Income VIP

|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|---------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ---------
|                                                                                         |                                                                             
|Corporate Bonds 90.4%                                                                   
|Consumer Discretionary 14.8%                                                            
|AMC Entertainment, Inc.:                                                                
|                                                                                         | 8.0%, 3/1/2014                                                               |          
|                                                                                         | 144A, 8.75%, 6/1/2019                                                        |          
|American Achievement Corp., 144A, 8.25%, 4/1/2012                                        |                                                                              | 255,000  
|American Achievement Group Holding Corp., 16.75%, 10/1/2012 (PIK)                        |                                                                              | 437,823  
|Ameristar Casinos, Inc., 144A, 9.25%, 6/1/2014 (b)                                       |                                                                              | 395,000  
|Asbury Automotive Group, Inc.:                                                          
|                                                                                         | 7.625%, 3/15/2017                                                            |          
|                                                                                         | 8.0%, 3/15/2014                                                              |          
|Ashtead Holdings PLC, 144A, 8.625%, 8/1/2015                                             |                                                                              | 380,000  
|CanWest MediaWorks LP, 144A, 9.25%, 8/1/2015**                                           |                                                                              | 340,000  
|Carrols Corp., 9.0%, 1/15/2013                                                           |                                                                              | 225,000  
|CSC Holdings, Inc.:                                                                     
|                                                                                         | 6.75%, 4/15/2012                                                             |          
|                                                                                         | Series B, 7.625%, 4/1/2011                                                   |          
|                                                                                         | 144A, 8.5%, 4/15/2014                                                        |          
|                                                                                         | 144A, 8.5%, 6/15/2015                                                        |          
|DirecTV Holdings LLC, 7.625%, 5/15/2016                                                  |                                                                              | 865,000  
|DISH DBS Corp.:                                                                         
|                                                                                         | 6.375%, 10/1/2011                                                            |          
|                                                                                         | 6.625%, 10/1/2014                                                            |          
|                                                                                         | 7.125%, 2/1/2016 (b)                                                         |          
|Dollarama Group Holdings LP, 7.468%***, 8/15/2012 (c)                                    |                                                                              | 347,000  
|Expedia, Inc., 7.456%, 8/15/2018                                                         |                                                                              | 380,000  
|Fontainebleau Las Vegas Holdings LLC, 144A, 11.0%, 6/15/2015**                           |                                                                              | 490,000  
|Goodyear Tire & Rubber Co., 10.5%, 5/15/2016 (b)                                         |                                                                              | 225,000  
|Great Canadian Gaming Corp., 144A, 7.25%, 2/15/2015                                      |                                                                              | 505,000  
|Group 1 Automotive, Inc., 8.25%, 8/15/2013                                               |                                                                              | 250,000  
|Harrahs Operating Escrow LLC, 144A, 11.25%, 6/1/2017                                     |                                                                              | 545,000  
|Hertz Corp., 8.875%, 1/1/2014                                                            |                                                                              | 1,005,000
|Idearc, Inc., 8.0%, 11/15/2016**                                                         |                                                                              | 920,000  
|Indianapolis Downs LLC, 144A, 11.0%, 11/1/2012                                           |                                                                              | 330,000  
|Isle of Capri Casinos, Inc., 7.0%, 3/1/2014                                              |                                                                              | 237,000  
|Kabel Deutschland GmbH, 10.625%, 7/1/2014                                                |                                                                              | 620,000  
|Lamar Media Corp., Series C, 6.625%, 8/15/2015 (b)                                       |                                                                              | 295,000  
|Levi Strauss & Co., 8.625%, 4/1/2013                                                     | EUR                                                                          | 700,000  
|Macy's Retail Holdings, Inc.:                                                           
|                                                                                         | 5.35%, 3/15/2012                                                             |          
|                                                                                         | 8.875%, 7/15/2015                                                            |          
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|MGM MIRAGE:                                                                             
|                                                                                         | 144A, 10.375%, 5/15/2014                                                     |          
|                                                                                         | 144A, 11.125%, 11/15/2017                                                    |          
|Michaels Stores, Inc., 10.0%, 11/1/2014                                                  |                                                                              | 265,000  
|MTR Gaming Group, Inc., Series B, 9.75%, 4/1/2010                                        |                                                                              | 630,000  
|Neiman Marcus Group, Inc., 10.375%, 10/15/2015                                           |                                                                              | 685,000  
|Norcraft Holdings LP, 9.75%, 9/1/2012                                                    |                                                                              | 1,385,000
|Penske Automotive Group, Inc., 7.75%, 12/15/2016                                         |                                                                              | 905,000  
|Pinnacle Entertainment, Inc., 7.5%, 6/15/2015                                            |                                                                              | 555,000  
|Quebecor Media, Inc., 7.75%, 3/15/2016 (b)                                               |                                                                              | 460,000  
|Quebecor World, Inc., 144A, 9.75%, 1/15/2015**                                           |                                                                              | 420,000  
|Reader's Digest Association, Inc., 9.0%, 2/15/2017                                       |                                                                              | 350,000  
|Sabre Holdings Corp., 8.35%, 3/15/2016                                                   |                                                                              | 460,000  
|Seminole Hard Rock Entertainment, Inc., 144A, 3.129%***, 3/15/2014                       |                                                                              | 590,000  
|Shingle Springs Tribal Gaming Authority, 144A, 9.375%, 6/15/2015                         |                                                                              | 370,000  
|Simmons Co., Step-up Coupon, 0% to 12/15/2009, 10.0% to 12/15/2014                       |                                                                              | 1,655,000
|Sonic Automotive, Inc., Series B, 8.625%, 8/15/2013                                      |                                                                              | 490,000  
|Starwood Hotels & Resorts Worldwide, Inc., 7.875%, 10/15/2014 (b)                        |                                                                              | 370,000  
|Travelport LLC:                                                                         
|                                                                                         | 5.293%***, 9/1/2014                                                          |          
|                                                                                         | 9.875%, 9/1/2014                                                             |          
|Trump Entertainment Resorts, Inc., 8.5%, 6/1/2015**                                      |                                                                              | 105,000  
|United Components, Inc., 9.375%, 6/15/2013                                               |                                                                              | 80,000   
|Unity Media GmbH:                                                                       
|                                                                                         | 144A, 8.75%, 2/15/2015                                                       | EUR      
|                                                                                         | 144A, 10.375%, 2/15/2015                                                     |          
|UPC Holding BV:                                                                         
|                                                                                         | 144A, 7.75%, 1/15/2014                                                       | EUR      
|                                                                                         | 144A, 8.0%, 11/1/2016                                                        | EUR      
|Vertis, Inc., 13.5%, 4/1/2014 (PIK)                                                      |                                                                              | 212,678  
|Videotron Ltd., 6.875%, 1/15/2014                                                        |                                                                              | 80,000   
|WMG Acquisition Corp., 144A, 9.5%, 6/15/2016                                             |                                                                              | 375,000  
|Young Broadcasting, Inc., 8.75%, 1/15/2014**                                             |                                                                              | 2,040,000
|                                                                                         | 26,330,376                                                                  
|Consumer Staples 2.9%                                                                   
|Alliance One International, Inc., 8.5%, 5/15/2012                                        |                                                                              | 250,000  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Delhaize America, Inc., 8.05%, 4/15/2027                                                 |                                                                              | 190,000  
|General Nutrition Centers, Inc., 6.404%***, 3/15/2014 (PIK)                              |                                                                              | 280,000  
|Ingles Markets, Inc., 144A, 8.875%, 5/15/2017                                            |                                                                              | 115,000  
|North Atlantic Trading Co., 144A, 10.0%, 3/1/2012                                        |                                                                              | 2,081,750
|Smithfield Foods, Inc., 7.75%, 7/1/2017                                                  |                                                                              | 75,000   
|SUPERVALU, Inc., 8.0%, 5/1/2016                                                          |                                                                              | 520,000  
|Tyson Foods, Inc.:                                                                      
|                                                                                         | 7.85%, 4/1/2016                                                              |          
|                                                                                         | 144A, 10.5%, 3/1/2014                                                        |          
|Viskase Companies, Inc., 11.5%, 6/15/2011                                                |                                                                              | 3,100,000
|                                                                                         | 5,245,302                                                                   
|Energy 12.6%                                                                            
|Atlas Energy Resources LLC, 144A, 10.75%, 2/1/2018                                       |                                                                              | 845,000  
|Belden & Blake Corp., 8.75%, 7/15/2012                                                   |                                                                              | 2,050,000
|Bristow Group, Inc., 7.5%, 9/15/2017                                                     |                                                                              | 485,000  
|Chaparral Energy, Inc., 8.5%, 12/1/2015                                                  |                                                                              | 600,000  
|Chesapeake Energy Corp.:                                                                
|                                                                                         | 6.25%, 1/15/2018                                                             |          
|                                                                                         | 6.875%, 1/15/2016                                                            |          
|                                                                                         | 7.25%, 12/15/2018                                                            |          
|                                                                                         | 7.5%, 6/15/2014 (b)                                                          |          
|                                                                                         | 9.5%, 2/15/2015                                                              |          
|Colorado Interstate Gas Co., 6.8%, 11/15/2015                                            |                                                                              | 220,000  
|El Paso Corp.:                                                                          
|                                                                                         | 7.25%, 6/1/2018                                                              |          
|                                                                                         | 7.75%, 6/15/2010 (b)                                                         |          
|                                                                                         | 8.25%, 2/15/2016                                                             |          
|                                                                                         | 9.625%, 5/15/2012                                                            |          
|EXCO Resources, Inc., 7.25%, 1/15/2011                                                   |                                                                              | 580,000  
|Forest Oil Corp., 7.25%, 6/15/2019                                                       |                                                                              | 210,000  
|Frontier Oil Corp.:                                                                     
|                                                                                         | 6.625%, 10/1/2011                                                            |          
|                                                                                         | 8.5%, 9/15/2016                                                              |          
|GulfSouth Pipeline Co., LP, 144A, 5.75%, 8/15/2012                                       |                                                                              | 100,000  
|Holly Corp., 144A, 9.875%, 6/15/2017 (b)                                                 |                                                                              | 575,000  
|KCS Energy, Inc., 7.125%, 4/1/2012                                                       |                                                                              | 1,495,000
|Linn Energy LLC, 144A, 11.75%, 5/15/2017                                                 |                                                                              | 650,000  
|Mariner Energy, Inc.:                                                                   
|                                                                                         | 7.5%, 4/15/2013                                                              |          
|                                                                                         | 8.0%, 5/15/2017                                                              |          
|Newfield Exploration Co., 7.125%, 5/15/2018                                              |                                                                              | 640,000  
|OPTI Canada, Inc.:                                                                      
|                                                                                         | 7.875%, 12/15/2014                                                           |          
|                                                                                         | 8.25%, 12/15/2014                                                            |          
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Petrohawk Energy Corp.:                                                                 
|                                                                                         | 7.875%, 6/1/2015                                                             |          
|                                                                                         | 9.125%, 7/15/2013                                                            |          
|                                                                                         | 144A, 10.5%, 8/1/2014                                                        |          
|Plains Exploration & Production Co.:                                                    
|                                                                                         | 7.0%, 3/15/2017 (b)                                                          |          
|                                                                                         | 7.625%, 6/1/2018                                                             |          
|Quicksilver Resources, Inc., 7.125%, 4/1/2016                                            |                                                                              | 1,040,000
|Regency Energy Partners LP, 8.375%, 12/15/2013                                           |                                                                              | 515,000  
|Southwestern Energy Co., 144A, 7.5%, 2/1/2018                                            |                                                                              | 585,000  
|Stone Energy Corp.:                                                                     
|                                                                                         | 6.75%, 12/15/2014                                                            |          
|                                                                                         | 8.25%, 12/15/2011                                                            |          
|Tennessee Gas Pipeline Co., 8.0%, 2/1/2016                                               |                                                                              | 95,000   
|Tesoro Corp.:                                                                           
|                                                                                         | 6.5%, 6/1/2017                                                               |          
|                                                                                         | 9.75%, 6/1/2019                                                              |          
|Whiting Petroleum Corp.:                                                                
|                                                                                         | 7.25%, 5/1/2012                                                              |          
|                                                                                         | 7.25%, 5/1/2013                                                              |          
|Williams Companies, Inc., 8.125%, 3/15/2012                                              |                                                                              | 1,040,000
|                                                                                         | 22,362,492                                                                  
|Financials 15.5%                                                                        
|Algoma Acquisition Corp., 144A, 9.875%, 6/15/2015                                        |                                                                              | 925,000  
|Ashton Woods USA LLC, 144A, Step-up Coupon, 0% to 6/30/2012, 11.0% to 6/30/2015          |                                                                              | 712,400  
|Bank of America NA:                                                                     
|                                                                                         | 5.3%, 3/15/2017                                                              |          
|                                                                                         | 6.1%, 6/15/2017                                                              |          
|Buffalo Thunder Development Authority, 144A, 9.375%, 12/15/2014**                        |                                                                              | 250,000  
|Calpine Construction Finance Co., LP, 144A, 8.0%, 6/1/2016                               |                                                                              | 570,000  
|CIT Group, Inc.:                                                                        
|                                                                                         | 5.8%, 7/28/2011 (b)                                                          |          
|                                                                                         | Series A, 7.625%, 11/30/2012 (b)                                             |          
|Citigroup, Inc., 5.0%, 9/15/2014                                                         |                                                                              | 795,000  
|Conproca SA de CV, REG S, 12.0%, 6/16/2010                                               |                                                                              | 1,137,645
|Ford Motor Credit Co., LLC:                                                             
|                                                                                         | 7.25%, 10/25/2011                                                            |          
|                                                                                         | 7.375%, 2/1/2011                                                             |          
|                                                                                         | 7.875%, 6/15/2010                                                            |          
|                                                                                         | 9.875%, 8/10/2011 (b)                                                        |          
|Fresenius US Finance II, Inc., 144A, 9.0%, 7/15/2015                                     |                                                                              | 420,000  
|GMAC LLC:                                                                               
|                                                                                         | 144A, 6.875%, 9/15/2011                                                      |          
|                                                                                         | 7.75%, 1/19/2010                                                             |          
|                                                                                         | 144A, 7.75%, 1/19/2010                                                       |          
|Hellas Telecommunications Finance, 144A, 9.435%***, 7/15/2015 (PIK)                      | EUR                                                                          | 295,000  
|Hexion US Finance Corp., 9.75%, 11/15/2014                                               |                                                                              | 205,000  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Inmarsat Finance II PLC, 10.375%, 11/15/2012                                             |                                                                              | 820,000  
|iPayment, Inc., 9.75%, 5/15/2014                                                         |                                                                              | 475,000  
|New ASAT (Finance) Ltd., 9.25%, 2/1/2011**                                               |                                                                              | 575,000  
|Nielsen Finance LLC, 144A, 11.5%, 5/1/2016 (b)                                           |                                                                              | 150,000  
|NiSource Finance Corp., 7.875%, 11/15/2010                                               |                                                                              | 745,000  
|Orascom Telecom Finance SCA, 144A, 7.875%, 2/8/2014                                      |                                                                              | 510,000  
|Pinnacle Foods Finance LLC, 9.25%, 4/1/2015                                              |                                                                              | 15,000   
|Qwest Capital Funding, Inc., 7.0%, 8/3/2009                                              |                                                                              | 355,000  
|Rainbow National Services LLC, 144A, 10.375%, 9/1/2014                                   |                                                                              | 112,000  
|Rio Tinto Finance (USA) Ltd., 8.95%, 5/1/2014                                            |                                                                              | 155,000  
|Sprint Capital Corp.:                                                                   
|                                                                                         | 7.625%, 1/30/2011                                                            |          
|                                                                                         | 8.375%, 3/15/2012                                                            |          
|Tropicana Entertainment LLC, 9.625%, 12/15/2014**                                        |                                                                              | 1,220,000
|UCI Holdco, Inc., 8.629%***, 12/15/2013 (PIK)                                            |                                                                              | 671,042  
|Universal City Development Partners Ltd., 11.75%, 4/1/2010                               |                                                                              | 2,125,000
|Virgin Media Finance PLC:                                                               
|                                                                                         | 8.75%, 4/15/2014                                                             | EUR      
|                                                                                         | 8.75%, 4/15/2014                                                             |          
|                                                                                         | Series 1, 9.5%, 8/15/2016                                                    |          
|Wind Acquisition Finance SA:                                                            
|                                                                                         | 144A, 9.75%, 12/1/2015                                                       | EUR      
|                                                                                         | 144A, 10.75%, 12/1/2015                                                      |          
|                                                                                         | 27,509,438                                                                  
|Health Care 5.7%                                                                        
|Community Health Systems, Inc., 8.875%, 7/15/2015                                        |                                                                              | 2,270,000
|HCA, Inc.:                                                                              
|                                                                                         | 144A, 8.5%, 4/15/2019                                                        |          
|                                                                                         | 9.125%, 11/15/2014                                                           |          
|                                                                                         | 9.25%, 11/15/2016                                                            |          
|                                                                                         | 9.625%, 11/15/2016 (PIK)                                                     |          
|HEALTHSOUTH Corp., 10.75%, 6/15/2016                                                     |                                                                              | 290,000  
|IASIS Healthcare LLC, 8.75%, 6/15/2014                                                   |                                                                              | 525,000  
|Surgical Care Affiliates, Inc., 144A, 8.875%, 7/15/2015 (PIK)                            |                                                                              | 515,000  
|The Cooper Companies, Inc., 7.125%, 2/15/2015                                            |                                                                              | 840,000  
|Valeant Pharmaceuticals International, 144A, 8.375%, 6/15/2016                           |                                                                              | 300,000  
|Vanguard Health Holding Co. I, LLC, Step-up Coupon, 0% to 10/1/2009, 11.25% to 10/1/2015 |                                                                              | 715,000  
|Vanguard Health Holding Co. II, LLC, 9.0%, 10/1/2014                                     |                                                                              | 1,095,000
|                                                                                         | 10,198,648                                                                  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Industrials 7.1%                                                                        
|Actuant Corp., 6.875%, 6/15/2017                                                         |                                                                              | 300,000  
|ARAMARK Corp., 8.5%, 2/1/2015 (b)                                                        |                                                                              | 745,000  
|BE Aerospace, Inc., 8.5%, 7/1/2018                                                       |                                                                              | 300,000  
|Belden, Inc., 7.0%, 3/15/2017                                                            |                                                                              | 420,000  
|Bombardier, Inc.:                                                                       
|                                                                                         | 144A, 6.3%, 5/1/2014                                                         |          
|                                                                                         | 144A, 6.75%, 5/1/2012                                                        |          
|Browning-Ferris Industries, Inc., 7.4%, 9/15/2035                                        |                                                                              | 145,000  
|Congoleum Corp., 8.625%, 8/1/2008**                                                      |                                                                              | 1,200,000
|Corrections Corp. of America, 7.75%, 6/1/2017                                            |                                                                              | 35,000   
|Esco Corp.:                                                                             
|                                                                                         | 144A, 4.504%***, 12/15/2013                                                  |          
|                                                                                         | 144A, 8.625%, 12/15/2013                                                     |          
|Great Lakes Dredge & Dock Co., 7.75%, 12/15/2013                                         |                                                                              | 300,000  
|K. Hovnanian Enterprises, Inc., 8.875%, 4/1/2012                                         |                                                                              | 435,000  
|Kansas City Southern de Mexico SA de CV:                                                
|                                                                                         | 7.375%, 6/1/2014                                                             |          
|                                                                                         | 7.625%, 12/1/2013                                                            |          
|                                                                                         | 9.375%, 5/1/2012                                                             |          
|Kansas City Southern Railway Co., 8.0%, 6/1/2015 (b)                                     |                                                                              | 655,000  
|Mobile Mini, Inc., 9.75%, 8/1/2014                                                       |                                                                              | 420,000  
|Navios Maritime Holdings, Inc., 9.5%, 12/15/2014                                         |                                                                              | 605,000  
|Owens Corning, Inc., 9.0%, 6/15/2019                                                     |                                                                              | 225,000  
|R.H. Donnelley Corp., Series A-4, 8.875%, 10/15/2017**                                   |                                                                              | 1,185,000
|RailAmerica, Inc., 144A, 9.25%, 7/1/2017                                                 |                                                                              | 380,000  
|RBS Global, Inc. & Rexnord Corp., 9.5%, 8/1/2014                                         |                                                                              | 335,000  
|Titan International, Inc., 8.0%, 1/15/2012                                               |                                                                              | 1,190,000
|TransDigm, Inc., 7.75%, 7/15/2014                                                        |                                                                              | 260,000  
|United Rentals North America, Inc.:                                                     
|                                                                                         | 6.5%, 2/15/2012                                                              |          
|                                                                                         | 7.0%, 2/15/2014                                                              |          
|                                                                                         | 144A, 10.875%, 6/15/2016                                                     |          
|US Concrete, Inc., 8.375%, 4/1/2014                                                      |                                                                              | 470,000  
|Vought Aircraft Industries, Inc., 8.0%, 7/15/2011                                        |                                                                              | 250,000  
|                                                                                         | 12,542,604                                                                  
|Information Technology 3.1%                                                             
|Alcatel-Lucent USA, Inc., 6.45%, 3/15/2029                                               |                                                                              | 570,000  
|L-3 Communications Corp.:                                                               
|                                                                                         | 5.875%, 1/15/2015                                                            |          
|                                                                                         | Series B, 6.375%, 10/15/2015                                                 |          
|                                                                                         | 7.625%, 6/15/2012                                                            |          
|MasTec, Inc., 7.625%, 2/1/2017                                                           |                                                                              | 610,000  
|Seagate Technology International, 144A, 10.0%, 5/1/2014                                  |                                                                              | 235,000  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|SunGard Data Systems, Inc., 10.25%, 8/15/2015                                            |                                                                              | 1,360,000
|Vangent, Inc., 9.625%, 2/15/2015                                                         |                                                                              | 350,000  
|                                                                                         | 5,474,456                                                                   
|Materials 10.7%                                                                         
|Appleton Papers, Inc., Series B, 8.125%, 6/15/2011                                       |                                                                              | 235,000  
|ARCO Chemical Co., 9.8%, 2/1/2020**                                                      |                                                                              | 3,270,000
|Ashland, Inc., 144A, 9.125%, 6/1/2017                                                    |                                                                              | 260,000  
|Cascades, Inc., 7.25%, 2/15/2013                                                         |                                                                              | 231,000  
|Clondalkin Acquisition BV, 144A, 2.629%***, 12/15/2013                                   |                                                                              | 540,000  
|CPG International I, Inc., 10.5%, 7/1/2013                                               |                                                                              | 880,000  
|Crown Americas LLC, 144A, 7.625%, 5/15/2017                                              |                                                                              | 40,000   
|Domtar Corp., 10.75%, 6/1/2017                                                           |                                                                              | 380,000  
|Dow Chemical Co., 8.55%, 5/15/2019                                                       |                                                                              | 385,000  
|Exopack Holding Corp., 11.25%, 2/1/2014                                                  |                                                                              | 1,415,000
|Freeport-McMoRan Copper & Gold, Inc.:                                                   
|                                                                                         | 8.25%, 4/1/2015                                                              |          
|                                                                                         | 8.375%, 4/1/2017                                                             |          
|GEO Specialty Chemicals, Inc.:                                                          
|                                                                                         | 144A, 7.5%***, 3/31/2015 (PIK)                                               |          
|                                                                                         | 10.0%, 3/31/2015                                                             |          
|Georgia-Pacific LLC:                                                                    
|                                                                                         | 144A, 7.125%, 1/15/2017                                                      |          
|                                                                                         | 144A, 8.25%, 5/1/2016                                                        |          
|                                                                                         | 9.5%, 12/1/2011                                                              |          
|Graphic Packaging International, Inc., 144A, 9.5%, 6/15/2017                             |                                                                              | 455,000  
|Hexcel Corp., 6.75%, 2/1/2015                                                            |                                                                              | 1,425,000
|Huntsman International LLC:                                                             
|                                                                                         | 144A, 6.875%, 11/15/2013                                                     | EUR      
|                                                                                         | 7.375%, 1/1/2015                                                             |          
|Huntsman LLC, 11.625%, 10/15/2010                                                        |                                                                              | 137,000  
|Innophos, Inc., 8.875%, 8/15/2014                                                        |                                                                              | 170,000  
|Koppers Holdings, Inc., Step-up Coupon, 0% to 11/15/2009, 9.875% to 11/15/2014           |                                                                              | 1,030,000
|Millar Western Forest Products Ltd., 7.75%, 11/15/2013                                   |                                                                              | 200,000  
|NewMarket Corp., 7.125%, 12/15/2016                                                      |                                                                              | 1,005,000
|Owens-Brockway Glass Container, Inc., 144A, 7.375%, 5/15/2016                            |                                                                              | 230,000  
|Pliant Corp., 11.85%, 6/15/2009**                                                        |                                                                              | 11       
|Radnor Holdings Corp., 11.0%, 3/15/2010**                                                |                                                                              | 265,000  
|Silgan Holdings, Inc., 144A, 7.25%, 8/15/2016                                            |                                                                              | 415,000  
|Teck Resources Ltd.:                                                                    
|                                                                                         | 144A, 9.75%, 5/15/2014                                                       |          
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|                                                                                         | 144A, 10.25%, 5/15/2016                                                      |          
|                                                                                         | 144A, 10.75%, 5/15/2019                                                      |          
|Terra Capital, Inc., Series B, 7.0%, 2/1/2017                                            |                                                                              | 815,000  
|Wolverine Tube, Inc., 15.0%, 3/31/2012 (PIK)                                             |                                                                              | 770,000  
|                                                                                         | 18,956,269                                                                  
|Telecommunication Services 9.1%                                                         
|BCM Ireland Preferred Equity Ltd., 144A, 8.281%***, 2/15/2017 (PIK)                      | EUR                                                                          | 567,388  
|CC Holdings GS V LLC, 144A, 7.75%, 5/1/2017                                              |                                                                              | 85,000   
|Centennial Communications Corp., 10.0%, 1/1/2013                                         |                                                                              | 290,000  
|Cincinnati Bell, Inc.:                                                                  
|                                                                                         | 7.25%, 7/15/2013                                                             |          
|                                                                                         | 8.375%, 1/15/2014                                                            |          
|Cricket Communications, Inc.:                                                           
|                                                                                         | 9.375%, 11/1/2014                                                            |          
|                                                                                         | 10.0%, 7/15/2015                                                             |          
|Crown Castle International Corp., 9.0%, 1/15/2015                                        |                                                                              | 775,000  
|Grupo Iusacell Celular SA de CV, 10.0%, 3/31/2012                                        |                                                                              | 278,182  
|Hellas Telecommunications Luxembourg V, 144A, 4.935%***, 10/15/2012                      | EUR                                                                          | 230,000  
|Hughes Network Systems LLC, 144A, 9.5%, 4/15/2014                                        |                                                                              | 980,000  
|Intelsat Corp.:                                                                         
|                                                                                         | 144A, 9.25%, 8/15/2014                                                       |          
|                                                                                         | 144A, 9.25%, 6/15/2016                                                       |          
|Intelsat Jackson Holdings Ltd., 11.25%, 6/15/2016 (b)                                    |                                                                              | 65,000   
|Intelsat Subsidiary Holding Co., Ltd.:                                                  
|                                                                                         | 8.875%, 1/15/2015                                                            |          
|                                                                                         | 144A, 8.875%, 1/15/2015 (b)                                                  |          
|iPCS, Inc., 3.153%***, 5/1/2013 (b)                                                      |                                                                              | 200,000  
|MetroPCS Wireless, Inc.:                                                                
|                                                                                         | 9.25%, 11/1/2014                                                             |          
|                                                                                         | 144A, 9.25%, 11/1/2014                                                       |          
|Millicom International Cellular SA, 10.0%, 12/1/2013                                     |                                                                              | 1,530,000
|Qwest Corp.:                                                                            
|                                                                                         | 144A, 8.375%, 5/1/2016                                                       |          
|                                                                                         | 8.875%, 3/15/2012                                                            |          
|Stratos Global Corp., 9.875%, 2/15/2013                                                  |                                                                              | 330,000  
|Telesat Canada, 144A, 11.0%, 11/1/2015                                                   |                                                                              | 1,545,000
|Windstream Corp.:                                                                       
|                                                                                         | 7.0%, 3/15/2019                                                              |          
|                                                                                         | 8.625%, 8/1/2016                                                             |          
|                                                                                         | 16,186,588                                                                  
|Utilities 8.9%                                                                          
|AES Corp.:                                                                              
|                                                                                         | 8.0%, 10/15/2017                                                             |          
|                                                                                         | 8.0%, 6/1/2020                                                               |          
|                                                                                         | 144A, 8.75%, 5/15/2013                                                       |          
|Allegheny Energy Supply Co., LLC, 144A, 8.25%, 4/15/2012                                 |                                                                              | 3,080,000
|CMS Energy Corp., 8.5%, 4/15/2011                                                        |                                                                              | 925,000  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Energy Future Holdings Corp., 10.875%, 11/1/2017                                         |                                                                              | 565,000  
|Knight, Inc., 6.5%, 9/1/2012                                                             |                                                                              | 205,000  
|Mirant Americas Generation LLC, 8.3%, 5/1/2011                                           |                                                                              | 1,375,000
|Mirant North America LLC, 7.375%, 12/31/2013                                             |                                                                              | 270,000  
|NRG Energy, Inc.:                                                                       
|                                                                                         | 7.25%, 2/1/2014                                                              |          
|                                                                                         | 7.375%, 2/1/2016                                                             |          
|                                                                                         | 7.375%, 1/15/2017                                                            |          
|                                                                                         | 8.5%, 6/15/2019                                                              |          
|NV Energy, Inc.:                                                                        
|                                                                                         | 6.75%, 8/15/2017                                                             |          
|                                                                                         | 8.625%, 3/15/2014                                                            |          
|Texas Competitive Electric Holdings Co., LLC, Series A, 10.25%, 11/1/2015                |                                                                              | 1,165,000
|                                                                                         | 15,732,728                                                                  
|Total Corporate Bonds (Cost $185,784,222)                                                | 160,538,901                                                                 
|                                                                                        
|Loan Participations and Assignments 5.7%                                                
|Senior Loans***                                                                         
|Alliance Mortgage Cycle Loan, Term Loan A, LIBOR plus 7.25%, 8.856%, 6/1/2010**          |                                                                              | 700,000  
|Buffets, Inc.:                                                                          
|                                                                                         | Letter of Credit Term Loan B, LIBOR plus 7.25%, 7.848%, 5/1/2013             |          
|                                                                                         | Incremental Term Loan, LIBOR (3% floor) plus 15.0%, 18.0%, 4/30/2012         |          
|                                                                                         | Second Lien Term Loan, LIBOR plus 1.0%, plus 16.25% (PIK), 19.121%, 5/1/2013 |          
|Charter Communications Operating LLC:                                                   
|                                                                                         | Term Loan, Prime plus 3.0%, 6.25%, 3/6/2014                                  |          
|                                                                                         | Term Loan, Prime plus 6.0%, 9.25%, 3/6/2014                                  |          
|Essar Steel Algoma, Inc., Term Loan B, LIBOR plus 2.5%, 2.81%, 6/20/2013                 |                                                                              | 282,841  
|Golden Nugget, Inc., Second Lien Term Loan, LIBOR plus 3.25%, 3.56%, 12/31/2014          |                                                                              | 460,000  
|Hawker Beechcraft Acquisition Co., LLC:                                                 
|                                                                                         | Letter of Credit, LIBOR plus 2.1%, 2.598%, 3/26/2014                         |          
|                                                                                         | Term Loan, LIBOR plus 2.0%, 2.598%, 3/26/2014                                |          
|Hexion Specialty Chemicals, Inc.:                                                       
|                                                                                         | Term Loan C2, LIBOR plus 2.25%, 2.875%, 5/6/2013                             |          
|                                                                                         | Term Loan C1, LIBOR plus 2.25%, 3.5%, 5/6/2013                               |          
|IASIS Healthcare LLC, Term Loan, LIBOR plus 5.25%, 6.289%, 6/13/2014 (PIK)               |                                                                              | 541,493  
|                                                                                         | Principal
Amount ($) (a)                                                     | Value ($)
|                                                                                         |                                                                             
|Momentive Performance Materials, Inc., Term Loan B, LIBOR plus 2.25%, 2.563%, 12/4/2013  |                                                                              | 180,000  
|Nuveen Investments, Inc., Term Loan, LIBOR plus 3.0%, 11/13/2014                         |                                                                              | 380,000  
|Sabre, Inc., Term Loan B, LIBOR plus 2.25%, 3.289%, 9/30/2014                            |                                                                              | 412,595  
|Sbarro, Inc., Term Loan, LIBOR plus 4.5%, 4.81%, 1/31/2014                               |                                                                              | 305,000  
|Texas Competitive Electric Holdings Co., LLC:                                           
|                                                                                         | Term Loan B2, LIBOR plus 3.5%, 3.821%, 10/10/2014                            |          
|                                                                                         | Term Loan B3, LIBOR plus 3.5%, 3.821%, 10/10/2014                            |          
|Tribune Co., Term Loan B, Prime plus 2.0%, 5.25%, 6/4/2014**                             |                                                                              | 829,426  
|Total Loan Participations and Assignments (Cost $13,369,826)                             | 10,089,792                                                                  
|                                                                                        
|Preferred Securities 0.5%                                                               
|Financials 0.2%                                                                         
|Xerox Capital Trust I, 8.0%, 2/1/2027                                                    |                                                                              | 315,000  
|Materials 0.3%                                                                          
|Hercules, Inc., 6.5%, 6/30/2029                                                          |                                                                              | 1,100,000
|Total Preferred Securities (Cost $1,023,773)                                             | 833,400                                                                     

|                                                                 | Shares                  | Value ($)
|---------------------------------------------------------------- | ----------------------- | ---------
|                                                                 |                        
|Common Stocks 0.0%                                              
|Consumer Discretionary 0.0%                                     
|Buffets Restaurants Holdings, Inc.*                              | 18,256                  | 21,907   
|Vertis Holdings, Inc.*                                           | 9,993                   | 0        
|                                                                 | 21,907                 
|Materials 0.0%                                                  
|GEO Specialty Chemicals, Inc.*                                   | 24,225                  | 20,592   
|GEO Specialty Chemicals, Inc. 144A*                              | 2,206                   | 1,875    
|                                                                 | 22,467                 
|Total Common Stocks (Cost $290,952)                              | 44,374                 
|                                                                
|Convertible Preferred Stocks 0.0%                               
|Consumer Discretionary                                          
|ION Media Networks, Inc.:                                       
|                                                                 | 144A, 12.0%*            |          
|                                                                 | Series AI, 144A, 12.0%* |          
|                                                                 | Series B, 12.0%*        |          
|Total Preferred Stocks (Cost $46,019)                            | 0                      
|                                                                
|Warrants 0.0%                                                   
|Financials 0.0%                                                 
|New ASAT (Finance) Ltd., Expiration Date 2/1/2011*               | 149,500                 | 8,395    
|                                                                 | Shares                  | Value ($)
|                                                                 |                        
|Industrials 0.0%                                                
|Dayton Superior Corp., 144A, Expiration Date 6/15/2009*          | 95                      | 0        
|Materials 0.0%                                                  
|Ashland, Inc., Expiration Date 3/31/2029*                        |                         | 1,100    
|Total Warrants (Cost $244,287)                                   | 8,395                  
|                                                                
|Securities Lending Collateral 3.1%                              
|Daily Assets Fund Institutional, 0.48% (d) (e)
(Cost $5,557,648) |                         | 5,557,648
|                                                                 | Shares                  | Value ($)
|                                                                 |                        
|Cash Equivalents 1.5%                                           
|Cash Management QP Trust, 0.27% (d) (Cost $2,580,662)            |                         | 2,580,662

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio(Cost $208,897,389)+ | 101.2           | 179,653,172
|Other Assets and Liabilities, Net              | (1.2)           | (2,071,117)
|Net Assets                                     | 100.0           | 177,582,055

|Securities                            | Coupon | Maturity Date | Principal Amount
($) | Acquisition
Cost ($) | Value ($)
|------------------------------------- | ------ | ------------- | -------------------- | -------------------- | ---------
|Alliance Mortgage Cycle Loan          | 8.856% | 6/1/2010      | 700,000              | USD                  | 700,000  
|ARCO Chemical Co.                     | 9.8%   | 2/1/2020      | 3,270,000            | USD                  | 3,694,081
|Buffalo Thunder Development Authority | 9.375% | 12/15/2014    | 250,000              | USD                  | 250,000  
|CanWest MediaWorks LP                 | 9.25%  | 8/1/2015      | 340,000              | USD                  | 340,000  
|Congoleum Corp.                       | 8.625% | 8/1/2008      | 1,200,000            | USD                  | 1,021,050
|Fontainebleau Las Vegas Holdings LLC  | 11.0%  | 6/15/2015     | 490,000              | USD                  | 495,962  
|Idearc, Inc.                          | 8.0%   | 11/15/2016    | 920,000              | USD                  | 936,284  
|New ASAT (Finance) Ltd.               | 9.25%  | 2/1/2011      | 575,000              | USD                  | 519,944  
|Pliant Corp.                          | 11.85% | 6/15/2009     | 11                   | USD                  | 11       
|Quebecor World, Inc.                  | 9.75%  | 1/15/2015     | 420,000              | USD                  | 420,000  
|R.H. Donnelley Corp.                  | 8.875% | 10/15/2017    | 1,185,000            | USD                  | 1,185,208
|Radnor Holdings Corp.                 | 11.0%  | 3/15/2010     | 265,000              | USD                  | 234,313  
|Tribune Co.                           | 5.25%  | 6/4/2014      | 829,426              | USD                  | 828,907  
|Tropicana Entertainment LLC           | 9.625% | 12/15/2014    | 1,220,000            | USD                  | 959,601  
|Trump Entertainment Resorts, Inc.     | 8.5%   | 6/1/2015      | 105,000              | USD                  | 107,100  
|Young Broadcasting, Inc.              | 8.75%  | 1/15/2014     | 2,040,000            | USD                  | 1,981,498
|                                      |        |               |                      | 13,673,959           | 1,914,286

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.

LIBOR: Represents the London InterBank Offered Rate.

PIK: Denotes that all or a portion of the income is paid in-kind.

Prime: Interest rate charged by banks to their most credit worthy customers.

REG S: Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of,
US persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of
1933.

