Edgar Filing: TCW CONVERTIBLE SECURITIES FUND INC

[TCW LOGO]-Registered Trademark-
TCW CONVERTIBLE
SECURITIES FUND, INC.
-------------------------------
DIRECTORS AND OFFICERS
Ernest O. Ellison
PRESIDENT AND DIRECTOR
John C. Argue
DIRECTOR
Norman Barker, Jr.
DIRECTOR
Richard W. Call
DIRECTOR
Matthew K. Fong
DIRECTOR
John A. Gavin
DIRECTOR
Patrick C. Haden
DIRECTOR
Charles A. Parker
DIRECTOR
Robert G. Sims
DIRECTOR

Thomas D. Lyon
SENIOR VICE PRESIDENT
Kevin A. Hunter
SENIOR VICE PRESIDENT
Thomas E. Larkin, Jr.
SENIOR VICE PRESIDENT
Hilary G.D. Lord
SENIOR VICE PRESIDENT
AND ASSISTANT SECRETARY
Alvin R. Albe, Jr.
SENIOR VICE PRESIDENT
Phillip K. Holl
SECRETARY
Michael E. Cahill
GENERAL COUNSEL AND
ASSISTANT SECRETARY
David S. DeVito
TREASURER
George Winn
ASSISTANT TREASURER

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SHAREHOLDER INFORMATION
INVESTMENT ADVISER
TCW Investment Management Company
865 South Figueroa Street
Los Angeles, California 90017
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TRANSFER AGENT, DIVIDEND REINVESTMENT
AND DISBURSING AGENT AND REGISTRAR
The Bank of New York
Church Street Station
P.O. Box #11002
New York, New York 10277-0770
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CUSTODIAN
Investors Bank & Trust Company
200 Clarendon Street
Boston, Massachusetts 02116
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INDEPENDENT AUDITORS
Deloitte & Touche LLP
350 South Grand Avenue
Los Angeles, California 90071
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LEGAL COUNSEL
Dechert
1775 Eye Street N.W.
Washington DC, 20006
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TCW Convertible
Securities Fund, Inc.
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-----------------------------

SEMI-ANNUAL REPORT

June 30, 2002
[TCW LOGO]-Registered Trademark-

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
The President's Letter
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DEAR SHAREHOLDER,

The first six months of 2002 were a difficult period for the financial
markets. Stocks declined significantly in what has become a bear market that
rivals that of 1973-1974. The combination of corporate fraud and the aggressive
accounting on the parts of some large corporations have shaken investor
confidence. This has not only been reflected in stock prices, but in corporate
credit spreads as well. The combination of falling stock prices and widening
credit spreads have been the primary cause of negative performance for
convertible securities in 2002.

PERFORMANCE OF THE FUND'S SHARES

For the six months ended June 30, 2002, the TCW Convertible Securities
Fund, Inc. (the "Fund") had a return on Net Asset Value (NAV) of a negative
17.98%. The Fund's shareholders realized a return of negative 21.86% from a
decrease in the market price of the Fund from $8.55 on December 31, 2001 to
$6.26 on June 30, 2002 (with dividends reinvested). The total distribution for
the period was $0.42. This represents the two quarterly dividends of $0.21. Of
these distributions, approximately $0.17 was from earned income while the
remainder was a return of capital. The ultimate return of capital for tax
purposes is determined on an annual basis. The Fund's market price per share on
June 30, 2002 represents a premium of 22.50% to the Fund's NAV of $5.11.

STRUCTURE OF THE FUND

The Fund continues to invest in companies that are concentrated in sectors
which we believe should grow more rapidly than the overall economy going
forward. The six largest industries are as follows:

Electronics....................................... 13.0%
Telecommunications................................ 12.1%
Media............................................. 9.6%
Pharmaceuticals................................... 6.8%
Computer Software................................. 6.2%
Insurance......................................... 5.2%

In addition, the Fund's holdings are structured as a "barbell". A
significant number of holdings are more bond-like with high yields / conversion
premiums, while at the other end of the "barbell", the securities are comprised
of more equity-like convertible bonds and preferreds.