At June 30, 2009, the Portfolio had the following open forward foreign currency exchange contracts:

|Contracts to Deliver          |           | In Exchange For |     | Settlement
Date |  | Unrealized
Depreciation ($)
|----------------------------- | --------- | --------------- | --- | --------------- |  | ---------------------------
|EUR                           | 5,475,700 |                 | USD | 7,572,745       |  | 7/14/2009                  
|EUR                           | 26,200    |                 | USD | 36,654          |  | 7/14/2009                  
|Total unrealized depreciation | (109,040)

|Currency Abbreviations                  
|----------------------------------------
|EUR     EuroUSD     United States Dollar

For information on the Portfolio's policy and additional disclosures regarding forward foreign currency exchange contracts, please refer to the
Derivatives section of Note A in the accompanying Notes to Financial Statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1          | Level 2            | Level 3          | Total             
|------------------------------------------------ | ---------------- | ------------------ | ---------------- | ------------------
|Fixed Income(f)                                  |                  |                    |                  |                   
|Corporate Bonds                                  | $               | $      158,091,924 | $      2,446,977 | $      160,538,901
|Loan Participation & Assignments                 |                 | 9,021,453          | 1,068,339        | 10,089,792        
|Preferred Securities                             |                 | 833,400            |                 | 833,400           
|Common Stock and/or Other Equity Investments (f) |                 | 21,907             | 30,862           | 52,769            
|Short-Term Investments (f)                       | $      5,557,648 | $      2,580,662   | $               | $      8,138,310  
|Total                                            | $   5,557,648    | $   170,549,346    | $   3,546,178    | $   179,653,172   
|Liabilities                                      |                  |                    |                  |                   
|Derivatives (g)                                  |                 | (109,040)          |                 | (109,040)         
|Total                                            | $               | $   (109,040)      | $               | $   (109,040)     

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                                     | Corporate Bonds | Loan
Participation and
Assignments | Other
Investments | Common Stock
and/or Other
Equity
Investments | Total          
|---------------------------------------------------------------------------------------------------- | --------------- | ---------------------------------- | ----------------- | -------------------------------------------- | ---------------
|Balance as of December 31, 2008                                                                      | $      110,737  | $      1,327,844                   | $      528,000    | $      34,196                                | $   2,000,777  
|Realized gains (loss)                                                                                |                | (98,430)                           |                  |                                             | (98,430)       
|Change in unrealized appreciation
(depreciation)                                                     | (1,019,078)     | 146,293                            | 417,336           | (247,620)                                    | (703,069)      
|Amortization premium/discount                                                                        | 6,939           | 7,476                              | 994               |                                             | 15,409         
|Net purchases  (sales)                                                                               | 1,571,828       | (314,844)                          | (946,330)         | 244,286                                      | 554,940        
|Net transfers in (out) of Level 3                                                                    | 1,776,551       |                                   |                  |                                             | 1,776,551      
|Balance as of June 30, 2009                                                                          | $   2,446,977   | $   1,068,339                      | $                | $   30,862                                   | $   3,546,178  
|Net change in unrealized
appreciation (depreciation) from
investments still held as of
June 30, 2009 | $   (958,524)   | $   (38,262)                       | $                | $   (3,335)                                  | $   (1,000,121)

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|Investments:Investments in securities, at value (cost $200,759,079)  including $5,360,137 of securities loaned                                                                            
|Investments in Daily Assets Fund Institutional (cost $5,557,648)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $2,580,662)                                                                                                                                   
|Total investments, at value (cost $208,897,389)                                                                                                                                            
|Cash                                                                                                                                                                                       
|Foreign currency, at value (cost $93,988)                                                                                                                                                  
|Receivable for investments sold                                                                                                                                                            
|Receivable for Portfolio shares sold                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Foreign taxes recoverable                                                                                                                                                                  
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable for investments purchased                                                                                                                                                          
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Payable upon return of securities loaned                                                                                                                                                   
|Net payable on closed forward currency exchange contracts                                                                                                                                  
|Unrealized depreciation on open forward foreign currency exchange contracts                                                                                                                
|Accrued management fee                                                                                                                                                                     
|Other accrued expenses and payables                                                                                                                                                        
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of                                                                                                                                                                      
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                  
|Foreign currency                                                                                                                                                                           
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($177,447,214 ÷ 31,862,326 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($134,841 ÷ 24,088 outstanding shares of beneficial interest, no
par value, unlimited number of shares authorized)        

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Interest (net of foreign taxes withheld of $164)                                                         
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Services to shareholders                                                                                 
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Credit default swap contracts                                                                            
|Foreign currency                                                                                         
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Credit default swap contracts                                                                            
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                     
|-----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                      
|Operations:Net investment income                                                                                       
|Net realized gain (loss)                                                                                               
|Change in net unrealized appreciation (depreciation)                                                                   
|Net increase (decrease) in net assets resulting from operations                                                        
|Distributions to shareholders from:Net investment income:Class A                                                       
|Class B                                                                                                                
|Total distributions                                                                                                    
|Portfolio share transactions:Class A
Proceeds from shares sold                                                         
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class A share transactions                                                  
|Class B
Proceeds from shares sold                                                                                      
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class B share transactions                                                  
|Increase (decrease) in net assets                                                                                      
|Net assets at beginning of period                                                                                      
|Net assets at end of period (including undistributed net investment income of $6,462,727 and
$18,004,319, respectively)
|Other Information                                                                                                      
|Class A
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class A shares                                                                              
|Shares outstanding at end of period                                                                                    
|Class B
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class B shares                                                                              
|Shares outstanding at end of period                                                                                    

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                 | 2009a    | 2008     | 2007     | 2006     | 2005     | 2004    
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------- | -------- | -------- | -------- | --------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   5.30 | $   7.81 | $   8.38 | $   8.23 | $   8.78 | $   8.43
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                 | .24      | .57      | .63      | .62      | .68      | .67     
|Net realized and unrealized gain (loss)                                                                                                                                                                          | .69      | (2.29)   | (.54)    | .19      | (.38)    | .31     
|Total from investment operations                                                                                                                                                                                 | .93      | (1.72)   | .09      | .81      | .30      | .98     
|Less distributions from:
Net investment income                                                                                                                                                                   | (.66)    | (.79)    | (.66)    | (.66)    | (.85)    | (.63)   
|Net asset value, end of period                                                                                                                                                                                   | $   5.57 | $   5.30 | $   7.81 | $   8.38 | $   8.23 | $   8.78
|Total Return (%)                                                                                                                                                                                                 | 19.04**  | (23.94)c | .96      | 10.47    | 3.89     | 12.42   
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 177      | 154      | 248      | 322      | 344      | 393     
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | .75*     | .80      | .69      | .71      | .70      | .66     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                   | .75*     | .79      | .69      | .71      | .70      | .66     
|Ratio of net investment income (%)                                                                                                                                                                               | 8.86*    | 8.42     | 7.84     | 7.73     | 8.27     | 8.11    
|Portfolio turnover rate (%)                                                                                                                                                                                      | 30**     | 38       | 61       | 93       | 100      | 162     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                 | 2009a    | 2008     | 2007     | 2006     | 2005     | 2004    
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------- | -------- | -------- | -------- | --------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   5.31 | $   7.81 | $   8.38 | $   8.22 | $   8.77 | $   8.41
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                 | .23      | .53      | .60      | .59      | .65      | .64     
|Net realized and unrealized gain (loss)                                                                                                                                                                          | .70      | (2.27)   | (.54)    | .20      | (.39)    | .32     
|Total from investment operations                                                                                                                                                                                 | .93      | (1.74)   | .06      | .79      | .26      | .96     
|Less distributions from:
Net investment income                                                                                                                                                                   | (.64)    | (.76)    | (.63)    | (.63)    | (.81)    | (.60)   
|Net asset value, end of period                                                                                                                                                                                   | $   5.60 | $   5.31 | $   7.81 | $   8.38 | $   8.22 | $   8.77
|Total Return (%)                                                                                                                                                                                                 | 18.84**  | (24.13)c | .54      | 10.11    | 3.41     | 12.08   
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | .1       | .1       | 10       | 53       | 56       | 57      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | 1.03*    | 1.25     | 1.08     | 1.10     | 1.10     | 1.06    
|Ratio of expenses after expense reductions (%)                                                                                                                                                                   | 1.03*    | 1.23     | 1.08     | 1.10     | 1.10     | 1.06    
|Ratio of net investment income (%)                                                                                                                                                                               | 8.58*    | 7.98     | 7.45     | 7.34     | 7.87     | 7.71    
|Portfolio turnover rate (%)                                                                                                                                                                                      | 30**     | 38       | 61       | 93       | 100      | 162     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Large Cap Value VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .84% and 1.20% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

The Portfolio is subject to stock market risk. The Portfolio may focus its investments on certain economic sectors, thereby increasing
its vulnerability to any single economic, political or regulatory development. This may result in greater share price volatility. Please
read this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement. Without
this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Large Cap Value VIP
|------------------------------------------------------------------
|[] DWS Large Cap Value VIP  Class A
[]Russell 1000® Value Index  
|vs2_g10k1080                                                      
|Yearly periods ended June 30                                      

|Comparative Results        
|---------------------------
|DWS Large Cap Value VIP    
|Class A                    
|Average annual total return
|Russell 1000 Value Index   
|Average annual total return
|DWS Large Cap Value VIP    
|Class B                    
|Average annual total return
|Russell 1000 Value Index   
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Large Cap Value VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                        | Class A |  | Class B | 
|------------------------------------------------ | ------- |  | ------- | 
|DWS Variable Series II  DWS Large Cap Value VIP | .87%    |  | 1.17%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Large Cap Value VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 98%     | 100%    
|Cash Equivalents                                                                         | 2%      |        
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Energy                                          | 20%     | 18%     
|Health Care                                     | 15%     | 16%     
|Utilities                                       | 13%     | 11%     
|Consumer Staples                                | 12%     | 9%      
|Financials                                      | 12%     | 14%     
|Industrials                                     | 7%      | 9%      
|Telecommunication Services                      | 7%      | 5%      
|Materials                                       | 7%      | 5%      
|Consumer Discretionary                          | 4%      | 4%      
|Information Technology                          | 3%      | 9%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 154. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Large Cap Value VIP

|                                                                  | Shares      | Value ($) 
|----------------------------------------------------------------- | ----------- | ----------
|                                                                  |            
|Common Stocks 98.3%                                              
|Consumer Discretionary 4.0%                                      
|Distributors 1.6%                                                
|Genuine Parts Co.                                                 | 99,521      | 3,339,925 
|Hotels Restaurants & Leisure 2.4%                                
|Burger King Holdings, Inc.                                        | 53,486      | 923,703   
|Carnival Corp. (Units) (a)                                        | 157,576     | 4,060,734 
|                                                                  | 4,984,437  
|Consumer Staples 12.2%                                           
|Beverages 1.0%                                                   
|PepsiCo, Inc.                                                     | 38,685      | 2,126,128 
|Food & Staples Retailing 3.2%                                    
|CVS Caremark Corp. (a)                                            | 122,053     | 3,889,829 
|Kroger Co.                                                        | 123,753     | 2,728,754 
|                                                                  | 6,618,583  
|Food Products 4.1%                                               
|General Mills, Inc.                                               | 47,827      | 2,679,268 
|Kellogg Co. (a)                                                   | 85,268      | 3,970,931 
|Kraft Foods, Inc. "A"                                             | 66,400      | 1,682,576 
|                                                                  | 8,332,775  
|Tobacco 3.9%                                                     
|Altria Group, Inc.                                                | 264,183     | 4,329,959 
|Philip Morris International, Inc. (a)                             | 85,995      | 3,751,102 
|                                                                  | 8,081,061  
|Energy 19.7%                                                     
|Energy Equipment & Services 5.2%                                 
|ENSCO International, Inc.                                         | 75,271      | 2,624,700 
|Noble Corp.                                                       | 71,311      | 2,157,158 
|Transocean Ltd.*                                                  | 79,264      | 5,888,522 
|                                                                  | 10,670,380 
|Oil, Gas & Consumable Fuels 14.5%                                
|Chevron Corp.                                                     | 51,333      | 3,400,811 
|ConocoPhillips                                                    | 105,595     | 4,441,326 
|Devon Energy Corp. (a)                                            | 34,210      | 1,864,445 
|ExxonMobil Corp.                                                  | 59,103      | 4,131,891 
|Marathon Oil Corp.                                                | 119,676     | 3,605,838 
|Nexen, Inc.                                                       | 122,632     | 2,654,983 
|Noble Energy, Inc.                                                | 52,918      | 3,120,574 
|Suncor Energy, Inc.                                               | 125,299     | 3,801,572 
|Sunoco, Inc.                                                      | 124,717     | 2,893,434 
|                                                                  | 29,914,874 
|Financials 11.3%                                                 
|Capital Markets 0.9%                                             
|Greenhill & Co., Inc. (a)                                         | 12,787      | 923,349   
|Northern Trust Corp.                                              | 17,893      | 960,496   
|                                                                  | 1,883,845  
|Commercial Banks 1.0%                                            
|Cullen/Frost Bankers, Inc.                                        | 20,216      | 932,362   
|M&T Bank Corp. (a)                                                | 20,404      | 1,039,176 
|                                                                  | 1,971,538  
|Diversified Financial Services 2.5%                              
|Bank of America Corp. (a)                                         | 184,877     | 2,440,376 
|JPMorgan Chase & Co.                                              | 39,288      | 1,340,114 
|NYSE Euronext                                                     | 52,474      | 1,429,917 
|                                                                  | 5,210,407  
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Insurance 6.1%                                                   
|Alleghany Corp.*                                                  | 1           | 255       
|Allstate Corp.                                                    | 81,329      | 1,984,427 
|Assurant, Inc.                                                    | 87,363      | 2,104,575 
|Chubb Corp.                                                       | 22,077      | 880,431   
|Cincinnati Financial Corp.                                        | 39,016      | 872,007   
|Fidelity National Financial, Inc. "A"                             | 77,636      | 1,050,415 
|First American Corp.                                              | 33,969      | 880,137   
|HCC Insurance Holdings, Inc.                                      | 36,115      | 867,121   
|MetLife, Inc.                                                     | 64,507      | 1,935,855 
|Odyssey Re Holdings Corp.                                         | 24,118      | 964,238   
|PartnerRe Ltd.                                                    | 15,700      | 1,019,715 
|                                                                  | 12,559,176 
|Thrifts & Mortgage Finance 0.8%                                  
|New York Community Bancorp., Inc.                                 | 83,275      | 890,209   
|People's United Financial, Inc.                                   | 52,019      | 782,366   
|                                                                  | 1,672,575  
|Health Care 14.6%                                                
|Health Care Equipment & Supplies 2.4%                            
|Baxter International, Inc. (a)                                    | 42,864      | 2,270,077 
|Becton, Dickinson & Co.                                           | 38,376      | 2,736,593 
|                                                                  | 5,006,670  
|Health Care Providers & Services 3.8%                            
|McKesson Corp.                                                    | 66,565      | 2,928,860 
|Medco Health Solutions, Inc.*                                     | 56,636      | 2,583,168 
|WellPoint, Inc.*                                                  | 45,227      | 2,301,602 
|                                                                  | 7,813,630  
|Life Sciences Tools & Services 1.2%                              
|Thermo Fisher Scientific, Inc.*                                   | 61,144      | 2,492,841 
|Pharmaceuticals 7.2%                                             
|Abbott Laboratories                                               | 22,083      | 1,038,784 
|Bristol-Myers Squibb Co.                                          | 44,814      | 910,172   
|Merck & Co., Inc. (a)                                             | 143,281     | 4,006,137 
|Mylan, Inc.*                                                      | 42,312      | 552,172   
|Teva Pharmaceutical Industries Ltd. (ADR) (a)                     | 91,395      | 4,509,429 
|Wyeth                                                             | 83,278      | 3,779,989 
|                                                                  | 14,796,683 
|Industrials 7.3%                                                 
|Aerospace & Defense 3.0%                                         
|Honeywell International, Inc.                                     | 108,620     | 3,410,668 
|United Technologies Corp.                                         | 56,037      | 2,911,682 
|                                                                  | 6,322,350  
|Electrical Equipment 1.9%                                        
|Emerson Electric Co.                                              | 120,125     | 3,892,050 
|Machinery 1.4%                                                   
|Dover Corp.                                                       | 88,418      | 2,925,752 
|Road & Rail 1.0%                                                 
|Norfolk Southern Corp.                                            | 53,785      | 2,026,081 
|Information Technology 3.3%                                      
|Communications Equipment 2.0%                                    
|Brocade Communications Systems, Inc.*                             | 298,929     | 2,337,625 
|Nokia Oyj (ADR)                                                   | 124,288     | 1,812,119 
|                                                                  | 4,149,744  
|Software 1.3%                                                    
|Microsoft Corp. (a)                                               | 116,132     | 2,760,457 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Materials 6.4%                                                   
|Chemicals 3.9%                                                   
|Air Products & Chemicals, Inc. (a)                                | 68,445      | 4,420,863 
|Praxair, Inc.                                                     | 52,505      | 3,731,530 
|                                                                  | 8,152,393  
|Containers & Packaging 1.4%                                      
|Sonoco Products Co.                                               | 119,141     | 2,853,427 
|Metals & Mining 1.1%                                             
|Kinross Gold Corp.                                                | 123,855     | 2,247,968 
|Telecommunication Services 7.0%                                  
|Diversified Telecommunication Services 6.0%                      
|AT&T, Inc.                                                        | 250,231     | 6,215,738 
|Deutsche Telekom AG (ADR)                                         | 178,000     | 2,100,400 
|Verizon Communications, Inc. (a)                                  | 130,954     | 4,024,216 
|                                                                  | 12,340,354 
|Wireless Telecommunication Services 1.0%                         
|Vodafone Group PLC (ADR)                                          | 107,402     | 2,093,265 
|Utilities 12.5%                                                  
|Electric Utilities 10.3%                                         
|Allegheny Energy, Inc.                                            | 114,149     | 2,927,922 
|American Electric Power Co., Inc.                                 | 87,419      | 2,525,535 
|Duke Energy Corp.                                                 | 212,705     | 3,103,366 
|Entergy Corp.                                                     | 31,073      | 2,408,779 
|Exelon Corp.                                                      | 32,689      | 1,674,004 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|FirstEnergy Corp.                                                 | 76,836      | 2,977,395 
|FPL Group, Inc.                                                   | 58,560      | 3,329,721 
|Southern Co.                                                      | 75,696      | 2,358,687 
|                                                                  | 21,305,409 
|Multi-Utilities 2.2%                                             
|PG&E Corp. (a)                                                    | 117,288     | 4,508,551 
|Total Common Stocks (Cost $196,550,030)                           | 203,053,329
|                                                                 
|Securities Lending Collateral 18.3%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $37,728,050) | 37,728,050  | 37,728,050
|                                                                 
|Cash Equivalents 2.4%                                            
|Cash Management QP Trust, 0.27% (b) (Cost $4,920,156)             | 4,920,156   | 4,920,156 

|                                               | % of Net
Assets | Value ($)   
|---------------------------------------------- | --------------- | ------------
|                                               |                
|Total Investment Portfolio(Cost $239,198,236)+ | 119.0           | 245,701,535 
|Other Assets and Liabilities, Net              | (19.0)          | (39,273,036)
|Net Assets                                     | 100.0           | 206,428,499 

ADR: American Depositary Receipt

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1            | Level 2       | Level 3  | Total             
|------------------------------------------------ | ------------------ | ------------- | -------- | ------------------
|Common Stock and/or Other Equity Investments (d) | $      203,053,329 | $            | $       | $      203,053,329
|Short-Term Investments (d)                       | 37,728,050         | 4,920,156     |         | 42,648,206        
|Total                                            | $   240,781,379    | $   4,920,156 | $       | $   245,701,535   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|Investments:Investments in securities, at value (cost $196,550,030)  including $36,705,599 of securities loaned                                                                           
|Investment in Daily Assets Fund Institutional (cost $37,728,050)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $4,920,156)                                                                                                                                   
|Total investments, at value (cost $239,198,236)                                                                                                                                            
|Cash                                                                                                                                                                                       
|Receivable for investments sold                                                                                                                                                            
|Dividends receivable                                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Receivable for Portfolio shares sold                                                                                                                                                       
|Foreign taxes recoverable                                                                                                                                                                  
|Other assets                                                                                                                                                                               
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable upon return of securities loaned                                                                                                                                                   
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Payable for investments purchased                                                                                                                                                          
|Accrued management fee                                                                                                                                                                     
|Other accrued expenses and payables                                                                                                                                                        
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of                                                                                                                                                                      
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                  
|Foreign currency                                                                                                                                                                           
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($205,756,332 ÷ 22,180,044 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($672,167 ÷ 72,314 outstanding shares of beneficial interest, no
par value, unlimited number of shares authorized)        

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $22,138)                                              
|Interest                                                                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Professional fees                                                                                        
|Distribution service fee (Class B)                                                                       
|Record keeping fees (Class B)                                                                            
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses                                                                                           
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Futures                                                                                                  
|Foreign currency                                                                                         
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                    
|----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                     
|Operations:Net investment income (loss)                                                                               
|Net realized gain (loss)                                                                                              
|Change in net unrealized appreciation (depreciation)                                                                  
|Net increase (decrease) in net assets resulting from operations                                                       
|Distributions to shareholders from:Net investment income:Class A                                                      
|Class B                                                                                                               
|Net realized gains:Class A                                                                                            
|Class B                                                                                                               
|Total distributions                                                                                                   
|Portfolio share transactions:Class A
Proceeds from shares sold                                                        
|Net assets acquired in tax free reorganization                                                                        
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class A share transactions                                                 
|Class B
Proceeds from shares sold                                                                                     
|Net assets acquired in tax free reorganization                                                                        
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class B share transactions                                                 
|Increase (decrease) in net assets                                                                                     
|Net assets at beginning of period                                                                                     
|Net assets at end of period (including undistributed net investment income of $1,610,159 and
$2,799,366, respectively)
|Other Information                                                                                                     
|Class A
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued in tax free reorganization                                                                              
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class A shares                                                                             
|Shares outstanding at end of period                                                                                   
|Class B
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares issued in tax free reorganization                                                                              
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class B shares                                                                             
|Shares outstanding at end of period                                                                                   

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | $   8.92 | $   19.21 | $   17.96 | $   15.81 | $   15.79 | $   14.57
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | .10      | .21       | .26       | .29d      | .26       | .27      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | .50      | (5.68)    | 1.98      | 2.12      | .04       | 1.18     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | .60      | (5.47)    | 2.24      | 2.41      | .30       | 1.45     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | (.24)    | (.34)     | (.32)     | (.26)     | (.28)     | (.23)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |         | (4.48)    | (.67)     |          |          |         
|Total Distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (.24)    | (4.82)    | (.99)     | (.26)     | (.28)     | (.23)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   9.28 | $   8.92  | $   19.21 | $   17.96 | $   15.81 | $   15.79
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 7.13**   | (36.40)c  | 13.15c,e  | 15.41d    | 1.97c     | 10.07    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 206      | 118       | 229       | 275       | 268       | 274      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | .87*     | .87       | .83       | .83       | .80       | .80      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | .87*     | .86       | .82       | .83       | .80       | .80      
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 2.36*    | 1.59      | 1.43      | 1.73d     | 1.64      | 1.84     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 68**     | 97        | 103       | 76        | 64        | 40       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.008 per share and an increase in the ratio of net investment income of 0.04%. Excluding this non-recurring income, total return
would have been 0.04% lower.eIncludes a reimbursement from the Advisor to reimburse the effect of losses incurred as the result of certain operation errors during the
period. Excluding this reimbursement, total return would have been 0.04% lower.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | $   8.92 | $   19.20 | $   17.94 | $   15.79 | $   15.77 | $   14.55
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | .09      | .12       | .19       | .23d      | .19       | .22      
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | .50      | (5.64)    | 1.99      | 2.11      | .05       | 1.17     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | .59      | (5.52)    | 2.18      | 2.34      | .24       | 1.39     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | (.21)    | (.28)     | (.25)     | (.19)     | (.22)     | (.17)    
|Net realized gains                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |         | (4.48)    | (.67)     |          |          |         
|Total Distributions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (.21)    | (4.76)    | (.92)     | (.19)     | (.22)     | (.17)    
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   9.30 | $   8.92  | $   19.20 | $   17.94 | $   15.79 | $   15.77
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 6.92**   | (36.64)c  | 12.77c,e  | 14.96d    | 1.58c     | 9.65     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 1        | .29       | 8         | 40        | 40        | 40       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 1.17*    | 1.28      | 1.21      | 1.21      | 1.21      | 1.18     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 1.17*    | 1.26      | 1.20      | 1.21      | 1.20      | 1.18     
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 2.06*    | 1.20      | 1.06      | 1.35d     | 1.24      | 1.46     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 68**     | 97        | 103       | 76        | 64        | 40       
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.008 per share and an increase in the ratio of net investment income of 0.04%. Excluding this non-recurring income, total return
would have been 0.04% lower.eIncludes a reimbursement from the Advisor to reimburse the effect of losses incurred as the result of certain operation errors during the
period. Excluding this reimbursement, total return would have been 0.04% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Mid Cap Growth VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is 1.08% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Stocks of
medium-sized companies involve greater risk than securities of larger, more established companies, as they often have limited
product lines, markets or financial resources and may be subject to more-erratic and more-abrupt market movements. Please read
this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns shown for all periods reflect a fee waiver and/or expense reimbursement. Without this waiver/reimbursement,
returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Mid Cap Growth VIP 
|------------------------------------------------------------------
|[] DWS Mid Cap Growth VIP  Class A
[]Russell Midcap® Growth Index
|vs2_g10k1070                                                      
|Yearly periods ended June 30                                      

|Comparative Results        
|---------------------------
|DWS Mid Cap Growth VIP     
|Class A                    
|Average annual total return
|Russell Midcap Growth
Index
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Mid Cap Growth VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had it
not done so, expenses would have been higher. The example in the table is based on an investment of $1,000
invested at the beginning of the six-month period and held for the entire period(January 1, 2009 to June 30,
2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                       | Class A | 
|----------------------------------------------- | ------- | 
|DWS Variable Series II  DWS Mid Cap Growth VIP | .94%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio of any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Mid Cap Growth VIP

|Asset Allocation(As a % of Investment Portfolio Excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 98%     | 97%     
|Cash Equivalents                                                                         | 2%      | 3%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Information Technology                          | 20%     | 22%     
|Industrials                                     | 17%     | 13%     
|Consumer Discretionary                          | 15%     | 17%     
|Health Care                                     | 15%     | 17%     
|Energy                                          | 11%     | 10%     
|Financials                                      | 8%      | 8%      
|Materials                                       | 7%      | 4%      
|Consumer Staples                                | 4%      | 4%      
|Telecommunication Services                      | 2%      | 3%      
|Utilities                                       | 1%      | 2%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 165. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Mid Cap Growth VIP

|                                                                 | Shares     | Value ($)
|---------------------------------------------------------------- | ---------- | ---------
|                                                                 |           
|Common Stocks 98.8%                                             
|Consumer Discretionary 15.2%                                    
|Diversified Consumer Services 1.3%                              
|Strayer Education, Inc. (a)                                      | 1,200      | 261,732  
|Hotels Restaurants & Leisure 2.9%                               
|Burger King Holdings, Inc. (a)                                   | 7,100      | 122,617  
|Darden Restaurants, Inc.                                         | 9,800      | 323,204  
|Penn National Gaming, Inc.*                                      | 4,600      | 133,906  
|                                                                 | 579,727   
|Internet & Catalog Retail 1.4%                                  
|Priceline.com, Inc.* (a)                                         | 2,550      | 284,453  
|Specialty Retail 8.7%                                           
|Advance Auto Parts, Inc.                                         | 5,600      | 232,344  
|American Eagle Outfitters, Inc. (a)                              | 20,200     | 286,234  
|Children's Place Retail Stores, Inc.* (a)                        | 10,400     | 274,872  
|Guess?, Inc. (a)                                                 | 11,300     | 291,314  
|Tiffany & Co. (a)                                                | 7,800      | 197,808  
|Urban Outfitters, Inc.* (a)                                      | 21,000     | 438,270  
|                                                                 | 1,720,842 
|Textiles, Apparel & Luxury Goods 0.9%                           
|Deckers Outdoor Corp.* (a)                                       | 2,400      | 168,648  
|Consumer Staples 3.8%                                           
|Household Products 1.4%                                         
|Church & Dwight Co., Inc.                                        | 4,900      | 266,119  
|Personal Products 2.4%                                          
|Chattem, Inc.*                                                   | 2,200      | 149,820  
|Herbalife Ltd.                                                   | 10,500     | 331,170  
|                                                                 | 480,990   
|Energy 10.6%                                                    
|Energy Equipment & Services 2.6%                                
|Cameron International Corp.*                                     | 8,600      | 243,380  
|FMC Technologies, Inc.*                                          | 7,200      | 270,576  
|                                                                 | 513,956   
|Oil, Gas & Consumable Fuels 8.0%                                
|Alpha Natural Resources, Inc.* (a)                               | 7,800      | 204,906  
|Concho Resources, Inc.* (a)                                      | 6,000      | 172,140  
|Petrohawk Energy Corp.* (a)                                      | 14,300     | 318,890  
|Range Resources Corp.                                            | 7,200      | 298,152  
|Southwestern Energy Co.*                                         | 8,700      | 337,995  
|Ultra Petroleum Corp.*                                           | 6,530      | 254,670  
|                                                                 | 1,586,753 
|Financials 7.8%                                                 
|Capital Markets 6.7%                                            
|Jefferies Group, Inc.*                                           | 4,700      | 100,251  
|Lazard Ltd. "A" (a)                                              | 7,800      | 209,976  
|Legg Mason, Inc. (a)                                             | 7,200      | 175,536  
|T. Rowe Price Group, Inc. (a)                                    | 6,000      | 250,020  
|TD Ameritrade Holding Corp.*                                     | 16,600     | 291,164  
|Waddell & Reed Financial, Inc. "A"                               | 11,300     | 297,981  
|                                                                 | 1,324,928 
|Diversified Financial Services 1.1%                             
|MSCI, Inc. "A"* (a)                                              | 9,474      | 231,545  
|                                                                 | Shares     | Value ($)
|                                                                 |           
|Health Care 14.8%                                               
|Biotechnology 2.4%                                              
|Alexion Pharmaceuticals, Inc.*                                   | 3,800      | 156,256  
|BioMarin Pharmaceutical, Inc.* (a)                               | 7,300      | 113,953  
|Myriad Genetics, Inc.* (a)                                       | 5,700      | 203,205  
|Myriad Pharmaceuticals, Inc.*                                    | 1,425      | 6,626    
|                                                                 | 480,040   
|Health Care Equipment & Supplies 1.5%                           
|Hologic, Inc.* (a)                                               | 12,000     | 170,760  
|Thoratec Corp.* (a)                                              | 4,800      | 128,544  
|                                                                 | 299,304   
|Health Care Providers & Services 2.9%                           
|AMERIGROUP Corp.* (a)                                            | 5,800      | 155,730  
|Laboratory Corp. of America Holdings* (a)                        | 3,500      | 237,265  
|MEDNAX, Inc.*                                                    | 4,400      | 185,372  
|                                                                 | 578,367   
|Health Care Technology 0.8%                                     
|Cerner Corp.* (a)                                                | 2,500      | 155,725  
|Life Sciences Tools & Services 5.1%                             
|Covance, Inc.* (a)                                               | 4,400      | 216,480  
|Illumina, Inc.* (a)                                              | 5,400      | 210,276  
|Life Technologies Corp.*                                         | 5,300      | 221,116  
|Pharmaceutical Product Development, Inc. (a)                     | 6,900      | 160,218  
|QIAGEN NV* (a)                                                   | 10,300     | 191,477  
|                                                                 | 999,567   
|Pharmaceuticals 2.1%                                            
|Mylan, Inc.* (a)                                                 | 32,400     | 422,820  
|Industrials 17.0%                                               
|Aerospace & Defense 0.6%                                        
|Curtiss-Wright Corp. (a)                                         | 4,200      | 124,866  
|Commercial Services & Supplies 1.1%                             
|Stericycle, Inc.*                                                | 4,300      | 221,579  
|Construction & Engineering 1.9%                                 
|Aecom Technology Corp.*                                          | 6,500      | 208,000  
|Quanta Services, Inc.* (a)                                       | 7,700      | 178,101  
|                                                                 | 386,101   
|Electrical Equipment 4.3%                                       
|First Solar, Inc.* (a)                                           | 2,200      | 356,664  
|General Cable Corp.* (a)                                         | 7,400      | 278,092  
|Roper Industries, Inc.                                           | 4,650      | 210,691  
|                                                                 | 845,447   
|Industrial Conglomerates 0.9%                                   
|McDermott International, Inc.*                                   | 8,400      | 170,604  
|Machinery 2.7%                                                  
|Harsco Corp.                                                     | 7,000      | 198,100  
|Joy Global, Inc.                                                 | 6,300      | 225,036  
|Terex Corp.* (a)                                                 | 9,200      | 111,044  
|                                                                 | 534,180   
|Professional Services 3.8%                                      
|FTI Consulting, Inc.* (a)                                        | 3,500      | 177,520  
|Huron Consulting Group, Inc.* (a)                                | 5,000      | 231,150  
|Robert Half International, Inc. (a)                              | 14,600     | 344,852  
|                                                                 | 753,522   
|                                                                 | Shares     | Value ($)
|                                                                 |           
|Road & Rail 1.7%                                                
|Genesee & Wyoming, Inc. "A"*                                     | 6,000      | 159,060  
|Knight Transportation, Inc. (a)                                  | 10,500     | 173,775  
|                                                                 | 332,835   
|Information Technology 20.1%                                    
|Communications Equipment 2.7%                                   
|F5 Networks, Inc.*                                               | 8,000      | 276,720  
|Juniper Networks, Inc.* (a)                                      | 11,200     | 264,320  
|                                                                 | 541,040   
|Electronic Equipment, Instruments & Components 1.3%             
|Itron, Inc.* (a)                                                 | 4,750      | 261,582  
|Internet Software & Services 2.0%                               
|Omniture, Inc.* (a)                                              | 12,400     | 155,744  
|VeriSign, Inc.* (a)                                              | 12,900     | 238,392  
|                                                                 | 394,136   
|IT Services 1.6%                                                
|Cognizant Technology Solutions Corp. "A"*                        | 5,200      | 138,840  
|CyberSource Corp.* (a)                                           | 6,300      | 96,390   
|ManTech International Corp. "A"* (a)                             | 1,800      | 77,472   
|                                                                 | 312,702   
|Semiconductors & Semiconductor Equipment 6.8%                   
|Altera Corp. (a)                                                 | 4,900      | 79,772   
|ARM Holdings PLC (ADR) (a)                                       | 18,600     | 111,042  
|ASML Holding NV (NY Registered Shares) (a)                       | 4,400      | 95,260   
|Broadcom Corp. "A"*                                              | 15,400     | 381,766  
|Cavium Networks, Inc.* (a)                                       | 10,800     | 181,548  
|Marvell Technology Group Ltd.*                                   | 20,100     | 233,964  
|MEMC Electronic Materials, Inc.*                                 | 8,100      | 144,261  
|Xilinx, Inc.                                                     | 5,600      | 114,576  
|                                                                 | 1,342,189 
|Software 5.7%                                                   
|Blackboard, Inc.* (a)                                            | 7,400      | 213,564  
|BMC Software, Inc.*                                              | 2,800      | 94,612   
|Concur Technologies, Inc.* (a)                                   | 6,200      | 192,696  
|Electronic Arts, Inc.*                                           | 7,800      | 169,416  
|McAfee, Inc.*                                                    | 5,500      | 232,045  
|Salesforce.com, Inc.* (a)                                        | 5,900      | 225,203  
|                                                                 | 1,127,536 
|                                                                 | Shares     | Value ($)
|                                                                 |           
|Materials 6.8%                                                  
|Chemicals 2.2%                                                  
|Airgas, Inc. (a)                                                 | 4,800      | 194,544  
|Intrepid Potash, Inc.* (a)                                       | 8,400      | 235,872  
|                                                                 | 430,416   
|Construction Materials 1.0%                                     
|Martin Marietta Materials, Inc. (a)                              | 2,600      | 205,088  
|Containers & Packaging 1.3%                                     
|Owens-Illinois, Inc.*                                            | 9,300      | 260,493  
|Metals & Mining 2.3%                                            
|Gerdau Ameristeel Corp.                                          | 42,300     | 288,486  
|Kinross Gold Corp.                                               | 9,300      | 168,795  
|                                                                 | 457,281   
|Telecommunication Services 1.8%                                 
|Wireless Telecommunication Services                             
|American Tower Corp. "A"*                                        | 11,600     | 365,748  
|Utilities 0.9%                                                  
|Electric Utilities                                              
|Allegheny Energy, Inc.                                           | 7,200      | 184,680  
|Total Common Stocks (Cost $19,600,462)                           | 19,607,541
|                                                                
|Securities Lending Collateral 31.6%                             
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $6,259,370) | 6,259,370  | 6,259,370
|                                                                
|Cash Equivalents 2.1%                                           
|Cash Management QP Trust, 0.27% (b) (Cost $415,073)              | 415,073    | 415,073  

|                                              | % of Net
Assets | Value ($)  
|--------------------------------------------- | --------------- | -----------
|                                              |                
|Total Investment Portfolio(Cost $26,274,905)+ | 132.5           | 26,281,984 
|Other Assets and Liabilities, Net             | (32.5)          | (6,445,391)
|Net Assets                                    | 100.0           | 19,836,593 

ADR: American Depositary Receipt

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                            | Level 1           | Level 2     | Level 3  | Total            
|------------------------------------------------- | ----------------- | ----------- | -------- | -----------------
|Common Stocks and/or Other Equity Investments (d) | $      19,607,541 | $          | $       | $      19,607,541
|Short-Term Investments (d)                        | 6,259,370         | 415,073     |         | 6,674,443        
|Total                                             | $   25,866,911    | $   415,073 | $       | $   26,281,984   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                    
|Investments:Investments in securities, at value (cost $19,600,462)  including $6,069,462 of securities loaned                                                                            
|Investment in Daily Assets Fund Institutional (cost $6,259,370)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $415,073)                                                                                                                                    
|Total investments, at value (cost $26,274,905)                                                                                                                                            
|Receivable for Portfolio shares sold                                                                                                                                                      
|Dividends receivable                                                                                                                                                                      
|Interest receivable                                                                                                                                                                       
|Other assets                                                                                                                                                                              
|Total assets                                                                                                                                                                              
|Liabilities                                                                                                                                                                               
|Payable upon return of securities loaned                                                                                                                                                  
|Payable for Portfolio shares redeemed                                                                                                                                                     
|Payable for investments purchased                                                                                                                                                         
|Accrued management fee                                                                                                                                                                    
|Other accrued expenses and payables                                                                                                                                                       
|Total liabilities                                                                                                                                                                         
|Net assets, at value                                                                                                                                                                      
|Net Assets Consist of                                                                                                                                                                     
|Accumulated net investment loss                                                                                                                                                           
|Net unrealized appreciation (depreciation) oninvestments                                                                                                                                  
|Accumulated net realized gain (loss)                                                                                                                                                      
|Paid-in capital                                                                                                                                                                           
|Net assets, at value                                                                                                                                                                      
|Class A
Net Asset Value, offering and redemption price per share ($19,836,593 ÷ 2,511,988  outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Dividends (net of foreign taxes withheld of $190)                                                        
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from investments                                                                
|Change in net unrealized appreciation (depreciation) on investments                                      
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                         
|-----------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                          
|Operations:Net investment income (loss)                                                                    
|Net realized gain (loss)                                                                                   
|Change in net unrealized appreciation (depreciation)                                                       
|Net increase (decrease) in net assets resulting from operations                                            
|Portfolio share transactions:Class A
Proceeds from shares sold                                             
|Cost of shares redeemed                                                                                    
|Shares converted*                                                                                          
|Net increase (decrease) in net assets from Class A share transactions                                      
|Class B
Proceeds from shares sold                                                                          
|Cost of shares redeemed                                                                                    
|Shares converted*                                                                                          
|Net increase (decrease) in net assets from Class B share transactions                                      
|Increase (decrease) in net assets                                                                          
|Net assets at beginning of period                                                                          
|Net assets at end of period (including accumulated net investment loss of $12,076 and $4,978,
respectively)
|Other Information                                                                                          
|Class A
Shares outstanding at beginning of period                                                          
|Shares sold                                                                                                
|Shares redeemed                                                                                            
|Shares converted*                                                                                          
|Net increase (decrease) in Class A shares                                                                  
|Shares outstanding at end of period                                                                        
|Class B
Shares outstanding at beginning of period                                                          
|Shares sold                                                                                                
|Shares redeemed                                                                                            
|Shares converted*                                                                                          
|Net increase (decrease) in Class B shares                                                                  
|Shares outstanding at end of period                                                                        

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004    
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | --------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | $   6.80 | $   13.61 | $   12.56 | $   11.32 | $   9.84  | $   9.46
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | (.00)*** | (.02)     | (.05)     | (.06)d    | (.05)     | (.01)   
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 1.10     | (6.79)    | 1.10      | 1.30      | 1.53      | .39     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 1.10     | (6.81)    | 1.05      | 1.24      | 1.48      | .38     
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | $   7.90 | $   6.80  | $   13.61 | $   12.56 | $   11.32 | $   9.84
|Total Return (%)c                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 16.18**  | (50.04)   | 8.36      | 10.95d    | 15.04     | 4.02    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 20       | 18        | 51        | 53        | 57        | 53      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 1.30*    | 1.17      | 1.05      | 1.03      | 1.01      | 1.02    
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | .94*     | 1.02      | .90       | .93       | .95       | .95     
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | (.08)*   | (.19)     | (.38)     | (.51)d    | (.45)     | (.11)   
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 43**     | 82        | 68        | 46        | 104       | 103     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.003 per share and an increase in the ratio of net investment income of 0.03%. Excluding this non-recurring income, total return
would have been 0.03% lower.*Annualized**Not annualized***Amount is more than ($.005).

Performance SummaryJune 30, 2009

DWS Money Market VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. The yield quotation more closely reflects the current earnings
of the Portfolio than the total return quotation.

Risk Considerations

An investment in the Portfolio is not insured or guaranteed by the FDIC or any other government agency. Although the
Portfolio seeks to preserve the value of your investment at $1.00 per share, this share price isn't guaranteed and you could
lose money by investing in the Portfolio.The share price of money market funds can fall below the$1.00 share price. You should
not rely on or expect the Advisorto enter into support agreements or take other actions tomaintain the Portfolio's $1.00 share price.
The credit quality of thePortfolio's holdings can change rapidly in certain markets, and thedefault of a single holding could have an
adverse impact on thePortfolio's share price. The Portfolio's share price can also benegatively affected during periods of high
redemptionpressures and/or illiquid markets. The actions of a few largeinvestors in the Portfolio may have a significant adverse effect
onthe share price of the Portfolio. Please read this Portfolio's prospectus for specific details regarding its risk profile.

|Portfolio's Class A Shares Yield | 7-day current
yield
|-------------------------------- | -------------------
|June 30, 2009                    | .13%               
|December 31, 2008                | 1.59%*             

Yields are historical, will fluctuate and do not guarantee future performance. The 7-day current yield refers to the income paid by the Portfolio
over a 7-day period expressed as an annual percentage rate of the Portfolio's shares outstanding.



Information About Your Portfolio's Expenses

DWS Money Market VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had
they not done so, expenses would have been higher. The example in the table is based on an investment of
$1,000 invested at the beginning of the six-month period and held for the entire period(January 1, 2009 to June
30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratio                      | Class A | 
|--------------------------------------------- | ------- | 
|DWS Variable Series II  DWS Money Market VIP | .47%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Money Market VIP

|Asset Allocation(As a % of Investment Portfolio) | 6/30/09 | 12/31/08
|------------------------------------------------ | ------- | --------
|                                                 |         |         
|Commercial Paper                                 | 43%     | 41%     
|Repurchase Agreements                            | 17%     | 6%      
|Certificates of Deposit and Bank Notes           | 14%     | 16%     
|Government & Agency Obligations                  | 13%     | 17%     
|Short-Term Notes                                 | 13%     | 14%     
|Time Deposit                                     |        | 4%      
|Master Notes                                     |        | 2%      
|                                                 | 100%    | 100%    

|Weighted Average Maturity*                    |         |        
|--------------------------------------------- | ------- | -------
|                                              |         |        
|DWS Variable Series II  DWS Money Market VIP | 63 days | 61 days
|First Tier Retail Money Fund Average          | 47 days | 42 days

Asset allocation and weighted average maturity are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 176. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Money Market VIP

|                                                                                                                       | Principal
Amount ($)    | Value ($) 
|---------------------------------------------------------------------------------------------------------------------- | ----------------------- | ----------
|                                                                                                                       |                        
|Certificates of Deposit and Bank Notes 14.6%                                                                          
|Bank of Tokyo-Mitsubishi UFJ Ltd.:                                                                                    
|                                                                                                                       | 1.0%, 7/6/2009          | 3,700,000 
|                                                                                                                       | 1.0%, 7/10/2009         | 1,500,000 
|BNP Paribas:                                                                                                          
|                                                                                                                       | 0.82%, 11/5/2009        | 5,000,000 
|                                                                                                                       | 1.0%, 8/10/2009         | 3,700,000 
|Canadian Imperial Bank of Commerce, 0.85%, 7/8/2009                                                                    | 3,700,000               | 3,700,000 
|Dexia Credit Local, 0.85%, 9/1/2009                                                                                    | 2,500,000               | 2,500,043 
|DnB NOR Bank ASA, 0.8%, 7/8/2009                                                                                       | 3,700,000               | 3,700,000 
|Landwirtschaftliche Rentenbank, 2.625%, 2/26/2010                                                                      | 1,500,000               | 1,517,077 
|Mizuho Corporate Bank Ltd.:                                                                                           
|                                                                                                                       | 0.42%, 9/9/2009         | 2,750,000 
|                                                                                                                       | 0.5%, 8/14/2009         | 2,500,000 
|                                                                                                                       | 0.7%, 8/5/2009          | 3,500,000 
|                                                                                                                       | 0.85%, 7/20/2009        | 4,500,000 
|Svenska Handelsbanken AB, 0.62%, 11/30/2009                                                                            | 3,000,000               | 3,000,253 
|Toronto-Dominion Bank:                                                                                                
|                                                                                                                       | 0.6%, 1/12/2010         | 2,800,000 
|                                                                                                                       | 0.75%, 2/8/2010         | 2,000,000 
|Wal-Mart Stores, Inc., 5.321%, 6/1/2010                                                                                | 1,500,000               | 1,563,757 
|Total Certificates of Deposit and Bank Notes (Cost $47,932,339)                                                        | 47,932,339             
|                                                                                                                      
|Commercial Paper 43.0%                                                                                                
|Issued at Discount**                                                                                                  
|ASB Finance Ltd.:                                                                                                     
|                                                                                                                       | 0.9%, 12/9/2009         | 1,000,000 
|                                                                                                                       | 144A, 1.03%, 8/17/2009  | 750,000   
|                                                                                                                       | 1.2%, 3/12/2010         | 500,000   
|BNZ International Funding Ltd., 144A, 1.0%, 8/14/2009                                                                  | 1,000,000               | 998,778   
|BP Capital Markets PLC:                                                                                               
|                                                                                                                       | 0.76%, 10/13/2009       | 2,200,000 
|                                                                                                                       | 0.78%, 10/22/2009       | 4,500,000 
|Caisse D'Amortissement de la Dette Sociale:                                                                           
|                                                                                                                       | 0.65%, 3/12/2010        | 1,500,000 
|                                                                                                                       | 0.7%, 1/8/2010          | 1,500,000 
|                                                                                                                       | 1.05%, 9/9/2009         | 2,000,000 
|Citibank Omni Master Trust, 144A, 0.77%, 7/1/2009                                                                      | 3,400,000               | 3,400,000 
|Coca-Cola Co.:                                                                                                        
|                                                                                                                       | 144A, 0.52%, 7/6/2009   | 2,500,000 
|                                                                                                                       | 144A, 0.57%, 7/15/2009  | 3,500,000 
|                                                                                                                       | 144A, 0.65%, 8/12/2009  | 3,500,000 
|Danske Corp.:                                                                                                         
|                                                                                                                       | 144A, 0.33%, 8/4/2009   | 3,300,000 
|                                                                                                                       | 144A, 0.6%, 1/11/2010   | 4,000,000 
|Eli Lilly & Co., 144A, 0.75%, 10/5/2009                                                                                | 3,500,000               | 3,493,000 
|General Electric Capital Services, Inc., 0.8%, 11/2/2009                                                               | 1,750,000               | 1,745,178 
|                                                                                                                       | Principal
Amount ($)    | Value ($) 
|                                                                                                                       |                        
|ING (US) Funding LLC, 0.61%, 8/3/2009                                                                                  | 7,000,000               | 6,996,086 
|Johnson & Johnson:                                                                                                    
|                                                                                                                       | 144A, 0.24%, 7/7/2009   | 3,000,000 
|                                                                                                                       | 144A, 0.3%, 7/22/2009   | 3,900,000 
|Kreditanstalt fuer Wiederaufbau:                                                                                      
|                                                                                                                       | 144A, 0.28%, 7/27/2009  | 2,000,000 
|                                                                                                                       | 144A, 0.6%, 8/27/2009   | 3,000,000 
|                                                                                                                       | 144A, 0.75%, 9/3/2009   | 3,000,000 
|Microsoft Corp., 144A, 0.17%, 7/15/2009                                                                                | 2,500,000               | 2,499,835 
|NRW.Bank:                                                                                                             
|                                                                                                                       | 0.49%, 8/12/2009        | 750,000   
|                                                                                                                       | 0.6%, 11/12/2009        | 750,000   
|                                                                                                                       | 0.67%, 10/15/2009       | 1,000,000 
|Procter & Gamble International Funding SCA:                                                                           
|                                                                                                                       | 144A, 0.64%, 9/4/2009   | 4,000,000 
|                                                                                                                       | 144A, 0.65%, 8/11/2009  | 3,800,000 
|Rabobank USA Financial Corp., 0.74%, 7/15/2009                                                                         | 3,500,000               | 3,498,993 
|Romulus Funding Corp.:                                                                                                
|                                                                                                                       | 144A, 0.87%, 7/1/2009   | 1,200,000 
|                                                                                                                       | 144A, 0.9%, 7/6/2009    | 3,000,000 
|Societe Generale North America, Inc.:                                                                                 
|                                                                                                                       | 0.5%, 9/15/2009         | 1,250,000 
|                                                                                                                       | 0.75%, 10/30/2009       | 1,500,000 
|Straight-A Funding LLC:                                                                                               
|                                                                                                                       | 144A, 0.36%, 8/27/2009  | 3,000,000 
|                                                                                                                       | 144A, 0.37%, 9/9/2009   | 2,500,000 
|                                                                                                                       | 144A, 0.37%, 9/10/2009  | 5,500,000 
|                                                                                                                       | 144A, 0.37%, 9/16/2009  | 10,200,000
|                                                                                                                       | 144A, 0.39%, 8/24/2009  | 4,000,000 
|                                                                                                                       | 144A, 0.43%, 8/10/2009  | 3,500,000 
|                                                                                                                       | 144A, 0.5%, 8/7/2009    | 2,000,000 
|Swedbank AB:                                                                                                          
|                                                                                                                       | 144A, 0.81%, 3/30/2010  | 1,300,000 
|                                                                                                                       | 144A, 0.82%, 2/19/2010  | 1,300,000 
|                                                                                                                       | 144A, 0.86%, 6/3/2010   | 1,000,000 
|                                                                                                                       | 144A, 0.89%, 5/28/2010  | 1,300,000 
|                                                                                                                       | 144A, 0.99%, 5/12/2010  | 1,700,000 
|                                                                                                                       | 144A, 1.07%, 6/10/2010  | 1,650,000 
|                                                                                                                       | 144A, 1.09%, 6/14/2010  | 1,000,000 
|Total Capital Canada Ltd.:                                                                                            
|                                                                                                                       | 144A, 0.29%, 8/12/2009  | 4,000,000 
|                                                                                                                       | 144A, 0.52%, 7/8/2009   | 3,700,000 
|Victory Receivables Corp., 144A, 0.4%, 9/17/2009                                                                       | 2,000,000               | 1,998,267 
|Wal-Mart Stores, Inc., 144A, 0.75%, 9/8/2009                                                                           | 2,000,000               | 1,997,125 
|Westpac Banking Corp., 0.74%, 9/24/2009                                                                                | 4,500,000               | 4,492,137 
|Total Commercial Paper (Cost $141,487,099)                                                                             | 141,487,099            
|                                                                                                                      
|                                                                                                                       | Principal
Amount ($)    | Value ($) 
|                                                                                                                       |                        
|Short-Term Notes* 12.9%                                                                                               
|Australia & New Zealand Banking Group Ltd.:                                                                           
|                                                                                                                       | 144A, 0.561%, 7/10/2009 | 1,000,000 
|                                                                                                                       | 144A, 0.876%, 7/2/2009  | 1,000,000 
|Commonwealth Bank of Australia, 144A, 0.71%, 6/24/2010                                                                 | 3,000,000               | 3,000,000 
|Credit Agricole SA, 144A, 0.565%, 7/22/2009                                                                            | 2,500,000               | 2,500,000 
|General Electric Capital Corp., 0.355%, 9/24/2009                                                                      | 10,000,000              | 10,000,000
|Inter-American Development Bank, 0.795%, 2/19/2010                                                                     | 3,900,000               | 3,900,000 
|International Bank for Reconstruction & Development, 0.989%, 2/1/2010                                                  | 3,000,000               | 3,000,000 
|Kreditanstalt fuer Wiederaufbau, 1.518%, 1/21/2010                                                                     | 2,500,000               | 2,500,000 
|Procter & Gamble International Funding SCA, 0.996%, 5/7/2010                                                           | 1,300,000               | 1,300,000 
|Queensland Treasury Corp., 0.68%, 6/18/2010                                                                            | 2,500,000               | 2,500,000 
|Rabobank Nederland NV:                                                                                                
|                                                                                                                       | 144A, 0.56%, 4/7/2011   | 4,000,000 
|                                                                                                                       | 144A, 1.176%, 10/9/2009 | 2,000,000 
|                                                                                                                       | 144A, 1.225%, 5/19/2010 | 1,800,000 
|Royal Bank of Canada, 144A, 0.739%, 7/15/2009                                                                          | 1,800,000               | 1,800,000 
|Royal Bank of Scotland PLC, 0.766%, 5/21/2010                                                                          | 2,000,000               | 2,000,000 
|Total Short-Term Notes (Cost $42,307,526)                                                                              | 42,307,526             
|                                                                                                                      
|                                                                                                                       | Principal
Amount ($)    | Value ($) 
|                                                                                                                       |                        
|Government & Agency Obligations 13.3%                                                                                 
|Foreign Government Obligations 2.2%                                                                                   
|Government of Canada:                                                                                                 
|                                                                                                                       | 0.21%, 7/7/2009         | 1,000,000 
|                                                                                                                       | 0.5%, 7/7/2009          | 500,000   
|                                                                                                                       | 0.5%, 7/8/2009          | 500,000   
|                                                                                                                       | 0.85%, 11/19/2009       | 1,500,000 
|                                                                                                                       | 0.9%, 11/30/2009        | 3,750,000 
|                                                                                                                       | 7,230,630              
|US Government Sponsored Agencies 8.1%                                                                                 
|Federal Home Loan Bank:                                                                                               
|                                                                                                                       | 0.507%**, 1/12/2010     | 4,000,000 
|                                                                                                                       | 0.795%**, 12/4/2009     | 2,000,000 
|                                                                                                                       | 0.85%*, 3/11/2010       | 2,500,000 
|Federal Home Loan Mortgage Corp.:                                                                                     
|                                                                                                                       | 0.535%**, 8/3/2009      | 5,000,000 
|                                                                                                                       | 0.592%**, 9/15/2009     | 2,000,000 
|                                                                                                                       | 0.593%**, 9/21/2009     | 3,200,000 
|Federal National Mortgage Association, 1.831%**, 7/27/2009                                                             | 8,000,000               | 7,989,022 
|                                                                                                                       | 26,661,386             
|US Treasury Obligations 3.0%                                                                                          
|US Treasury Bills:                                                                                                    
|                                                                                                                       | 0.3%**, 7/23/2009       | 2,000,000 
|                                                                                                                       | 0.345%**, 7/30/2009     | 2,000,000 
|                                                                                                                       | 0.48%**, 1/14/2010      | 2,500,000 
|                                                                                                                       | 0.53%**, 6/3/2010       | 1,650,000 
|                                                                                                                       | 0.6%**, 6/3/2010        | 1,600,000 
|                                                                                                                       | 9,725,338              
|Total Government & Agency Obligations (Cost $43,617,354)                                                               | 43,617,354             
|                                                                                                                      
|Repurchase Agreements 16.6%                                                                                           
|JPMorgan Securities, Inc., 0.08%, dated 6/30/2009, to be repurchased at $54,603,555 on 7/1/2009 (a) (Cost
$54,603,434) | 54,603,434              | 54,603,434

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio(Cost $329,947,752)+ | 100.4           | 329,947,752
|Other Assets and Liabilities, Net              | (0.4)           | (1,263,111)
|Net Assets                                     | 100.0           | 328,684,641

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities. Securities held by a money market Portfolio are reflected as
Level 2 because the securities are valued at amortized cost (which approximates fair value) and, accordingly, the inputs used to determine
value are not quoted prices in an active market.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                     | Level 1  | Level 2            | Level 3  | Total             
|-------------------------- | -------- | ------------------ | -------- | ------------------
|Short-Term Investments (b) | $       | $      329,947,752 | $       | $      329,947,752
|Total                      | $       | $   329,947,752    | $       | $   329,947,752   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                         
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                      
|Investments:Investments in securities, at value at amortized cost                                                                                                                           
|Repurchase agreements, valued at amortized cost                                                                                                                                             
|Total investments, valued at amortized cost                                                                                                                                                 
|Interest receivable                                                                                                                                                                         
|Receivable for Portfolio shares sold                                                                                                                                                        
|Other assets                                                                                                                                                                                
|Total assets                                                                                                                                                                                
|Liabilities                                                                                                                                                                                 
|Payable for Portfolio shares redeemed                                                                                                                                                       
|Distributions payable                                                                                                                                                                       
|Accrued management fee                                                                                                                                                                      
|Other accrued expenses and payables                                                                                                                                                         
|Total liabilities                                                                                                                                                                           
|Net assets, at value                                                                                                                                                                        
|Net Assets Consist of                                                                                                                                                                       
|Distributions in excess of net investment income                                                                                                                                            
|Accumulated net realized gain (loss)                                                                                                                                                        
|Paid-in capital                                                                                                                                                                             
|Net assets, at value                                                                                                                                                                        
|Class A
Net Asset Value, offering and redemption price per share ($328,684,641 ÷ 328,810,880 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)
|--------------------------------------------------------------------------
|Investment Income                                                         
|Income:Interest                                                           
|Expenses:Management fee                                                   
|Administration fee                                                        
|Services to shareholders                                                  
|Custodian fee                                                             
|Distribution service fee (Class B)                                        
|Professional fees                                                         
|Trustees' fee and expenses                                                
|Reports to shareholders and shareholder meeting                           
|Temporary guarantee program participation fee                             
|Other                                                                     
|Total expenses, before expense reductions                                 
|Expense reductions                                                        
|Total expenses, after expense reductions                                  
|Net investment income                                                     
|Net realized gain (loss)                                                  
|Net increase (decrease) in net assets resulting from operations           

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                             
|-------------------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                              
|Operations:Net investment income                                                                                               
|Net realized gain (loss)                                                                                                       
|Net increase (decrease) in net assets resulting from operations                                                                
|Distributions to shareholders from:Net investment income:Class A                                                               
|Class B                                                                                                                        
|Total distributions                                                                                                            
|Portfolio share transactions:Class A
Proceeds from shares sold                                                                 
|Shares converted*                                                                                                              
|Reinvestment of distributions                                                                                                  
|Cost of shares redeemed                                                                                                        
|Net increase (decrease) in net assets from Class A share transactions                                                          
|Class B
Proceeds from shares sold                                                                                              
|Shares converted*                                                                                                              
|Reinvestment of distributions                                                                                                  
|Cost of shares redeemed                                                                                                        
|Net increase (decrease) in net assets from Class B share transactions                                                          
|Increase (decrease) in net assets                                                                                              
|Net assets at beginning of period                                                                                              
|Net assets at end of period (including distributions in excess of net investment income of $118,469 and
$130,622, respectively)
|Other Information                                                                                                              
|Class A
Shares outstanding at beginning of period                                                                              
|Shares sold                                                                                                                    
|Shares converted*                                                                                                              
|Shares issued to shareholders in reinvestment of distributions                                                                 
|Shares redeemed                                                                                                                
|Net increase (decrease) in Class A shares                                                                                      
|Shares outstanding at end of period                                                                                            
|Class B
Shares outstanding at beginning of period                                                                              
|Shares sold                                                                                                                    
|Shares converted*                                                                                                              
|Shares issued to shareholders in reinvestment of distributions                                                                 
|Shares redeemed                                                                                                                
|Net increase (decrease) in Class B shares                                                                                      
|Shares outstanding at end of period                                                                                            

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                          | 2009a     | 2008      | 2007      | 2006      | 2005      | 2004     
|--------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                  
|Net asset value, beginning of period                                                                                                                      | $   1.000 | $   1.000 | $   1.000 | $   1.000 | $   1.000 | $   1.000
|Income from investment operations:
Net investment income                                                                                                  | .003      | .026      | .049      | .046      | .028      | .009     
|Total from investment operations                                                                                                                          | .003      | .026      | .049      | .046      | .028      | .009     
|Less distributions from:
Net investment income                                                                                                            | (.003)    | (.026)    | (.049)    | (.046)    | (.028)    | (.009)   
|Net asset value, end of period                                                                                                                            | $   1.000 | $   1.000 | $   1.000 | $   1.000 | $   1.000 | $   1.000
|Total Return (%)                                                                                                                                          | .29b**    | 2.64b     | 5.00b     | 4.65b     | 2.80      | .91      
|Ratios to Average Net Assets and Supplemental Data                                                                                                       
|Net assets, end of period ($ millions)                                                                                                                    | 329       | 398       | 355       | 294       | 235       | 241      
|Ratio of expenses before expense reductions (%)                                                                                                           | .48*      | .52       | .46       | .52       | .52       | .53      
|Ratio of expenses after expense reductions (%)                                                                                                            | .47*      | .50       | .45       | .51       | .52       | .53      
|Ratio of net investment income (%)                                                                                                                        | .61*      | 2.56      | 4.88      | 4.58      | 2.77      | .88      
|aFor the six months ended June 30, 2009 (Unaudited).bTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Small Cap Growth VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is .79% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Additionally, stocks
of small companies involve greater risk than securities of larger, more-established companies, as they often have limited product
lines, markets or financial resources and may be subject to more erratic and abrupt market movements. Finally, derivatives may be
more volatile and less liquid than traditional securities and the Portfolio could suffer losses on its derivatives positions. Please read this
Portfolio's prospectus for specific details regarding this product's investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement. Without
this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Small Cap Growth VIP
|-------------------------------------------------------------------
|[] DWS Small Cap Growth VIP  Class A
[]Russell 2000® Growth Index 
|vs2_g10k1060                                                       
|Yearly periods ended June 30                                       

|Comparative Results        
|---------------------------
|DWS Small Cap Growth VIP   
|Class A                    
|Average annual total return
|Russell 2000 Growth Index  
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Small Cap Growth VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratio                          | Class A | 
|------------------------------------------------- | ------- | 
|DWS Variable Series II  DWS Small Cap Growth VIP | .94%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Small Cap Growth VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 98%     | 94%     
|Cash Equivalents                                                                         | 2%      | 6%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Information Technology                          | 24%     | 33%     
|Health Care                                     | 24%     | 18%     
|Industrials                                     | 16%     | 11%     
|Consumer Discretionary                          | 13%     | 16%     
|Energy                                          | 9%      | 8%      
|Financials                                      | 8%      | 9%      
|Consumer Staples                                | 4%      | 5%      
|Materials                                       | 2%      |        
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 187. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Small Cap Growth VIP

|                                                                  | Shares     | Value ($) 
|----------------------------------------------------------------- | ---------- | ----------
|                                                                  |           
|Common Stocks 98.3%                                              
|Consumer Discretionary 13.0%                                     
|Diversified Consumer Services 1.5%                               
|Capella Education Co.*                                            | 16,700     | 1,001,165 
|Hotels Restaurants & Leisure 2.6%                                
|Buffalo Wild Wings, Inc.* (a)                                     | 29,000     | 943,080   
|Burger King Holdings, Inc.                                        | 20,800     | 359,216   
|Red Robin Gourmet Burgers, Inc.*                                  | 26,200     | 491,250   
|                                                                  | 1,793,546 
|Specialty Retail 7.2%                                            
|Advance Auto Parts, Inc.                                          | 24,500     | 1,016,505 
|Children's Place Retail Stores, Inc.* (a)                         | 35,300     | 932,979   
|DSW, Inc. "A"*                                                    | 55,900     | 550,615   
|Guess?, Inc.                                                      | 42,300     | 1,090,494 
|hhgregg, Inc.*                                                    | 35,600     | 539,696   
|Urban Outfitters, Inc.*                                           | 36,400     | 759,668   
|                                                                  | 4,889,957 
|Textiles, Apparel & Luxury Goods 1.7%                            
|True Religion Apparel, Inc.*                                      | 53,300     | 1,188,590 
|Consumer Staples 4.2%                                            
|Food & Staples Retailing 0.8%                                    
|Casey's General Stores, Inc.                                      | 20,700     | 531,783   
|Food Products 2.1%                                               
|Darling International, Inc.*                                      | 72,900     | 481,140   
|Green Mountain Coffee Roasters, Inc.* (a)                         | 16,050     | 948,876   
|                                                                  | 1,430,016 
|Personal Products 1.3%                                           
|Chattem, Inc.* (a)                                                | 13,300     | 905,730   
|Energy 8.8%                                                      
|Energy Equipment & Services 2.1%                                 
|Dril-Quip, Inc.*                                                  | 25,000     | 952,500   
|T-3 Energy Services, Inc.*                                        | 41,400     | 493,074   
|                                                                  | 1,445,574 
|Oil, Gas & Consumable Fuels 6.7%                                 
|Arena Resources, Inc.*                                            | 28,300     | 901,355   
|BPZ Resources, Inc.* (a)                                          | 190,500    | 931,545   
|Carrizo Oil & Gas, Inc.* (a)                                      | 61,000     | 1,046,150 
|EXCO Resources, Inc.*                                             | 70,200     | 906,984   
|Goodrich Petroleum Corp.* (a)                                     | 31,800     | 781,962   
|                                                                  | 4,567,996 
|Financials 8.7%                                                  
|Capital Markets 3.2%                                             
|Duff & Phelps Corp. "A"                                           | 40,500     | 720,090   
|Riskmetrics Group, Inc.* (a)                                      | 35,700     | 630,462   
|Waddell & Reed Financial, Inc. "A"                                | 32,000     | 843,840   
|                                                                  | 2,194,392 
|Commercial Banks 0.7%                                            
|PrivateBancorp., Inc.                                             | 21,900     | 487,056   
|Consumer Finance 0.7%                                            
|Dollar Financial Corp.*                                           | 36,800     | 507,472   
|Diversified Financial Services 2.2%                              
|Portfolio Recovery Associates, Inc.* (a)                          | 37,920     | 1,468,642 
|Insurance 1.9%                                                   
|eHealth, Inc.*                                                    | 71,900     | 1,269,754 
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Health Care 22.9%                                                
|Biotechnology 4.2%                                               
|Alexion Pharmaceuticals, Inc.*                                    | 26,900     | 1,106,128 
|BioMarin Pharmaceutical, Inc.*                                    | 27,800     | 433,958   
|Myriad Genetics, Inc.*                                            | 26,500     | 944,725   
|Myriad Pharmaceuticals, Inc.*                                     | 6,150      | 28,598    
|United Therapeutics Corp.*                                        | 4,100      | 341,653   
|                                                                  | 2,855,062 
|Health Care Equipment & Supplies 5.3%                            
|Hologic, Inc.*                                                    | 48,700     | 693,001   
|Masimo Corp.*                                                     | 30,800     | 742,588   
|NuVasive, Inc.* (a)                                               | 20,500     | 914,300   
|Thoratec Corp.*                                                   | 47,900     | 1,282,762 
|                                                                  | 3,632,651 
|Health Care Providers & Services 6.7%                            
|AMERIGROUP Corp.*                                                 | 18,800     | 504,780   
|Centene Corp.*                                                    | 30,900     | 617,382   
|Genoptix, Inc.*                                                   | 31,700     | 1,014,083 
|Gentiva Health Services, Inc.*                                    | 40,900     | 673,214   
|MEDNAX, Inc.*                                                     | 13,800     | 581,394   
|Psychiatric Solutions, Inc.* (a)                                  | 51,700     | 1,175,658 
|                                                                  | 4,566,511 
|Health Care Technology 0.7%                                      
|Cerner Corp.* (a)                                                 | 8,200      | 510,778   
|Life Sciences Tools & Services 2.6%                              
|Covance, Inc.*                                                    | 9,700      | 477,240   
|ICON PLC (ADR)                                                    | 34,900     | 753,142   
|Illumina, Inc.*                                                   | 14,200     | 552,948   
|                                                                  | 1,783,330 
|Pharmaceuticals 3.4%                                             
|Flamel Technologies SA (ADR)* (a)                                 | 34,500     | 241,500   
|MiddleBrook Pharmaceuticals, Inc.*                                | 228,100    | 307,935   
|Mylan, Inc.*                                                      | 71,000     | 926,550   
|Par Pharmaceutical Companies, Inc.*                               | 57,100     | 865,065   
|                                                                  | 2,341,050 
|Industrials 14.8%                                                
|Aerospace & Defense 2.1%                                         
|BE Aerospace, Inc.*                                               | 53,100     | 762,516   
|Curtiss-Wright Corp.                                              | 23,900     | 710,547   
|                                                                  | 1,473,063 
|Commercial Services & Supplies 0.7%                              
|Team, Inc.*                                                       | 28,600     | 448,162   
|Construction & Engineering 0.6%                                  
|MYR Group, Inc.* (a)                                              | 21,300     | 430,686   
|Electrical Equipment 5.3%                                        
|A-Power Energy Generation Systems Ltd.* (a)                       | 59,400     | 474,012   
|AZZ, Inc.*                                                        | 22,200     | 763,902   
|Baldor Electric Co. (a)                                           | 41,800     | 994,422   
|General Cable Corp.*                                              | 18,700     | 702,746   
|Polypore International, Inc.*                                     | 64,000     | 711,680   
|                                                                  | 3,646,762 
|Machinery 3.5%                                                   
|Astec Industries, Inc.*                                           | 20,400     | 605,676   
|Badger Meter, Inc. (a)                                            | 18,200     | 746,200   
|RBC Bearings, Inc.*                                               | 30,600     | 625,770   
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Terex Corp.*                                                      | 32,800     | 395,896   
|                                                                  | 2,373,542 
|Professional Services 0.9%                                       
|FTI Consulting, Inc.*                                             | 11,600     | 588,352   
|Road & Rail 1.7%                                                 
|Genesee & Wyoming, Inc. "A"*                                      | 20,300     | 538,153   
|Knight Transportation, Inc. (a)                                   | 37,000     | 612,350   
|                                                                  | 1,150,503 
|Information Technology 23.8%                                     
|Electronic Equipment, Instruments & Components 2.1%              
|Itron, Inc.* (a)                                                  | 25,800     | 1,420,806 
|Internet Software & Services 3.2%                                
|LogMeIn, Inc.*                                                    | 3,200      | 51,200    
|LoopNet, Inc.* (a)                                                | 112,400    | 871,100   
|MercadoLibre, Inc.*                                               | 24,900     | 669,312   
|Omniture, Inc.*                                                   | 48,800     | 612,928   
|                                                                  | 2,204,540 
|IT Services 4.6%                                                 
|CyberSource Corp.*                                                | 94,500     | 1,445,850 
|Forrester Research, Inc.*                                         | 48,200     | 1,183,310 
|ManTech International Corp. "A"*                                  | 11,800     | 507,872   
|                                                                  | 3,137,032 
|Semiconductors & Semiconductor Equipment 5.6%                    
|Atheros Communications* (a)                                       | 50,200     | 965,848   
|Cavium Networks, Inc.*                                            | 53,350     | 896,813   
|Microsemi Corp.*                                                  | 46,700     | 644,460   
|Netlogic Microsystems, Inc.* (a)                                  | 36,300     | 1,323,498 
|                                                                  | 3,830,619 
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Software 8.3%                                                    
|ArcSight, Inc.*                                                   | 20,700     | 367,839   
|Blackboard, Inc.* (a)                                             | 33,500     | 966,810   
|Concur Technologies, Inc.* (a)                                    | 32,500     | 1,010,100 
|FalconStor Software, Inc.*                                        | 227,800    | 1,082,050 
|Rosetta Stone, Inc.*                                              | 17,100     | 469,224   
|Taleo Corp. "A"*                                                  | 54,700     | 999,368   
|VanceInfo Technologies, Inc. (ADR)*                               | 52,500     | 775,425   
|                                                                  | 5,670,816 
|Materials 2.1%                                                   
|Chemicals 0.9%                                                   
|Airgas, Inc.                                                      | 15,200     | 616,056   
|Containers & Packaging 1.2%                                      
|Silgan Holdings, Inc.                                             | 16,200     | 794,286   
|Total Common Stocks (Cost $68,917,703)                            | 67,156,280
|                                                                 
|Securities Lending Collateral 25.5%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $17,420,200) | 17,420,200 | 17,420,200
|                                                                 
|Cash Equivalents 1.7%                                            
|Cash Management QP Trust, 0.27% (b) (Cost $1,192,024)             | 1,192,024  | 1,192,024 

|                                              | % of Net
Assets | Value ($)   
|--------------------------------------------- | --------------- | ------------
|                                              |                
|Total Investment Portfolio(Cost $87,529,927)+ | 125.5           | 85,768,504  
|Other Assets and Liabilities, Net (a)         | (25.5)          | (17,423,368)
|Net Assets                                    | 100.0           | 68,345,136  

ADR: American Depositary Receipt

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1           | Level 2       | Level 3  | Total            
|------------------------------------------------ | ----------------- | ------------- | -------- | -----------------
|Common Stocks and/or Other Equity Investments(d) | $      67,156,280 | $            | $       | $      67,156,280
|Short-Term Investments (d)                       | 17,420,200        | 1,192,024     |         | 18,612,224       
|Total                                            | $   84,576,480    | $   1,192,024 | $       | $   85,768,504   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                      
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                   
|Investments:Investments in securities, at value (cost $68,917,703)  including $16,423,549 of securities loaned                                                                          
|Investment in Daily Assets Fund Institutional (cost $17,420,200)*                                                                                                                        
|Investment in Cash Management QP Trust (cost $1,192,024)                                                                                                                                 
|Total investments, at value (cost $87,529,927)                                                                                                                                           
|Receivable for investments sold                                                                                                                                                          
|Dividends receivable                                                                                                                                                                     
|Interest receivable                                                                                                                                                                      
|Other assets                                                                                                                                                                             
|Total assets                                                                                                                                                                             
|Liabilities                                                                                                                                                                              
|Cash overdraft                                                                                                                                                                           
|Payable for Portfolio shares redeemed                                                                                                                                                    
|Payable upon return of securities loaned                                                                                                                                                 
|Payable for investments purchased                                                                                                                                                        
|Accrued management fee                                                                                                                                                                   
|Other accrued expenses and payables                                                                                                                                                      
|Total liabilities                                                                                                                                                                        
|Net assets, at value                                                                                                                                                                     
|Net Assets Consist of                                                                                                                                                                    
|Accumulated net investment loss                                                                                                                                                          
|Net unrealized appreciation (depreciation) on investments                                                                                                                                
|Accumulated net realized gain (loss)                                                                                                                                                     
|Paid-in capital                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                     
|Class A
Net Asset Value, offering and redemption price per share ($68,345,136 ÷ 8,053,251 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends                                                                                         
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses                                                                                           
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from investments                                                                
|Change in net unrealized appreciation (depreciation) on investments                                      
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                           
|-------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                            
|Operations:Net investment income (loss)                                                                      
|Net realized gain (loss)                                                                                     
|Change in net unrealized appreciation (depreciation)                                                         
|Net increase (decrease) in net assets resulting from operations                                              
|Portfolio share transactions:Class A
Proceeds from shares sold                                               
|Cost of shares redeemed                                                                                      
|Shares converted*                                                                                            
|Net increase (decrease) in net assets from Class A share transactions                                        
|Class B
Proceeds from shares sold                                                                            
|Cost of shares redeemed                                                                                      
|Shares converted*                                                                                            
|Net increase (decrease) in net assets from Class B share transactions                                        
|Increase (decrease) in net assets                                                                            
|Net assets at beginning of period                                                                            
|Net assets at end of period (including accumulated net investment loss of $107,085 and $16,609,
respectively)
|Other Information                                                                                            
|Class A
Shares outstanding at beginning of period                                                            
|Shares sold                                                                                                  
|Shares redeemed                                                                                              
|Shares converted*                                                                                            
|Net increase (decrease) in Class A shares                                                                    
|Shares outstanding at end of period                                                                          
|Class B
Shares outstanding at beginning of period                                                            
|Shares sold                                                                                                  
|Shares redeemed                                                                                              
|Shares converted*                                                                                            
|Net increase (decrease) in Class B shares                                                                    
|Shares outstanding at end of period                                                                          

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | $   7.61 | $   15.07 | $   14.19 | $   13.48 | $   12.59 | $   11.34
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | (.01)    | (.01)     | (.01)     | (.04)e    | (.06)     | (.05)    
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | .89      | (7.45)    | .89       | .75       | .95       | 1.30     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | .88      | (7.46)    | .88       | .71       | .89       | 1.25     
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | $   8.49 | $   7.61  | $   15.07 | $   14.19 | $   13.48 | $   12.59
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 11.56**  | (49.50)c  | 6.20c     | 5.27c,e   | 7.07d     | 11.02    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 68       | 69        | 174       | 208       | 243       | 210      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .94*     | .88       | .75       | .73       | .72       | .71      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | .94*     | .85       | .72       | .72       | .72       | .71      
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | (.29)*   | (.04)     | (.09)     | (.32)e    | (.47)     | (.47)    
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 58**     | 67        | 67        | 73        | 94        | 117      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses been reduced.dIn 2005, the Portfolio realized a gain of $49,496 on the disposal of an investment not meeting the Portfolio's investment restrictions. This
violation had no negative impact on the total return.eIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.008 per share and an increase in the ratio of net investment income of 0.06%. Excluding this non-recurring income, total return
would have been 0.06% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Strategic Income VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is .84% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

The Portfolio invests in individual bonds whose yields and market values fluctuate so that your investment may be worth more or less
than its original cost. Bond investments are subject to interest-rate risk such that when interest rates rise, the prices of the bonds,
and thus the value of the bond investment, can decline and the investor can lose principal value. Additionally, investments by the
Portfolio in lower-rated bonds present greater risk to principal and income than investments in higher-quality securities. The Portfolio
invests in derivatives seeking to hedge positions in certain securities and to generate income in order to enhance the Portfolio's
returns. Derivatives can be more volatile and less liquid than traditional fixed-income securities. Finally, investing in foreign securities
presents certain risks, such as currency fluctuation, political and economic changes and market risks. All of these factors may result in
greater share price volatility. Please read this Portfolio's prospectus for specific details regarding its investments and risk profile.

Portfolio returns for all periods shown reflect a fee waiver and/or expense reimbursement. Without this waiver/reimbursement,
returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Strategic Income VIP                                
|---------------------------------------------------------------------------------------------------
|[] DWS Strategic Income VIP  Class A
[]Barclays Capital US Government/Credit Index
[]Blended Index
|vs2_g10k1050                                                                                       
|Yearly periods ended June 30                                                                       

|Comparative Results                        
|-------------------------------------------
|DWS Strategic Income VIP                   
|Class A                                    
|Average annual total return                
|Barclays Capital US
Government/Credit Index
|Average annual total return                
|Blended Index                              
|Average annual total return                

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Strategic Income VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had it
not done so, expenses would have been higher. The example in the table is based on an investment of $1,000
invested at the beginning of the six-month period and held for the entire period(January 1, 2009 to June 30,
2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                         | Class A | 
|------------------------------------------------- | ------- | 
|DWS Variable Series II  DWS Strategic Income VIP | .82%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Strategic Income VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Corporate Bonds                                                                          | 63%     | 42%     
|Government & Agency Obligations                                                          | 24%     | 42%     
|Asset Backed                                                                             | 3%      | 1%      
|Collateralized Mortgage Obligations                                                      | 2%      | 1%      
|Commercial Mortgage-Backed Securities                                                    | 2%      | 2%      
|Mortgage-Backed Securities Pass-Throughs                                                 | 2%      | 3%      
|Loan Participations and Assignments                                                      | 2%      | 2%      
|Cash Equivalents                                                                         | 2%      | 6%      
|Municipal Bonds and Notes                                                                |        | 1%      
|                                                                                         | 100%    | 100%    

|Quality(Excludes Securities Lending Collateral) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Cash Equivalents                                | 3%      | 5%      
|AAA                                             | 26%     | 31%     
|AA                                              | 5%      | 1%      
|A                                               | 9%      | 15%     
|BBB                                             | 15%     | 8%      
|BB                                              | 17%     | 15%     
|B                                               | 14%     | 15%     
|CCC                                             | 6%      | 3%      
|Below CCC                                       | 2%      | 1%      
|Not Rated                                       | 3%      | 6%      
|                                                | 100%    | 100%    

|Interest Rate Sensitivity | 6/30/09   | 12/31/08 
|------------------------- | --------- | ---------
|                          |           |          
|Effective maturity        | 6.6 years | 7.4 years
|Average duration          | 4.2 years | 5.1 years

Asset allocation, quality and interest rate sensitivity are subject to change.

The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") credit
ratings. The ratings of Moody's and S&P represent their opinions as to the quality of the securities they rate. Ratings are relative and
subjective and are not absolute standards of quality. The Portfolio's credit quality does not remove market risk.

For more complete details about the Portfolio's investment portfolio, see page 198. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Strategic Income VIP