TCW CONVERTIBLE SECURITIES FUND
BREAKDOWN OF YIELD / CONVERSION PREMIUM
AS OF JUNE 30, 2002

25% 25%-50% 50%-75% 75%-100% 100%
---- ------- ------- -------- -------

NUMBER OF SECURITIES..... 19 17 7 3 26
PORTFOLIO WEIGHTING...... 27.9% 27.4% 8.2% 3.0% 33.5%
WGT. AVG. CONV.
PREMIUM................ 16.4% 32.0% 60.4% 90.4% 425.7%
WGT. AVG.
YIELD-TO-MATURITY...... 2.5% 4.0% 6.8% 7.9% 15.6%

We believe that the Fund, with a current yield of 6.7%, BBB- average credit
quality and its "barbell" approach, should provide moderate exposure to
improving equity and credit markets and is positioned to provide good
performance relative to bonds and stocks going forward.

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
The President's Letter (continued)
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FUND STRATEGY AND OUTLOOK

The performance of the Fund during the first half of 2002 was disappointing.
The stocks of companies in growth sectors of the economy continued to do poorly.
In addition, companies with significant leverage were also hit hard as investors
worried about future liquidity and their ultimate viability. Particularly
affected were companies in the technology, telecommunications, power and media
sectors. The Fund's significant weightings in these sectors of the economy,
especially media, has hurt performance thus far this year. We believe that many
convertibles in the technology, wireless telecommunications, media and
healthcare sectors now provide attractive investment opportunities. Some of
these opportunities are in busted convertible bonds, which have double-digit
yields and where the underlying company has a strong balance sheet. Other
opportunities are in more equity-sensitive convertibles whose underlying stocks
have declined significantly with the market and appear attractive.

The issuance of convertible securities has slowed substantially relative to
the first six months of 2001. During the first half of 2002, there were 86 new
issues with a net value of $41.7 billion brought to market. This was down from
$57.6 billion in new issuance for the first six months of 2001. The issuance
thus far in 2002, has been characterized by relatively high quality ($29.1
billion of issuance was investment grade), a large number of convertible
preferreds (42.8% of issuance) and fewer zero-coupon issues (19.6% of issuance).

The new issue market remained active despite the slowdown as compared to the
same period in 2001. The Fund participated in 35 of the 86 new issues brought to
market. Of the 35 issues, 16 were purchased as investments and 19 were purchased
as trades.

TCW CONVERTIBLE SECURITIES FUND
2002 NEW ISSUES PURCHASED

Conversion
Security Credit Quality Yield Premium
-------- -------------- ---------- ----------

Williams 9.0% Pfd.................. BBB 9.0% 25.0%
Morgan Stanley exch. Siebel 20.35%
Pfd.............................. A 20.35% NA
*Emulex Corp. 1.75% 2/1/07......... NR 1.75% 22.0%
Ford Motor 6.5% Pfd................ BBB- 7.0% 22.5%
Lehman Exch. Siebel 19% Pfd........ A- 19.0% NA
*GATX Corp. 7.5% 2/1/07............ BBB 7.5% 16.0%
*Acxicom 3.75% 2/15/09............. BB- 3.75% 30.0%
*OSI Pharmaceuticals 4.0% 2/1/09... NR 4.0% 23.3%
*Adaptec 3.0% 3/5/07............... B- 3.0% 32.0%
*GAP Stores 5.75% 3/15/09.......... BB+ 5.75% 30.0%
General Motors 5.25% Pfd B......... BBB+ 5.25% 22.5%
General Motors 4.5% Pfd A.......... BBB+ 4.5% 32.5%
Commerce Bancorp 5.95% Pfd......... BB+ 5.95% 27.0%
Merrill Lynch 0% 3/13/32........... AA- 0% 33.0%
*Lucent 7.75% Pfd.................. CCC+ 7.75% 24.0%
*Computer Associates 5% 3/15/07.... BBB+ 5.0% 33.0%
*Ohio Casualty 5.0% 3/19/22........ BB 5.0% 27.0%
*NAVISTAR 4.75% 4/1/09............. BB- 4.75% 30.0%
*Airborne 5.75% 5/1/07............. BBB- 5.75% 24.0%
Traveler's 4.5% 4/15/32............ BBB 4.5% 25.0%
*EDO Corp. 5.25% 4/15/07........... NR 5.25% 25.0%
*GenCorp Bond 5.75% 4/5/07......... B+ 5.75% 27.0%
*Duane Reade 2.15% 4/16/22......... BB- 2.15% 28.0%
Sempra 8.5% Pfd.................... A- 8.5% 22.0%
*Isis Pharmaceuticals 5.5%
5/1/09........................... NR 5.5% 25.0%
Alltel 7.75% Pfd................... A 7.75% 22.0%
*Lennox 6.25% 6/1/09............... B 6.25% 25.0%
IKON Office 5.0% 5/1/07............ BB+ 5.0% 29.0%
*Pep Boys 4.25% 6/1/07............. BB- 4.25% 33.0%
*Charming Shoppes 4.75% 6/1/12..... BB- 4.75% 29.0%
Toys 'R Us 6.25% Pfd............... BBB 6.25% 22.0%
*Mentor Graphics 6.87% 6/15/07..... NR 6.88% 45.0%
Medicis Pharmaceuticals 2.5%
6/4/32........................... NR 2.5% 25.0%
El Paso Energy 9.0% Pfd............ BBB 9.0% 20.0%

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* Security held for short term.

The stock market's decline in 2002 has been caused by concerns over corporate
governance, a weakening dollar, valuation issues, continuing terrorist threats
and tension in the West Bank. Although the list appears somewhat daunting,
improving economic fundamentals will eventually erase many of the concerns. We
believe the third quarter will mark an important reversal in corporate earnings
reports. It now appears that over 60% of the companies in the S&P 500 reported
earnings, which exceeded expectations. Improving earnings will help reduce the
perceived risk in the high yield market and make equity and debt issuance less
onerous. As the market resolves concerns one by one, a meaningful rally could
occur, leading to better performance for the Fund in the second half of the
year.

DIVIDEND DISTRIBUTION POLICY

The Fund announced on July 24, 2002 that its historic policy of paying a
quarterly $0.21 distribution is not sustainable in the current environment and
will be discontinued. In the future, dividends will be declared and paid
quarterly out of estimated net investment company taxable income. The Fund
intends to distribute to shareholders substantially all of its net realized
capital gains at least annually, to the extent required for U.S. federal income
tax purposes. The Board of Directors also may, in its discretion, choose to pay
distributions in excess of net investment income and net realized capital gains,
though it is not required to do so. If it elects to do so, this excess amount
will be treated as a return of capital, which will reduce the tax basis in a
shareholder's shares, thereby increasing his or her potential gain or reducing
potential loss on the sale of the shares.

The company has adopted these changes in recognition of the severe market
conditions facing the convertible securities market at this time and the
difficulty of realizing capital gains against a broad and sustained decline in
market values and declining interest rates. The Fund expects the net effect of
the new policy will be a decrease in the quarterly distribution, at least over
the near term. The current yield on the net asset value of the Fund's portfolio
is approximately 6.7%.

JOHN C. ARGUE

It is with great sadness that I have to report that John passed away on
August 10, 2002, after an eight-month battle with leukemia. We will miss his
candor, insights, leadership, knowledge, and most importantly, his friendship.

DIVIDEND REINVESTMENT PLAN

Shareholders who wish to add to their investment may do so through the
Dividend Reinvestment Plan (the "Plan"). Under the Plan, your dividend is used
to purchase shares on the open market whenever shares and the related sales
commission are selling below the Fund's Net Asset Value per share. If the market
price, including commission, is selling above the Net Asset Value, you will
receive shares at a price equal to the higher of the Net Asset Value per share
on the payment date or 95% of the closing market price on the payment date.