|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|----------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ----------
|                                                                                                      |                                                                             
|Corporate Bonds 64.2%                                                                                
|Consumer Discretionary 5.7%                                                                          
|AMC Entertainment, Inc., 8.0%, 3/1/2014                                                               |                                                                              | 105,000   
|American Achievement Corp., 144A, 8.25%, 4/1/2012                                                     |                                                                              | 30,000    
|American Achievement Group Holding Corp., 16.75%, 10/1/2012 (PIK)                                     |                                                                              | 59,496    
|Ameristar Casinos, Inc., 144A, 9.25%, 6/1/2014 (b)                                                    |                                                                              | 50,000    
|Asbury Automotive Group, Inc.:                                                                       
|                                                                                                      | 7.625%, 3/15/2017                                                            |           
|                                                                                                      | 8.0%, 3/15/2014                                                              |           
|Ashtead Holdings PLC, 144A, 8.625%, 8/1/2015                                                          |                                                                              | 120,000   
|CanWest MediaWorks LP, 144A, 9.25%, 8/1/2015**                                                        |                                                                              | 50,000    
|Carrols Corp., 9.0%, 1/15/2013                                                                        |                                                                              | 30,000    
|CSC Holdings, Inc.:                                                                                  
|                                                                                                      | 6.75%, 4/15/2012                                                             |           
|                                                                                                      | Series B, 7.625%, 4/1/2011                                                   |           
|DirecTV Holdings LLC, 7.625%, 5/15/2016                                                               |                                                                              | 145,000   
|DISH DBS Corp.:                                                                                      
|                                                                                                      | 6.375%, 10/1/2011                                                            |           
|                                                                                                      | 6.625%, 10/1/2014                                                            |           
|                                                                                                      | 7.125%, 2/1/2016                                                             |           
|Dollarama Group Holdings LP, 7.468%***, 8/15/2012 (c)                                                 |                                                                              | 52,000    
|Expedia, Inc., 7.456%, 8/15/2018                                                                      |                                                                              | 45,000    
|Fontainebleau Las Vegas Holdings LLC, 144A, 11.0%, 6/15/2015**                                        |                                                                              | 65,000    
|Goodyear Tire & Rubber Co., 10.5%, 5/15/2016 (b)                                                      |                                                                              | 25,000    
|Great Canadian Gaming Corp., 144A, 7.25%, 2/15/2015                                                   |                                                                              | 55,000    
|Group 1 Automotive, Inc., 8.25%, 8/15/2013                                                            |                                                                              | 30,000    
|Hertz Corp., 8.875%, 1/1/2014 (b)                                                                     |                                                                              | 115,000   
|Idearc, Inc., 8.0%, 11/15/2016**                                                                      |                                                                              | 125,000   
|Indianapolis Downs LLC, 144A, 11.0%, 11/1/2012                                                        |                                                                              | 40,000    
|Isle of Capri Casinos, Inc., 7.0%, 3/1/2014                                                           |                                                                              | 39,000    
|Kabel Deutschland GmbH, 10.625%, 7/1/2014                                                             |                                                                              | 150,000   
|Lamar Media Corp., Series C, 6.625%, 8/15/2015 (b)                                                    |                                                                              | 40,000    
|Levi Strauss & Co., 8.625%, 4/1/2013                                                                  | EUR                                                                          | 100,000   
|Macy's Retail Holdings, Inc.:                                                                        
|                                                                                                      | 5.35%, 3/15/2012                                                             |           
|                                                                                                      | 8.875%, 7/15/2015                                                            |           
|MGM MIRAGE:                                                                                          
|                                                                                                      | 144A, 10.375%, 5/15/2014                                                     |           
|                                                                                                      | 144A, 11.125%, 11/15/2017                                                    |           
|Michaels Stores, Inc., 10.0%, 11/1/2014                                                               |                                                                              | 30,000    
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|MTR Gaming Group, Inc., Series B, 9.75%, 4/1/2010                                                     |                                                                              | 85,000    
|Neiman Marcus Group, Inc., 10.375%, 10/15/2015                                                        |                                                                              | 80,000    
|Norcraft Holdings LP, 9.75%, 9/1/2012                                                                 |                                                                              | 155,000   
|Nordstrom, Inc., 6.75%, 6/1/2014                                                                      |                                                                              | 370,000   
|Penske Automotive Group, Inc., 7.75%, 12/15/2016                                                      |                                                                              | 125,000   
|Pinnacle Entertainment, Inc.:                                                                        
|                                                                                                      | 7.5%, 6/15/2015                                                              |           
|                                                                                                      | 8.75%, 10/1/2013                                                             |           
|Quebecor Media, Inc., 7.75%, 3/15/2016                                                                |                                                                              | 50,000    
|Quebecor World, Inc., 144A, 9.75%, 1/15/2015**                                                        |                                                                              | 45,000    
|Reader's Digest Association, Inc., 9.0%, 2/15/2017                                                    |                                                                              | 50,000    
|Sabre Holdings Corp., 8.35%, 3/15/2016                                                                |                                                                              | 50,000    
|Seminole Hard Rock Entertainment, Inc., 144A, 3.129%***, 3/15/2014                                    |                                                                              | 65,000    
|Shingle Springs Tribal Gaming Authority, 144A, 9.375%, 6/15/2015                                      |                                                                              | 50,000    
|Simmons Co., Step-up Coupon, 0% to 12/15/2009, 10.0% to 12/15/2014                                    |                                                                              | 185,000   
|Sonic Automotive, Inc., Series B, 8.625%, 8/15/2013                                                   |                                                                              | 55,000    
|Starwood Hotels & Resorts Worldwide, Inc., 7.875%, 10/15/2014                                         |                                                                              | 45,000    
|Time Warner Cable, Inc.:                                                                             
|                                                                                                      | 6.75%, 6/15/2039                                                             |           
|                                                                                                      | 8.25%, 4/1/2019                                                              |           
|Travelport LLC:                                                                                      
|                                                                                                      | 5.293%***, 9/1/2014                                                          |           
|                                                                                                      | 9.875%, 9/1/2014                                                             |           
|Trump Entertainment Resorts, Inc., 8.5%, 6/1/2015**                                                   |                                                                              | 15,000    
|United Components, Inc., 9.375%, 6/15/2013                                                            |                                                                              | 10,000    
|Unity Media GmbH, 144A, 8.75%, 2/15/2015                                                              | EUR                                                                          | 200,000   
|UPC Holding BV:                                                                                      
|                                                                                                      | 144A, 7.75%, 1/15/2014                                                       | EUR       
|                                                                                                      | 144A, 8.0%, 11/1/2016                                                        | EUR       
|Vertis, Inc., 13.5%, 4/1/2014 (PIK)                                                                   |                                                                              | 20,016    
|WMG Acquisition Corp., 144A, 9.5%, 6/15/2016                                                          |                                                                              | 45,000    
|Young Broadcasting, Inc., 8.75%, 1/15/2014**                                                          |                                                                              | 275,000   
|                                                                                                      | 3,993,772                                                                   
|Consumer Staples 1.5%                                                                                
|Alliance One International, Inc.:                                                                    
|                                                                                                      | 8.5%, 5/15/2012                                                              |           
|                                                                                                      | 144A, 10.0%, 7/15/2016 (d)                                                   |           
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Altria Group, Inc.:                                                                                  
|                                                                                                      | 8.5%, 11/10/2013                                                             |           
|                                                                                                      | 9.7%, 11/10/2018                                                             |           
|                                                                                                      | 10.2%, 2/6/2039                                                              |           
|Delhaize America, Inc., 8.05%, 4/15/2027                                                              |                                                                              | 20,000    
|General Nutrition Centers, Inc., 6.404%***, 3/15/2014 (PIK)                                           |                                                                              | 40,000    
|Ingles Markets, Inc., 144A, 8.875%, 5/15/2017                                                         |                                                                              | 30,000    
|North Atlantic Trading Co., 144A, 10.0%, 3/1/2012                                                     |                                                                              | 223,000   
|Smithfield Foods, Inc.:                                                                              
|                                                                                                      | 7.75%, 7/1/2017                                                              |           
|                                                                                                      | 144A, 10.0%, 7/15/2014 (d)                                                   |           
|SUPERVALU, Inc., 8.0%, 5/1/2016                                                                       |                                                                              | 90,000    
|Tyson Foods, Inc., 6.6%, 4/1/2016                                                                     |                                                                              | 120,000   
|Viskase Companies, Inc., 11.5%, 6/15/2011                                                             |                                                                              | 225,000   
|                                                                                                      | 1,049,726                                                                   
|Energy 8.7%                                                                                          
|Anadarko Petroleum Corp., 8.7%, 3/15/2019                                                             |                                                                              | 360,000   
|Atlas Energy Resources LLC, 144A, 10.75%, 2/1/2018                                                    |                                                                              | 115,000   
|Belden & Blake Corp., 8.75%, 7/15/2012                                                                |                                                                              | 310,000   
|Bill Barrett Corp., 9.875%, 7/15/2016 (d)                                                             |                                                                              | 40,000    
|Bristow Group, Inc., 7.5%, 9/15/2017                                                                  |                                                                              | 70,000    
|Chaparral Energy, Inc., 8.5%, 12/1/2015                                                               |                                                                              | 110,000   
|Chesapeake Energy Corp.:                                                                             
|                                                                                                      | 6.25%, 1/15/2018                                                             |           
|                                                                                                      | 6.875%, 1/15/2016                                                            |           
|                                                                                                      | 7.25%, 12/15/2018                                                            |           
|                                                                                                      | 7.5%, 6/15/2014 (b)                                                          |           
|Colorado Interstate Gas Co., 6.8%, 11/15/2015                                                         |                                                                              | 30,000    
|DCP Midstream LLC, 144A, 9.75%, 3/15/2019                                                             |                                                                              | 420,000   
|El Paso Corp.:                                                                                       
|                                                                                                      | 7.25%, 6/1/2018                                                              |           
|                                                                                                      | 9.625%, 5/15/2012                                                            |           
|Empresa Nacional del Petroleo, 144A, 6.25%, 7/8/2019 (d)                                              |                                                                              | 180,000   
|Energy Transfer Partners LP, 8.5%, 4/15/2014                                                          |                                                                              | 370,000   
|Enterprise Products Operating LLP, Series L, 6.3%, 9/15/2017                                          |                                                                              | 550,000   
|EXCO Resources, Inc., 7.25%, 1/15/2011                                                                |                                                                              | 95,000    
|Forest Oil Corp., 7.25%, 6/15/2019                                                                    |                                                                              | 35,000    
|Frontier Oil Corp.:                                                                                  
|                                                                                                      | 6.625%, 10/1/2011                                                            |           
|                                                                                                      | 8.5%, 9/15/2016 (b)                                                          |           
|GulfSouth Pipeline Co., LP, 144A, 5.75%, 8/15/2012                                                    |                                                                              | 15,000    
|Husky Energy, Inc., 7.25%, 12/15/2019                                                                 |                                                                              | 210,000   
|KCS Energy, Inc., 7.125%, 4/1/2012                                                                    |                                                                              | 240,000   
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Linn Energy LLC, 144A, 11.75%, 5/15/2017                                                              |                                                                              | 75,000    
|Mariner Energy, Inc.:                                                                                
|                                                                                                      | 7.5%, 4/15/2013                                                              |           
|                                                                                                      | 8.0%, 5/15/2017 (b)                                                          |           
|Newfield Exploration Co., 7.125%, 5/15/2018                                                           |                                                                              | 90,000    
|OPTI Canada, Inc.:                                                                                   
|                                                                                                      | 7.875%, 12/15/2014                                                           |           
|                                                                                                      | 8.25%, 12/15/2014                                                            |           
|Pemex Project Funding Master Trust, 5.75%, 3/1/2018                                                   |                                                                              | 460,000   
|Petrohawk Energy Corp.:                                                                              
|                                                                                                      | 7.875%, 6/1/2015                                                             |           
|                                                                                                      | 9.125%, 7/15/2013                                                            |           
|Plains Exploration & Production Co.:                                                                 
|                                                                                                      | 7.0%, 3/15/2017 (b)                                                          |           
|                                                                                                      | 7.625%, 6/1/2018                                                             |           
|Quicksilver Resources, Inc.:                                                                         
|                                                                                                      | 7.125%, 4/1/2016                                                             |           
|                                                                                                      | 11.75%, 1/1/2016 (b)                                                         |           
|Regency Energy Partners LP:                                                                          
|                                                                                                      | 8.375%, 12/15/2013                                                           |           
|                                                                                                      | 144A, 9.375%, 6/1/2016                                                       |           
|Southwestern Energy Co., 144A, 7.5%, 2/1/2018                                                         |                                                                              | 85,000    
|Stone Energy Corp.:                                                                                  
|                                                                                                      | 6.75%, 12/15/2014                                                            |           
|                                                                                                      | 8.25%, 12/15/2011                                                            |           
|Talisman Energy, Inc., 7.75%, 6/1/2019                                                                |                                                                              | 190,000   
|Tesoro Corp., 6.5%, 6/1/2017                                                                          |                                                                              | 60,000    
|Whiting Petroleum Corp.:                                                                             
|                                                                                                      | 7.25%, 5/1/2012                                                              |           
|                                                                                                      | 7.25%, 5/1/2013                                                              |           
|Williams Companies, Inc., 8.125%, 3/15/2012                                                           |                                                                              | 180,000   
|                                                                                                      | 6,107,005                                                                   
|Financials 26.6%                                                                                     
|Algoma Acquisition Corp., 144A, 9.875%, 6/15/2015                                                     |                                                                              | 125,000   
|American Express Co., 8.125%, 5/20/2019                                                               |                                                                              | 180,000   
|American International Group, Inc., 18.2%***, 6/27/2022                                               |                                                                              | 360,000   
|Anglo American Capital PLC, 144A, 9.375%, 4/8/2019                                                    |                                                                              | 330,000   
|Ashton Woods USA LLC, 144A, Step-up Coupon, 0% to 6/30/2012, 11.0% to 6/30/2015                       |                                                                              | 75,400    
|Bank of America Corp., 7.625%, 6/1/2019                                                               |                                                                              | 360,000   
|Buffalo Thunder Development Authority, 144A, 9.375%, 12/15/2014**                                     |                                                                              | 30,000    
|Calpine Construction Finance Co., LP, 144A, 8.0%, 6/1/2016                                            |                                                                              | 65,000    
|Capital One Bank USA NA, 8.8%, 7/15/2019                                                              |                                                                              | 360,000   
|CIT Group, Inc.:                                                                                     
|                                                                                                      | 5.4%, 2/13/2012                                                              |           
|                                                                                                      | 5.8%, 7/28/2011 (b)                                                          |           
|                                                                                                      | Series A, 7.625%, 11/30/2012 (b)                                             |           
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Citigroup, Inc.:                                                                                     
|                                                                                                      | 6.5%, 8/19/2013                                                              |           
|                                                                                                      | 8.5%, 5/22/2019                                                              |           
|Commonwealth Bank of Australia, 8.7%***, 7/21/2016                                                    |                                                                              | 1,000,000 
|Conproca SA de CV, REG S, 12.0%, 6/16/2010                                                            |                                                                              | 143,100   
|Depfa ACS Bank, 144A, 9.5%***, 10/6/2023                                                              |                                                                              | 1,000,000 
|Ford Motor Credit Co., LLC:                                                                          
|                                                                                                      | 7.25%, 10/25/2011                                                            |           
|                                                                                                      | 7.375%, 2/1/2011                                                             |           
|                                                                                                      | 7.875%, 6/15/2010                                                            |           
|                                                                                                      | 9.875%, 8/10/2011                                                            |           
|GMAC LLC:                                                                                            
|                                                                                                      | 144A, 6.875%, 9/15/2011                                                      |           
|                                                                                                      | 144A, 7.75%, 1/19/2010                                                       |           
|Hellas Telecommunications Finance, 144A, 9.435%***, 7/15/2015 (PIK)                                   | EUR                                                                          | 100,000   
|Hexion US Finance Corp., 9.75%, 11/15/2014                                                            |                                                                              | 35,000    
|HSBC Finance Corp., 1.206%***, 5/10/2010                                                              |                                                                              | 210,000   
|Inmarsat Finance II PLC, 10.375%, 11/15/2012                                                          |                                                                              | 135,000   
|Intergas Finance BV, REG S, 6.875%, 11/4/2011                                                         |                                                                              | 275,000   
|iPayment, Inc., 9.75%, 5/15/2014                                                                      |                                                                              | 45,000    
|Kreditanstalt fuer Wiederaufbau:                                                                     
|                                                                                                      | 2.05%, 2/16/2026                                                             | JPY       
|                                                                                                      | 5.0%, 7/4/2011                                                               | EUR       
|MetLife, Inc.:                                                                                       
|                                                                                                      | 6.75%, 6/1/2016                                                              |           
|                                                                                                      | 7.717%, 2/15/2019                                                            |           
|New ASAT (Finance) Ltd., 9.25%, 2/1/2011**                                                            |                                                                              | 90,000    
|Nielsen Finance LLC, 144A, 11.5%, 5/1/2016 (b)                                                        |                                                                              | 20,000    
|NiSource Finance Corp., 7.875%, 11/15/2010                                                            |                                                                              | 75,000    
|Orascom Telecom Finance SCA, 144A, 7.875%, 2/8/2014                                                   |                                                                              | 100,000   
|Pacific Life Global Funding, 144A, 1.8%***, 2/6/2016                                                  |                                                                              | 386,000   
|PNC Bank NA, 6.875%, 4/1/2018                                                                         |                                                                              | 180,000   
|Principal Financial Group, Inc., 8.875%, 5/15/2019                                                    |                                                                              | 360,000   
|Qwest Capital Funding, Inc., 7.0%, 8/3/2009                                                           |                                                                              | 50,000    
|Rainbow National Services LLC, 144A, 10.375%, 9/1/2014                                                |                                                                              | 13,000    
|Rio Tinto Finance (USA) Ltd.:                                                                        
|                                                                                                      | 8.95%, 5/1/2014                                                              |           
|                                                                                                      | 9.0%, 5/1/2019                                                               |           
|Sprint Capital Corp.:                                                                                
|                                                                                                      | 7.625%, 1/30/2011                                                            |           
|                                                                                                      | 8.375%, 3/15/2012                                                            |           
|Telecom Italia Capital SA:                                                                           
|                                                                                                      | 5.25%, 10/1/2015                                                             |           
|                                                                                                      | 7.175%, 6/18/2019                                                            |           
|Telefonica Emisiones SAU, 5.877%, 7/15/2019 (d)                                                       |                                                                              | 170,000   
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|The Goldman Sachs Group, Inc., 7.5%, 2/15/2019                                                        |                                                                              | 360,000   
|Toll Brothers Finance Corp., 8.91%, 10/15/2017                                                        |                                                                              | 360,000   
|Toyota Motor Credit Corp., 5.25%, 2/3/2012                                                            | EUR                                                                          | 1,000,000 
|Tropicana Entertainment LLC, 9.625%, 12/15/2014**                                                     |                                                                              | 150,000   
|UCI Holdco, Inc., 8.629%***, 12/15/2013 (PIK)                                                         |                                                                              | 72,822    
|Universal City Development Partners Ltd., 11.75%, 4/1/2010                                            |                                                                              | 235,000   
|Virgin Media Finance PLC:                                                                            
|                                                                                                      | 8.75%, 4/15/2014                                                             |           
|                                                                                                      | Series 1, 9.5%, 8/15/2016                                                    |           
|Wind Acquisition Finance SA, 144A, 9.75%, 12/1/2015                                                   | EUR                                                                          | 180,000   
|                                                                                                      | 18,642,957                                                                  
|Health Care 2.9%                                                                                     
|Boston Scientific Corp., 6.0%, 6/15/2011                                                              |                                                                              | 75,000    
|Community Health Systems, Inc., 8.875%, 7/15/2015                                                     |                                                                              | 345,000   
|Express Scripts, Inc., 7.25%, 6/15/2019                                                               |                                                                              | 84,000    
|HCA, Inc.:                                                                                           
|                                                                                                      | 144A, 8.5%, 4/15/2019                                                        |           
|                                                                                                      | 9.125%, 11/15/2014                                                           |           
|                                                                                                      | 9.25%, 11/15/2016                                                            |           
|                                                                                                      | 9.625%, 11/15/2016 (PIK)                                                     |           
|HEALTHSOUTH Corp., 10.75%, 6/15/2016                                                                  |                                                                              | 50,000    
|IASIS Healthcare LLC, 8.75%, 6/15/2014                                                                |                                                                              | 75,000    
|McKesson Corp., 7.5%, 2/15/2019                                                                       |                                                                              | 95,000    
|Merck & Co., Inc., 4.0%, 6/30/2015                                                                    |                                                                              | 155,000   
|Surgical Care Affiliates, Inc., 144A, 8.875%, 7/15/2015 (PIK)                                         |                                                                              | 55,000    
|The Cooper Companies, Inc., 7.125%, 2/15/2015                                                         |                                                                              | 95,000    
|Vanguard Health Holding Co. I, LLC, Step-up Coupon, 0% to 10/1/2009, 11.25% to 10/1/2015              |                                                                              | 75,000    
|Vanguard Health Holding Co. II, LLC, 9.0%, 10/1/2014                                                  |                                                                              | 150,000   
|WellPoint, Inc., 7.0%, 2/15/2019                                                                      |                                                                              | 230,000   
|                                                                                                      | 2,053,738                                                                   
|Industrials 3.8%                                                                                     
|Actuant Corp., 6.875%, 6/15/2017                                                                      |                                                                              | 40,000    
|Allied Waste North America, Inc., 6.5%, 11/15/2010                                                    |                                                                              | 40,000    
|ARAMARK Corp., 8.5%, 2/1/2015                                                                         |                                                                              | 20,000    
|BE Aerospace, Inc., 8.5%, 7/1/2018 (b)                                                                |                                                                              | 105,000   
|Belden, Inc.:                                                                                        
|                                                                                                      | 7.0%, 3/15/2017                                                              |           
|                                                                                                      | 144A, 9.25%, 6/15/2019                                                       |           
|Bombardier, Inc., 144A, 6.75%, 5/1/2012                                                               |                                                                              | 100,000   
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Browning-Ferris Industries, Inc., 7.4%, 9/15/2035                                                     |                                                                              | 15,000    
|Cenveo Corp., 144A, 10.5%, 8/15/2016                                                                  |                                                                              | 55,000    
|Congoleum Corp., 8.625%, 8/1/2008**                                                                   |                                                                              | 125,000   
|Corrections Corp. of America, 7.75%, 6/1/2017                                                         |                                                                              | 30,000    
|Esco Corp., 144A, 8.625%, 12/15/2013                                                                  |                                                                              | 80,000    
|Great Lakes Dredge & Dock Co., 7.75%, 12/15/2013                                                      |                                                                              | 50,000    
|Hutchison Whampoa International 09 Ltd., 144A, 7.625%, 4/9/2019                                       |                                                                              | 206,000   
|Ingersoll-Rand Global Holding Co., Ltd., 9.5%, 4/15/2014                                              |                                                                              | 230,000   
|K. Hovnanian Enterprises, Inc., 8.875%, 4/1/2012                                                      |                                                                              | 55,000    
|Kansas City Southern de Mexico SA de CV:                                                             
|                                                                                                      | 7.375%, 6/1/2014                                                             |           
|                                                                                                      | 7.625%, 12/1/2013                                                            |           
|                                                                                                      | 9.375%, 5/1/2012                                                             |           
|Kansas City Southern Railway Co., 8.0%, 6/1/2015                                                      |                                                                              | 100,000   
|Mobile Mini, Inc., 9.75%, 8/1/2014                                                                    |                                                                              | 65,000    
|Navios Maritime Holdings, Inc., 9.5%, 12/15/2014                                                      |                                                                              | 75,000    
|Owens Corning, Inc., 9.0%, 6/15/2019                                                                  |                                                                              | 360,000   
|R.H. Donnelley Corp., Series A-4, 8.875%, 10/15/2017**                                                |                                                                              | 165,000   
|RailAmerica, Inc., 144A, 9.25%, 7/1/2017                                                              |                                                                              | 45,000    
|RBS Global & Rexnord Corp., 9.5%, 8/1/2014                                                            |                                                                              | 45,000    
|Titan International, Inc., 8.0%, 1/15/2012                                                            |                                                                              | 195,000   
|TransDigm, Inc., 7.75%, 7/15/2014                                                                     |                                                                              | 30,000    
|United Rentals North America, Inc.:                                                                  
|                                                                                                      | 6.5%, 2/15/2012                                                              |           
|                                                                                                      | 7.0%, 2/15/2014                                                              |           
|US Concrete, Inc., 8.375%, 4/1/2014                                                                   |                                                                              | 55,000    
|Vought Aircraft Industries, Inc., 8.0%, 7/15/2011                                                     |                                                                              | 35,000    
|                                                                                                      | 2,672,783                                                                   
|Information Technology 1.0%                                                                          
|Alcatel-Lucent USA, Inc., 6.45%, 3/15/2029                                                            |                                                                              | 70,000    
|L-3 Communications Corp.:                                                                            
|                                                                                                      | 5.875%, 1/15/2015                                                            |           
|                                                                                                      | Series B, 6.375%, 10/15/2015                                                 |           
|                                                                                                      | 7.625%, 6/15/2012                                                            |           
|MasTec, Inc., 7.625%, 2/1/2017                                                                        |                                                                              | 65,000    
|Seagate Technology International, 144A, 10.0%, 5/1/2014                                               |                                                                              | 25,000    
|SunGard Data Systems, Inc., 10.25%, 8/15/2015                                                         |                                                                              | 165,000   
|Vangent, Inc., 9.625%, 2/15/2015                                                                      |                                                                              | 35,000    
|                                                                                                      | 713,369                                                                     
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Materials 5.4%                                                                                       
|Appleton Papers, Inc., Series B, 8.125%, 6/15/2011                                                    |                                                                              | 25,000    
|ArcelorMittal, 9.0%, 2/15/2015                                                                        |                                                                              | 180,000   
|ARCO Chemical Co., 9.8%, 2/1/2020**                                                                   |                                                                              | 405,000   
|Ashland, Inc., 144A, 9.125%, 6/1/2017                                                                 |                                                                              | 55,000    
|Barrick Gold Corp., 6.95%, 4/1/2019                                                                   |                                                                              | 310,000   
|Cascades, Inc., 7.25%, 2/15/2013                                                                      |                                                                              | 25,000    
|Clondalkin Acquisition BV, 144A, 2.629%***, 12/15/2013                                                |                                                                              | 75,000    
|CPG International I, Inc., 10.5%, 7/1/2013                                                            |                                                                              | 130,000   
|Crown Americas LLC, 144A, 7.625%, 5/15/2017                                                           |                                                                              | 30,000    
|Dow Chemical Co.:                                                                                    
|                                                                                                      | 8.55%, 5/15/2019                                                             |           
|                                                                                                      | 9.4%, 5/15/2039                                                              |           
|Exopack Holding Corp., 11.25%, 2/1/2014                                                               |                                                                              | 160,000   
|Freeport-McMoRan Copper & Gold, Inc.:                                                                
|                                                                                                      | 8.25%, 4/1/2015                                                              |           
|                                                                                                      | 8.375%, 4/1/2017                                                             |           
|GEO Specialty Chemicals, Inc.:                                                                       
|                                                                                                      | 144A, 7.5%***, 3/31/2015 (PIK)                                               |           
|                                                                                                      | 10.0%, 3/31/2015                                                             |           
|Georgia-Pacific LLC:                                                                                 
|                                                                                                      | 144A, 7.0%, 1/15/2015                                                        |           
|                                                                                                      | 144A, 7.125%, 1/15/2017                                                      |           
|                                                                                                      | 144A, 8.25%, 5/1/2016                                                        |           
|                                                                                                      | 9.5%, 12/1/2011                                                              |           
|Graphic Packaging International, Inc., 144A, 9.5%, 6/15/2017                                          |                                                                              | 70,000    
|Hexcel Corp., 6.75%, 2/1/2015                                                                         |                                                                              | 255,000   
|Huntsman International LLC, 144A, 6.875%, 11/15/2013                                                  | EUR                                                                          | 100,000   
|Huntsman LLC, 11.625%, 10/15/2010                                                                     |                                                                              | 98,000    
|Innophos, Inc., 8.875%, 8/15/2014                                                                     |                                                                              | 35,000    
|Koppers Holdings, Inc., Step-up Coupon, 0% to 11/15/2009, 9.875% to 11/15/2014                        |                                                                              | 130,000   
|Millar Western Forest Products Ltd., 7.75%, 11/15/2013                                                |                                                                              | 35,000    
|NewMarket Corp., 7.125%, 12/15/2016                                                                   |                                                                              | 110,000   
|NewPage Corp., 10.0%, 5/1/2012                                                                        |                                                                              | 110,000   
|Owens-Brockway Glass Container, Inc., 144A, 7.375%, 5/15/2016                                         |                                                                              | 110,000   
|Pliant Corp., 11.85%, 6/15/2009**                                                                     |                                                                              | 10        
|Radnor Holdings Corp., 11.0%, 3/15/2010**                                                             |                                                                              | 25,000    
|Silgan Holdings, Inc., 144A, 7.25%, 8/15/2016                                                         |                                                                              | 50,000    
|Solo Cup Co., 144A, 10.5%, 11/1/2013 (d)                                                              |                                                                              | 55,000    
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Teck Resources Ltd.:                                                                                 
|                                                                                                      | 144A, 9.75%, 5/15/2014                                                       |           
|                                                                                                      | 144A, 10.25%, 5/15/2016                                                      |           
|                                                                                                      | 144A, 10.75%, 5/15/2019                                                      |           
|Terra Capital, Inc., Series B, 7.0%, 2/1/2017                                                         |                                                                              | 110,000   
|The Mosaic Co., 144A, 7.375%, 12/1/2014                                                               |                                                                              | 85,000    
|Wolverine Tube, Inc., 15.0%, 3/31/2012 (PIK)                                                          |                                                                              | 85,000    
|                                                                                                      | 3,804,319                                                                   
|Telecommunication Services 3.8%                                                                      
|BCM Ireland Preferred Equity Ltd., 144A, 8.281%***, 2/15/2017 (PIK)                                   | EUR                                                                          | 70,669    
|CC Holdings GS V LLC, 144A, 7.75%, 5/1/2017                                                           |                                                                              | 60,000    
|Centennial Communications Corp.:                                                                     
|                                                                                                      | 10.0%, 1/1/2013                                                              |           
|                                                                                                      | 10.125%, 6/15/2013                                                           |           
|Cincinnati Bell, Inc.:                                                                               
|                                                                                                      | 7.25%, 7/15/2013                                                             |           
|                                                                                                      | 8.375%, 1/15/2014 (b)                                                        |           
|Cricket Communications, Inc.:                                                                        
|                                                                                                      | 9.375%, 11/1/2014                                                            |           
|                                                                                                      | 10.0%, 7/15/2015                                                             |           
|France Telecom SA, 5.375%, 7/8/2019 (d)                                                               |                                                                              | 130,000   
|Frontier Communications Corp., 6.25%, 1/15/2013                                                       |                                                                              | 45,000    
|Grupo Iusacell Celular SA de CV, 10.0%, 3/31/2012                                                     |                                                                              | 29,280    
|Hellas Telecommunications Luxembourg V, 144A, 4.935%***, 10/15/2012                                   | EUR                                                                          | 200,000   
|Hughes Network Systems LLC, 144A, 9.5%, 4/15/2014                                                     |                                                                              | 150,000   
|Intelsat Corp.:                                                                                      
|                                                                                                      | 144A, 9.25%, 8/15/2014                                                       |           
|                                                                                                      | 144A, 9.25%, 6/15/2016                                                       |           
|Intelsat Subsidiary Holding Co., Ltd., 144A, 8.875%, 1/15/2015                                        |                                                                              | 130,000   
|iPCS, Inc., 3.153%***, 5/1/2013 (b)                                                                   |                                                                              | 35,000    
|MetroPCS Wireless, Inc.:                                                                             
|                                                                                                      | 9.25%, 11/1/2014                                                             |           
|                                                                                                      | 144A, 9.25%, 11/1/2014                                                       |           
|Millicom International Cellular SA, 10.0%, 12/1/2013                                                  |                                                                              | 265,000   
|Qwest Corp.:                                                                                         
|                                                                                                      | 7.875%, 9/1/2011                                                             |           
|                                                                                                      | 8.875%, 3/15/2012                                                            |           
|Stratos Global Corp., 9.875%, 2/15/2013                                                               |                                                                              | 30,000    
|Telesat Canada, 144A, 11.0%, 11/1/2015                                                                |                                                                              | 180,000   
|Windstream Corp.:                                                                                    
|                                                                                                      | 7.0%, 3/15/2019                                                              |           
|                                                                                                      | 8.625%, 8/1/2016                                                             |           
|                                                                                                      | 2,652,452                                                                   
|Utilities 4.8%                                                                                       
|AES Corp.:                                                                                           
|                                                                                                      | 8.0%, 10/15/2017                                                             |           
|                                                                                                      | 8.0%, 6/1/2020                                                               |           
|                                                                                                      | 144A, 8.75%, 5/15/2013                                                       |           
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Allegheny Energy Supply Co., LLC, 144A, 8.25%, 4/15/2012                                              |                                                                              | 470,000   
|CMS Energy Corp., 8.5%, 4/15/2011                                                                     |                                                                              | 225,000   
|Dominion Resources, Inc., Series C, 5.15%, 7/15/2015                                                  |                                                                              | 360,000   
|Electricite de France, 144A, 6.5%, 1/26/2019                                                          |                                                                              | 194,000   
|Energy Future Holdings Corp., 10.875%, 11/1/2017                                                      |                                                                              | 65,000    
|Knight, Inc., 6.5%, 9/1/2012                                                                          |                                                                              | 115,000   
|Mirant Americas Generation LLC, 8.3%, 5/1/2011                                                        |                                                                              | 230,000   
|Mirant North America LLC, 7.375%, 12/31/2013                                                          |                                                                              | 60,000    
|NRG Energy, Inc.:                                                                                    
|                                                                                                      | 7.25%, 2/1/2014                                                              |           
|                                                                                                      | 7.375%, 2/1/2016                                                             |           
|                                                                                                      | 7.375%, 1/15/2017                                                            |           
|NV Energy, Inc.:                                                                                     
|                                                                                                      | 6.75%, 8/15/2017                                                             |           
|                                                                                                      | 8.625%, 3/15/2014                                                            |           
|Sempra Energy, 6.5%, 6/1/2016                                                                         |                                                                              | 180,000   
|Texas Competitive Electric Holdings Co., LLC, Series A, 10.25%, 11/1/2015                             |                                                                              | 130,000   
|Toledo Edison Co., 7.25%, 5/1/2020                                                                    |                                                                              | 230,000   
|                                                                                                      | 3,388,308                                                                   
|Total Corporate Bonds (Cost $47,255,338)                                                              | 45,078,429                                                                  
|                                                                                                     
|Commercial Mortgage-Backed Securities 2.2%                                                           
|Credit Suisse Mortgage Capital Certificates Trust, "A2", Series 2007-C1, 5.268%, 2/15/2040            |                                                                              | 814,000   
|JPMorgan Chase Commercial Mortgage Securities Corp., "F", Series 2004-LN2, 144A, 5.641%***,
7/15/2041 |                                                                              | 500,000   
|Wachovia Bank Commercial Mortgage Trust, "A2", Series 2007-C32, 5.924%***, 6/15/2049                  |                                                                              | 780,000   
|Total Commercial Mortgage-Backed Securities (Cost $1,953,667)                                         | 1,567,653                                                                   
|                                                                                                     
|Collateralized Mortgage Obligations 2.3%                                                             
|Banc of America Mortgage Securities, "2A2", Series 2004-A, 5.456%***, 2/25/2034                       |                                                                              | 279,339   
|Citicorp Mortgage Securities, Inc., "1A7", Series 2006-4, 6.0%, 8/25/2036                             |                                                                              | 249,931   
|Merrill Lynch Mortgage Investors Trust:                                                              
|                                                                                                      | "2A1A", Series 2005-A9, 5.155%***, 12/25/2035                                |           
|                                                                                                      | "2A", Series 2003-A6, 5.377%***, 10/25/2033                                  |           
|Provident Funding Mortgage Loan Trust, "2A1", Series 2005-1, 4.382%***, 5/25/2035                     |                                                                              | 219,882   
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Residential Funding Mortgage Securities I, "3A1", Series 2005-SA2, 5.143%***, 6/25/2035               |                                                                              | 334,337   
|Wells Fargo Mortgage-Backed Securities Trust, "3A1", Series 2004-EE, 4.49%***, 12/25/2034             |                                                                              | 158,082   
|Total Collateralized Mortgage Obligations (Cost $1,578,814)                                           | 1,602,530                                                                   
|                                                                                                     
|Asset-Backed 2.7%                                                                                    
|Credit Card Receivables 2.1%                                                                         
|Bank One Issuance Trust, "B2", Series 2004-B2, 4.37%, 4/15/2012                                       |                                                                              | 550,000   
|Washington Mutual Master Note Trust, "C1", Series 2007-C1, 144A, 0.719%***, 5/15/2014                 |                                                                              | 1,000,000 
|                                                                                                      | 1,493,421                                                                   
|Miscellaneous 0.6%                                                                                   
|Duane Street CLO, "A", Series 2005-1A, 144A, 1.224%***, 11/8/2017                                     |                                                                              | 495,423   
|Total Asset-Backed (Cost $1,908,538)                                                                  | 1,907,099                                                                   
|                                                                                                     
|Mortgage-Backed Securities Pass-Throughs 2.2%                                                        
|Government National Mortgage Association:                                                            
|                                                                                                      | 4.5%, 10/1/2038 (d)                                                          |           
|                                                                                                      | 5.5%, 5/1/2036 (d)                                                           |           
|Total Mortgage-Backed Securities Pass-Throughs (Cost $1,507,695)                                      | 1,522,734                                                                   
|                                                                                                     
|Government & Agency Obligations 24.5%                                                                
|Other Government Related 1.6%                                                                        
|Citibank NA, FDIC Guaranteed, 1.016%***, 5/7/2012                                                     |                                                                              | 650,000   
|JPMorgan Chase & Co.:                                                                                
|                                                                                                      | Series 3, FDIC Guaranteed, 0.854%***, 12/26/2012                             |           
|                                                                                                      | FDIC Guaranteed, 0.859%***, 6/15/2012                                        |           
|                                                                                                      | 1,153,748                                                                   
|Sovereign Bonds 17.2%                                                                                
|Federal Republic of Germany, Series 06, 4.0%, 7/4/2016                                                | EUR                                                                          | 150,000   
|Federative Republic of Brazil:                                                                       
|                                                                                                      | 8.875%, 10/14/2019                                                           |           
|                                                                                                      | 12.5%, 1/5/2016                                                              | BRL       
|Government of Canada, 4.5%, 6/1/2015                                                                  | CAD                                                                          | 350,000   
|Kingdom of Spain, 3.15%, 1/31/2016                                                                    | EUR                                                                          | 1,300,000 
|Province of Quebec, Series PO, 1.6%, 5/9/2013                                                         | JPY                                                                          | 85,000,000
|Republic of Argentina, 5.83%, 12/31/2033                                                              | ARS                                                                          | 440       
|Republic of Bulgaria, 144A, 8.25%, 1/15/2015                                                          |                                                                              | 170,000   
|Republic of Colombia, 8.25%, 12/22/2014                                                               |                                                                              | 170,000   
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|Republic of El Salvador, 144A, 7.65%, 6/15/2035 (b)                                                   |                                                                              | 156,000   
|Republic of Greece:                                                                                  
|                                                                                                      | 3.6%, 7/20/2016                                                              | EUR       
|                                                                                                      | 4.5%, 9/20/2037                                                              | EUR       
|Republic of Indonesia, 144A, 6.875%, 3/9/2017                                                         |                                                                              | 440,000   
|Republic of Panama, 9.375%, 1/16/2023                                                                 |                                                                              | 500,000   
|Republic of Peru, 7.35%, 7/21/2025                                                                    |                                                                              | 185,000   
|Republic of Poland, 5.875%, 2/3/2014                                                                  | EUR                                                                          | 190,000   
|Republic of South Africa, 6.875%, 5/27/2019                                                           |                                                                              | 220,000   
|Republic of Turkey:                                                                                  
|                                                                                                      | 7.0%, 9/26/2016                                                              |           
|                                                                                                      | 7.25%, 3/15/2015                                                             |           
|                                                                                                      | 11.75%, 6/15/2010                                                            |           
|Republic of Uruguay:                                                                                 
|                                                                                                      | 7.625%, 3/21/2036                                                            |           
|                                                                                                      | 9.25%, 5/17/2017                                                             |           
|Russian Federation, REG S, 7.5%, 3/31/2030                                                            |                                                                              | 179,419   
|Socialist Republic of Vietnam, 144A, 6.875%, 1/15/2016 (b)                                            |                                                                              | 100,000   
|United Kingdom Treasury Bond, 4.75%, 9/7/2015                                                         | GBP                                                                          | 1,500,000 
|United Mexican States, Series A, 5.875%, 1/15/2014                                                    |                                                                              | 220,000   
|                                                                                                      | 12,036,022                                                                  
|US Government Sponsored Agencies 1.2%                                                                
|Federal Home Loan Bank, 7.45%***, 10/16/2023                                                          |                                                                              | 600,000   
|Federal National Mortgage Association, 8.45%***, 2/27/2023                                            |                                                                              | 250,000   
|                                                                                                      | 835,500                                                                     
|US Treasury Obligations 4.5%                                                                         
|US Treasury Bills:                                                                                   
|                                                                                                      | 0.15%****, 9/17/2009 (e)                                                     |           
|                                                                                                      | 0.16%****, 8/27/2009 (e)                                                     |           
|US Treasury Bond, 3.5%, 2/15/2039                                                                     |                                                                              | 672,000   
|US Treasury Inflation-Indexed Note, 2.0%, 4/15/2012                                                   |                                                                              | 840,608   
|US Treasury Notes:                                                                                   
|                                                                                                      | 2.25%, 5/31/2014                                                             |           
|                                                                                                      | 2.75%, 2/15/2019                                                             |           
|                                                                                                      | 3.125%, 5/15/2019                                                            |           
|                                                                                                      | 3,128,508                                                                   
|Total Government & Agency Obligations (Cost $16,840,460)                                              | 17,153,778                                                                  
|                                                                                                     
|Loan Participations and Assignments 2.1%                                                             
|Senior Loans*** 1.8%                                                                                 
|Buffets, Inc.:                                                                                       
|                                                                                                      | Second Lien Term Loan, LIBOR plus 1.0%, plus 16.25% (PIK), 19.121%, 5/1/2013 |           
|                                                                                                      | Letter of Credit Term Loan B, LIBOR plus 7.25%, 7.848%, 5/1/2013             |           
|                                                                                                      | Principal
Amount ($) (a)                                                     | Value ($) 
|                                                                                                      |                                                                             
|                                                                                                      | Incremental Term Loan, LIBOR (3% floor) plus 15.0%, 18.0%, 4/30/2012         |           
|Charter Communications Operating LLC:                                                                
|                                                                                                      | Term Loan, Prime plus 3.0%, 6.25%, 3/6/2014                                  |           
|                                                                                                      | Term Loan, Prime plus 6.0%, 9.25%, 3/6/2014                                  |           
|Essar Steel Algoma, Inc., Term Loan B, LIBOR plus 2.5%, 2.81%, 6/20/2013                              |                                                                              | 37,474    
|Golden Nugget, Inc., Second Lien Term Loan, LIBOR plus 3.25%, 3.56%, 12/31/2014                       |                                                                              | 55,000    
|Hawker Beechcraft Acquisition Co., LLC:                                                              
|                                                                                                      | Letter of Credit, LIBOR plus 2.1%, 2.598%, 3/26/2014                         |           
|                                                                                                      | Term Loan, LIBOR plus 2.0%, 2.598%, 3/26/2014                                |           
|Hexion Specialty Chemicals, Inc.:                                                                    
|                                                                                                      | Term Loan C2, LIBOR plus 2.25%, 2.875%, 5/6/2013                             |           
|                                                                                                      | Term Loan C1, LIBOR plus 2.25%, 3.5%, 5/6/2013                               |           
|IASIS Healthcare LLC, Term Loan, LIBOR plus 5.25%, 6.289%, 6/13/2014 (PIK)                            |                                                                              | 75,752    
|Sabre, Inc., Term Loan B, LIBOR plus 2.25%, 3.289%, 9/30/2014                                         |                                                                              | 48,590    
|Sbarro, Inc., Term Loan, LIBOR plus 4.5%, 4.81%, 1/31/2014                                            |                                                                              | 40,000    
|Texas Competitive Electric Holdings Co., LLC:                                                        
|                                                                                                      | Term Loan B2, LIBOR plus 3.5%, 3.821%, 10/10/2014                            |           
|                                                                                                      | Term Loan B3, LIBOR plus 3.5%, 3.821%, 10/10/2014                            |           
|Tribune Co., Term Loan B, Prime plus 2.0%, 5.25%, 6/4/2014**                                          |                                                                              | 88,875    
|                                                                                                      | 1,293,663                                                                   
|Sovereign Loans 0.3%                                                                                 
|Export-Import Bank of Ukraine, 6.8%, 10/4/2012                                                        |                                                                              | 105,000   
|Gazprom, 144A, 6.51%, 3/7/2022                                                                        |                                                                              | 130,000   
|                                                                                                      | 177,079                                                                     
|Total Loan Participations and Assignments (Cost $1,914,603)                                           | 1,470,742                                                                   
|                                                                                                     
|Preferred Securities 0.1%                                                                            
|Financials 0.0%                                                                                      
|Xerox Capital Trust I, 8.0%, 2/1/2027 (b)                                                             |                                                                              | 35,000    
|Materials 0.1%                                                                                       
|Hercules, Inc., 6.5%, 6/30/2029                                                                       |                                                                              | 85,000    
|Total Preferred Securities (Cost $85,821)                                                             | 72,500                                                                      

|                                                        | Shares                  | Value ($)
|------------------------------------------------------- | ----------------------- | ---------
|                                                        |                        
|Common Stocks 0.0%                                     
|Consumer Discretionary 0.0%                            
|Buffets Restaurants Holdings, Inc.*                     | 2,318                   | 2,782    
|Vertis Holdings, Inc.*                                  | 940                     | 0        
|                                                        | 2,782                  
|Materials 0.0%                                         
|GEO Specialty Chemicals, Inc.*                          | 2,058                   | 1,749    
|Total Common Stocks (Cost $19,822)                      | 4,531                  
|                                                       
|Convertible Preferred Stocks 0.0%                      
|Consumer Discretionary                                 
|ION Media Networks, Inc.:                               |                         |          
|                                                        | 144A, 12.0%*            |          
|                                                        | Series AI, 144A, 12.0%* |          
|Total Convertible Preferred Stocks (Cost $4,191)        | 0                      
|                                                       
|Warrants 0.0%                                          
|Financials 0.0%                                        
|New ASAT (Finance) Ltd., Expiration Date 2/1/2011*      | 15,600                  | 876      
|Industrials 0.0%                                       
|Dayton Superior Corp., 144A, Expiration Date 6/15/2009* | 10                      | 0        
|Materials 0.0%                                         
|Ashland, Inc., Expiration Date 3/31/2029*               |                         | 85       
|Total Warrants (Cost $17,432)                           | 876                    

|                                                                                                                                                                                       | Contract
Amount | Value ($) 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------- | ----------
|                                                                                                                                                                                       |                
|Call Options Purchased 0.1%                                                                                                                                                           
|Call Options                                                                                                                                                                          
|Option on an interest rate swap expiring on March 14, 2012 for the obligation to receive a fixed rate of
1.72% versus the one-year EUR LIBOR, Expiration Date 3/10/2011 (Cost $54,651) | EUR             | 36,700,000

|                                                               | Shares | Value ($)
|-------------------------------------------------------------- | ------ | ---------
|                                                               |       
|Securities Lending Collateral 1.3%                            
|Daily Assets Fund Institutional, 0.48% (f) (g) (Cost $883,325) |        | 883,325  
|                                                              
|Cash Equivalents 1.9%                                         
|Cash Management QP Trust, 0.27% (f) (Cost $1,372,379)          |        | 1,372,379

|                                              | % of Net
Assets | Value ($)  
|--------------------------------------------- | --------------- | -----------
|                                              |                
|Total Investment Portfolio(Cost $75,396,736)+ | 103.6           | 72,674,376 
|Other Assets and Liabilities, Net             | (3.6)           | (2,553,264)
|Net Assets                                    | 100.0           | 70,121,112 

|Securities                            | Coupon | Maturity
Date | Principal Amount | Acquisition
Cost ($) | Value ($)
|------------------------------------- | ------ | ------------- | ---------------- | -------------------- | ---------
|ARCO Chemical Co.                     | 9.8%   | 2/1/2020      | 405,000          | USD                  | 423,400  
|Buffalo Thunder Development Authority | 9.375% | 12/15/2014    | 30,000           | USD                  | 30,000   
|CanWest MediaWorks LP                 | 9.25%  | 8/1/2015      | 50,000           | USD                  | 50,000   
|Congoleum Corp.                       | 8.625% | 8/1/2008      | 125,000          | USD                  | 105,994  
|Fontainebleau Las Vegas Holdings LLC  | 11.0%  | 6/15/2015     | 65,000           | USD                  | 65,225   
|Idearc, Inc.                          | 8.0%   | 11/15/2016    | 125,000          | USD                  | 99,731   
|New ASAT (Finance) Ltd.               | 9.25%  | 2/1/2011      | 90,000           | USD                  | 75,700   
|Pliant Corp.                          | 11.85% | 6/15/2009     | 10               | USD                  | 10       
|Quebecor World, Inc.                  | 9.75%  | 1/15/2015     | 45,000           | USD                  | 45,000   
|R.H. Donnelley Corp.                  | 8.875% | 10/15/2017    | 165,000          | USD                  | 157,483  
|Radnor Holdings Corp.                 | 11.0%  | 3/15/2010     | 25,000           | USD                  | 15,888   
|Tribune Co.                           | 5.25%  | 6/4/2014      | 88,875           | USD                  | 88,819   
|Tropicana Entertainment LLC           | 9.625% | 12/15/2014    | 150,000          | USD                  | 122,979  
|Trump Entertainment Resorts, Inc.     | 8.5%   | 6/1/2015      | 15,000           | USD                  | 10,838   
|Young Broadcasting, Inc.              | 8.75%  | 1/15/2014     | 275,000          | USD                  | 224,631  
|                                      |        |               |                  | 1,515,698            | 226,978  

144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers.