To enroll in the Plan, if your shares are registered in your name, write to
The Bank of New York, Church Street Station, P.O. Box #11002, New York, New York
10277-0770, or call their toll free number (800) 524-4458. If your shares are
held by a brokerage firm, please call your broker. If, however, you need
assistance, please call our investor relations department at (877) TCW-MKTS
(829-6587). As always, we would be pleased to accommodate your investment needs.

Sincerely,

/s/ Ernest O. Ellison

Ernest O. Ellison
President and Director
August 12, 2002

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Schedule of Investments (Unaudited)
June 30, 2002
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Principal Market
Amount Value
---------- ------------

FIXED INCOME SECURITIES

BANKING & FINANCIAL SERVICES (2.2% OF
NET ASSETS)
$4,035,000 E*TRADE Group, Inc., 6%,
due 02/01/07.......................... $ 3,071,644+
2,975,000 E*TRADE Group, Inc., 6.75%,
due 05/15/08.......................... 2,573,375+
------------
Total Banking & Financial
Services.......................... 5,645,019
------------
BUILDING MATERIALS (1.2%)
3,465,000 American International Group, Inc.,
Exchangeable Home Depot, Inc., (144A),
1%, due 02/14/06...................... 3,114,169*
------------
COMMERCIAL SERVICES (2.1%)
5,720,000 Ikon Office Solutions, (144A), 5%,
due 05/01/07.......................... 5,387,210*
------------
COMMUNICATIONS (0.9%)
5,350,000 Nortel Networks Corp., (144A), 4.25%,
due 09/01/08.......................... 2,467,687*
------------
COMPUTER SERVICES (1.1%)
5,030,000 Federal National Mortgage Association,
Exchangeable Micron Technology, Inc.,
(144A), 0%, due 05/15/08.............. 2,890,993*
------------
COMPUTER SOFTWARE (4.1%)
5,360,000 Lehman Brothers Holdings, Inc.,
Exchangeable Siebel Systems, Inc.,
19%, due 02/01/03..................... 2,599,600
2,820,000 Siebel Systems, Inc., 5.5%,
due 09/15/06.......................... 2,802,375+
1,950,000 Symantec Corp., (144A), 3%,
due 11/01/06.......................... 2,371,687*
3,505,000 Veritas Software Corp., 1.856%,
due 08/13/06.......................... 2,939,819
------------
Total Computer Software............. 10,713,481
------------

Principal Market
Amount Value
---------- ------------

ELECTRIC UTILITIES (1.1%)
$4,320,000 AES Corp., 4.5%, due 08/15/05........... $ 2,775,600+
------------
ELECTRONICS (11.6%)
4,520,000 ASM Lithography Holding N.V., (144A),
4.25%, due 11/30/04................... 3,983,250*+
3,170,000 ASM Lithography Holding N.V., (144A),
5.75%, due 10/15/06................... 3,669,275*
3,060,000 Burr-Brown Corp., 4.25%,
due 02/15/07.......................... 3,098,250+
5,255,000 GlobeSpan, Inc., (144A), 5.25%,
due 05/15/06.......................... 4,256,550*
4,080,000 LSI Logic Corp., 4.25%, due 03/15/04.... 3,957,600+
3,815,000 PMC-Sierra, Inc., (144A), 3.75%,
due 08/15/06.......................... 2,832,637*
9,330,000 STMicroelectronics N.V., 0%,
due 09/22/09.......................... 8,268,712
------------
Total Electronics................... 30,066,274
------------
ENERGY & OIL SERVICES (2.1%)
4,995,000 Kerr-McGee Corp., 5.25%,
due 02/15/10.......................... 5,531,962
------------
ENTERTAINMENT & LEISURE (2.0%)
5,460,000 Morgan Stanley Dean Witter & Co.,
Exchangeable The Walt Disney Co.,
0.25%, due 12/30/08................... 5,282,550
------------
INDUSTRIAL-DIVERSIFIED (4.0%)
1,705,000 SPX Corp., 0%, due 02/06/21............. 1,159,400
9,000,000 SPX Corp., (144A), 0%, due 02/06/21..... 6,120,000*
4,530,000 Tyco International, Ltd., 0%,
due 02/12/21.......................... 3,137,025+
------------
Total Industrial--Diversified....... 10,416,425
------------
INSURANCE (3.8%)
7,105,000 American International Group, Inc.,
0.5%, due 05/15/07.................... 6,492,194+
3,440,000 Swiss RE America Holding, (144A), 3.25%,
due 11/21/21.......................... 3,341,100*
------------
Total Insurance..................... 9,833,294
------------