FDIC: Federal Deposit Insurance Corp.

LIBOR: Represents the London InterBank Offered Rate.

PIK: Denotes that all or a portion of the income is paid in-kind.

Prime: Interest rate charged by banks to their most credit worthy customers.

REG S: Securities sold under Regulation S may not be offered, sold or delivered within the United States or to, or for the account or benefit of,
US persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

At June 30, 2009, open futures contracts purchased were as follows:

|Futures                                 | Expiration
Date | Contracts | Aggregated
Face
Value ($) | Value ($) | Unrealized
Appreciation/
(Depreciation) ($)
|--------------------------------------- | --------------- | --------- | ------------------------- | --------- | -------------------------------------------
|10 Year Australian Treasury Bond        | 9/15/2009       | 14        | 1,162,319                 | 1,171,065 | 8,746                                      
|10 Year US Treasury Note                | 9/21/2009       | 34        | 3,968,673                 | 3,953,031 | (15,642)                                   
|3 Year Australian Treasury Bond         | 9/15/2009       | 11        | 920,195                   | 917,022   | (3,173)                                    
|AEX Index                               | 7/17/2009       | 2         | 146,598                   | 142,782   | (3,816)                                    
|ASX SPI 200 Index                       | 9/17/2009       | 6         | 486,542                   | 471,514   | (15,028)                                   
|Federal Republic of Germany Euro-Schatz | 9/8/2009        | 47        | 7,101,069                 | 7,114,269 | 13,200                                     
|FTSE 100 Index                          | 9/18/2009       | 14        | 998,356                   | 971,523   | (26,833)                                   
|FTSE MIB Index                          | 9/18/2009       | 1         | 139,407                   | 133,887   | (5,520)                                    
|Hang Seng Index                         | 7/30/2009       | 5         | 564,983                   | 594,189   | 29,206                                     
|IBEX 35 Index                           | 7/17/2009       | 1         | 133,151                   | 136,314   | 3,163                                      
|S&P E-Mini 500 Index                    | 9/18/2009       | 22        | 1,034,715                 | 1,007,050 | (27,665)                                   
|United Kingdom Long Gilt Bond           | 9/28/2009       | 11        | 2,127,379                 | 2,136,917 | 9,538                                      
|Total net unrealized depreciation       | (33,824)       

At June 30, 2009, open futures contracts sold were as follows:

|Futures                               | Expiration
Date | Contracts | Aggregated
Face
Value ($) | Value ($) | Unrealized
Appreciation/
(Depreciation) ($)
|------------------------------------- | --------------- | --------- | ------------------------- | --------- | -------------------------------------------
|10 Year Canadian Government Bond      | 9/21/2009       | 3         | 309,880                   | 312,754   | (2,874)                                    
|10 Year Japanese Government Bond      | 9/10/2009       | 4         | 5,648,153                 | 5,734,157 | (86,004)                                   
|2 Year US Treasury Note               | 9/30/2009       | 18        | 3,901,778                 | 3,891,938 | 9,840                                      
|CAC 40 Index                          | 7/17/2009       | 1         | 45,066                    | 43,993    | 1,073                                      
|DAX Index                             | 9/18/2009       | 7         | 1,219,883                 | 1,183,181 | 36,702                                     
|DJ Euro Stoxx 50 Index                | 9/18/2009       | 4         | 135,964                   | 134,561   | 1,403                                      
|Federal Republic of Germany Euro-Bund | 9/8/2009        | 14        | 2,333,163                 | 2,377,997 | (44,834)                                   
|NASDAQ E-Mini 100 Index               | 9/18/2009       | 14        | 415,870                   | 413,350   | 2,520                                      
|Russell E-Mini 2000 Index             | 9/18/2009       | 14        | 731,220                   | 710,080   | 21,140                                     
|S&P TSE 60 Index                      | 9/17/2009       | 1         | 110,670                   | 107,828   | 2,842                                      
|TOPIX Index                           | 9/11/2009       | 7         | 669,953                   | 671,770   | (1,817)                                    
|Total net unrealized depreciation     | (60,009)       

At June 30, 2009, open interest rate swap contracts were as follows:

|Effective/
Expiration Date    | Notional 
Amount ($) | Cash Flows Paid
by the Portfolio | Cash Flows Received 
by the Portfolio | Unrealized
Appreciation ($)
|----------------------------- | -------------------- | -------------------------------- | ------------------------------------- | ---------------------------
|4/20/2009
4/20/2024           | 500,0001             | Fixed  7.5%                     | Floating  LIBOR                      | 5,825                      
|5/15/2009
5/15/2024           | 500,0001             | Fixed  7.5%                     | Floating  LIBOR                      | 3,671                      
|Total unrealized appreciation | 9,496               

At June 30, 2009, open total return swap contracts were as follows:

|Effective/
Expiration Date | Notional
Amount ($) | Fixed Cash
Flows Paid by
the Portfolio | Reference Entity                    | Value ($) | Upfront 
Premiums Paid/
(Received) ($) | Unrealized
Depreciation ($)
|-------------------------- | ------------------- | -------------------------------------- | ----------------------------------- | --------- | -------------------------------------- | ---------------------------
|6/1/2009
6/1/2012          | 3,000,0002          | 0.425%                                 | Global Interest
Rate Strategy
Index | (34,989)  | 2,200                                  | (37,189)                   

Counterparties:

At June 30, 2009, the Portfolio had the following open forward foreign currency exchange contracts:

|Contracts to Deliver          |             | In Exchange For |     | Settlement
Date |  | Unrealized
Appreciation ($)
|----------------------------- | ----------- | --------------- | --- | --------------- |  | ---------------------------
|USD                           | 259,944     |                 | NZD | 410,000         |  | 7/15/2009                  
|USD                           | 1,358,522   |                 | JPY | 133,036,000     |  | 7/15/2009                  
|SEK                           | 4,970,000   |                 | USD | 651,197         |  | 7/15/2009                  
|EUR                           | 1,170,000   |                 | USD | 1,647,079       |  | 7/15/2009                  
|NOK                           | 782,000     |                 | USD | 123,841         |  | 7/15/2009                  
|GBP                           | 1,650,000   |                 | USD | 2,723,025       |  | 7/29/2009                  
|JPY                           | 200,000,000 |                 | USD | 2,097,938       |  | 7/29/2009                  
|Total unrealized appreciation | 74,283     

|Contracts to Deliver          |           | In Exchange For |     | Settlement
Date |  | Unrealized
Depreciation ($)
|----------------------------- | --------- | --------------- | --- | --------------- |  | ---------------------------
|EUR                           | 731,000   |                 | USD | 1,010,953       |  | 7/14/2009                  
|EUR                           | 198,500   |                 | USD | 274,520         |  | 7/14/2009                  
|EUR                           | 800       |                 | USD | 1,119           |  | 7/14/2009                  
|EUR                           | 112,300   |                 | USD | 157,108         |  | 7/14/2009                  
|USD                           | 2,979,658 |                 | CHF | 3,202,000       |  | 7/15/2009                  
|USD                           | 933,109   |                 | CAD | 1,029,000       |  | 7/15/2009                  
|USD                           | 1,594,892 |                 | AUD | 1,975,000       |  | 7/15/2009                  
|GBP                           | 471,000   |                 | USD | 773,316         |  | 7/15/2009                  
|EUR                           | 4,150,000 |                 | USD | 5,814,901       |  | 7/29/2009                  
|Total unrealized depreciation | (109,764)

|Currency Abbreviations                                                                                                                                                                                                                                                
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ARS     Argentine PesoAUD     Australian DollarBRL     Brazilian RealCAD     Canadian DollarCHF     Swiss FrancEUR     EuroGBP     British PoundJPY     Japanese YenNOK     Norwegian KroneNZD     New Zealand DollarSEK     Swedish KronaUSD     United States Dollar

For information on the Portfolio's policy and additional disclosures regarding option contracts, futures contracts, interest rate swap contracts,
total return swap contracts and forward foreign currency exchange contracts, please refer to the Derivatives section of Note A in the
accompanying Notes to Financial Statements.

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                           | Level 1    | Level 2           | Level 3          | Total            
|------------------------------------------------ | ---------- | ----------------- | ---------------- | -----------------
|Fixed Income (h)                                 |            |                   |                  |                  
|Corporate Bonds                                  | $         | $      43,763,981 | $      1,314,448 | $      45,078,429
|Commercial Mortgage-Backed Securities            |           | 1,567,653         |                 | 1,567,653        
|Collateralized Mortgage Obligations              |           | 1,602,530         |                 | 1,602,530        
|Asset-Backed                                     |           | 1,493,421         | 413,678          | 1,907,099        
|Mortgage-Backed Securities Pass-Throughs         |           | 1,522,734         |                 | 1,522,734        
|Government & Agency Obligations                  |           | 15,538,302        | 721,821          | 16,260,123       
|Loan Participation & Assignments                 |           | 1,333,834         | 136,908          | 1,470,742        
|Preferred Securities                             |           | 72,500            |                 | 72,500           
|Common Stock and/or Other Equity Investments (h) |           | 2,782             | 2,625            | 5,407            
|Short-Term Investments (h)                       | 883,325    | 2,266,034         |                 | 3,149,359        
|Derivatives (i)                                  |           | 121,579           |                 | 121,579          
|Total                                            | $  883,325 | $   69,285,350    | $   2,589,480    | $   72,758,155   

|                | Level 1         | Level 2          | Level 3  | Total           
|--------------- | --------------- | ---------------- | -------- | ----------------
|Liabilities     |                 |                  |          |                 
|Derivatives (i) | $      (93,833) | $      (146,953) | $       | $      (240,786)
|Total           | $   (93,833)    | $   (146,953)    | $       | $   (240,786)   

The following is a reconciliation of the Portfolio's Level 3 investments for which significant unobservable inputs were used in determining
value:

|                                                                                                     | Corporate
Bonds | Asset-Backed | Government
& Agency
Obligations | Loan
Participation
and
Assignments | Other
Investments | Common
Stock and/or
Other Equity
Investments | Total        
|---------------------------------------------------------------------------------------------------- | --------------- | ------------ | ------------------------------- | ---------------------------------- | ----------------- | -------------------------------------------- | -------------
|Balance as of
December 31, 2008                                                                      | $      932,370  | $           | $      815,353                  | $      86,087                      | $      40,800     | $      2,973                                 | $   1,877,583
|Realized gains (loss)                                                                                |                |             | (17,094)                        | (18,834)                           |                  |                                             | (35,928)     
|Change in unrealized
appreciation
(depreciation)                                                     | (137,544)       |             | 56,382                          | 23,760                             | 26,614            | (17,780)                                     | (48,568)     
|Amortization
premium/discount                                                                        | 1,176           |             | (5,605)                         | 769                                | 115               |                                             | (3,545)      
|Net purchases (sales)                                                                                | 343,527         | 413,678      | (127,215)                       | 45,126                             | (67,529)          | 17,432                                       | 625,019      
|Net transfers in (out) of
Level 3                                                                    | 174,919         |             |                                |                                   |                  |                                             | 174,919      
|Balance as of
June 30, 2009                                                                          | $   1,314,448   | $   413,678  | $   721,821                     | $   136,908                        | $                | $   2,625                                    | $   2,589,480
|Net change in
unrealized
appreciation
(depreciation) from
investments still held
as of June 30, 2009 | $   (132,086)   | $           | $   21,808                      | $   (5,293)                        | $                | $   (17,780)                                 | $   (133,351)

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                      
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                   
|Investments:Investments in securities, at value (cost $73,141,032)  including $851,636 of securities loaned                                                                             
|Investment in Daily Assets Fund Institutional (cost $883,325)*                                                                                                                           
|Investment in Cash Management QP Trust (cost $1,372,379)                                                                                                                                 
|Total investments, at value (cost $75,396,736)                                                                                                                                           
|Cash                                                                                                                                                                                     
|Foreign currency, at value (cost $189,148)                                                                                                                                               
|Receivable for when-issued and delayed securities sold                                                                                                                                   
|Receivable for investments sold                                                                                                                                                          
|Interest receivable                                                                                                                                                                      
|Unrealized appreciation on forward foreign currency exchange contracts                                                                                                                   
|Unrealized appreciation on open swap contracts                                                                                                                                           
|Foreign taxes recoverable                                                                                                                                                                
|Due from Advisor                                                                                                                                                                         
|Other assets                                                                                                                                                                             
|Total assets                                                                                                                                                                             
|Liabilities                                                                                                                                                                              
|Payable for when-issued and delayed delivery securities purchased                                                                                                                        
|Payable for investments purchased                                                                                                                                                        
|Payable upon return of securities loaned                                                                                                                                                 
|Payable for Portfolio shares redeemed                                                                                                                                                    
|Net payable on closed forward currency exchange contracts                                                                                                                                
|Unrealized depreciation on open forward foreign currency exchange contracts                                                                                                              
|Payable for variation margin on open futures contracts                                                                                                                                   
|Unrealized depreciation on open swap contracts                                                                                                                                           
|Accrued management fee                                                                                                                                                                   
|Accrued expenses                                                                                                                                                                         
|Total liabilities                                                                                                                                                                        
|Net assets, at value                                                                                                                                                                     
|Net Assets Consist of                                                                                                                                                                    
|Undistributed net investment income                                                                                                                                                      
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                
|Swap contracts                                                                                                                                                                           
|Futures                                                                                                                                                                                  
|Foreign currency                                                                                                                                                                         
|Accumulated net realized gain (loss)                                                                                                                                                     
|Paid-in capital                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                     
|Class A
Net Asset Value, offering and redemption price per share ($70,121,112 ÷ 6,790,348 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Interest (net of foreign taxes withheld of $1,331)                                                
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Pricing service fee                                                                                      
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Swap contracts                                                                                           
|Futures                                                                                                  
|Written options                                                                                          
|Foreign currency                                                                                         
|Payments by affiliates (see Note I)                                                                      
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Swap contracts                                                                                           
|Written options                                                                                          
|Futures                                                                                                  
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                    
|----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                     
|Operations:Net investment income                                                                                      
|Net realized gain (loss)                                                                                              
|Change in net unrealized appreciation (depreciation)                                                                  
|Net increase (decrease) in net assets resulting from operations                                                       
|Distributions to shareholders from:Net investment income:Class A                                                      
|Class B                                                                                                               
|Net realized gains:Class A                                                                                            
|Class B                                                                                                               
|Total distributions                                                                                                   
|Portfolio share transactions:Class A
Proceeds from shares sold                                                        
|Shares converted*                                                                                                     
|Reinvestment of distributions                                                                                         
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class A share transactions                                                 
|Class B
Proceeds from shares sold                                                                                     
|Shares converted*                                                                                                     
|Cost of shares redeemed                                                                                               
|Net increase (decrease) in net assets from Class B share transactions                                                 
|Increase (decrease) in net assets                                                                                     
|Net assets at beginning of period                                                                                     
|Net assets at end of period (including undistributed net investment income of $1,449,730 and
$3,179,356, respectively)
|Other Information                                                                                                     
|Class A
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares converted*                                                                                                     
|Shares issued to shareholders in reinvestment of distributions                                                        
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class A shares                                                                             
|Shares outstanding at end of period                                                                                   
|Class B
Shares outstanding at beginning of period                                                                     
|Shares sold                                                                                                           
|Shares converted*                                                                                                     
|Shares redeemed                                                                                                       
|Net increase (decrease) in Class B shares                                                                             
|Shares outstanding at end of period                                                                                   

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                 | 2009a     | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   10.03 | $   11.70 | $   11.80 | $   11.50 | $   12.25 | $   11.82
|Income (loss) from investment operations:
Net investment incomeb                                                                                                                                                 | .28       | .55       | .63       | .62       | .65       | .58      
|Net realized and unrealized gain (loss)                                                                                                                                                                          | .57       | (1.38)    | (.01)     | .36       | (.39)     | .39      
|Total from investment operations                                                                                                                                                                                 | .85       | (.83)     | .62       | .98       | .26       | .97      
|Less distributions from:
Net investment income                                                                                                                                                                   | (.55)     | (.69)     | (.72)     | (.57)     | (.98)     |         
|Net realized gains                                                                                                                                                                                               |          | (.15)     |          | (.11)     | (.03)     | (.54)    
|Total distributions                                                                                                                                                                                              | (.55)     | (.84)     | (.72)     | (.68)     | (1.01)    | (.54)    
|Net asset value, end of period                                                                                                                                                                                   | $   10.33 | $   10.03 | $   11.70 | $   11.80 | $   11.50 | $   12.25
|Total Return (%)                                                                                                                                                                                                 | 9.20c**   | (7.75)c   | 5.43c     | 8.98      | 2.38      | 8.60     
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 70        | 73        | 100       | 86        | 71        | 62       
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | .92*      | .89       | .84       | .85       | .88       | .84      
|Ratio of expenses after expense reductions (%)                                                                                                                                                                   | .82*      | .87       | .83       | .85       | .88       | .84      
|Ratio of net investment income (%)                                                                                                                                                                               | 5.78*     | 5.06      | 5.50      | 5.47      | 5.61      | 4.99     
|Portfolio turnover rate (%)                                                                                                                                                                                      | 224**     | 234       | 147       | 143       | 120       | 210      
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Strategic Value VIP (formerly DWS Dreman High Return Equity VIP)

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .77% and 1.13% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. In addition, the
Portfolio may focus its investments on certain economic sectors, thereby increasing its vulnerability to any single economic, political
or regulatory development. This may result in greater share price volatility. Please read this Portfolio's prospectus for specific details
regarding this product's investments and risk profile.

Portfolio returns shown for all periods shown reflect a fee waiver and/or expense reimbursement. Without this waiver/reimbursement,
returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Strategic Value VIP
|------------------------------------------------------------------
|[] DWS Strategic Value VIP  Class A
[]S&P 500® Index             
|vs2_g10k1040                                                      
|Yearly periods ended June 30                                      

|Comparative Results        
|---------------------------
|DWS Strategic Value VIP    
|Class A                    
|Average annual total return
|S&P 500 Index              
|Average annual total return
|DWS Strategic Value VIP    
|Class B                    
|Average annual total return
|S&P 500 Index              
|Average annual total return

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Strategic Value VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. In the most recent six-month period, the Portfolio limited these expenses; had it
not done so, expenses would have been higher. The example in the table is based on an investment of $1,000
invested at the beginning of the six-month period and held for the entire period(January 1, 2009 to June 30,
2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                        | Class A |  | Class B | 
|------------------------------------------------ | ------- |  | ------- | 
|DWS Variable Series II  DWS Strategic Value VIP | .78%    |  | 1.10%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Strategic Value VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 93%     | 100%    
|Cash Equivalents                                                                         | 7%      |        
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Energy                                          | 17%     | 29%     
|Financials                                      | 17%     | 20%     
|Industrials                                     | 14%     | 10%     
|Health Care                                     | 13%     | 19%     
|Consumer Discretionary                          | 11%     | 10%     
|Consumer Staples                                | 10%     | 7%      
|Information Technology                          | 9%      |        
|Telecommunication Services                      | 5%      | 2%      
|Materials                                       | 4%      | 3%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 223. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Strategic Value VIP

|                                                                  | Shares      | Value ($) 
|----------------------------------------------------------------- | ----------- | ----------
|                                                                  |            
|Common Stocks 94.5%                                              
|Consumer Discretionary 10.0%                                     
|Auto Components 1.1%                                             
|Johnson Controls, Inc.                                            | 130,000     | 2,823,600 
|Hotels Restaurants & Leisure 1.5%                                
|Burger King Holdings, Inc.                                        | 62,250      | 1,075,057 
|Carnival Corp. (Units)                                            | 110,983     | 2,860,032 
|                                                                  | 3,935,089  
|Media 2.9%                                                       
|Time Warner, Inc.                                                 | 110,161     | 2,774,955 
|Walt Disney Co. (a)                                               | 215,060     | 5,017,350 
|                                                                  | 7,792,305  
|Specialty Retail 4.5%                                            
|GameStop Corp. "A"*                                               | 83,226      | 1,831,804 
|Lowe's Companies, Inc.                                            | 294,014     | 5,706,812 
|Staples, Inc. (a)                                                 | 222,720     | 4,492,263 
|                                                                  | 12,030,879 
|Consumer Staples 9.3%                                            
|Beverages 0.8%                                                   
|PepsiCo, Inc.                                                     | 40,000      | 2,198,400 
|Food & Staples Retailing 2.2%                                    
|CVS Caremark Corp.                                                | 96,449      | 3,073,830 
|Kroger Co.                                                        | 128,592     | 2,835,453 
|                                                                  | 5,909,283  
|Tobacco 6.3%                                                     
|Altria Group, Inc.                                                | 641,730     | 10,517,955
|Philip Morris International, Inc.                                 | 138,979     | 6,062,264 
|                                                                  | 16,580,219 
|Energy 16.4%                                                     
|Oil, Gas & Consumable Fuels                                      
|Anadarko Petroleum Corp. (a)                                      | 177,741     | 8,067,664 
|Apache Corp.                                                      | 77,943      | 5,623,587 
|Chesapeake Energy Corp. (a)                                       | 129,339     | 2,564,792 
|Chevron Corp.                                                     | 120,555     | 7,986,769 
|ConocoPhillips                                                    | 227,880     | 9,584,634 
|Devon Energy Corp.                                                | 70,000      | 3,815,000 
|EnCana Corp.                                                      | 66,531      | 3,291,289 
|Valero Energy Corp.                                               | 164,035     | 2,770,551 
|                                                                  | 43,704,286 
|Financials 16.2%                                                 
|Capital Markets 3.3%                                             
|Bank of New York Mellon Corp.                                     | 106,978     | 3,135,525 
|The Goldman Sachs Group, Inc.                                     | 38,968      | 5,745,442 
|                                                                  | 8,880,967  
|Commercial Banks 2.6%                                            
|PNC Financial Services Group, Inc.                                | 65,246      | 2,532,197 
|SunTrust Banks, Inc.                                              | 121,850     | 2,004,433 
|Wells Fargo & Co.                                                 | 99,867      | 2,422,773 
|                                                                  | 6,959,403  
|Consumer Finance 0.6%                                            
|Capital One Financial Corp.                                       | 80,000      | 1,750,400 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Diversified Financial Services 6.4%                              
|Bank of America Corp.                                             | 700,000     | 9,240,000 
|JPMorgan Chase & Co.                                              | 226,785     | 7,735,637 
|                                                                  | 16,975,637 
|Insurance 3.2%                                                   
|Allstate Corp.                                                    | 183,959     | 4,488,600 
|Fidelity National Financial, Inc. "A"                             | 100,000     | 1,353,000 
|The Travelers Companies, Inc.                                     | 64,085      | 2,630,048 
|                                                                  | 8,471,648  
|Thrifts & Mortgage Finance 0.1%                                  
|Washington Mutual, Inc.                                           | 1,394,944   | 140,889   
|Health Care 12.7%                                                
|Biotechnology 1.5%                                               
|Amgen, Inc.*                                                      | 72,542      | 3,840,374 
|Health Care Equipment & Supplies 1.0%                            
|Baxter International, Inc.                                        | 51,764      | 2,741,421 
|Health Care Providers & Services 3.3%                            
|Aetna, Inc.                                                       | 185,258     | 4,640,713 
|UnitedHealth Group, Inc.                                          | 167,001     | 4,171,685 
|                                                                  | 8,812,398  
|Pharmaceuticals 6.9%                                             
|Merck & Co., Inc. (a)                                             | 194,595     | 5,440,876 
|Mylan, Inc.*                                                      | 193,728     | 2,528,150 
|Novartis AG (ADR)                                                 | 67,593      | 2,757,119 
|Pfizer, Inc.                                                      | 511,337     | 7,670,055 
|                                                                  | 18,396,200 
|Industrials 12.9%                                                
|Aerospace & Defense 6.3%                                         
|Honeywell International, Inc.                                     | 88,734      | 2,786,248 
|ITT Corp.                                                         | 77,339      | 3,441,585 
|Northrop Grumman Corp.                                            | 113,439     | 5,181,894 
|United Technologies Corp.                                         | 105,940     | 5,504,642 
|                                                                  | 16,914,369 
|Air Freight & Logistics 2.2%                                     
|FedEx Corp. (a)                                                   | 104,397     | 5,806,561 
|Industrial Conglomerates 2.7%                                    
|General Electric Co.                                              | 335,908     | 3,936,842 
|Tyco International Ltd.                                           | 125,000     | 3,247,500 
|                                                                  | 7,184,342  
|Machinery 1.7%                                                   
|Caterpillar, Inc. (a)                                             | 137,606     | 4,546,502 
|Information Technology 9.0%                                      
|Communications Equipment 1.0%                                    
|Cisco Systems, Inc.*                                              | 137,958     | 2,571,537 
|Computers & Peripherals 5.2%                                     
|Dell, Inc.*                                                       | 327,486     | 4,496,383 
|Hewlett-Packard Co.                                               | 115,186     | 4,451,939 
|International Business Machines Corp.                             | 39,111      | 4,083,970 
|Lexmark International, Inc. "A"*                                  | 50,000      | 792,500   
|                                                                  | 13,824,792 
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Software 2.8%                                                    
|Microsoft Corp.                                                   | 250,565     | 5,955,930 
|Symantec Corp.*                                                   | 100,000     | 1,556,000 
|                                                                  | 7,511,930  
|Materials 3.6%                                                   
|Metals & Mining                                                  
|BHP Billiton Ltd. (ADR) (a)                                       | 122,180     | 6,686,911 
|Newmont Mining Corp.                                              | 70,631      | 2,886,689 
|                                                                  | 9,573,600  
|Telecommunication Services 4.4%                                  
|Diversified Telecommunication Services 3.4%                      
|AT&T, Inc.                                                        | 150,000     | 3,726,000 
|Verizon Communications, Inc.                                      | 177,653     | 5,459,277 
|                                                                  | 9,185,277  
|Wireless Telecommunication Services 1.0%                         
|Vodafone Group PLC (ADR)                                          | 134,141     | 2,614,408 
|Total Common Stocks (Cost $261,928,161)                           | 251,676,716
|                                                                  | Shares      | Value ($) 
|                                                                  |            
|Securities Lending Collateral 11.7%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $31,122,990) | 31,122,990  | 31,122,990
|                                                                 
|Cash Equivalents 6.7%                                            
|Cash Management QP Trust, 0.27% (b) (Cost $17,791,568)            | 17,791,568  | 17,791,568

|                                               | % of Net
Assets | Value ($)   
|---------------------------------------------- | --------------- | ------------
|                                               |                
|Total Investment Portfolio(Cost $310,842,719)+ | 112.9           | 300,591,274 
|Other Assets and Liabilities, Net              | (12.9)          | (34,327,259)
|Net Assets                                     | 100.0           | 266,264,015 

ADR: American Depositary Receipt

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                            | Level 1            | Level 2        | Level 3  | Total             
|------------------------------------------------- | ------------------ | -------------- | -------- | ------------------
|Common Stocks and/or Other Equity Investments (d) | $      251,676,716 | $             | $       | $      251,676,716
|Short-Term Investments (d)                        | 31,122,990         | 17,791,568     |         | 48,914,558        
|Total                                             | $   282,799,706    | $   17,791,568 | $       | $   300,591,274   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                        
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                     
|Investments:Investments in securities, at value (cost $261,928,161)  including $30,015,418 of securities loaned                                                                           
|Investment in Daily Assets Fund Institutional (cost $31,122,990)*                                                                                                                          
|Investment in Cash Management QP Trust (cost $17,791,568)                                                                                                                                  
|Total investments at value (cost $310,842,719)                                                                                                                                             
|Cash                                                                                                                                                                                       
|Receivable for Portfolio shares sold                                                                                                                                                       
|Dividends receivable                                                                                                                                                                       
|Interest receivable                                                                                                                                                                        
|Other assets                                                                                                                                                                               
|Total assets                                                                                                                                                                               
|Liabilities                                                                                                                                                                                
|Payable upon return of securities loaned                                                                                                                                                   
|Payable for investments purchased                                                                                                                                                          
|Payable for Portfolio shares redeemed                                                                                                                                                      
|Accrued management fee                                                                                                                                                                     
|Other accrued expenses and payables                                                                                                                                                        
|Total liabilities                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                       
|Net Assets Consist of                                                                                                                                                                      
|Undistributed net investment income                                                                                                                                                        
|Net unrealized appreciation (depreciation) on investments                                                                                                                                  
|Accumulated net realized gain (loss)                                                                                                                                                       
|Paid-in capital                                                                                                                                                                            
|Net assets, at value                                                                                                                                                                       
|Class A
Net Asset Value, offering and redemption price per share ($264,470,175 ÷ 44,304,853 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($1,793,876 ÷ 299,240 outstanding shares of beneficial interest,
no par value, unlimited number of shares authorized)     

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $3,992)                                               
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Other income                                                                                             
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administrative service fees                                                                              
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Services to shareholders                                                                                 
|Record keeping fees (Class B)                                                                            
|Professional fees                                                                                        
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Payments made by affiliate (see Note I)                                                                  
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                     
|-----------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                      
|                                                                                                                       
|Operations:Net investment income (loss)                                                                                
|Net realized gain (loss)                                                                                               
|Change in net unrealized appreciation (depreciation)                                                                   
|Net increase (decrease) in net assets resulting from operations                                                        
|Distributions to shareholders from:Net investment income:Class A                                                       
|Class B                                                                                                                
|Net realized gains:Class A                                                                                             
|Class B                                                                                                                
|Total distributions                                                                                                    
|Portfolio share transactions:Class A
Proceeds from shares sold                                                         
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class A share transactions                                                  
|Class B
Proceeds from shares sold                                                                                      
|Reinvestment of distributions                                                                                          
|Cost of shares redeemed                                                                                                
|Net increase (decrease) in net assets from Class B share transactions                                                  
|Increase (decrease) in net assets                                                                                      
|Net assets at beginning of period                                                                                      
|Net assets at end of period (including undistributed net investment income of $2,756,982 and
$12,673,806, respectively)
|Other Information                                                                                                      
|Class A
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class A shares                                                                              
|Shares outstanding at end of period                                                                                    
|Class B
Shares outstanding at beginning of period                                                                      
|Shares sold                                                                                                            
|Shares issued to shareholders in reinvestment of distributions                                                         
|Shares redeemed                                                                                                        
|Net increase (decrease) in Class B shares                                                                              
|Shares outstanding at end of period                                                                                    

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                 | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   6.21 | $   14.40 | $   15.02 | $   13.41 | $   12.65 | $   11.29
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                          | .06      | .22       | .29       | .27       | .24       | .23      
|Net realized and unrealized gain (loss)                                                                                                                                                                          | (.02)    | (5.80)    | (.56)     | 2.21      | .75       | 1.32     
|Total from investment operations                                                                                                                                                                                 | .04      | (5.58)    | (.27)     | 2.48      | .99       | 1.55     
|Less distributions from:
Net investment income                                                                                                                                                                   | (.28)    | (.36)     | (.22)     | (.28)     | (.23)     | (.19)    
|Net realized gains                                                                                                                                                                                               |         | (2.25)    | (.13)     | (.59)     |          |         
|Total distributions                                                                                                                                                                                              | (.28)    | (2.61)    | (.35)     | (.87)     | (.23)     | (.19)    
|Net asset value, end of period                                                                                                                                                                                   | $   5.97 | $   6.21  | $   14.40 | $   15.02 | $   13.41 | $   12.65
|Total Return (%)                                                                                                                                                                                                 | 1.63c**  | (45.98)c  | (1.86)    | 18.74     | 7.92      | 13.95    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 264      | 308       | 792       | 992       | 785       | 747      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                  | .83*     | .81       | .78       | .77       | .78       | .78      
|Ratio of expenses after expense reductions(%)                                                                                                                                                                    | .78*     | .80       | .78       | .77       | .78       | .78      
|Ratio of net investment income (%)                                                                                                                                                                               | 2.25*    | 2.21      | 1.94      | 1.87      | 1.84      | 1.96     
|Portfolio turnover rate (%)                                                                                                                                                                                      | 42**     | 28        | 27        | 20        | 10        | 9        
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

|Class B
Years Ended December 31,                                                                                                                                                                                 | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004     
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | ---------
|Selected Per Share Data                                                                                                                                                                                         
|Net asset value, beginning of period                                                                                                                                                                             | $   6.22 | $   14.41 | $   15.02 | $   13.39 | $   12.63 | $   11.27
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                          | .05      | .16       | .24       | .22       | .19       | .18      
|Net realized and unrealized gain (loss)                                                                                                                                                                          | (.02)    | (5.79)    | (.56)     | 2.19      | .75       | 1.33     
|Total from investment operations                                                                                                                                                                                 | .03      | (5.63)    | (.32)     | 2.41      | .94       | 1.51     
|Less distributions from:
Net investment income                                                                                                                                                                   | (.26)    | (.31)     | (.16)     | (.19)     | (.18)     | (.15)    
|Net realized gains                                                                                                                                                                                               |         | (2.25)    | (.13)     | (.59)     |          |         
|Total distributions                                                                                                                                                                                              | (.26)    | (2.56)    | (.29)     | (.78)     | (.18)     | (.15)    
|Net asset value, end of period                                                                                                                                                                                   | $   5.99 | $   6.22  | $   14.41 | $   15.02 | $   13.39 | $   12.63
|Total Return (%)                                                                                                                                                                                                 | 1.41c**  | (46.16)c  | (2.19)c   | 18.21c    | 7.51      | 13.53    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                              
|Net assets, end of period ($ millions)                                                                                                                                                                           | 2        | 2         | 37        | 191       | 135       | 117      
|Ratio of expenses before expense reduction (%)                                                                                                                                                                   | 1.14*    | 1.21      | 1.15      | 1.16      | 1.17      | 1.16     
|Ratio of expenses after expense reduction (%)                                                                                                                                                                    | 1.10*    | 1.17      | 1.13      | 1.16      | 1.17      | 1.16     
|Ratio of net investment income (%)                                                                                                                                                                               | 1.93*    | 1.84      | 1.59      | 1.48      | 1.45      | 1.58     
|Portfolio turnover rate (%)                                                                                                                                                                                      | 42**     | 28        | 27        | 20        | 10        | 9        
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Technology VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratios, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 are .95% and 1.29% for Class A and Class B shares, respectively. Please see the
Information About Your Portfolio's Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

This Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Investments by the
Portfolio in small companies present greater risk of loss than investments in larger, more established companies. Concentration of the
Portfolio's investment in technology stocks may present a greater risk than investments in a more diversified portfolio. Investments by
the Portfolio in emerging technology companies present greater risk than investments in more established technology companies.
This Portfolio is non-diversified and can take larger positions in fewer companies, increasing its overall potential risk. Please read this
Portfolio's prospectus for specific details regarding this product's investments and risk profile.

Portfolio returns shown during the 1-year, 3-year, 5-year and 10-year/Life of Class periods reflect a fee waiver and/or expense
reimbursement. Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Technology VIP                                             
|----------------------------------------------------------------------------------------------------------
|[] DWS Technology VIP  Class A
[]Russell 1000® Growth Index
[]S&P® North American Technology Sector Index
|vs2_g10k1030                                                                                              
|Yearly periods ended June 30                                                                              

|Comparative Results                       
|------------------------------------------
|DWS Technology VIP                        
|Class A                                   
|Average annual total return               
|Russell 1000 Growth Index                 
|Average annual total return               
|S&P North American
Technology Sector Index
|Average annual total return               
|DWS Technology VIP                        
|Class B                                   
|Average annual total return               
|Russell 1000 Growth Index                 
|Average annual total return               
|S&P North American
Technology Sector Index
|Average annual total return               

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Technology VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratios                   | Class A |  | Class B | 
|------------------------------------------- | ------- |  | ------- | 
|DWS Variable Series II  DWS Technology VIP | .99%    |  | 1.34%   | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Technology VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 97%     | 98%     
|Cash Equivalents                                                                         | 3%      | 2%      
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Information Technology:                         |         |         
|Computers & Peripherals                         | 24%     | 18%     
|Communications Equipment                        | 21%     | 23%     
|Software                                        | 20%     | 18%     
|Semiconductors & Semiconductor Equipment        | 15%     | 22%     
|Internet Software & Services                    | 12%     | 10%     
|IT Services                                     | 6%      | 6%      
|Electronic Equipment, Instruments & Components  |        | 1%      
|Consumer Discretionary                          | 2%      | 1%      
|Industrials                                     |        | 1%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 234. A complete list of portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Technology VIP

|                                                                 | Shares     | Value ($)
|---------------------------------------------------------------- | ---------- | ---------
|                                                                 |           
|Common Stocks 97.5%                                             
|Consumer Discretionary 1.7%                                     
|Internet & Catalog Retail 0.8%                                  
|Amazon.com, Inc.*                                                | 3,800      | 317,908  
|Priceline.com, Inc.* (a)                                         | 2,000      | 223,100  
|                                                                 | 541,008   
|Media 0.9%                                                      
|Grupo Televisa SA (ADR)                                          | 36,900     | 627,300  
|Health Care 0.1%                                                
|Health Care Technology                                          
|Medidata Solutions, Inc.*                                        | 3,800      | 62,244   
|Industrials 0.1%                                                
|Aerospace & Defense                                             
|DigitalGlobe, Inc.*                                              | 2,000      | 38,400   
|Information Technology 95.6%                                    
|Communications Equipment 20.4%                                  
|Brocade Communications Systems, Inc.*                            | 71,300     | 557,566  
|Cisco Systems, Inc.*                                             | 167,800    | 3,127,792
|Comverse Technology, Inc.*                                       | 46,300     | 395,865  
|Corning, Inc.                                                    | 60,100     | 965,206  
|F5 Networks, Inc.*                                               | 9,600      | 332,064  
|Harris Corp.                                                     | 10,200     | 289,272  
|Harris Stratex Networks, Inc. "A"*                               | 2,533      | 16,414   
|Infinera Corp.* (a)                                              | 24,500     | 223,685  
|Juniper Networks, Inc.* (a)                                      | 33,800     | 797,680  
|Motorola, Inc.                                                   | 94,200     | 624,546  
|Nokia Oyj (ADR) (a)                                              | 20,800     | 303,264  
|Polycom, Inc.*                                                   | 34,500     | 699,315  
|QUALCOMM, Inc.                                                   | 87,016     | 3,933,123
|Research In Motion Ltd.*                                         | 19,600     | 1,392,580
|Sonus Networks, Inc.*                                            | 123,400    | 198,674  
|                                                                 | 13,857,046
|Computers & Peripherals 23.0%                                   
|Apple, Inc.*                                                     | 33,600     | 4,785,648
|Data Domain, Inc.* (a)                                           | 23,600     | 787,060  
|EMC Corp.*                                                       | 65,300     | 855,430  
|Hewlett-Packard Co.                                              | 102,100    | 3,946,165
|International Business Machines Corp.                            | 39,300     | 4,103,706
|SanDisk Corp.*                                                   | 19,400     | 284,986  
|Synaptics, Inc.* (a)                                             | 23,250     | 898,613  
|                                                                 | 15,661,608
|Internet Software & Services 12.2%                              
|Akamai Technologies, Inc.*                                       | 7,100      | 136,178  
|Digital River, Inc.* (a)                                         | 13,700     | 497,584  
|eBay, Inc.*                                                      | 45,600     | 781,128  
|Equinix, Inc.* (a)                                               | 5,900      | 429,166  
|Google, Inc. "A"*                                                | 12,900     | 5,438,511
|LogMeIn, Inc.*                                                   | 5,100      | 81,600   
|Yahoo!, Inc.*                                                    | 61,500     | 963,090  
|                                                                 | 8,327,257 
|                                                                 | Shares     | Value ($)
|                                                                 |           
|IT Services 5.4%                                                
|Amdocs Ltd.*                                                     | 16,400     | 351,780  
|Cognizant Technology Solutions Corp. "A"*                        | 28,200     | 752,940  
|CyberSource Corp.*                                               | 17,600     | 269,280  
|Fiserv, Inc.*                                                    | 11,600     | 530,120  
|Global Payments, Inc.                                            | 24,300     | 910,278  
|MasterCard, Inc. "A"                                             | 2,000      | 334,620  
|Visa, Inc. "A"                                                   | 9,000      | 560,340  
|                                                                 | 3,709,358 
|Semiconductors & Semiconductor Equipment 14.6%                  
|Applied Materials, Inc.                                          | 25,700     | 281,929  
|ASML Holding NV (NY Registered Shares)                           | 15,100     | 326,915  
|Broadcom Corp. "A"*                                              | 31,800     | 788,322  
|Cymer, Inc.* (a)                                                 | 9,700      | 288,381  
|FormFactor, Inc.* (a)                                            | 11,000     | 189,640  
|Intel Corp.                                                      | 199,489    | 3,301,543
|KLA-Tencor Corp. (a)                                             | 13,600     | 343,400  
|Marvell Technology Group Ltd.*                                   | 39,700     | 462,108  
|MediaTek, Inc.                                                   | 24,487     | 291,281  
|MEMC Electronic Materials, Inc.*                                 | 7,800      | 138,918  
|Microchip Technology, Inc. (a)                                   | 8,700      | 196,185  
|Microsemi Corp.*                                                 | 15,200     | 209,760  
|MKS Instruments, Inc.*                                           | 10,800     | 142,452  
|Monolithic Power Systems, Inc.*                                  | 11,100     | 248,751  
|National Semiconductor Corp.                                     | 14,900     | 186,995  
|Netlogic Microsystems, Inc.*                                     | 15,000     | 546,900  
|NVIDIA Corp.*                                                    | 26,700     | 301,443  
|Taiwan Semiconductor Manufacturing Co., Ltd. (ADR)               | 59,107     | 556,197  
|Texas Instruments, Inc.                                          | 41,700     | 888,210  
|Xilinx, Inc. (a)                                                 | 13,900     | 284,394  
|                                                                 | 9,973,724 
|Software 20.0%                                                  
|Activision Blizzard, Inc.*                                       | 45,600     | 575,928  
|Adobe Systems, Inc.*                                             | 18,500     | 523,550  
|ANSYS, Inc.* (a)                                                 | 5,400      | 168,264  
|ArcSight, Inc.*                                                  | 19,500     | 346,515  
|Ariba, Inc.*                                                     | 59,600     | 586,464  
|BMC Software, Inc.*                                              | 15,700     | 530,503  
|Check Point Software Technologies Ltd.*                          | 11,800     | 276,946  
|Citrix Systems, Inc.*                                            | 12,100     | 385,869  
|Electronic Arts, Inc.*                                           | 13,300     | 288,876  
|Informatica Corp.*                                               | 22,300     | 383,337  
|McAfee, Inc.*                                                    | 15,400     | 649,726  
|Microsoft Corp.                                                  | 187,900    | 4,466,383
|Nintendo Co., Ltd.                                               | 1,200      | 330,245  
|Oracle Corp.                                                     | 129,900    | 2,782,458
|Salesforce.com, Inc.* (a)                                        | 6,100      | 232,837  
|Symantec Corp.*                                                  | 44,800     | 697,088  
|VanceInfo Technologies, Inc. (ADR)*                              | 24,300     | 358,911  
|                                                                 | 13,583,900
|Total Common Stocks (Cost $56,666,578)                           | 66,381,845
|                                                                
|                                                                 | Shares     | Value ($)
|                                                                 |           
|Securities Lending Collateral 8.2%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $5,566,127) | 5,566,127  | 5,566,127
|                                                                
|Cash Equivalents 3.0%                                           
|Cash Management QP Trust, 0.27% (b) (Cost $2,012,976)            | 2,012,976  | 2,012,976

|                                               | % of Net
Assets | Value ($)  
|---------------------------------------------- | --------------- | -----------
|                                               |                
|Total Investment Portfolio (Cost $64,245,681)+ | 108.7           | 73,960,948 
|Other Assets and Liabilities, Net (a)          | (8.7)           | (5,900,461)
|Net Assets                                     | 100.0           | 68,060,487 