+ Security partially or fully lent (Note 3).
* 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. At June 30, 2002,
the value of these securities amounted to $75,416,694 or 29.1% of net assets.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Schedule of Investments (Unaudited) (continued)
June 30, 2002
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Principal Market
Amount Value
---------- ------------

MEDIA-BROADCASTING & PUBLISHING (1.3%)
$3,830,000 Charter Communications, Inc., 4.75%,
due 06/01/06.......................... $ 1,782,980
455,000 Charter Communications, Inc., 5.75%,
due 10/15/05.......................... 238,306
2,555,000 Charter Communications, Inc., (144A),
5.75%, due 10/15/05................... 1,338,181*
------------
Total Media--Broadcasting &
Publishing........................ 3,359,467
------------
MEDICAL SUPPLIES (4.0%)
7,420,000 Agilent Technolgies, Inc., (144A), 3%,
due 12/01/21.......................... 7,624,050*
3,595,000 Alza Corp., Exchangeable Johnson &
Johnson, Inc., 0%, due 07/28/20....... 2,699,629
------------
Total Medical Supplies.............. 10,323,679
------------
PHARMACEUTICALS (6.8%)
3,960,000 Human Genome Sciences, Inc., 5%,
due 02/01/07.......................... 3,019,500
4,085,000 Invitrogen Corp., (144A), 2.25%,
due 12/15/06.......................... 3,196,513*
2,100,000 Medicis Pharmaceutical Corp., (144A),
2.5%, due 06/04/32.................... 2,034,375*
9,635,000 Roche Holdings, Inc., Exchangeable
Genentech, Inc., (144A), 0%,
due 01/19/15.......................... 6,804,719*
4,425,000 Sepracor Inc., (144A), 5.75%,
due 11/15/06.......................... 2,682,656*
------------
Total Pharmaceuticals............... 17,737,763
------------
TELECOMMUNICATIONS (9.5%)
9,000,000 American Tower Corp., 6.25%,
due 10/15/09.......................... 5,400,000
3,315,000 Bank of America Corp., Exchangeable
Qualcomm, Inc., 15%, due 09/27/02..... 2,142,319
4,750,000 Echostar Communications Corp., 4.875%,
due 01/01/07.......................... 3,710,938+
9,250,000 Nextel Communications, Inc., 4.75%,
due 07/01/07.......................... 4,574,125+
4,405,000 ONI Systems Corp., 5%, due 10/15/05..... 3,006,413+

Principal Market
Amount Value
---------- ------------

$4,805,000 Telefonos de Mexico, S.A. de C.V.,
4.25%, due 06/15/04................... $ 5,705,938+
------------
Total Telecommunications............ 24,539,733
------------
TRANSPORTATION (2.7%)
6,850,000 United Parcel Service, Inc., 1.75%,
due 09/27/07.......................... 7,021,250+
------------
TOTAL FIXED INCOME SECURITIES
(COST: $187,179,818) (60.5%)...... 157,106,556
------------

Number of
Shares
----------

EQUITY SECURITIES

COMMON STOCK (COST: $16,059,509) (3.7%)

MEDIA-BROADCASTING & PUBLISHING (3.7%)
297,200 Clear Channel Communications, Inc....... 9,516,344
------------