ADR: American Depositary Receipt

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                        | Level 1          | Level 2         | Level 3  | Total          
|--------------------------------------------- | ---------------- | --------------- | -------- | ---------------
|Common Stocks and/or Other Equity Investments |                  |                 |          |                
|Internet & Catalog Retail                     | $      541,008   | $              | $       | $      541,008 
|Media                                         | 627,300          |                |         | 627,300        
|Health Care Technology                        | 62,244           |                |         | 62,244         
|Aerospace & Defense                           | 38,400           |                |         | 38,400         
|Communications Equipment                      | 13,857,046       |                |         | 13,857,046     
|Computers & Peripherals                       | 15,661,608       |                |         | 15,661,608     
|Internet Software & Services                  | 8,327,257        |                |         | 8,327,257      
|IT Services                                   | 3,709,358        |                |         | 3,709,358      
|Semiconductors & Semiconductor Equipment      | 9,682,443        | 291,281         |         | 9,973,724      
|Software                                      | 13,253,655       | 330,245         |         | 13,583,900     
|Short-Term Investments (d)                    | 5,566,127        | 2,012,976       |         | 7,579,103      
|Total                                         | $     71,326,446 | $     2,634,502 | $       | $    73,960,948

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                      
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                   
|Investments:Investments in securities, at value (cost $56,666,578)  including $4,704,280 of securities loaned                                                                           
|Investment in Daily Assets Fund Institutional (cost $5,566,127)*                                                                                                                         
|Investment in Cash Management QP Trust (cost $2,012,976)                                                                                                                                 
|Total investments, at value (cost $64,245,681)                                                                                                                                           
|Foreign currency, at value (cost $18,655)                                                                                                                                                
|Interest receivable                                                                                                                                                                      
|Receivable for investments sold                                                                                                                                                          
|Dividends receivable                                                                                                                                                                     
|Receivable for Portfolio shares sold                                                                                                                                                     
|Other assets                                                                                                                                                                             
|Total assets                                                                                                                                                                             
|Liabilities                                                                                                                                                                              
|Payable for Portfolio shares redeemed                                                                                                                                                    
|Payable for investments purchased                                                                                                                                                        
|Payable upon return of securities loaned                                                                                                                                                 
|Accrued management fee                                                                                                                                                                   
|Other accrued expenses and payables                                                                                                                                                      
|Total liabilities                                                                                                                                                                        
|Net assets, at value                                                                                                                                                                     
|Net Assets Consist of                                                                                                                                                                    
|Undistributed net investment income                                                                                                                                                      
|Net unrealized appreciation (depreciation) on:Investments                                                                                                                                
|Foreign currency                                                                                                                                                                         
|Accumulated net realized gain (loss)                                                                                                                                                     
|Paid-in capital                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                     
|Class A
Net Asset Value, offering and redemption price per share ($65,838,097 ÷ 9,059,543 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)
|Class B
Net Asset Value, offering and redemption price per share ($2,222,390 ÷ 312,729 outstanding shares of beneficial interest,
no par value, unlimited number of shares authorized)   

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $7,950)                                               
|Interest                                                                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Custodian fees                                                                                           
|Distribution service fee (Class B)                                                                       
|Record keeping fees (Class B)                                                                            
|Services to shareholders                                                                                 
|Audit and tax fees                                                                                       
|Legal fees                                                                                               
|Trustees' fees and expenses                                                                              
|Reports to shareholders                                                                                  
|Other                                                                                                    
|Total expenses                                                                                           
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Written options                                                                                          
|Foreign currency                                                                                         
|                                                                                                         
|Change in net unrealized appreciation (depreciation) on:Investments                                      
|Foreign currency                                                                                         
|                                                                                                         
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                                                 
|---------------------------------------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                                                  
|Operations:Net investment income (loss)                                                                                                            
|Net realized gain (loss)                                                                                                                           
|Net unrealized appreciation (depreciation)                                                                                                         
|Net increase (decrease) in net assets resulting from operations                                                                                    
|Portfolio share transactions:Class A
Proceeds from shares sold                                                                                     
|Cost of shares redeemed                                                                                                                            
|Net increase (decrease) in net assets from Class A share transactions                                                                              
|Class B
Proceeds from shares sold                                                                                                                  
|Cost of shares redeemed                                                                                                                            
|Net increase (decrease) in net assets from Class B share transactions                                                                              
|Increase (decrease) in net assets                                                                                                                  
|Net assets at beginning of period                                                                                                                  
|Net assets at end of period (including undistributed net investment income and accumulated net
investment loss of $16,190 and $4,837, respectively)
|Other Information                                                                                                                                  
|Class A
Shares outstanding at beginning of period                                                                                                  
|Shares sold                                                                                                                                        
|Shares redeemed                                                                                                                                    
|Net increase (decrease) in Class A shares                                                                                                          
|Shares outstanding at end of period                                                                                                                
|Class B
Shares outstanding at beginning of period                                                                                                  
|Shares sold                                                                                                                                        
|Shares redeemed                                                                                                                                    
|Net increase (decrease) in Class B shares                                                                                                          
|Shares outstanding at end of period                                                                                                                

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 2009a    | 2008      | 2007      | 2006     | 2005     | 2004    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | -------- | -------- | --------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | $   5.76 | $   10.71 | $   9.37  | $   9.30 | $   9.01 | $   8.84
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | .00***   | (.00)***  | (.02)     | (.01)d   | (.03)    | .04     
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 1.51     | (4.95)    | 1.36      | .08      | .36      | .13     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 1.51     | (4.95)    | 1.34      | .07      | .33      | .17     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |         |          |          |         | (.04)    |        
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | $   7.27 | $   5.76  | $   10.71 | $   9.37 | $   9.30 | $   9.01
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 26.22**  | (46.22)c  | 14.30     | .75d     | 3.74     | 1.92    
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 66       | 60        | 153       | 165      | 199      | 230     
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | .99*     | 1.01      | .91       | .89      | .86      | .83     
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | .99*     | 1.00      | .91       | .89      | .86      | .83     
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | .08*     | (.01)     | (.15)     | (.12)d   | (.36)    | .43     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 36**     | 71        | 91        | 49       | 135      | 112     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.017 per share and an increase in the ratio of net investment income of 0.18%. Excluding this non-recurring income, total return
would have been 0.19% lower.*Annualized**Not annualized***Amount is less than $0.005.

|Class B
Years Ended December 31,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 2009a    | 2008      | 2007      | 2006     | 2005     | 2004    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | -------- | -------- | --------
|Selected Per Share Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Net asset value, beginning of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $   5.64 | $   10.53 | $   9.25  | $   9.21 | $   8.93 | $   8.80
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | (.01)    | (.03)     | (.05)     | (.04)d   | (.07)    | .01     
|Net realized and unrealized gain (loss)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.48     | (4.86)    | 1.33      | .08      | .36      | .12     
|Total from investment operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 1.47     | (4.89)    | 1.28      | .04      | .29      | .13     
|Less distributions from:
Net investment income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |         |          |          |         | (.01)    |        
|Net asset value, end of period                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $   7.11 | $   5.64  | $   10.53 | $   9.25 | $   9.21 | $   8.93
|Total Return (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | 26.06**  | (46.44)c  | 13.84     | .43d     | 3.27     | 1.48c   
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Net assets, end of period ($ millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 2        | 2         | 3         | 14       | 16       | 16      
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1.34*    | 1.35      | 1.29      | 1.28     | 1.26     | 1.22    
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 1.34*    | 1.35      | 1.29      | 1.28     | 1.26     | 1.21    
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (.27)*   | (.35)     | (.53)     | (.51)d   | (.76)    | .05     
|Portfolio turnover rate (%)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 36**     | 71        | 91        | 49       | 135      | 112     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.dIncludes non-recurring income from the Advisor recorded as a result of an administrative proceeding regarding disclosure of brokerage
allocation practices in connection with sales of DWS Funds. The non-recurring income resulted in an increase in net investment income
of $0.017 per share and an increase in the ratio of net investment income of 0.18%. Excluding this non-recurring income, total return
would have been 0.19% lower.*Annualized**Not annualized

Performance SummaryJune 30, 2009

DWS Turner Mid Cap Growth VIP

All performance shown is historical, assumes reinvestment of all dividend and capital gain distributions and does not
guarantee future results. Investment return and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current performance may be lower or higher than the
performance data quoted. Please contact your participating insurance company for the Portfolio's most recent month-end
performance. Performance doesn't reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option. These charges and fees will reduce returns. While all share classes have the same underlying Portfolio,
their performance will differ.

The total annual Portfolio operating expense ratio, gross of any fee waivers or expense reimbursements, as stated in the fee
table of the prospectus dated May 1, 2009 is .98% for Class A shares. Please see the Information About Your Portfolio's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C, Related Parties) sections of this report for
gross and net expense-related disclosure for the period ended June 30, 2009.

Risk Considerations

The Portfolio is subject to stock market risk, meaning stocks in the Portfolio may decline in value for extended periods of time due to
the activities and financial prospects of individual companies, or due to general market and economic conditions. Stocks of
medium-sized companies involve greater risk than securities of larger, more established companies, as they often have limited
product lines, markets or financial resources and may be subject to more-erratic and more-abrupt market movements. Please read
this Portfolio's prospectus for specific details regarding this product's investments and risk profile.

Portfolio returns shown for the 1-year, 3-year, 5-year and 10-year periods reflect a fee waiver and/or expense reimbursement for
Class A shares. Without this waiver/reimbursement, returns would have been lower.

|Growth of an Assumed $10,000 Investment in DWS Turner Mid Cap Growth VIP from 5/1/2001 to 6/30/2009
|---------------------------------------------------------------------------------------------------
|[] DWS Turner Mid Cap Growth VIP  Class A
[]Russell MidCap® Growth Index                          
|vs2_g10k1020                                                                                       
|Yearly periods ended June 30                                                                       

|Comparative Results          
|-----------------------------
|DWS Turner Mid Cap Growth VIP
|Class A                      
|Average annual total return  
|Russell Midcap Growth
Index  
|Average annual total return  

The growth of $10,000 is cumulative.

Information About Your Portfolio's Expenses

DWS Turner Mid Cap Growth VIP

As an investor of the Portfolio, you incur two types of costs: ongoing expenses and transaction costs. Ongoing
expenses include management fees, distribution and service (12b-1) fees and other Portfolio expenses. Examples
of transaction costs include contract charges, redemption fees and account maintenance fees, which are not
shown in this section. The following tables are intended to help you understand your ongoing expenses (in
dollars) of investing in the Portfolio and to help you compare these expenses with the ongoing expenses of
investing in other mutual funds. The example in the table is based on an investment of $1,000 invested at the
beginning of the six-month period and held for the entire period(January 1, 2009 to June 30, 2009).

The tables illustrate your Portfolio's expenses in two ways:

•   Actual Portfolio Return. This helps you estimate the actual dollar amount of ongoing expenses (but not
transaction costs) paid on a $1,000 investment in the Portfolio using the Portfolio's actual return during the
period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold.

•   Hypothetical 5% Portfolio Return. This helps you to compare your Portfolio's ongoing expenses (but not
transaction costs) with those of other mutual funds using the Portfolio's actual expense ratio and a
hypothetical rate of return of 5% per year before expenses. Examples using a 5% hypothetical Portfolio return
may be found in the shareholder reports of other mutual funds. The hypothetical account values and expenses
may not be used to estimate the actual ending account balance or expenses you paid for the period.

Please note that the expenses shown in these tables are meant to highlight your ongoing expenses only and do
not reflect any transaction costs. The "Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total expense of owning different funds. If
these transaction costs had been included, your costs would have been higher.

|Expenses and Value of a $1,000 Investmentfor the six months ended June 30, 2009
|-------------------------------------------------------------------------------
|Actual Portfolio Return                                                        
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      
|Hypothetical 5% Portfolio Return                                               
|Beginning Account Value 1/1/09                                                 
|Ending Account Value 6/30/09                                                   
|Expenses Paid per $1,000*                                                      

|Annualized Expense Ratio                               | Class A | 
|------------------------------------------------------ | ------- | 
|DWS Variable Series II  DWS Turner Mid Cap Growth VIP | .99%    | 

For more information, please refer to the Portfolio's prospectus.

These tables do not reflect charges and fees ("contract charges") associated with the separate account that
invests in the Portfolio or any variable life insurance policy or variable annuity contract for which the Portfolio is an
investment option.

Portfolio Summary

DWS Turner Mid Cap Growth VIP

|Asset Allocation(As a % of Investment Portfolio excluding Securities Lending Collateral) | 6/30/09 | 12/31/08
|---------------------------------------------------------------------------------------- | ------- | --------
|                                                                                         |         |         
|Common Stocks                                                                            | 99%     | 100%    
|Cash Equivalents                                                                         | 1%      |        
|                                                                                         | 100%    | 100%    

|Sector Diversification(As a % of Common Stocks) | 6/30/09 | 12/31/08
|----------------------------------------------- | ------- | --------
|                                                |         |         
|Information Technology                          | 26%     | 21%     
|Consumer Discretionary                          | 17%     | 22%     
|Health Care                                     | 15%     | 13%     
|Industrials                                     | 11%     | 13%     
|Financials                                      | 9%      | 10%     
|Energy                                          | 7%      | 8%      
|Materials                                       | 6%      | 6%      
|Consumer Staples                                | 5%      | 3%      
|Utilities                                       | 2%      | 2%      
|Telecommunication Services                      | 2%      | 2%      
|                                                | 100%    | 100%    

Asset allocation and sector diversification are subject to change.

For more complete details about the Portfolio's investment portfolio, see page 244. A complete list of the portfolio holdings of the Portfolio is
posted as of the month end on www.dws-investments.com on or about the 15th day of the following month. More frequent posting of
portfolio holdings information may be made from time to time on www.dws-investments.com.

Following the Portfolio's fiscal first and third quarter-end, a complete portfolio holdings listing is filed with the SEC
on Form N-Q. The form will be available on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the SEC's Public
Reference Room may be obtained by calling (800) SEC-0330.

Investment PortfolioJune 30, 2009 (Unaudited)

DWS Turner Mid Cap Growth VIP

|                                                                  | Shares     | Value ($) 
|----------------------------------------------------------------- | ---------- | ----------
|                                                                  |           
|Common Stocks 100.2%                                             
|Consumer Discretionary 17.2%                                     
|Auto Components 1.3%                                             
|Goodyear Tire & Rubber Co.*                                       | 31,680     | 356,717   
|Magna International, Inc. "A"                                     | 5,180      | 218,803   
|                                                                  | 575,520   
|Hotels Restaurants & Leisure 5.9%                                
|Darden Restaurants, Inc.                                          | 12,440     | 410,271   
|Penn National Gaming, Inc.*                                       | 10,210     | 297,213   
|Starwood Hotels & Resorts Worldwide, Inc. (a)                     | 31,740     | 704,628   
|WMS Industries, Inc.* (a)                                         | 20,455     | 644,537   
|Wynn Resorts Ltd.* (a)                                            | 13,530     | 477,609   
|                                                                  | 2,534,258 
|Household Durables 1.6%                                          
|D.R. Horton, Inc. (a)                                             | 35,670     | 333,871   
|Pulte Homes, Inc. (a)                                             | 39,150     | 345,695   
|                                                                  | 679,566   
|Media 0.6%                                                       
|Cablevision Systems Corp. (New York Group) "A"                    | 13,850     | 268,829   
|Multiline Retail 2.4%                                            
|Kohl's Corp.*                                                     | 14,430     | 616,882   
|Nordstrom, Inc. (a)                                               | 20,230     | 402,375   
|                                                                  | 1,019,257 
|Specialty Retail 3.4%                                            
|Guess?, Inc.                                                      | 28,350     | 730,863   
|Urban Outfitters, Inc.* (a)                                       | 36,270     | 756,955   
|                                                                  | 1,487,818 
|Textiles, Apparel & Luxury Goods 2.0%                            
|Coach, Inc.                                                       | 23,230     | 624,422   
|The Warnaco Group, Inc.*                                          | 7,170      | 232,308   
|                                                                  | 856,730   
|Consumer Staples 5.3%                                            
|Beverages 0.8%                                                   
|Hansen Natural Corp.* (a)                                         | 11,890     | 366,450   
|Food & Staples Retailing 1.2%                                    
|Whole Foods Market, Inc. (a)                                      | 27,300     | 518,154   
|Household Products 1.1%                                          
|Energizer Holdings, Inc.*                                         | 8,840      | 461,801   
|Personal Products 2.2%                                           
|Alberto-Culver Co.                                                | 12,790     | 325,250   
|Avon Products, Inc.                                               | 23,840     | 614,595   
|                                                                  | 939,845   
|Energy 6.4%                                                      
|Energy Equipment & Services 2.5%                                 
|Cameron International Corp.*                                      | 23,260     | 658,258   
|Nabors Industries Ltd.*                                           | 26,320     | 410,066   
|                                                                  | 1,068,324 
|Oil, Gas & Consumable Fuels 3.9%                                 
|CONSOL Energy, Inc.                                               | 14,970     | 508,381   
|Petrohawk Energy Corp.*                                           | 25,270     | 563,521   
|Range Resources Corp.                                             | 15,474     | 640,778   
|                                                                  | 1,712,680 
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Financials 8.6%                                                  
|Capital Markets 5.1%                                             
|Northern Trust Corp.                                              | 11,500     | 617,320   
|T. Rowe Price Group, Inc. (a)                                     | 20,140     | 839,234   
|TD Ameritrade Holding Corp.*                                      | 25,130     | 440,780   
|Waddell & Reed Financial, Inc. "A"                                | 10,710     | 282,423   
|                                                                  | 2,179,757 
|Diversified Financial Services 2.4%                              
|IntercontinentalExchange, Inc.*                                   | 5,340      | 610,041   
|MSCI, Inc. "A"*                                                   | 16,990     | 415,236   
|                                                                  | 1,025,277 
|Real Estate Investment Trusts 0.7%                               
|Digital Realty Trust, Inc. (REIT) (a)                             | 8,900      | 319,065   
|Real Estate Management & Development 0.4%                        
|CB Richard Ellis Group, Inc. "A"*                                 | 19,780     | 185,141   
|Health Care 15.2%                                                
|Biotechnology 3.8%                                               
|Alexion Pharmaceuticals, Inc.* (a)                                | 20,480     | 842,138   
|Myriad Genetics, Inc.*                                            | 5,870      | 209,265   
|Myriad Pharmaceuticals, Inc.*                                     | 1,927      | 8,961     
|United Therapeutics Corp.* (a)                                    | 7,000      | 583,310   
|                                                                  | 1,643,674 
|Health Care Equipment & Supplies 3.0%                            
|Beckman Coulter, Inc. (a)                                         | 4,080      | 233,131   
|Intuitive Surgical, Inc.* (a)                                     | 1,980      | 324,047   
|St. Jude Medical, Inc.*                                           | 17,570     | 722,127   
|                                                                  | 1,279,305 
|Health Care Providers & Services 5.6%                            
|AmerisourceBergen Corp.                                           | 18,280     | 324,287   
|DaVita, Inc.*                                                     | 7,990      | 395,185   
|Express Scripts, Inc.*                                            | 9,750      | 670,313   
|Laboratory Corp. of America Holdings* (a)                         | 9,400      | 637,226   
|Omnicare, Inc.                                                    | 14,660     | 377,642   
|                                                                  | 2,404,653 
|Life Sciences Tools & Services 2.2%                              
|Illumina, Inc.* (a)                                               | 17,240     | 671,325   
|Life Technologies Corp.*                                          | 6,990      | 291,623   
|                                                                  | 962,948   
|Pharmaceuticals 0.6%                                             
|Allergan, Inc.                                                    | 5,530      | 263,117   
|Industrials 11.2%                                                
|Aerospace & Defense 1.2%                                         
|Precision Castparts Corp.                                         | 7,100      | 518,513   
|Air Freight & Logistics 1.6%                                     
|C.H. Robinson Worldwide, Inc. (a)                                 | 13,110     | 683,686   
|Airlines 0.4%                                                    
|Continental Airlines, Inc. "B"* (a)                               | 21,890     | 193,945   
|Commercial Services & Supplies 0.6%                              
|Stericycle, Inc.*                                                 | 4,790      | 246,829   
|Construction & Engineering 1.1%                                  
|Quanta Services, Inc.* (a)                                        | 12,560     | 290,513   
|URS Corp.*                                                        | 3,600      | 178,272   
|                                                                  | 468,785   
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Industrial Conglomerates 0.9%                                    
|McDermott International, Inc.*                                    | 18,500     | 375,735   
|Machinery 3.6%                                                   
|Cummins, Inc.                                                     | 16,150     | 568,641   
|Joy Global, Inc. (a)                                              | 8,430      | 301,120   
|Navistar International Corp.*                                     | 3,560      | 155,216   
|Parker Hannifin Corp.                                             | 12,470     | 535,711   
|                                                                  | 1,560,688 
|Professional Services 1.1%                                       
|Robert Half International, Inc. (a)                               | 20,690     | 488,698   
|Trading Companies & Distributors 0.7%                            
|Fastenal Co. (a)                                                  | 9,370      | 310,803   
|Information Technology 26.5%                                     
|Communications Equipment 5.1%                                    
|Alcatel-Lucent (ADR)*                                             | 119,840    | 297,203   
|Brocade Communications Systems, Inc.*                             | 22,420     | 175,324   
|Ciena Corp.* (a)                                                  | 19,530     | 202,136   
|F5 Networks, Inc.*                                                | 24,500     | 847,455   
|Juniper Networks, Inc.*                                           | 18,900     | 446,040   
|Riverbed Technology, Inc.* (a)                                    | 9,520      | 220,769   
|                                                                  | 2,188,927 
|Computers & Peripherals 1.6%                                     
|NetApp, Inc.*                                                     | 34,190     | 674,227   
|Internet Software & Services 2.0%                                
|MercadoLibre, Inc.* (a)                                           | 7,660      | 205,901   
|VeriSign, Inc.* (a)                                               | 21,920     | 405,081   
|VistaPrint Ltd.* (a)                                              | 6,400      | 272,960   
|                                                                  | 883,942   
|IT Services 1.5%                                                 
|Fiserv, Inc.*                                                     | 8,170      | 373,369   
|Global Payments, Inc.                                             | 7,320      | 274,207   
|                                                                  | 647,576   
|Semiconductors & Semiconductor Equipment 10.8%                   
|ASML Holding NV (NY Registered) (a)                               | 19,750     | 427,588   
|Atheros Communications* (a)                                       | 29,330     | 564,309   
|Broadcom Corp. "A"*                                               | 31,960     | 792,289   
|Lam Research Corp.*                                               | 18,540     | 482,040   
|Marvell Technology Group Ltd.*                                    | 37,550     | 437,082   
|Micron Technology, Inc.* (a)                                      | 121,170    | 613,120   
|Netlogic Microsystems, Inc.*                                      | 4,850      | 176,831   
|PMC-Sierra, Inc.*                                                 | 41,970     | 334,081   
|Teradyne, Inc.*                                                   | 54,250     | 372,155   
|Varian Semiconductor Equipment Associates, Inc.*                  | 19,590     | 469,964   
|                                                                  | 4,669,459 
|                                                                  | Shares     | Value ($) 
|                                                                  |           
|Software 5.5%                                                    
|Activision Blizzard, Inc.*                                        | 47,010     | 593,736   
|Adobe Systems, Inc.*                                              | 11,070     | 313,281   
|BMC Software, Inc.*                                               | 5,290      | 178,749   
|McAfee, Inc.*                                                     | 22,380     | 944,212   
|Salesforce.com, Inc.* (a)                                         | 9,420      | 359,562   
|                                                                  | 2,389,540 
|Materials 6.0%                                                   
|Chemicals 2.8%                                                   
|Airgas, Inc.                                                      | 7,520      | 304,786   
|CF Industries Holdings, Inc.                                      | 6,460      | 478,944   
|Ecolab, Inc.                                                      | 11,290     | 440,197   
|                                                                  | 1,223,927 
|Metals & Mining 3.2%                                             
|Alcoa, Inc. (a)                                                   | 35,030     | 361,860   
|Steel Dynamics, Inc.                                              | 24,750     | 364,568   
|Teck Resources Ltd. "B"*                                          | 11,150     | 177,731   
|United States Steel Corp. (a)                                     | 12,750     | 455,685   
|                                                                  | 1,359,844 
|Telecommunication Services 1.5%                                  
|Wireless Telecommunication Services                              
|MetroPCS Communications, Inc.* (a)                                | 23,140     | 307,993   
|Millicom International Cellular SA* (a)                           | 6,030      | 339,248   
|                                                                  | 647,241   
|Utilities 2.3%                                                   
|Electric Utilities 1.6%                                          
|PPL Corp.                                                         | 20,410     | 672,714   
|Gas Utilities 0.7%                                               
|Questar Corp.                                                     | 10,170     | 315,881   
|Total Common Stocks (Cost $39,518,674)                            | 43,273,129
|                                                                 
|Securities Lending Collateral 26.4%                              
|Daily Assets Fund Institutional, 0.48% (b) (c) (Cost $11,418,135) | 11,418,135 | 11,418,135
|                                                                 
|Cash Equivalents 0.6%                                            
|Cash Management QP Trust, 0.27% (b) (Cost $252,419)               | 252,419    | 252,419   

|                                              | % of Net
Assets | Value ($)   
|--------------------------------------------- | --------------- | ------------
|                                              |                
|Total Investment Portfolio(Cost $51,189,228)+ | 127.2           | 54,943,683  
|Other Assets and Liabilities, Net             | (27.2)          | (11,735,895)
|Net Assets                                    | 100.0           | 43,207,788  

ADR: American Depositary Receipt

REIT: Real Estate Investment Trust

Fair Value Measurements

Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements," as amended,
establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value
measurements.

Various inputs are used in determining the value of the Portfolio's investments. These inputs are summarized in three broad levels. Level 1
includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable inputs (including the
Portfolio's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of June 30, 2009 in valuing the Portfolio's investments. For information on the Portfolio's
policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to the
Financial Statements.

|Assets                                            | Level 1           | Level 2     | Level 3  | Total            
|------------------------------------------------- | ----------------- | ----------- | -------- | -----------------
|Common Stocks and/or Other Equity Investments (d) | $      43,273,129 | $          | $       | $      43,273,129
|Short-Term Investments (d)                        | 11,418,135        | 252,419     |         | 11,670,554       
|Total                                             | $   54,691,264    | $   252,419 | $       | $   54,943,683   

The accompanying notes are an integral part of the financial statements.

Financial Statements

|Statement of Assets and Liabilities
as of June 30, 2009 (Unaudited)                                                                                                                      
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Assets                                                                                                                                                                                   
|Investments:Investments in securities, at value (cost $39,518,674)  including $11,076,989 of securities loaned                                                                          
|Investment in Daily Assets Fund Institutional (cost $11,418,135)*                                                                                                                        
|Investment in Cash Management QP Trust (cost $252,419)                                                                                                                                   
|Total investments, at value (cost $51,189,228)                                                                                                                                           
|Cash                                                                                                                                                                                     
|Receivable for investments sold                                                                                                                                                          
|Receivable for Portfolio shares sold                                                                                                                                                     
|Dividends receivable                                                                                                                                                                     
|Interest receivable                                                                                                                                                                      
|Total assets                                                                                                                                                                             
|Liabilities                                                                                                                                                                              
|Payable upon return of securities loaned                                                                                                                                                 
|Payable for investments purchased                                                                                                                                                        
|Payable for Portfolio shares redeemed                                                                                                                                                    
|Accrued management fee                                                                                                                                                                   
|Other accrued expenses and payables                                                                                                                                                      
|Total liabilities                                                                                                                                                                        
|Net assets, at value                                                                                                                                                                     
|Net Assets Consist of                                                                                                                                                                    
|Undistributed net investment income                                                                                                                                                      
|Net unrealized appreciation (depreciation) on investments                                                                                                                                
|Accumulated net realized gain (loss)                                                                                                                                                     
|Paid-in capital                                                                                                                                                                          
|Net assets, at value                                                                                                                                                                     
|Class A
Net Asset Value, offering and redemption price per share ($43,207,788 ÷ 7,512,231 outstanding shares of beneficial
interest, no par value, unlimited number of shares authorized)

The accompanying notes are an integral part of the financial statements.

|Statement of Operations
for the six months ended June 30, 2009 (Unaudited)                               
|---------------------------------------------------------------------------------------------------------
|Investment Income                                                                                        
|Income:Dividends (net of foreign taxes withheld of $474)                                                 
|Interest  Cash Management QP Trust                                                                      
|Securities lending income, including income from Daily Assets Fund Institutional, net of borrower rebates
|Total Income                                                                                             
|Expenses:Management fee                                                                                  
|Administration fee                                                                                       
|Services to shareholders                                                                                 
|Custodian fee                                                                                            
|Distribution service fee (Class B)                                                                       
|Legal fees                                                                                               
|Audit and tax fees                                                                                       
|Reports to shareholders                                                                                  
|Total expenses before expense reductions                                                                 
|Expense reductions                                                                                       
|Total expenses after expense reductions                                                                  
|Net investment income (loss)                                                                             
|Realized and Unrealized Gain (Loss)                                                                      
|Net realized gain (loss) from:Investments                                                                
|Change in net unrealized appreciation (depreciation) on investments                                      
|Net gain (loss)                                                                                          
|Net increase (decrease) in net assets resulting from operations                                          

The accompanying notes are an integral part of the financial statements.



|Statement of Changes in Net Assets                                                                                                                 
|---------------------------------------------------------------------------------------------------------------------------------------------------
|Increase (Decrease) in Net Assets                                                                                                                  
|Operations:Net investment income (loss)                                                                                                            
|Net realized gain (loss)                                                                                                                           
|Change in net unrealized appreciation (depreciation)                                                                                               
|Net increase (decrease) in net assets resulting from operations                                                                                    
|Distributions to shareholders from:Net realized gains:Class A                                                                                      
|Class B                                                                                                                                            
|Tax return of capital:Class A                                                                                                                      
|Class B                                                                                                                                            
|Total distributions                                                                                                                                
|Portfolio share transactions:Class A
Proceeds from shares sold                                                                                     
|Shares issued to shareholders in reinvestment of distributions                                                                                     
|Cost of shares redeemed                                                                                                                            
|Shares converted*                                                                                                                                  
|Net increase (decrease) in net assets from Class A share transactions                                                                              
|Class B
Proceeds from shares sold                                                                                                                  
|Shares issued to shareholders in reinvestment of distributions                                                                                     
|Cost of shares redeemed                                                                                                                            
|Shares converted*                                                                                                                                  
|Net increase (decrease) in net assets from Class B share transactions                                                                              
|Increase (decrease) in net assets                                                                                                                  
|Net assets at beginning of period                                                                                                                  
|Net assets at end of period (including undistributed net investment income and accumulated
net investment loss of $19,541 and $5,550, respectively)
|Other Information                                                                                                                                  
|Class A
Shares outstanding at beginning of period                                                                                                  
|Shares sold                                                                                                                                        
|Shares issued to shareholders in reinvestment of distributions                                                                                     
|Shares redeemed                                                                                                                                    
|Shares converted*                                                                                                                                  
|Net increase (decrease) in Class A shares                                                                                                          
|Shares outstanding at end of period                                                                                                                
|Class B
Shares outstanding at beginning of period                                                                                                  
|Shares sold                                                                                                                                        
|Shares issued to shareholders in reinvestment of distributions                                                                                     
|Shares redeemed                                                                                                                                    
|Shares converted*                                                                                                                                  
|Net increase (decrease) in Class B shares                                                                                                          
|Shares outstanding at end of period                                                                                                                

The accompanying notes are an integral part of the financial statements.

Financial Highlights

|Class A
Years Ended December 31,                                                                                                                                                                                                              | 2009a    | 2008      | 2007      | 2006      | 2005      | 2004    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | --------- | --------- | --------- | --------- | --------
|Selected Per Share Data                                                                                                                                                                                                                      
|Net asset value, beginning of period                                                                                                                                                                                                          | $   5.06 | $   12.55 | $   10.92 | $   11.02 | $   9.86  | $   8.88
|Income (loss) from investment operations:
Net investment income (loss)b                                                                                                                                                                       | .00***   | (.01)     | (.04)     | (.01)     | (.05)     | (.07)   
|Net realized and unrealized gain (loss)                                                                                                                                                                                                       | .69      | (5.28)    | 2.64      | .77       | 1.21      | 1.05    
|Total from investment operations                                                                                                                                                                                                              | .69      | (5.29)    | 2.60      | .76       | 1.16      | .98     
|Less distributions from:Net realized gains                                                                                                                                                                                                    |         | (2.20)    | (.97)     | (.86)     |          |        
|Tax return of capital                                                                                                                                                                                                                         |         | (.00)***  |          |          |          |        
|Total distributions                                                                                                                                                                                                                           |         | (2.20)    | (.97)     | (.86)     |          |        
|Net asset value, end of period                                                                                                                                                                                                                | $   5.75 | $   5.06  | $   12.55 | $   10.92 | $   11.02 | $   9.86
|Total Return (%)                                                                                                                                                                                                                              | 13.64**  | (49.49)c  | 25.75     | 6.52      | 11.76     | 11.04   
|Ratios to Average Net Assets and Supplemental Data                                                                                                                                                                                           
|Net assets, end of period ($ millions)                                                                                                                                                                                                        | 43       | 49        | 129       | 117       | 122       | 118     
|Ratio of expenses before expense reductions (%)                                                                                                                                                                                               | .99*     | 1.03      | .95       | .97       | 1.11      | 1.19    
|Ratio of expenses after expense reductions (%)                                                                                                                                                                                                | .99*     | 1.00      | .95       | .97       | 1.11      | 1.19    
|Ratio of net investment income (loss) (%)                                                                                                                                                                                                     | .12*     | (.14)     | (.36)     | (.06)     | (.56)     | (.82)   
|Portfolio turnover rate (%)                                                                                                                                                                                                                   | 58**     | 156       | 133       | 148       | 151       | 174     
|aFor the six months ended June 30, 2009 (Unaudited).bBased on average shares outstanding during the period.cTotal return would have been lower had certain expenses not been reduced.*Annualized**Not annualized***Amount is less than $.005.

Notes to Financial Statements(Unaudited)

A. Organization and Significant Accounting Policies

DWS Variable Series II (the "Trust") is registered under the Investment Company Act of 1940, as amended
(the"1940 Act"), as an open-end management investment company organized as a Massachusetts business trust.
The Trust offers seventeen portfolios (hereinafter referred to individually as "Portfolio" or collectively as
"Portfolios"), including DWS Alternative Asset Allocation Plus VIP (commencement of operations on February 2,
2009) that invests primarily in existing DWS Funds ("Underlying Funds"). Each Portfolio (except DWS Technology
VIP) is classified as a diversified open-end management investment company. DWS Technology VIP is classified
as a non-diversified, open-end management investment company. Each Underlying Fund's accounting policies and
investment holdings are outlined in the Underlying Fund's financial statements and are available upon request.

Multiple Classes of Shares of Beneficial Interest. Certain portfolios of the Trust offer two classes of shares (Class
A shares and Class B shares). Effective March 6, 2009 (February 3, 2009 for the DWS Money Market VIP) Class B
shares of DWS Balanced VIP, DWS Diversified International VIP (formerly DWS International Select Equity VIP),
DWS Mid Cap Growth VIP, DWS Money Market VIP, DWS Small Cap Growth VIP, DWS Strategic Income VIP and
DWS Turner Mid Cap VIP were combined into the Class A shares of the same Portfolio. On May 18, 2009, the
DWS Alternative Asset Allocation Plus VIP commenced offering Class B shares. Sales of Class B shares are
subject to record keeping fees up to 0.15% and Rule 12b-1 fees under the 1940 Act equal to an annual rate of
0.25%, of the average daily net assets of the Class B shares of the applicable Portfolio. Class A shares are not
subject to such fees.

Investment income, realized and unrealized gains and losses, and certain portfolio-level expenses and expense
reductions, if any, are borne pro rata on the basis of relative net assets by the holders of all classes of shares
except that each class bears certain expenses unique to that class (including the applicable Rule 12b-1 fee and
record keeping fees). Differences in class-level expenses may result in payment of different per share dividends
by class. All shares have equal rights with respect to voting subject to class-specific arrangements.

The Trust's financial statements are prepared in accordance with accounting principles generally accepted in the
United States of America which require the use of management estimates. Actual results could differ from those
estimates. The policies described below are followed consistently by the Trust in the preparation of its financial
statements.

Security Valuation. DWS Money Market VIP values all securities utilizing the amortized cost method permitted in
accordance with Rule 2a-7 under the 1940 Act and certain conditions therein. Under this method, which does not
take into account unrealized capital gains or losses on securities, an instrument is initially valued at its cost and
thereafter assumes a constant accretion/amortization rate to maturity of any discount or premium.

Investments in securities are stated at value determined as of the close of regular trading on the New York Stock
Exchange on each day the exchange is open for trading. Equity securities and exchange traded funds ("ETFs") are
valued at the most recent sale price or official closing price reported on the exchange (US or foreign) or
over-the-counter market on which they trade. Securities and ETFs for which no sales are reported are valued at
the calculated mean between the most recent bid and asked quotations on the relevant market or, if a mean
cannot be determined, at the most recent bid quotation.

Debt securities are valued by independent pricing services approved by the Trustees of the Portfolios. If the
pricing services are unable to provide valuations, the securities are valued at the most recent bid quotation or
evaluated price, as applicable, obtained from one or more broker-dealers. Such services may use various pricing
techniques which take into account appropriate factors such as yield, quality, coupon rate, maturity, type of issue,
trading characteristics and other data, as well as broker quotes.

Money market instruments purchased with an original or remaining maturity of sixty days or less, maturing at par,
are valued at amortized cost. Investments in open-end investment companies and Cash Management QP Trust
are valued at their net asset value each business day.

Investments in the Underlying Funds are valued at the net asset value per share of each class of the Underlying
Funds as of the close of regular trading on the New York Stock Exchange on each day the exchange is open for
trading.

Securities and other assets for which market quotations are not readily available or for which the above valuation
procedures are deemed not to reflect fair value are valued in a manner that is intended to reflect their fair value as
determined in accordance with procedures approved by the Trustees. Certain Portfolios may use a fair valuation
model to value international equity securities in order to adjust for events which may occur between the close of
the foreign exchanges and the close of the New York Stock Exchange. In accordance with the Portfolio's valuation
procedures, factors used in determining value may include, but are not limited to, the type of the security, the
size of the holding, the initial cost of the security, the existence of any contractual restrictions on the security's
disposition, the price and extent of public trading in similar securities of the issuer or of comparable companies,
quotations or evaluated prices from broker-dealers and/or pricing services, information obtained from the issuer,
analysts, and/or the appropriate stock exchange (for exchange-traded securities), an analysis of the company's
financial statements, an evaluation of the forces that influence the issuer and the market(s) in which the security
is purchased and sold and with respect to debt securities, the maturity, coupon, creditworthiness, currency
denomination, and the movement of the market in which the security is normally traded. The value determined
under these procedures may differ from published values for the same securities.

Foreign Currency Translations. The books and records of the Trust are maintained in US dollars. Investment
securities and other assets and liabilities denominated in a foreign currency are translated into US dollars at the
prevailing exchange rates at period end. Purchases and sales of investment securities, income and expenses are
translated into US dollars at the prevailing exchange rates on the respective dates of the transactions.

Net realized and unrealized gains and losses on foreign currency transactions represent net gains and losses
between trade and settlement dates on securities transactions, the disposition of forward foreign currency
exchange contracts and foreign currencies and the difference between the amount of net investment income
accrued and the US dollar amount actually received. That portion of both realized and unrealized gains and losses
on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed but is
included with net realized and unrealized gain/appreciation and loss/depreciation on investments.

Repurchase Agreements. Each Portfolio may enter into repurchase agreements with certain banks and
broker/dealers whereby each Portfolio, through its custodian or sub-custodian bank, receives delivery of the
underlying securities, the amount of which at the time of purchase and each subsequent business day is required
to be maintained at such a level that the value is equal to at least the principal amount of the repurchase price
plus accrued interest. The custodian bank holds the collateral in a separate account until the agreement matures.
If the value of the securities falls below the principal amount of the repurchase agreement plus accrued interest,
the financial institution deposits additional collateral by the following business day. If the financial institution either
fails to deposit the required additional collateral or fails to repurchase the securities as agreed, the Portfolio has
the right to sell the securities and recover any resulting loss from the financial institution. If the financial institution
enters into bankruptcy, the Portfolio's claim on the collateral may be subject to legal proceedings.

Securities Lending. Each Portfolio, except DWS Money Market VIP and DWS Alternative Asset Allocation Plus VIP,
may lend securities to financial institutions. The Portfolio retains beneficial ownership of the securities it has
loaned and continues to receive interest and dividends paid by the issuer of securities and to participate in any
changes in their market value. The Portfolio requires the borrowers of the securities to maintain collateral with the
Portfolio consisting of liquid, unencumbered assets having a value at least equal to the value of the securities
loaned. When the collateral falls below specified amounts, the lending agents will use their best efforts to obtain
additional collateral on the next business day to meet required amounts under the security lending agreement.
The Portfolio may invest the cash collateral into a joint trading account in an affiliated money market fund pursuant
to Exemptive Orders issued by the SEC. The Portfolio receives compensation for lending its securities either in
the form of fees or by earning interest on invested cash collateral net of borrower rebates and fees paid to a
lending agent. Either the Portfolio or the borrower may terminate the loan. There may be risks of delay and costs
in recovery of securities or even loss of rights in the collateral should the borrower of the securities fail financially.
The Portfolio is also subject to all investment risks associated with the reinvestment of any cash collateral
received, including, but not limited to, interest rate, credit and liquidity risk associated with such investments.

Loan Participations and Assignments. DWS Balanced VIP, DWS High Income VIP and DWS Strategic Income VIP
may invest in Loan Participations and Assignments. Loan Participations and Assignments are portions of loans
originated by banks and sold in pieces to investors. These US dollar-denominated fixed and floating rate loans
("Loans") in which the Portfolio invests, are arranged between the borrower and one or more financial institutions
("Lenders"). These Loans may take the form of Senior Loans, which are corporate obligations often issued in
connection with recapitalizations, acquisitions, leveraged buy-outs and refinancings, and Sovereign Loans, which
are debt instruments between a foreign sovereign entity and one or more financial institutions. The Portfolio
invests in such Loans in the form of participations in Loans ("Participations") or assignments of all or a portion of
Loans from third parties ("Assignments"). Participations typically result in the Portfolio having a contractual
relationship only with the Lender, not with the borrower. The Portfolio has the right to receive payments of
principal, interest and any fees to which it is entitled from the Lender selling the Participation and only upon
receipt by the Lender of the payments from the borrower. In connection with purchasing Participations, the
Portfolio generally has no right to enforce compliance by the borrower with the terms of the loan agreement
relating to the Loan, or any rights of set-off against the borrower, and the Portfolio will not benefit directly from
any collateral supporting the Loan in which it has purchased the Participation. As a result, the Portfolio assumes
the credit risk of both the borrower and the Lender that is selling the Participation. Assignments typically result in
the Portfolio having a direct contractual relationship with the borrower, and the Portfolio may enforce compliance
by the borrower with the terms of the loan agreement. All Loan Participations and Assignments involve interest
rate risk, liquidity risk and credit risk, including the potential default or insolvency of the borrower.

Mortgage Dollar Rolls. DWS Core Fixed Income VIP, DWS Government & Agency Securities VIP and DWS
Balanced VIP may enter into mortgage dollar rolls in which the Portfolio sells to a bank or broker/dealer (the
"counterparty") mortgage-backed securities for delivery in the current month and simultaneously contracts to
repurchase similar, but not identical, securities on a fixed date. The counterparty receives all principal and interest
payments, including prepayments, made on the security while it is the holder. The Portfolio receives
compensation as consideration for entering into the commitment to repurchase. The compensation is paid in the
form of a lower price for the security upon its repurchase, or alternatively, a fee. Mortgage dollar rolls may be
renewed with a new sale and repurchase price and a cash settlement made at each renewal without physical
delivery of the securities subject to the contract.

Certain risks may arise upon entering into mortgage dollar rolls from the potential inability of counterparties to
meet the terms of their commitments. Additionally, the value of such securities may change adversely before the
Portfolio is able to repurchase them. There can be no assurance that the Portfolio's use of the cash that it receives
from a mortgage dollar roll will provide a return that exceeds its costs.

When-Issued/Delayed Delivery Securities. DWS Balanced VIP, DWS Core Fixed Income VIP, DWS Government &
Agency Securities VIP, DWS High Income VIP and DWS Strategic Income VIP may purchase securities with
delivery or payment to occur at a later date beyond the normal settlement period. At the time the Portfolio enters
into a commitment to purchase a security, the transaction is recorded and the value of the security is reflected in
the net asset value. The price of such security and the date when the security will be delivered and paid for are
fixed at the time the transaction is negotiated. The value of the security may vary with market fluctuations. No
interest accrues to the Portfolio until payment takes place. At the time the Portfolio enters into this type of
transaction it is required to segregate cash or other liquid assets at least equal to the amount of the commitment.

Certain risks may arise upon entering into when-issued or delayed delivery securities from the potential inability
of counterparties to meet the terms of their contracts or if the issuer does not issue the securities due to
political, economic, or other factors. Additionally, losses may arise due to changes in the value of the underlying
securities.

Derivatives. Each Portfolio has adopted the provisions of Statement of Financial Accounting Standard No. 161
("FAS 161"), "Disclosures about Derivative Instruments and Hedging Activities," effective at the beginning of the
Portfolio's fiscal year. FAS 161 requires enhanced disclosures about the Portfolio's derivative and hedging activities
and derivatives accounted for as hedging instruments under FAS 133 must be disclosed separately from
derivatives that do not qualify for hedge accounting under FAS 133. Because investment companies account for
their derivatives at fair value and record any changes in fair value in current period earnings, the Portfolio's
derivatives are not accounted for as hedging instruments under FAS 133. As such, even though the Portfolio may
use derivatives in an attempt to achieve an economic hedge, the Portfolio's derivatives are not considered to be
hedging instruments under FAS 133. The disclosure below is presented in accordance with FAS 161.

Interest Rate Swap Contracts. DWS Government & Agency Securities VIP and DWS Strategic Income VIP may
enter into interest rate swap transactions to reduce the interest rate risk inherent in the Portfolio's underlying
investments. The use of interest rate swaps is a highly specialized activity that involves investment techniques
and risks different from those associated with ordinary portfolio security transactions. In an interest rate swap,
the Portfolio agrees to pay to the other party to the interest rate swap (which is known as the "counterparty") a
fixed rate payment in exchange for the counterparty agreeing to pay to the Portfolio a variable rate payment, or
the Portfolio agrees to receive from the counterparty a fixed rate payment in exchange for the counterparty
agreeing to receive from the Portfolio a variable rate payment. The payment obligations are based on the
notional amount of the swap. Certain risks may arise when entering into swap transactions including
counterparty default, liquidity or unfavorable changes in interest rates. Payments received or made at the end of
the measurement period are recorded as realized gain or loss on the Statement of Operations. The value of the
swap is adjusted daily based upon a price supplied by a board approved pricing vendor and the change in value
is recorded as unrealized appreciation or depreciation.

A summary of the open interest rate swap contracts as of June 30, 2009 is included in a table following the
Portfolio's Investment Portfolio for DWS Government & Agency Securities VIP and DWS Strategic Income VIP.
The volume indicated is generally indicative of the volume throughout the period.

Credit Default Swap Contracts. A credit default swap is a contract between a buyer and a seller of protection
against pre-defined credit events for the reference entity. DWS Balanced VIP, DWS High Income VIP and DWS
Strategic Income VIP may buy or sell credit default swap contracts to seek to increase the Portfolio's income, to
add leverage to the Portfolio, to gain exposure to an underlying issuer's credit quality characteristics without
directly investing in that issuer, or to hedge the risk of default on Portfolio securities. As a seller in the credit
default swap contract, the Portfolio is required to pay the par (or other agreed-upon) value of the referenced
entity to the counterparty with the occurrence of a credit event by a third party, such as a US or foreign
corporate issuer, on the reference entity, which would likely result in a loss to the Portfolio. In return, the
Portfolio receives from the counterparty a periodic stream of payments over the term of the contract provided
that no credit event has occurred. If no credit event occurs, the Portfolio keeps the stream of payments with no
payment obligations. The Portfolio may also buy credit default swap contracts in order to hedge against the risk
of a credit event on debt securities, in which case the Portfolio functions as the counterparty referenced above.
This involves the risk that the contract may expire worthless. It also involves counterparty risk that the seller
may fail to satisfy its payment obligations to the Portfolio with the occurrence of a credit event. When the
Portfolio sells a credit default swap contract it will cover its commitment. This may be achieved by, among other
methods, maintaining cash or liquid assets equal to the aggregate notional value of the reference entities for all
outstanding credit default swap contracts sold by the Portfolio.

Credit default swap contracts are marked to market daily based upon quotations from a board approved pricing
vendor and the change in value, if any, is recorded daily as unrealized gain or loss. An upfront payment made by
the Portfolio is recorded as an asset on the Statement of Assets and Liabilities. An upfront payment received by
the Portfolio is recorded as a liability on the Statement of Assets and Liabilities. Under the terms of the credit
default swap contracts, the Portfolio receives or makes quarterly payments based on a specified interest rate on
a fixed notional amount. These payments are recorded as a realized gain or loss on the Statement of
Operations. Payments received or made as a result of a credit event or termination of the contract are
recognized, net of a proportional amount of the upfront payment, as realized gains or losses.

Total Return Swap Contracts. Total return swaps involve commitments to pay interest in exchange for a
market-linked return based on a notional amount. DWS Strategic Income VIP and DWS Government & Agency
Securities VIP may enter into total return swap transactions to hedge against market and interest rate risk or to
enhance returns. To the extent the total return of the reference security or index underlying the total return
swap exceeds or falls short of the offsetting interest rate obligation, the Portfolio will receive a payment or make
a payment to the counterparty, respectively. Certain risks may arise when entering into swap transactions
including counterparty default, liquidity or unfavorable changes in the value of underlying reference security or
index. Payments received or made at the end of each measurement period are recorded as realized gain or loss
on the Statement of Operations. The value of the swap is adjusted daily based upon a price supplied by a board
approved pricing vendor and the change in value is recorded as unrealized appreciation or depreciation.

A summary of the open total return swap contracts as of June 30, 2009 is included in a table following the
Portfolio's Investment Portfolio for DWS Government & Agency Securities VIP and DWS Strategic Income VIP.
The volume indicated is generally indicative of the volume throughout the period.

Options. An option contract is a contract in which the writer (seller) of the option grants the buyer of the option,
upon payment of a premium, the right to purchase from (call option), or sell to (put option), the writer a
designated instrument at a specified price within a specified period of time. Certain options, including options
on indices, will require cash settlement by the Portfolio if the option is exercised.

The liability representing the Portfolio's obligation under an exchange traded written option or investment in a
purchased option is valued at the last sale price or, in the absence of a sale, the mean between the closing bid
and asked prices or at the most recent asked price (bid for purchased options) if no bid and asked price are
available. Over-the-counter written or purchased options are valued using dealer-supplied quotations. Gain or
loss is recognized when the option contract expires or is closed.

If the Portfolio writes a covered call option, the Portfolio foregoes, in exchange for the premium, the opportunity
to profit during the option period from an increase in the market value of the underlying security above the
exercise price. If the Portfolio writes a put option it accepts the risk of a decline in the value of the underlying
security below the exercise price. Over-the-counter options have the risk of the potential inability of
counterparties to meet the terms of their contracts. The Portfolio's maximum exposure to purchased options is
limited to the premium initially paid. In addition, certain risks may arise upon entering into option contracts
including the risk that an illiquid secondary market will limit the Portfolio's ability to close out an option contract
prior to the expiration date and that a change in the value of the option contract may not correlate exactly with
changes in the value of the securities or currencies hedged.

A summary of the open option contracts as of June 30, 2009 is included in the Portfolio's Investment Portfolio
for DWS Global Thematic VIP and DWS Strategic Income VIP. The volume indicated is generally indicative of the
volume throughout the period.

Futures Contracts. A futures contract is an agreement between a buyer or seller and an established futures
exchange or its clearinghouse in which the buyer or seller agrees to take or make a delivery of a specific amount
of a financial instrument at a specified price on a specific date (settlement date).

Futures contracts are valued at the most recent settlement price. Upon entering into a futures contract, the
Portfolio is required to depositwith a financial intermediary cash or securities ("initial margin") in an amount
equal to acertain percentage of the face value indicated in the futures contract.Subsequent payments
("variation margin") are made or received by thePortfolio dependent upon the daily fluctuations in the value and
are recorded for financial reporting purposes asunrealized gains or losses by the Portfolio. Gains or losses are
realized when the contract expires or is closed. Since all futures contracts areexchange traded, counterparty
risk is minimized as the exchange'sclearinghouse acts as the counterparty, and guarantees the futures against
default.

Certain risks may arise upon entering into futures contracts, including the risk that an illiquid market will limit
the Portfolio's ability to close out a futures contract prior to the settlement date and that a change in the value of
a futures contract may not correlate exactly with the changes in the value of the underlying hedged security,
index or currency. Risk of loss may exceed amounts recognized on the Statement of Assets and Liabilities.

A summary of the open future contracts as of June 30, 2009 is included in a table following the Portfolio's
Investment Portfolio for DWS Balanced VIP, DWS Blue Chip VIP, DWS Diversified International Equity VIP, DWS
Government & Agency Securities VIP and DWS Strategic Income VIP. The volume indicated is generally
indicative of the volume throughout the period.

Forward Foreign Currency Exchange Contracts. A forward foreign currency exchange contract (forward
currency contract) is a commitment to purchase or sell a foreign currency at the settlement date at a negotiated
rate. DWS Balanced VIP, DWS High Income VIP and DWS Strategic Income VIP may enter into forward currency
contracts in order to hedge its exposure to changes in foreign currency exchange rates on its foreign currency
denominated portfolio holdings and to facilitate transactions in foreign currency denominated securities. DWS
Balanced VIP and DWS Strategic Income VIP may also enter into forward currency contracts as part of each
Portfolio's global tactical asset allocation strategy.

Forward currency contracts are valued at the prevailing forward exchange rate of the underlying currencies and
unrealized gain (loss) is recorded daily. Certain risks may arise upon entering into forward currency contracts
from the potential inability of counterparties to meet the terms of their contracts. The maximum counterparty
credit risk to the Portfolio is measured by the unrealized gain on appreciated contracts. Additionally, when
utilizing forward currency contracts to hedge, the Portfolio gives up the opportunity to profit from favorable
exchange rate movements during the term of the contract.

A summary of the open forward foreign currency exchange contracts as of June 30, 2009 is included in a table
following the Portfolio's Investment Portfolio for DWS Balanced VIP, DWS High Income VIP and DWS Strategic
Income VIP. The volume indicated is generally indicative of the volume throughout the period.

The following tables summarize the value of each Portfolio's derivative instruments held as of June 30, 2009 and
the related location on the accompanying Statement of Assets and Liabilities, presented by primary underlying
risk exposure:

DWS Balanced VIP

There are no open credit default swap contracts as of June 30, 2009. During the six months ended June 30,
2009, the Portfolio had transactions in credit contracts having notional value of less than five percent of the
Portfolio's net assets.

The Portfolio may enter into futures contracts on equity and fixed-income securities, including on financial indices,
and security indices and on currency as part of its global tactical asset allocation overlay strategy. As part of this
strategy, the Portfolio may use futures contracts to gain exposure to changes in interest rates, and take advantage
of short-term inefficiencies and relative mispricings within the global equity, bond and currency markets.

|Asset Derivatives              | Forward
Contracts
|------------------------------ | -----------------
|Foreign Exchange Contracts (a) | $      147,810   
|                               | $   147,810      

The above derivative is located in the following Statement of Assets and Liabilities accounts:

|Liability Derivatives          | Forward
Contracts | Futures
Contracts | Total Value     
|------------------------------ | ----------------- | ----------------- | ----------------
|Foreign Exchange Contracts (a) | $      (304,795)  | $                | $      (304,795)
|Equity Contracts (b)           |                  | 28,644            | 28,644          
|Interest Rate Contracts (b)    |                  | (318,420)         | (318,420)       
|                               | $   (304,795)     | $   (289,776)     | $   (594,571)   

Each of the above derivatives is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six monthsended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss)           | Forward
Contracts | Swap Contracts | Futures
Contracts | Total Value   
|------------------------------ | ----------------- | -------------- | ----------------- | --------------
|Foreign Exchange Contracts (a) | $      953,227    | $             | $                | $      953,227
|Credit Contracts (b)           |                  | 18,816         |                  | 18,816        
|Equity Contracts (c)           |                  |               | 164,635           | 164,635       
|Interest Rate Contracts (c)    |                  |               | 318,732           | 318,732       
|                               | $   953,227       | $   18,816     | $   483,367       | $   1,455,410 

Each of the above derivatives is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Forward
Contracts  | Swap Contracts | Futures
Contracts | Total Value       
|---------------------------------------------------- | ------------------ | -------------- | ----------------- | ------------------
|Foreign Exchange Contracts (a)                       | $      (1,830,888) | $             | $                | $      (1,830,888)
|Credit Contracts (b)                                 |                   | (18,005)       |                  | (18,005)          
|Equity Contracts (c)                                 |                   |               | (22,086)          | (22,086)          
|Interest Rate Contracts (c)                          |                   |               | (539,662)         | (539,662)         
|                                                     | $   (1,830,888)    | $   (18,005)   | $   (561,748)     | $   (2,410,641)   

Each of the above derivatives is located in the following Statement of Operations accounts:

DWS Blue Chip VIP

The Portfolio may enter into futures contracts in circumstances where the portfolio management believes they
offer economical means of gaining exposure to a particular asset class or to keep cash on hand to meet
shareholder redemptions or other needs while maintaining exposure to the stock market.

|Liability Derivatives | Futures
Contracts
|--------------------- | -----------------
|Equity Contracts (a)  | $      (74,000)  
|                      | $   (74,000)     

The above derivative is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six months ended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss) | Futures
Contracts
|-------------------- | -----------------
|Equity Contracts (a) | $      (57,736)  
|                     | $   (57,736)     

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Futures
Contracts
|---------------------------------------------------- | -----------------
|Equity Contracts (a)                                 | $      (87,278)  
|                                                     | $   (87,278)     

The above derivative is located in the following Statement of Operations accounts:

DWS Core Fixed Income VIP

The Portfolio may enter into futures contracts in circumstances where portfolio management believes they offer
an economic means of gaining exposure to a particular asset class or to keep cash on hand to meet shareholder
redemptions or other needs while maintaining exposure to the market. The Portfolio's underlying bond
investments are subject to interest rate risk. As interest rates increase, the value of Portfolio's fixed rate bonds
may fall. The Portfolio may sell interest rate futures to gain exposure to different parts of the yield curve while
managing the overall duration.

There are no open futures contracts as of June 30, 2009. During the six months ended June 30, 2009, the
Portfolio had transactions in futures contracts having face value of less than five percent of the Portfolio's net
assets.

The amount of unrealized and realized gains and losses on derivative instruments recognized in Portfolio earnings
during the six monthsended June 30, 2009 and the related location on the accompanying Statement of
Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss)        | Futures
Contracts
|--------------------------- | -----------------
|Interest Rate Contracts (a) | $      231,032   
|                            | $   231,032      

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Futures
Contracts
|---------------------------------------------------- | -----------------
|Interest Rate Contracts (a)                          | $      75,129    

The above derivative is located in the following Statement of Operations accounts:

DWS Diversified International Equity VIP

The Portfolio may enter into futures contracts in circumstances where the portfolio management believes they
offer economical means of gaining exposure to a particular asset class or to keep cash on hand to meet
shareholder redemptions or other needs while maintaining exposure to the market.

|Liability Derivatives | Futures
Contracts
|--------------------- | -----------------
|Equity Contracts (a)  | (10,102)         
|                      | $   (10,102)     

The above derivatives is located in the following Statement of Assets and Liabilities accounts:

The amount of unrealized and realized gains and losses on derivative instruments recognized in Portfolio earnings
during the six monthsended June 30, 2009 and the related location on the accompanying Statement of
Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss) | Futures
Contracts
|-------------------- | -----------------
|Equity Contracts (a) | (29,084)         
|                     | $   (29,084)     

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Futures
Contracts
|---------------------------------------------------- | -----------------
|Equity Contracts (a)                                 | $      (10,102)  
|                                                     | $   (10,102)     

The above derivative is located in the following Statement of Operations accounts:

DWS Global Thematic VIP

The Portfolio may enter into option contracts in order to hedge against potential adverse price movements in the
value of portfolio assets; as a temporary substitute for selling selected investments; to lock in the purchase price
of a security which it expects to purchase in the near future; as a temporary substitute for purchasing selected
investments.

|Asset Derivatives    | Purchased
Options
|-------------------- | -----------------
|Equity Contracts (a) | $      2,040     
|                     | $   2,040        

The above derivative is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six monthsended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss) | Purchased
Options
|-------------------- | -----------------
|Equity Contracts (a) | $               
|                     | $               

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Purchased
Options
|---------------------------------------------------- | -----------------
|Equity Contracts (a)                                 | $      (7,140)   
|                                                     | $   (7,140)      

The above derivative is located in the following Statement of Operations accounts:

DWS Government & Agency Securities VIP

The Portfolio may enter into futures contracts to gain exposure to different parts of the yield curve while
managing the overall duration.

|Asset Derivatives           | Swap Contracts
|--------------------------- | --------------
|Interest Rate Contracts (a) | $      18,961 

The above derivative is located in the following Statement of Assets and Liabilities accounts:

|Liability Derivatives       | Futures
Contracts | Swap Contracts   | Total Value     
|--------------------------- | ----------------- | ---------------- | ----------------
|Interest Rate Contracts (a) | $      (78,898)   | $      (122,967) | $      (201,865)

Each of the above derivatives is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six monthsended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss)        | Futures
Contracts 
|--------------------------- | ------------------
|Interest Rate Contracts (a) | $      (1,960,907)

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Futures
Contracts | Swap Contracts   | Total Value     
|---------------------------------------------------- | ----------------- | ---------------- | ----------------
|Interest Rate Contracts (a)                          | $      3,271,331  | $      (104,006) | $      3,167,325

Each of the above derivatives is located in the following Statement of Operations accounts:

DWS High Income VIP

There are no open credit default swap contracts as of June 30, 2009. During the six months ended June 30,
2009, the Portfolio had transactions in credit contracts having notional value of less than five percent of the
Portfolio's net assets.

|Liability Derivatives          | Forward
Contracts
|------------------------------ | -----------------
|Foreign Exchange Contracts (a) | $      (114,511) 
|                               | $   (114,511)    

The above derivative is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six monthsended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss)           | Forward
Contracts | Swap Contracts | Total Value     
|------------------------------ | ----------------- | -------------- | ----------------
|Foreign Exchange Contracts (a) | $      (209,178)  | $             | $      (209,178)
|Credit Contracts (b)           |                  | 291,737        | 291,737         
|                               | $   (209,178)     | $   291,737    | $   82,559      

Each of the above derivatives is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Forward
Contracts | Swap Contracts | Total Value     
|---------------------------------------------------- | ----------------- | -------------- | ----------------
|Foreign Exchange Contracts (a)                       | $      (244,074)  | $             | $      (244,074)
|Credit Contracts (b)                                 |                  | (288,556)      | (288,556)       
|                                                     | $   (244,074)     | $   (288,556)  | $   (532,630)   

Each of the above derivatives is located in the following Statement of Operations accounts:

DWS Large Cap Value VIP

The Portfolio may enter into futures contracts in circumstances where the portfolio management believes they
offer economical means of gaining exposure to a particular asset class or to keep cash on hand to meet
shareholder redemptions or other needs while maintaining exposure to the stock market.

There are no open futures contracts as of June 30, 2009. During the six months ended June 30, 2009, the
Portfolio had transactions in futures contracts having face value of less than five percent of the Portfolio's net
assets.

The amount of unrealized and realized gains and losses on derivative instruments recognized in Portfolio earnings
during the six monthsended June 30, 2009 and the related location on the accompanying Statement of
Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss) | Futures
Contracts
|-------------------- | -----------------
|Equity Contracts (a) | $      (17,763)  
|                     | $   (17,763)     

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Futures
Contracts
|---------------------------------------------------- | -----------------
|Equity Contracts (a)                                 | $               
|                                                     | $               

The above derivative is located in the following Statement of Operations accounts:

DWS Strategic Income VIP

There are no open credit default swap contracts as of June 30, 2009. During the six months ended June 30,
2009, the Portfolio had transactions in credit contracts having notional value of less than five percent of the
Portfolio's net assets.

The Portfolio may enter into futures contracts on equity and fixed-income securities, including on financial indices,
and security indices and on currency as part of its global tactical asset allocation overlay strategy. As part of this
strategy, the Portfolio may use futures contracts to gain exposure to changes in interest rates, and take advantage
of short-term inefficiencies and relative mispricings within the global equity, bond and currency markets.

The Portfolio may enter into option contracts in order to enhance potential gain.

|Asset Derivatives              | Purchased
Options | Forward
Contracts | Swap Contracts | Total Value  
|------------------------------ | ----------------- | ----------------- | -------------- | -------------
|Interest Rate Contracts (a)    | $      37,800     | $                | $      9,496   | $      47,296
|Foreign Exchange Contracts (b) |                  | 74,283            |               | 74,283       
|                               | $   37,800        | $   74,283        | $   9,496      | $   121,579  

Each of the above derivatives is located in the following Statement of Assets and Liabilities accounts:

|Liability Derivatives          | Forward
Contracts | Swap Contracts  | Futures
Contracts | Total Value     
|------------------------------ | ----------------- | --------------- | ----------------- | ----------------
|Interest Rate Contracts (a)    | $                | $      (37,189) | $      (66,369)   | $      (103,558)
|Equity Contracts (a)           |                  |                | (27,464)          | (27,464)        
|Foreign Exchange Contracts (b) | (110,624)         |                |                  | (110,624)       
|                               | $   (110,624)     | $   (37,189)    | $   (93,833)      | $   (241,646)   

Each of the above derivatives is located in the following Statement of Assets and Liabilities accounts:

Additionally, the amount of unrealized and realized gains and losses on derivative instruments recognized in
Portfolio earnings during the six monthsended June 30, 2009 and the related location on the accompanying
Statement of Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss)           | Purchased
Options | Written Options | Forward
Contracts | Swap Contracts | Futures
Contracts | Total Value   
|------------------------------ | ----------------- | --------------- | ----------------- | -------------- | ----------------- | --------------
|Interest Rate Contracts (a)    | $                | $      (29,550) | $                | $      36,178  | $      192,202    | $      198,830
|Equity Contracts (a)           |                  |                |                  |               | (54,875)          | (54,875)      
|Foreign Exchange
Contracts (b) |                  |                | (227,457)         |               |                  | (227,457)     
|                               | $                | $   (29,550)    | $   (227,457)     | $   36,178     | $   137,327       | $   (83,502)  

Each of the above derivatives is located in the following Statement of Operations accounts:

|Change in Net Unrealized
Appreciation (Depreciation) | Purchased
Options | Written
Options | Forward
Contracts | Swap Contracts   | Futures
Contracts | Total Value     
|---------------------------------------------------- | ----------------- | --------------- | ----------------- | ---------------- | ----------------- | ----------------
|Interest Rate Contracts (a)                          | $      (16,851)   | $      47,755   | $                | $      (184,099) | $      (170,090)  | $      (323,285)
|Equity Contracts (a)                                 |                  |                |                  |                 | 82,317            | 82,317          
|Foreign Exchange Contracts (b)                       |                  |                | (575,446)         |                 |                  | (575,446)       
|                                                     | $   (16,851)      | $   47,755      | $   (575,446)     | $   (184,099)    | $   (87,773)      | $   (816,414)   

Each of the above derivatives is located in the following Statement of Operations accounts:

DWS Technology VIP

The Portfolio may enter into option contracts in order to hedge against potential adverse price movements in the
value of portfolio assets; as a temporary substitute for selling selected investments; to lock in the purchase price
of a security which it expects to purchase in the near future; as a temporary substitute for purchasing selected
investments.

There are no open options as of June 30, 2009. During the six months ended June 30, 2009, the Portfolio had
transactions in options having value of less than five percent of the Portfolio's net assets.

The amount of unrealized and realized gains and losses on derivative instruments recognized in Portfolio earnings
during the six months ended June 30, 2009 and the related location on the accompanying Statement of
Operations is summarized in the following tables by primary underlying risk exposure:

|Realized Gain (Loss) | Written Options
|-------------------- | ---------------
|Equity Contracts (a) | $      12,238  
|                     | $   12,238     

The above derivative is located in the following Statement of Operations accounts:

|Change in Net Unrealized Appreciation (Depreciation) | Written Options
|---------------------------------------------------- | ---------------
|Equity Contracts (a)                                 | $             
|                                                     | $             

The above derivative is located in the following Statement of Operations accounts:

Taxes. Each Portfolio's policy is to comply with the requirements of the Internal Revenue Code, as amended,
which are applicable to regulated investment companies and to distribute all of its taxable income to its
shareholders.

Additionally, based on the Portfolios' understanding of the tax rules and rates related to income, gains and
transactions for the foreign jurisdictions in which they invest, the Portfolios will provide for foreign taxes, and
where appropriate, deferred foreign taxes.

At December 31, 2008, the following Portfolios had an approximate net tax basis capital loss carryforward which
may be applied against any realized net taxable capital gains of each succeeding year until fully utilized or until the
following expiration dates, whichever occurs first:

|Portfolio                                | Capital Loss
Carryforward ($) | Expiration
Date
|---------------------------------------- | ----------------------------- | ---------------
|DWS Balanced VIP                         | 1,789,000                     | 12/31/2010     
|                                         | 1,366,000                     | 12/31/2011     
|                                         | 21,426,000                    | 12/31/2016     
|DWS Blue Chip VIP                        | 26,695,000                    | 12/31/2016     
|DWS Core Fixed Income VIP                | 3,813,000                     | 12/31/2014     
|                                         | 50,000                        | 12/31/2015     
|                                         | 6,143,000                     | 12/31/2016     
|DWS Diversified International Equity VIP | 32,933,000                    | 12/31/2016     
|DWS Dreman Small Mid Cap Value VIP       | 40,231,000                    | 12/31/2016     
|DWS Global Thematic VIP                  | 42,028,000                    | 12/31/2016     
|DWS Government & Agency Securities VIP   | 930,000                       | 12/31/2014     
|                                         | 924,000                       | 12/31/2015     
|DWS High Income VIP                      | 22,935,000                    | 12/31/2009     
|                                         | 55,108,000                    | 12/31/2010     
|                                         | 13,877,000                    | 12/31/2011     
|                                         | 3,844,000                     | 12/31/2014     
|                                         | 858,000                       | 12/31/2015     
|                                         | 17,301,000                    | 12/31/2016     
|DWS Large Cap Value VIP                  | 17,185,000                    | 12/31/2016     
|DWS Mid Cap Growth VIP                   | 20,154,000                    | 12/31/2011     
|                                         | 936,000                       | 12/31/2016     
|DWS Small Cap Growth VIP                 | 11,291,000                    | 12/31/2009     
|                                         | 71,888,000                    | 12/31/2010     
|                                         | 4,155,000                     | 12/31/2011     
|                                         | 8,113,000                     | 12/31/2016     
|DWS Strategic Income VIP                 | 1,611,000                     | 12/31/2016     
|DWS Strategic Value VIP                  | 68,443,000                    | 12/31/2016     
|DWS Technology VIP                       | 73,057,000                    | 12/31/2009     
|                                         | 93,499,000                    | 12/31/2010     
|                                         | 71,516,000                    | 12/31/2011     
|                                         | 13,148,000                    | 12/31/2016     
|DWS Turner Mid Cap Growth VIP            | 6,753,000                     | 12/31/2016     

In addition, from November 1, 2008 through December 31, 2008, the following Portfolios incurred net realized
capital losses. As permitted by tax regulations, the Portfolios intend to elect to defer these losses and treat them
as arising in the fiscal year ended December 31, 2009.

|Portfolio                                |                  
|---------------------------------------- | -----------------
|DWS Balanced VIP                         | $      20,377,000
|DWS Blue Chip VIP                        | 12,172,000       
|DWS Core Fixed Income VIP                | 14,342,000       
|DWS Diversified International Equity VIP | 15,109,000       
|DWS Dreman Small Mid Cap Value VIP       | 22,331,000       
|DWS Global Thematic VIP                  | 12,260,000       
|DWS Government & Agency Securities VIP   | 4,625,000        
|DWS High Income VIP                      | 6,542,000        
|DWS Large Cap Value VIP                  | 8,279,000        
|DWS Mid Cap Growth VIP                   | 3,503,000        
|DWS Small Cap Growth VIP                 | 14,538,000       
|DWS Strategic Income VIP                 | 1,428,000        
|DWS Strategic Value VIP                  | 78,628,000       
|DWS Technology VIP                       | 6,328,000        
|DWS Turner Mid Cap Growth VIP            | 9,753,000        

The Portfolios have reviewed the tax positions for the open tax years as of December 31, 2008 and have
determined that no provision for income tax is required in the Portfolios' financial statements. The Portfolios'
federal tax returns for the prior three fiscal years remain subject to examination by the Internal Revenue Service.

Distribution of Income and Gains. Distributions of net investment income, if any, for each Portfolio, except
DWS Money Market VIP, are made annually. Net realized gains from investment transactions, in excess of
available capital loss carryforwards, would be taxable to each Portfolio if not distributed and, therefore, will be
distributed to shareholders at least annually. Net investment income of DWS Money Market VIP is declared as a
daily dividend and is distributed to shareholders monthly. DWS Money Market VIP may take into account capital
gains and losses in its daily dividend declarations. DWS Money Market VIP may also make additional distributions
for tax purposes if necessary.

The timing and characterization of certain income and capital gains distributions are determined annually in
accordance with federal tax regulations which may differ from accounting principles generally accepted in the
United States of America. These differences primarily relate to net operating losses, investments in foreign
denominated investments, investments in forward foreign currency exchange contracts, investments in futures,
income received from Passive Foreign Investment Companies and Real Estate Investment Trusts and certain
securities sold at a loss. As a result, net investment income (loss) and net realized gain (loss) on investment
transactions for a reporting period may differ significantly from distributions during such period. Accordingly, each
Portfolio may periodically make reclassifications among certain of its capital accounts without impacting the net
asset value of the Portfolio.

The tax character of current year distributions will be determined at the end of the current fiscal year.

Offering Costs. Offering costs for DWS Alternative Asset Allocation Plus VIP were paid connection with the
offering of the shares and are being amortized over one year.

Expenses. Expenses arising in connection with a specific Portfolio are allocated to that Portfolio. Trust expenses
are allocated between each Portfolio in proportion to its relative net assets.

Contingencies. In the normal course of business, each Portfolio may enter into contracts with service providers
that contain general indemnification clauses. The Portfolios' maximum exposure under these arrangements is
unknown as this would involve future claims that may be made against the Portfolios that have not yet been
made. However, based on experience, the Portfolios expect the risk of loss to be remote.

Real Estate Investment Trusts.DWS Balanced VIP and DWS Dreman Small Mid Cap Value VIP periodically
recharacterize distributions received from a Real Estate Investment Trust ("REIT") investment based on
information provided by the REIT into the following categories: ordinary income, long-term and short-term capital
gains, and return of capital. If information is not available timely from a REIT, the recharacterization will be
estimated and a recharacterization will be made in the following year when such information becomes available.
Distributions received from REITs in excess of income are recorded as either a reduction of cost of investments
or realized gains. The Portfolios distinguish between dividends on a tax basis and a financial reporting basis and
only distributions in excess of tax basis earnings and profits are reported in the financial statements as a tax
return of capital.

Other. Investment transactions are accounted for on a trade date plus one basis for daily net asset value
calculations. However, for financial reporting purposes, investment transactions are reported on trade date.
Interest income is recorded on the accrual basis. Dividend income is recorded on the ex-dividend date net of
foreign withholding taxes. Certain dividends from foreign securities may be recorded subsequent to the
ex-dividend date as soon as the Portfolio is informed of such dividends. Realized gains and losses from
investment transactions are recorded on an identified cost basis. All discounts and premiums are
accreted/amortized for both tax and financial reporting purposes for each Portfolio, with the exception of
securities in default of principal. Distributions of income and capital gains from the Underlying Funds are recorded
on the ex-dividend date.

B. Purchases and Sales of Securities

During the six months ended June 30, 2009 and for the period from February 2, 2009 through June 30, 2009 for
DWS Alternative Asset Allocation Plus VIP, purchases and sales of investment transactions (excluding short-term
investments) were as follows:

|Portfolio                                                               | Purchases ($) | Sales ($)  
|----------------------------------------------------------------------- | ------------- | -----------
|DWS Alternative Asset Allocation Plus VIP                               | 324,605       | 61,005     
|DWS Balanced VIPexcluding US Treasury Obligations                       | 285,507,656   | 320,190,113
|US Treasury Obligations                                                 | 59,465,388    | 49,824,759 
|DWS Blue Chip VIP                                                       | 38,970,151    | 54,436,839 
|DWS Core Fixed Income VIPexcluding US Treasury Obligations              | 103,895,003   | 129,339,716
|US Treasury Obligations                                                 | 98,012,774    | 95,896,577 
|DWS Diversified International Equity VIP                                | 105,041,216   | 120,871,265
|DWS Dreman Small Mid Cap Value VIP                                      | 87,651,171    | 116,476,649
|DWS Global Thematic VIP                                                 | 58,505,763    | 68,750,456 
|DWS Government & Agency Securities VIPexcluding US Treasury Obligations | 967,906,490   | 973,380,641
|US Treasury Obligations                                                 | 3,077,198     | 12,452,041 
|DWS High Income VIP                                                     | 58,677,644    | 46,045,727 
|DWS Large Cap Value VIP                                                 | 166,239,586   | 99,728,041 
|DWS Mid Cap Growth VIP                                                  | 7,543,590     | 8,327,235  
|DWS Small Cap Growth VIP                                                | 35,353,695    | 40,731,065 
|DWS Strategic Income VIPexcluding US Treasury Obligations               | 116,860,555   | 118,276,714
|US Treasury Obligations                                                 | 34,480,538    | 36,053,603 
|DWS Strategic Value VIP                                                 | 110,675,531   | 165,448,751
|DWS Technology VIP                                                      | 21,211,691    | 29,420,022 
|DWS Turner Mid Cap Growth VIP                                           | 24,630,813    | 35,194,003 

For the six months ended June 30, 2009, transactions for written options on interest rate swaps were as follows
for DWS Strategic Income VIP:

|                                 | Contract
Amount | Premiums     
|-------------------------------- | --------------- | -------------
|Outstanding, beginning of period | 12,000,000      | $      70,950
|Options written                  |                |             
|Options closed                   | (12,000,000)    | (70,950)     
|Outstanding, end of period       |                | $           

For the six months ended June 30, 2009, transactions for written options on securities were as follows for
DWS Technology VIP:

|                                 | Number of
Contracts | Premiums
|-------------------------------- | ------------------- | --------
|Outstanding, beginning of period |                    | $      
|Options written                  | 422                 | 12,238  
|Options closed                   |                    |        
|Options expired                  |                    |        
|Options exercised                | (422)               | (12,238)
|Outstanding, end of period       |                    | $      

C. Related Parties

Management Agreement. Under the Investment Management Agreement with Deutsche Investment
Management Americas Inc. ("DIMA" or the "Advisor"), an indirect, wholly owned subsidiary of Deutsche Bank
AG, the Advisor directs the investments of each Portfolio in accordance with its investment objectives, policies
and restrictions. The Advisor determines the securities, instruments and other contracts relating to investments
to be purchased, sold or entered into by each Portfolio or delegates such responsibility to each Portfolio's
subadvisor.

Under the Investment Management Agreement with the Advisor, the fees are equivalent to the annual rates
shown below of each Portfolio's average daily net assets, computed and accrued daily and payable monthly:

|Portfolio                                                                                                                                 | Annual
Management
Fee Rate
|----------------------------------------------------------------------------------------------------------------------------------------- | --------------------------
|DWS Alternative Asset Allocation VIPon assets invested in other DWS funds
on assets invested in all other assets not considered DWS funds | .200%
1.200%              
|DWS Balanced VIP$0-$250 million                                                                                                           | .370%                     
|next $750 million                                                                                                                         | .345%                     
|over $1 billion                                                                                                                           | .310%                     
|DWS Blue Chip VIP$0-$250 million                                                                                                          | .550%                     
|next $750 million                                                                                                                         | .520%                     
|next $1.5 billion                                                                                                                         | .500%                     
|next $2.5 billion                                                                                                                         | .480%                     
|next $2.5 billion                                                                                                                         | .450%                     
|next $2.5 billion                                                                                                                         | .430%                     
|next $2.5 billion                                                                                                                         | .410%                     
|over $12.5 billion                                                                                                                        | .390%                     
|DWS Core Fixed Income VIP$0-$250 million                                                                                                  | .500%                     
|next $750 million                                                                                                                         | .470%                     
|next $1.5 billion                                                                                                                         | .450%                     
|next $2.5 billion                                                                                                                         | .430%                     
|next $2.5 billion                                                                                                                         | .400%                     
|next $2.5 billion                                                                                                                         | .380%                     
|next $2.5 billion                                                                                                                         | .360%                     
|over $12.5 billion                                                                                                                        | .340%                     
|DWS Diversified International Equity VIP$0-$1.5 billion                                                                                   | .650%                     
|next $1.75 billion                                                                                                                        | .635%                     
|next $1.75 billion                                                                                                                        | .620%                     
|over $5 billion                                                                                                                           | .605%                     
|DWS Dreman Small Mid Cap Value VIP$0-$250 million                                                                                         | .650%                     
|next $750 million                                                                                                                         | .620%                     
|next $1.5 billion                                                                                                                         | .600%                     
|next $2.5 billion                                                                                                                         | .580%                     
|next $2.5 billion                                                                                                                         | .550%                     
|next $2.5 billion                                                                                                                         | .540%                     
|next $2.5 billion                                                                                                                         | .530%                     
|over $12.5 billion                                                                                                                        | .520%                     
|DWS Global Thematic VIP$0-$250 million                                                                                                    | .915%                     
|next $500 million                                                                                                                         | .865%                     
|next $750 million                                                                                                                         | .815%                     
|next $1.5 billion                                                                                                                         | .765%                     
|over $3 billion                                                                                                                           | .715%                     
|DWS Government & Agency Securities VIP$0-$250 million                                                                                     | .450%                     
|next $750 million                                                                                                                         | .430%                     
|next $1.5 billion                                                                                                                         | .410%                     
|next $2.5 billion                                                                                                                         | .400%                     
|next $2.5 billion                                                                                                                         | .380%                     
|next $2.5 billion                                                                                                                         | .360%                     
|next $2.5 billion                                                                                                                         | .340%                     
|over $12.5 billion                                                                                                                        | .320%                     
|DWS High Income VIP$0-$250 million                                                                                                        | .500%                     
|next $750 million                                                                                                                         | .470%                     
|next $1.5 billion                                                                                                                         | .450%                     
|next $2.5 billion                                                                                                                         | .430%                     
|next $2.5 billion                                                                                                                         | .400%                     
|next $2.5 billion                                                                                                                         | .380%                     
|next $2.5 billion                                                                                                                         | .360%                     
|over $12.5 billion                                                                                                                        | .340%                     
|DWS Large Cap Value VIP$0-$250 million                                                                                                    | .650%                     
|next $750 million                                                                                                                         | .625%                     
|next $1.5 billion                                                                                                                         | .600%                     
|next $2.5 billion                                                                                                                         | .575%                     
|next $2.5 billion                                                                                                                         | .550%                     
|next $2.5 billion                                                                                                                         | .525%                     
|next $2.5 billion                                                                                                                         | .500%                     
|over $12.5 billion                                                                                                                        | .475%                     
|DWS Mid Cap Growth VIP$0-$250 million                                                                                                     | .665%                     
|next $750 million                                                                                                                         | .635%                     
|next $1.5 billion                                                                                                                         | .615%                     
|next $2.5 billion                                                                                                                         | .595%                     
|next $2.5 billion                                                                                                                         | .565%                     
|next $2.5 billion                                                                                                                         | .555%                     
|next $2.5 billion                                                                                                                         | .545%                     
|over $12.5 billion                                                                                                                        | .535%                     
|DWS Money Market VIP$0-$500 million                                                                                                       | .285%                     
|next $500 million                                                                                                                         | .270%                     
|next $1.0 billion                                                                                                                         | .255%                     
|over $2.0 billion                                                                                                                         | .240%                     
|DWS Small Cap Growth VIP$0-$250 million                                                                                                   | .550%                     
|next $750 million                                                                                                                         | .525%                     
|over $1 billion                                                                                                                           | .500%                     
|DWS Strategic Income VIP$0-$250 million                                                                                                   | .550%                     
|next $750 million                                                                                                                         | .520%                     
|next $1.5 billion                                                                                                                         | .500%                     
|next $2.5 billion                                                                                                                         | .480%                     
|next $2.5 billion                                                                                                                         | .450%                     
|next $2.5 billion                                                                                                                         | .430%                     
|next $2.5 billion                                                                                                                         | .410%                     
|over $12.5 billion                                                                                                                        | .390%                     
|DWS Strategic Value VIP$0-$250 million                                                                                                    | .665%                     
|next $750 million                                                                                                                         | .635%                     
|next $1.5 billion                                                                                                                         | .615%                     
|next $2.5 billion                                                                                                                         | .595%                     
|next $2.5 billion                                                                                                                         | .565%                     
|next $2.5 billion                                                                                                                         | .555%                     
|next $2.5 billion                                                                                                                         | .545%                     
|over $12.5 billion                                                                                                                        | .535%                     
|DWS Technology VIP$0-$250 million                                                                                                         | .665%                     
|next $750 million                                                                                                                         | .635%                     
|next $1.5 billion                                                                                                                         | .615%                     
|next $2.5 billion                                                                                                                         | .595%                     
|next $2.5 billion                                                                                                                         | .565%                     
|next $2.5 billion                                                                                                                         | .555%                     
|next $2.5 billion                                                                                                                         | .545%                     
|over $12.5 billion                                                                                                                        | .535%                     
|DWS Turner Mid Cap Growth VIP$0-$250 million                                                                                              | .715%                     
|next $250 million                                                                                                                         | .700%                     
|next $500 million                                                                                                                         | .685%                     
|over $1 billion                                                                                                                           | .670%                     

Prior to February 27, 2009, Aberdeen Asset Management Inc. ("AAMI") served as subadvisor to DWS Core Fixed
Income VIP and was paid by the Advisor for its services. The Board of the Portfolio approved the termination of
AAMI as the Portfolio's subadvisor. Effective February 27, 2009, DIMA assumed all day-to-day advisory
responsibilities for the Portfolio that were previously delegated to AAMI.

Dreman Value Management, L.L.C. ("DVM") serves as subadvisor to DWS Dreman Small Mid Cap Value VIP and,
prior to June 2, 2009, served as subadvisor to DWS Strategic Value VIP. DVM is paid by the Advisor for its
services.

Turner Investment Partners, Inc. serves as subadvisor to DWS Turner Mid Cap Growth VIP and is paid by the
Advisor for its services.

Deutsche Asset Management International GmbH ("DeAMi") serves as subadvisor to DWS Large Cap Value VIP,
and effective June 2, 2009 through July 31, 2009, served as subadvisor to DWS Strategic Value VIP. DeAMi is
paid by the Advisor for its services.

For the period from February 2, 2009 (commencement of operations) to June 30, 2009, the Advisor has agreed to
waive 0.15% of the monthly management fee based on average daily net assets for DWS Alternative Asset
Allocation Plus VIP.

For the period from January 1, 2009 through April 30, 2009, the Advisor had contractually agreed to waive all or a
portion of its fee and reimburse or pay certain operating expenses to the extent necessary to maintain the
operating expenses of each class for the period (excluding certain expenses such as extraordinary expenses,
taxes, brokerage and interest expense) as follows:

|Portfolio                      | Annual Rate
|------------------------------ | -----------
|DWS Global Thematic VIPClass A | 1.05%      
|Class B                        | 1.45%      

For the period from January 1, 2009 through September 30, 2009 and through March 6, 2009 for Class B shares
for DWS Balanced VIP, DWS Diversified International VIP, DWS Mid Cap Growth VIP, DWS Small Cap VIP, DWS
Strategic Income VIP and DWS Turner Mid Cap Growth VIP, the Advisor has contractually agreed to waive all or a
portion of its fee and reimburse or pay certain operating expenses to the extent necessary to maintain the
operating expenses of each class for the period (excluding certain expenses such as extraordinary expenses,
taxes, brokerage and interest expense) as follows:

|Portfolio                                       | Annual Rate
|----------------------------------------------- | -----------
|DWS Balanced VIPClass B                         | 1.22%      
|DWS Blue Chip VIPClass B                        | 1.25%      
|DWS Diversified International Equity VIPClass B | 1.40%      
|DWS Government & Agency Securities VIPClass A   | .65%       
|Class B                                         | 1.05%      
|DWS High Income VIPClass B                      | 1.18%      
|DWS Large Cap Value VIPClass B                  | 1.25%      
|DWS Mid Cap Growth VIPClass A                   | .94%       
|Class B                                         | 1.34%      
|DWS Small Cap Growth VIPClass B                 | 1.41%      
|DWS Strategic Income VIPClass A                 | .82%       
|Class B                                         | 1.22%      
|DWS Technology VIPClass B                       | 1.48%      
|DWS Turner Mid Cap Growth VIPClass B            | 1.34%      

For the period from April 27, 2009 through September 30, 2009, the Advisor has contractually agreed to waive all
or a portion of its fee and reimburse or pay certain operating expenses to the extent necessary to maintain the
operating expenses of each class for the period (excluding certain expenses such as extraordinary expenses,
taxes, brokerage and interest expense) as follows:

|Portfolio                      | Annual Rate
|------------------------------ | -----------
|DWS Large Cap Value VIPClass A | .88%       

For the period from May 1, 2009 through September 30, 2009, the Advisor has contractually agreed to waive all
or a portion of its fee and reimburse or pay certain operating expenses to the extent necessary to maintain the
operating expenses of each class for the period (excluding certain expenses such as extraordinary expenses,
taxes, brokerage and interest expense) as follows:

|Portfolio                      | Annual Rate
|------------------------------ | -----------
|DWS Global Thematic VIPClass A | 1.07%      
|Class B                        | 1.47%      

For the period from January 1, 2009 through April 30, 2010, the Advisor has contractually agreed to waive all or a
portion of its fee and reimburse or pay certain operating expenses to the extent necessary to maintain the
operating expenses of each class for the period (excluding certain expenses such as extraordinary expenses,
taxes, brokerage and interest expense) as follows:

|Portfolio                      | Annual Rate
|------------------------------ | -----------
|DWS Money Market VIPClass A    | .44%       
|DWS Strategic Value VIPClass A | .78%       
|Class B                        | 1.11%      

Effective February 2, 2009 (commencement of operations) for Class A shares and effective May 18, 2009
(commencement of operations) for Class B shares through April 30, 2010, the Advisor has contractually agreed to
waive all or a portion of its fee and reimburse or pay certain operating expenses to the extent necessary to
maintain the operating expenses of the class for the period (excluding certain expenses such as extraordinary
expenses, taxes, brokerage and interest expense) as follows:

|Portfolio                                        | Annual Rate
|------------------------------------------------ | -----------
|DWS Alternative Asset Allocation Plus VIPClass A | .21%       
|Class B                                          | .61%       

Accordingly, for the six months ended June 30, 2009 and for the period from February 2, 2009 (commencement
of operations) through June 30, 2009 for DWS Alternative Asset Allocation Plus VIP, the total management fees,
management fees waived and effective management fee rates were as follows:

|Portfolio                                 | Total
Aggregated ($) | Waived ($) | Annualized
Effective Rate
|----------------------------------------- | -------------------- | ---------- | -------------------------
|DWS Alternative Asset Allocation Plus VIP | 174                  | 174        | .00%                     
|DWS Balanced VIP                          | 525,985              |           | .37%                     
|DWS Blue Chip VIP                         | 260,115              |           | .55%                     
|DWS Core Fixed Income VIP                 | 331,939              |           | .50%                     
|DWS Diversified International Equity VIP  | 246,680              |           | .65%                     
|DWS Dreman Small Mid Cap Value VIP        | 683,833              |           | .65%                     
|DWS Global Thematic VIP                   | 255,400              | 150,639    | .38%                     
|DWS Government & Agency Securities VIP    | 465,975              |           | .45%                     
|DWS High Income VIP                       | 402,015              |           | .50%                     
|DWS Large Cap Value VIP                   | 459,755              |           | .65%                     
|DWS Mid Cap Growth VIP                    | 58,688               | 31,273     | .31%                     
|DWS Money Market VIP                      | 516,497              | 13,148     | .28%                     
|DWS Small Cap Growth VIP                  | 169,655              |           | .55%                     
|DWS Strategic Income VIP                  | 188,431              | 33,131     | .45%                     
|DWS Strategic Value VIP                   | 869,290              | 58,026     | .62%                     
|DWS Technology VIP                        | 202,696              |           | .67%                     
|DWS Turner Mid Cap Growth VIP             | 151,387              |           | .72%                     

In addition, for the period ended June 30, 2009, the Advisor waived $52,652 other expenses for DWS Alternative
Asset Allocation Plus VIP.

Administration Fee. Pursuant to an Administrative Services Agreement, DIMA provides most administrative
services to the Portfolios. For all services provided under the Administrative Services Agreement, the Portfolios
pay DIMA an annual fee ("Administration Fee") of 0.10% of the Portfolios' average daily net assets, computed and
accrued daily and payable monthly. For the six months ended June 30, 2009 and for the period from February 2,
2009 (commencement of operations) through June 30, 2009 for DWS Alternative Asset Allocation Plus VIP, the
Administration Fee was as follows:

|Portfolio                                 | Total
Aggregated ($) | Waived ($) | Unpaid at
June 30, 2009 ($)
|----------------------------------------- | -------------------- | ---------- | ---------------------------
|DWS Alternative Asset Allocation Plus VIP | 87                   | 87         |                           
|DWS Balanced VIP                          | 143,476              |           | 24,855                     
|DWS Blue Chip VIP                         | 47,294               |           | 8,175                      
|DWS Core Fixed Income VIP                 | 66,388               |           | 10,283                     
|DWS Diversified International Equity VIP  | 37,951               |           | 6,588                      
|DWS Dreman Small Mid Cap Value VIP        | 105,207              |           | 18,459                     
|DWS Global Thematic VIP                   | 27,912               |           | 5,042                      
|DWS Government & Agency Securities VIP    | 103,550              |           | 15,866                     
|DWS High Income VIP                       | 80,403               |           | 14,601                     
|DWS Large Cap Value VIP                   | 70,732               |           | 17,404                     
|DWS Mid Cap Growth VIP                    | 8,825                |           | 1,653                      
|DWS Money Market VIP                      | 181,227              |           | 27,276                     
|DWS Small Cap Growth VIP                  | 30,846               |           | 5,657                      
|DWS Strategic Income VIP                  | 34,260               |           | 5,746                      
|DWS Strategic Value VIP                   | 131,156              |           | 22,707                     
|DWS Technology VIP                        | 30,481               |           | 5,622                      
|DWS Turner Mid Cap Growth VIP             | 21,173               |           | 3,657                      

Service Provider Fees. DWS Investments Service Company ("DISC"), an affiliate of the Advisor, is the transfer
agent, dividend-paying agent and shareholder service agent for each Portfolio. Pursuant to a sub-transfer agency
agreement between DISC and DST Systems, Inc. ("DST"), DISC has delegated certain transfer agent,
dividend-paying agent and shareholder service agent functions to DST. DISC compensates DST out of the
shareholder servicing fee it receives from each Portfolio. For the six months ended June 30, 2009, for the period
ended March 6, 2009 (February 3, 2009 for DWS Money Market VIP) for DWS Balanced VIP, DWS Diversified
International Equity VIP, DWS Mid Cap Growth VIP, DWS Small Cap Growth VIP, DWS Strategic Income VIP and
DWS Turner Mid Cap Growth VIP and for the period from February 2, 2009 (commencement of operations) for
Class A shares and May 18, 2009 (commencement of operations) for Class B shares to June 30, 2009 for DWS
Alternative Asset Allocation Plus VIP, the amounts charged to each Portfolio by DISC were as follows:

|Portfolio                                         | Total
Aggregated ($) | Waived ($) | Unpaid at
June 30, 2009 ($)
|------------------------------------------------- | -------------------- | ---------- | ---------------------------
|DWS Alternative Asset Allocation Plus VIP Class A | 19                   |           |                           
|DWS Alternative Asset Allocation Plus VIP Class B | 3                    | 3          | 3                          
|DWS Balanced VIP Class A                          | 425                  |           | 74                         
|DWS Balanced VIP Class B                          | 5                    |           |                           
|DWS Blue Chip VIP Class A                         | 171                  |           | 56                         
|DWS Blue Chip VIP Class B                         | 7                    |           |                           
|DWS Core Fixed Income VIP Class A                 | 43                   |           | 43                         
|DWS Core Fixed Income VIP Class B                 | 28                   |           | 12                         
|DWS Diversified International Equity VIP Class A  | 108                  |           | 41                         
|DWS Diversified International Equity VIP Class B  | 5                    | 5          |                           
|DWS Dreman Small Mid Cap Value VIP Class A        | 387                  |           | 124                        
|DWS Dreman Small Mid Cap Value VIP Class B        | 143                  |           | 51                         
|DWS Global Thematic VIP Class A                   | 229                  | 229        |                           
|DWS Global Thematic VIP Class B                   | 42                   |           | 19                         
|DWS Government & Agency Securities VIP Class A    | 226                  |           | 225                        
|DWS Government & Agency Securities VIP Class B    | 21                   |           |                           
|DWS High Income VIP Class A                       | 169                  |           | 54                         
|DWS High Income VIP Class B                       | 19                   |           | 19                         
|DWS Large Cap Value VIP Class A                   | 164                  |           | 164                        
|DWS Large Cap Value VIP Class B                   | 13                   |           | 13                         
|DWS Mid Cap Growth VIP Class A                    | 113                  | 113        |                           
|DWS Mid Cap Growth VIP Class B                    | 5                    | 5          |                           
|DWS Money Market VIP Class A                      | 233                  | 233        |                           
|DWS Money Market VIP Class B                      | 2                    | 2          |                           
|DWS Small Cap Growth VIP Class A                  | 432                  |           | 86                         
|DWS Small Cap Growth VIP Class B                  | 5                    |           |                           
|DWS Strategic Income VIP Class A                  | 95                   | 95         |                           
|DWS Strategic Income VIP Class B                  | 5                    | 5          |                           
|DWS Strategic Value VIP Class A                   | 276                  | 276        |                           
|DWS Strategic Value VIP Class B                   | 105                  |           | 36                         
|DWS Technology VIP Class A                        | 112                  |           | 37                         
|DWS Technology VIP Class B                        | 883                  |           | 24                         
|DWS Turner Mid Cap Growth VIP Class A             | 51                   |           | 27                         
|DWS Turner Mid Cap Growth VIP Class B             | 8                    | 8          |                           

Distribution Service Agreement. Under the Portfolios' Class B 12b-1 plans, DWS Investments Distributors, Inc.
("DIDI") received a fee ("Distribution Service Fee") of 0.25% of average daily net assets of Class B shares. For
the six months ended June 30, 2009, for the period ended March 6, 2009 (February 3, 2009 for DWS Money
Market VIP) for DWS Balanced VIP, DWS Diversified International Equity VIP, DWS Mid Cap Growth VIP, DWS
Small Cap Growth VIP, DWS Strategic Income VIP and DWS Turner Mid Cap Growth VIP, the Distribution Service
Fee was as follows:

|Portfolio                                | Total
Aggregated ($) | Waived ($) | Unpaid at
June 30, 2009 ($)
|---------------------------------------- | -------------------- | ---------- | ---------------------------
|DWS Balanced VIP                         | 20                   |           |                           
|DWS Blue Chip VIP                        | 160                  |           | 160                        
|DWS Core Fixed Income VIP                | 38,426               |           | 5,632                      
|DWS Diversified International Equity VIP | 40                   | 10         |                           
|DWS Dreman Small Mid Cap Value VIP       | 26,631               |           | 4,753                      
|DWS Global Thematic VIP                  | 4,780                |           | 900                        
|DWS Government & Agency Securities VIP   | 9,365                |           | 1,543                      
|DWS High Income VIP                      | 170                  |           | 28                         
|DWS Large Cap Value VIP                  | 561                  |           | 138                        
|DWS Mid Cap Growth VIP                   | 9                    |           |                           
|DWS Money Market VIP                     | 10                   |           |                           
|DWS Small Cap Growth VIP                 | 6                    |           |                           
|DWS Strategic Income VIP                 | 21                   |           |                           
|DWS Strategic Value VIP                  | 2,202                |           | 389                        
|DWS Technology VIP                       | 2,218                |           | 427                        
|DWS Turner Mid Cap Growth VIP            | 3                    |           | 3                          

Typesetting and Filing Service Fees. Under an agreement with DIMA, DIMA is compensated for providing
typesetting and certain regulatory filing services to each Portfolio. For the six months ended June 30, 2009 and
for the period from February 2, 2009 (commencement of operations) though June 30, 2009 for DWS Alternative
Asset Allocation Plus VIP, the amount charged to each Portfolio by DIMA included in the Statement of Operations
under "reports to shareholders" was as follows:

|Portfolio                                 | Amount ($) | Unpaid at
June 30, 2009 ($)
|----------------------------------------- | ---------- | ---------------------------
|DWS Alternative Asset Allocation Plus VIP | 5,627      |                           
|DWS Balanced VIP                          | 3,400      | 2,516                      
|DWS Blue Chip VIP                         | 3,278      | 929                        
|DWS Core Fixed Income VIP                 | 6,186      | 4,383                      
|DWS Diversified International Equity VIP  | 2,751      | 1,130                      
|DWS Dreman Small Mid Cap Value VIP        | 4,100      | 2,317                      
|DWS Global Thematic VIP                   | 3,471      | 2,962                      
|DWS Government & Agency Securities VIP    | 872        | 872                        
|DWS High Income VIP                       | 3,547      | 1,698                      
|DWS Large Cap Value VIP                   | 7,768      |                           
|DWS Mid Cap Growth VIP                    | 3,090      | 1,928                      
|DWS Money Market VIP                      | 3,121      | 2,728                      
|DWS Small Cap Growth VIP                  | 3,863      | 3,426                      
|DWS Strategic Income VIP                  | 3,243      | 2,340                      
|DWS Strategic Value VIP                   | 3,332      | 1,698                      
|DWS Technology VIP                        | 3,661      | 1,357                      
|DWS Turner Mid Cap Growth VIP             | 1,720      | 1,520                      

Trustees' Fees and Expenses. The Portfolios paid each Trustee not affiliated with the Advisor retainer fees plus
specified amounts for various committee services and for the Board Chairperson.

Cash Management QP Trust. Pursuant to an Exemptive Order issued by the SEC, each Portfolio may invest in the
Cash Management QP Trust (the "QP Trust") and other affiliated funds managed by the Advisor. The QP Trust
seeks to provide as high a level of current income as is consistent with the preservation of capital and the
maintenance of liquidity. The QP Trust does not pay the Advisor a management fee for the affiliated funds'
investments in the QP Trust.

D. Investing in High Yield Securities

Investing in high yield securities may involve greater risks and considerations not typically associated with
investing in US Government bonds and other high quality fixed-income securities. These securities are
non-investment grade securities, often referred to as "junk bonds." Economic downturns may disrupt the high
yield market and impair the ability of issuers to repay principal and pay interest. Also, an increase in interest rates
would likely have an adverse impact on the value of such obligations. Moreover, high yield securities may be less
liquid due to the extent that there is no established retail secondary market and because of a decline in the value
of such securities.

E. Investing in Emerging Markets

Investing in emerging markets may involve special risks and considerations not typically associated with investing
in the United States of America. These risks include revaluation of currencies, high rates of inflation, repatriation
restrictions on income and capital, and future adverse political, social and economic developments. Moreover,
securities issued in these markets may be less liquid, subject to government ownership controls or delayed
settlements and may have prices more volatile than those of comparable securities of issuers in the United
States of America.

F. Fee Reductions

The Portfolios have entered into an arrangement with their custodian whereby credits realized as a result of
uninvested cash balances were used to reduce a portion of the Portfolios' expenses. During the six months
ended June 30, 2009, the Portfolios' custodian fee was reduced under the arrangement as follows:

|Portfolio                 | Amount ($)
|------------------------- | ----------
|DWS Balanced VIP          | 4         
|DWS Core Fixed Income VIP | 2         
|DWS High Income VIP       | 6         
|DWS Money Market VIP      | 2         
|DWS Strategic Income VIP  | 2         

G. Ownership of the Portfolios

At June 30, 2009, the beneficial ownership in each Portfolio was as follows:

DWS Alternative Asset Allocation Plus VIP: Two Participating Insurance Companies were owners of record of
10% or more of the total outstanding Class A shares of the Portfolio, each owning 71% and 29%.

DWS Balanced VIP: Three Participating Insurance Companies were owners of record of 10% or more of the total
outstanding Class A shares of the Portfolio, each owning 43%, 23% and 15%.

DWS Blue Chip VIP: Two Participating Insurance Companies were owners of record of 10% or more of the total
outstanding Class A shares of the Portfolio, each owning 56% and 37%. One Participating Insurance Company
was the owner of record of 10% or more of the total outstanding Class B shares of the Portfolio, owning 100%.

DWS Core Fixed Income VIP: Three Participating Insurance Companies were owners of record of 10% or more of
the total outstanding Class A shares of the Portfolio, each owning 43%, 42% and 14%. One Participating
Insurance Company was the owner of record of 10% or more of the total outstanding Class B shares of the
Portfolio, owning 100%.

DWS Diversified International Equity VIP: Three Participating Insurance Companies were owners of record of
10% or more of the total outstanding Class A shares of the Portfolio, each owning 44%, 28% and 28%.

DWS Dreman Small Mid Cap Value VIP:Three Participating Insurance Companies were owners of record of 10%
or more of the total outstanding Class A shares of the Portfolio, each owning 43%, 26% and 14%. Three
Participating Insurance Companies were owners of record of 10% or more of the total outstanding Class B shares
of the Portfolio, each owning 40%, 18% and 18%.

DWS Global Thematic VIP: Two Participating Insurance Companies were owners of record of 10% or more of the
total outstanding Class A shares of the Portfolio, each owning 62% and 33%. One Participating Insurance
Company was the owner of record of 10% or more of the total outstanding Class B shares of the Portfolio,
owning 99%.

DWS Government & Agency Securities VIP: Three Participating Insurance Companies were owners of record of
10% or more of the total outstanding Class A shares of the Portfolio, each owning 41%, 39% and 14%. One
Participating Insurance Company was the owner of record of 10% or more of the total outstanding Class B shares
of the Portfolio, owning 97%.

DWS High Income VIP: Three Participating Insurance Companies were owners of record of 10% or more of the
total outstanding Class A shares of the Portfolio, each owning 33%, 33% and 28%. One Participating Insurance
Company was the owner of record of 10% or more of the total outstanding Class B shares of the Portfolio,
owning 100%.

DWS Large Cap Value VIP: Three Participating Insurance Companies were owners of record of 10% or more of
the total outstanding Class A shares of the Portfolio, each owning 57%, 29% and 10%. Two Participating
Insurance Companies were owners of record of 10% or more of the total outstanding Class B shares of the
Portfolio, each owning 58% and 42%.

DWS Mid Cap Growth VIP: Two Participating Insurance Companies were owners of record of 10% or more of the
total outstanding Class A shares of the Portfolio, each owning 64% and 34%.

DWS Money Market VIP: Three Participating Insurance Companies were owners of record of 10% or more of the
total outstanding Class A shares of the Portfolio, each owning 38%, 20% and 14%.

DWS Small Cap Growth VIP: Three Participating Insurance Companies were owners of record of 10% or more of
the total outstanding Class A shares of the Portfolio, each owning 45%, 26% and 25%.

DWS Strategic Income VIP: Two Participating Insurance Companies were owners of record of 10% or more of
the total outstanding Class A shares of the Portfolio, each owning 61% and 36%.

DWS Strategic Value VIP: Two Participating Insurance Companies were owners of record of 10% or more of the
total outstanding Class A shares of the Portfolio, each owning 59% and 29%. Five Participating Insurance
Companies were owners of record of 10% or more of the total outstanding Class B shares of the Portfolio, each
owning 25%, 23%, 12%, 11% and 10%.

DWS Technology VIP: Two Participating Insurance Companies were owners of record of 10% or more of the total
outstanding Class A shares of the Portfolio, each owning 58% and 37%. One Participating Insurance Company
was the owner of record of 10% or more of the outstanding Class B shares of the Portfolio, owning 92%.

DWS Turner Mid Cap Growth VIP: Two Participating Insurance Companies were owners of record of 10% or
more of the total outstanding Class A shares of the Portfolio, each owning 77% and 22%.

H. Line of Credit

The Trust and other affiliated funds (the "Participants") share in a $450 million revolving credit facility provided by
a syndication of banks. The Portfolios may borrow for temporary or emergency purposes, including the meeting
of redemption requests that otherwise might require the untimely disposition of securities. The Participants are
charged an annual commitment fee which is allocated based on net assets, among each of the Participants.
Interest is calculated at a rate per annum equal to the sum of the Federal Funds Rate plus 1.25 percent plus if
LIBOR exceeds the Federal Funds Rate the amount of such excess. The facility borrowing limit for each Portfolio
as a percentage of net assets is as follows:

|Portfolio                                 | Facility
Borrowing Limit
|----------------------------------------- | ------------------------
|DWS Alternative Asset Allocation Plus VIP | 10%                     
|DWS Balanced VIP                          | 33%                     
|DWS Blue Chip VIP                         | 33%                     
|DWS Core Fixed Income VIP                 | 33%                     
|DWS Diversified International Equity VIP  | 33%                     
|DWS Dreman Small Mid Cap Value VIP        | 33%                     
|DWS Global Thematic VIP                   | 33%                     
|DWS Government & Agency Securities VIP    | 33%                     
|DWS High Income VIP                       | 33%                     
|DWS Large Cap Value VIP                   | 33%                     
|DWS Mid Cap Growth VIP                    | 33%                     
|DWS Money Market VIP                      | 33%                     
|DWS Small Cap Growth VIP                  | 33%                     
|DWS Strategic Income VIP                  | 33%                     
|DWS Strategic Value VIP                   | 33%                     
|DWS Technology VIP                        | 5%                      
|DWS Turner Mid Cap Growth VIP             | 33%                     

I. Payments Made by Affiliates

During the six months ended June 30, 2009, the Advisor fully reimbursed DWS Strategic Income VIP $188 for
losses incurred on trades executed incorrectly. The amount of the losses was less than 0.01% of the Portfolio's
average net assets, thus having no impact on the Portfolio's total return.

In addition, during the six months ended June 30, 2009, the Advisor reimbursed DWS Dreman Small Mid Cap
Value VIP and DWS Strategic Value VIP $9,887 and $12,813, respectively, for a loss incurred as a result of a
breach of the Portfolios' investment restrictions. The amount of the loss was less than 0.01% of the Portfolios'
average daily net assets, thus having no impact on the Portfolios' total return.

In addition, during the six months ended June 30, 2009, the Advisor fully reimbursed DWS Core Fixed Income
VIP $24,775 for losses incurred on trades executed incorrectly.

J. Participation in the Treasury's Temporary Guarantee Program

DWS Money Market VIP is participating in the Temporary Guarantee Program for Money Market Funds (the
"Program") established by the U.S. Department of the Treasury (the "Treasury"). The Program is designed to
protect the value of accounts in the Portfolios of the close of business on September 19, 2008. According to the
terms of the Program, any investment made by a shareholder after September 19, 2008 in excess of the amount
held in the account as of the close of business on that date will not be covered by the Program. Any purchase of
the shares of the Portfolio for an account opened after September 19, 2008 will also not be covered under the
Program. The Program guarantee will apply to the lesser of (i) the number of shares held in an account as of the
close of business on September 19, 2008, or (ii) the number of shares held in the account on the date the
Program guarantee is triggered. Subject to certain conditions and limitations, the Program guarantee is triggered
if the Portfolio's net asset value falls below $0.995 and the Portfolio is liquidated. Guarantee payments under the
Program will not exceed the amount available within the Treasury's Exchange Stabilization Fund ("ESF") on the
date of payment.

The Portfolio bears the expenses of participating in the Program. The expense is determined by the product of (i)
the number of shares outstanding of each class as of September 19, 2008 valued at $1.00; and (ii) the applicable
Program participation fee rate, which is based upon the market-based net asset value outstanding of each share
class as of September 19, 2008. For the initial period ending December 18, 2008, the Program participation fee
was equal to 0.01%. For the coverage under the Program beginning on December 19, 2008 and ending on
April 30, 2009, the Program participation fee was equal to 0.015%. For the coverage under the Program beginning
on May 1, 2009 and ending September 18, 2009, the Program participation fee is equal to 0.015%. This expense
is being amortized over the length of the participation in the Program and is included in "Temporary guarantee
program participation fee" on the Statement of Operations. For the period from January 1, 2009 through
June 30, 2009, the Portfolio accrued $79,769. This expense was borne by the Portfolio without regard to any
expense limitation currently in effect for the Portfolio. The Program is set to terminate on September 18, 2009.

Neither the Portfolio nor Deutsche Investment Management Americas Inc., the Portfolio's investment advisor, are
in any manner approved, endorsed, sponsored or authorized by the Treasury.

K. Acquisition of Assets

On April 24, 2009, DWS Large Cap Value VIP acquired all of the net assets of DWS Davis Venture Value VIP
pursuant to a plan of reorganization approved by shareholders on November 21, 2008. The acquisition was
accomplished by a tax-free exchange of 17,064,120 Class A shares and 32,154 Class B shares of DWS Davis
Venture Value VIP for 12,224,432 Class A shares and 22,957 Class B shares of DWS Large Cap Value VIP,
respectively, outstanding on April 24, 2009. DWS Davis Venture Value VIP's net assets at that date, $107,655,331,
including $5,676,099 of net unrealized appreciation, were combined with those of the Portfolio. The aggregate net
assets of the Portfolio immediately before the acquisition were $106,678,067. The combined net assets of the
Portfolio immediately following the acquisition were $214,333,398.

L. Review for Subsequent Events

In accordance with the provisions set forth in Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 165 "Subsequent Events," adopted by the Portfolios as of June 30, 2009, events and
transactions from July 1, 2009 through August 18, 2009, the date the financial statements were available to be
issued, have been evaluated by management for subsequent events. Management has determined that there
were no material events that would require disclosure in the Portfolios' financial statements through this date.

Other Information

DWS Balanced VIP

Effective July 14, 2009, the portfolio management team for the portfolio is as follows:

Robert Wang       J. Richard Robben, CFA
James B. Francis, CFA   Thomas Schuessler, PhD
Inna Okounkova  Mark Schumann
Thomas Picciochi        Richard Shepley
John Brennan    Michael Sieghart, CFA
William Chepolis, CFA   Gary Sullivan, CFA
Owen Fitzpatrick, CFA   Andreas Wendelken
Matthew F. MacDonald, CFAPortfolio Managers

DWS Blue Chip VIP

Effective August 1, 2009, the portfolio management team for the portfolio is as follows:

Robert Wang
James B. Francis, CFAPortfolio Managers

DWS Mid Cap Growth VIP and DWS Small Cap Growth VIP

Effective August 13, 2009, the portfolio management team for the portfolio is as follows:

Joseph Axtell, CFA
Rafaelina M. LeePortfolio Managers

Proxy Voting

The Trust's policies and procedures for voting proxies for portfolio securities and information about how the
Trust voted proxies related to its portfolio securities during the 12-month period endedJune 30are available on
our Web site  www.dws-investments.com (click on "proxy voting"at the bottom of the page)  or on the SEC's
Web site  www.sec.gov. To obtain a written copy of the Trust's policies and procedures without charge, upon
request, call us toll free at (800) 621-1048.

Summary of Management Fee Evaluation by Independent
Fee Consultant

October 24, 2008

Pursuant to an Order entered into by Deutsche Investment Management Americas and affiliates (collectively,
"DeAM") with the Attorney General of New York, I, Thomas H. Mack, have been appointed the Independent Fee
Consultant for the DWS Funds (formerly the DWS Scudder Funds). My duties include preparing an annual written
evaluation of the management fees DeAM charges the Funds, considering among other factors the management
fees charged by other mutual fund companies for like services, management fees DeAM charges other clients for
like services, DeAM's costs of supplying services under the management agreements and related profit margins,
possible economies of scale if a Fund grows larger, and the nature and quality of DeAM's services, including fund
performance. This report summarizes my evaluation for 2008, including my qualifications, the evaluation process
for each of the DWS Funds, consideration of certain complex-level factors, and my conclusions. I served in
substantially the same capacity in 2007.

Qualifications

For more than 35 years I have served in various professional capacities within the investment management
business. I have held investment analysis and advisory positions, including securities analyst, portfolio strategist
and director of investment policy with a large investment firm. I have also performed business management
functions, including business development, financial management and marketing research and analysis.

Since 1991, I have been an independent consultant within the asset management industry. I have provided
services to over 125 client organizations, including investment managers, mutual fund boards, product
distributors and related organizations. Over the past ten years I have completed a number of assignments for
mutual fund boards, specifically including assisting boards with management contract renewal.

I hold a Master of Business Administration degree, with highest honors, from Harvard University and Master of
Science and Bachelor of Science (highest honors) degrees from the University of California at Berkeley. I am an
independent director and audit committee financial expert for two closed-end mutual funds, serve on the board of
directors of a private market research company, and have served in various leadership and financial oversight
capacities with non-profit organizations.

Evaluation of Fees for each DWS Fund

My work focused primarily on evaluating, fund-by-fund, the fees charged to each of the 129 Fund portfolios in the
DWS Fund family. For each Fund, I considered each of the key factors mentioned above, as well as any other
relevant information. In doing so I worked closely with the Funds' Independent Directors in their annual contract
renewal process, as well as in their approval of contracts for several new funds (documented separately).

In evaluating each Fund's fees, I reviewed comprehensive materials provided by or on behalf of DeAM, including
expense information prepared by Lipper Analytical, comparative performance information, profitability data,
manager histories, and other materials. I also accessed certain additional information from the Lipper, Strategic
Insight, and Morningstar databases and drew on my industry knowledge and experience.

To facilitate evaluating this considerable body of information, I prepared for each Fund a document summarizing
the key data elements in each area as well as additional analytics discussed below. This made it possible to
consider each key data element in the context of the others.

In the course of contract renewal, DeAM agreed to implement a number of fee and expense adjustments
requested by the Independent Directors which will favorably impact future fees and expenses, and my evaluation
includes the effects of these changes.

Fees and Expenses Compared with Other Funds

The competitive fee and expense evaluation for each fund focused on two primary comparisons:

The Fund's contractual management fee (the advisory fee plus the administration fee where applicable)
compared with those of a group of typically 12-15 funds in the same Lipper investment category (e.g. Large
Capitalization Growth) having similar distribution arrangements and being of similar size.

The Fund's total expenses compared with a broader universe of funds from the same Lipper investment
category and having similar distribution arrangements.

These two comparisons provide a view of not only the level of the fee compared with funds of similar scale but
also the total expense the Fund bears for all the services it receives, in comparison with the investment choices
available in the Fund's investment category and distribution channel. The principal figure-of-merit used in these
comparisons was the subject Fund's percentile ranking against peers.

DeAM's Fees for Similar Services to Others

DeAM provided management fee schedules for all of its US domiciled fund and non-fund investment
management accounts in any of the investment categories where there is a DWS Fund. These similar products
included the other DWS Funds, non-fund pooled accounts, institutional accounts and sub-advisory accounts.
Using this information, I calculated for each Fund the fee that would be charged to each similar product, at the
subject Fund's asset level.

Evaluating information regarding non-fund products is difficult because there are varying levels of services
required for different types of accounts, with mutual funds generally requiring considerably more regulatory and
administrative types of service as well as having more frequent cash flows than other types of accounts. Also,
while mutual fund fees for similar fund products can be expected to be similar, there will be some differences due
to different pricing conditions in different distribution channels (e.g. retail funds versus those used in variable
insurance products), differences in underlying investment processes and other factors.

Costs and Profit Margins

DeAM provided a detailed profitability analysis for each Fund. After making some adjustments so that the
presentation would be more comparable to the available industry figures, I reviewed profit margins from
investment management alone, from investment management plus other fund services (excluding distribution)
provided to the Funds by DeAM (principally shareholder services), and DeAM profits from all sources, including
distribution. A later section comments on overall profitability.

Economies of Scale

Economies of scale  an expected decline in management cost per dollar of fund assets as fund assets grow 
are very rarely quantified and documented because of inherent difficulties in collecting and analyzing relevant
data. However, in virtually every investment category that I reviewed, larger funds tend to have lower fees and
lower total expenses than smaller funds. To see how each DWS Fund compares with this industry observation, I
reviewed:

The trend in Fund assets over the last five years and the accompanying trend in total expenses. This shows if
the Fund has grown and, if so, whether total expense (management fees as well as other expenses) have
declined as a percent of assets.

Whether the Fund has break-points in its management fee schedule, the extent of the fee reduction built into
the schedule and the asset levels where the breaks take effect, and in the case of a sub-advised Fund how the
Fund's break-points compare with those of the sub-advisory fee schedule.

How the Fund's contractual fee schedule compares with trends in the industry data. To accomplish this, I
constructed a chart showing how actual latest-fiscal-year contractual fees of the Fund and of other similar
funds relate to average fund assets, with the subject Fund's contractual fee schedule superimposed.

Quality of Service  Performance

The quality-of-service evaluation focused on investment performance, which is the principal result of the
investment management service. Each Fund's performance was reviewed over the past 1, 3, 5 and 10 years, as
applicable, and compared with that of other funds in the same investment category and with a suitable market
index.

In addition, I calculated and reviewed risk-adjusted returns relative to an index of similar mutual funds' returns and
a suitable market index. The risk-adjusted returns analysis provides a way of determining the extent to which the
Fund's return comparisons are mainly the product of investment value-added (or lack thereof) or alternatively
taking considerably more or less risk than is typical in its investment category.

I also received and considered the history of portfolio manager changes for each Fund, as this provided an
important context for evaluating the performance results.

Complex-Level Considerations

While this evaluation was conducted mainly at the individual fund level, there are some issues relating to the
reasonableness of fees that can alternatively be considered across the whole fund complex:

I reviewed DeAM's profitability analysis for all DWS Funds, with a view toward determining if the allocation
procedures used were reasonable and how profit levels compared with public data for other investment
managers.

I considered whether DeAM and affiliates receive any significant ancillary or "fall-out" benefits that should be
considered in interpreting the direct profitability results. These would be situations where serving as the
investment manager of the Funds is beneficial to another part of the Deutsche Bank organization.

I considered how aggregated DWS Fund expenses had varied over the years, by asset class and in the context
of trends in asset levels.

I reviewed the structure of the DeAM organization, trends in staffing levels, and information on compensation
of investment management and other professionals compared with industry data.

Findings

Based on the process and analysis discussed above, which included reviewing a wide range of information from
management and external data sources and considering among other factors the fees DeAM charges other
clients, the fees charged by other fund managers, DeAM's costs and profits associated with managing the Funds,
economies of scale, possible fall-out benefits, and the nature and quality of services provided, in my opinion the
management fees charged the DWS Funds are reasonable.

vs2_sigmack1Thomas H. Mack

Summary of Administrative Fee Evaluation by Independent
Fee Consultant

September 29, 2008

Pursuant to an Order entered into by Deutsche Asset Management (DeAM) with the Attorney General of New
York, I, Thomas H. Mack, have been appointed the Independent Fee Consultant for the DWS Funds and have as
part of my duties evaluated the reasonableness of the proposed management fees to be charged by DeAM to the
DWS Funds, taking onto account a proposal to pass through to the funds certain fund accounting-related charges
in connection with new regulatory requirements. My evaluation considered the following:

•   While the proposal would alter the services to be provided under the Administration Agreement, which I
consider to be part of fund management under the Order, it is my opinion that the change in services is slight
and that the scope of prospective services under the combination of the Advisory and Administration
Agreements continues to be comparable with those typically provided to competitive funds under their
management agreements.

•   While the proposal would increase fund expenses, according to a pro forma analysis performed by
management, the prospective effect is less than .01% for all but seven of the DeAM Funds' 438 active share
classes, and in all cases the effect is less than .03% and overall expenses would remain reasonable in my
opinion.

Based on the foregoing considerations, in my opinion the fees and expenses for all of the DWS Funds will remain
reasonable if the Directors adopt this proposal.

vs2_sigmack0Thomas H. Mack

DWS Investments is part of Deutsche Bank's Asset Management division and, within the US, represents the
retail asset management activities of Deutsche Bank AG, Deutsche Bank Trust Company Americas, Deutsche
Investment Management Americas Inc. and DWS Trust Company.

The views expressed in this report reflect those of the portfolio managers only through the end of the period of
the report as stated on the cover. The managers' views are subject to change at any time based on market and
other conditions and should not be construed as a recommendation.

This information must be preceded or accompanied by a current prospectus.

Portfolio changes should not be considered recommendations for action by individual investors.

DWS Investment Distributors, Inc.
222 South Riverside Plaza
Chicago, IL 60606
(800) 778-1482

VS2-3  (R-12547-1  8/09)

vs2_backcover0vs2_backcoverlogo0




ITEM 2.
        CODE OF ETHICSNot applicable.ITEM 3.
        AUDIT COMMITTEE FINANCIAL EXPERTNot applicable.ITEM 4.
        PRINCIPAL ACCOUNTANT FEES AND SERVICESNot applicable.
  ITEM 5.
        AUDIT COMMITTEE OF LISTED REGISTRANTSNot ApplicableITEM 6.
        SCHEDULE OF INVESTMENTSNot ApplicableITEM 7.
        DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIESNot applicable.ITEM 8.
        PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIESNot applicable.
  ITEM 9.
        PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERSNot Applicable.
  ITEM 10.
        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSThe primary function of the Nominating and Governance Committee is to identify and recommend individuals for membership on the Board and oversee the administration of the Board Governance Guidelines. Shareholders may recommend candidates for Board positions by forwarding their correspondence by U.S. mail or courier service to Chairman of the Board, P.O. Box 100176, Cape Coral, FL 33910.ITEM 11.
        CONTROLS AND PROCEDURES(a)        The Chief Executive and Financial Officers concluded that the Registrants Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.(b)        There have been no changes in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal controls over financial reporting.
  
  ITEM 12.
        EXHIBITS(a)(1)   Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.(b)       Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT.


Form N-CSRS Item F  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.  Registrant:
        DWS Variable Series IIBy:
        /s/Michael G. Clark
Michael G. Clark
PresidentDate:
        August 20, 2009
   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.  Registrant:
        DWS Variable Series IIBy:
        /s/Michael G. Clark
Michael G. Clark
PresidentDate:
        August 20, 2009By:
        /s/Paul Schubert
Paul Schubert
Chief Financial Officer and TreasurerDate:
        August 20, 2009