CONVERTIBLE PREFERRED STOCK

AEROSPACE/DEFENSE (1.2%)
46,050 Raytheon, Inc., Class B, $4.125......... 3,050,812+
------------
AUTOMOTIVE (2.7%)
108,300 General Motors Corp., $1.125............ 2,798,472+
159,300 General Motors Corp., $1.313............ 4,184,811
------------
Total Automotive.................... 6,983,283
------------
BANKING & FINANCIAL SERVICES (1.8%)
62,700 Washington Mutual, Inc., $2.688......... 3,330,937
26,750 Washington Mutual, Inc., (144A),
$2.688................................ 1,421,094*
------------
Total Banking & Financial
Services.......................... 4,752,031
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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Schedule of Investments (Unaudited) (continued)
June 30, 2002
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Number of Market
Shares Value
---------- ------------

COMMERCIAL SERVICES (2.6%)
152,450 Cendant Corp., $3.875................... $ 6,662,065+
------------
COMMUNICATIONS (3.8%)
8,800 Lucent Technologies, Inc., (144A),
$77.50................................ 4,268,000*
145,720 Titan Capital Trust, $2.875............. 5,537,360
------------
Total Communications................ 9,805,360
------------
COMPUTER SERVICES (3.0%)
118,400 Tribune Co., $2.00...................... 7,725,600
------------
COMPUTER SOFTWARE (2.1%)
148,300 Morgan Stanley Dean Witter & Co.,
Exchangeable Siebel Systems, Inc.,
$7.123................................ 2,632,325
165,300 Solectron Corp., $1.8125................ 2,952,258**+
------------
Total Computer Software............. 5,584,583
------------
ELECTRIC UTILITIES (1.8%)
165,300 Calpine Capital Trust II, $2.75......... 4,793,700
------------
ELECTRONICS (1.4%)
132,990 Goldman Sachs Group, Inc., Exchangeable
Texas Instruments, Inc., $2.458....... 3,777,581
------------
INSURANCE (1.4%)
79,600 QBE Insurance Group, Ltd., (144A),
$4.00................................. 3,669,560*
100 Reinsurance Group of America, Inc.,
$2.875................................ 4,962
------------
Total Insurance..................... 3,674,522
------------
MEDIA-BROADCASTING & PUBLISHING (4.6%)
65,000 Cox Communications, Inc., $3.50......... 2,649,400
77,100 Cox Communications, Inc., $6.859........ 2,259,030
141,900 Equity Securities Trust, Exchangeable
Cablevision Systems Corp. $1.406...... 1,627,593

Number of Market
Shares Value
---------- ------------

107,250 Equity Securities Trust, Exchangeable
Cablevision Systems Corp., $2.343..... $ 1,576,575
2,050 Radio One, Inc., $65.00................. 1,966,975+
2,025 Radio One, Inc., (144A), $65.00......... 1,942,988*
------------
Total Media--Broadcasting &
Publishing........................ 12,022,561
------------
OIL & GAS (4.9%)
107,300 El Paso Corp., $4.50.................... 5,504,490
183,200 Sempra Energy, $2.125................... 4,231,920
236,500 Williams Companies, Inc., $2.25......... 2,975,170+
------------
Total Oil & Gas..................... 12,711,580
------------
PAPER & FOREST PRODUCTS (1.4%)
66,750 Boise Cascade Corp., $3.75.............. 3,574,463
------------
RETAIL (1.7%)
88,700 Toys R Us, Inc., $3.125................. 4,550,310
------------
TELECOMMUNICATIONS (2.6%)
63,100 Alltel Corp., $3.875.................... 3,062,874
239,600 MediaOne Group, Inc., Exchangeable
Vodafone AirTouch PLC, $3.041......... 3,584,416
------------
Total Telecommunications............ 6,647,290
------------
UTILITIES (1.6%)
136,440 Mirant Trust, $3.125.................... 4,044,082+
------------
TOTAL CONVERTIBLE PREFERRED STOCK
(COST: $130,226,795) (38.6%)...... 100,359,823
------------
TOTAL EQUITY SECURITIES (COST:
$146,286,304) (42.3%)............. 109,876,167
------------

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Schedule of Investments (Unaudited) (continued)
June 30, 2002
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Principal Market
Amount Value
---------- ------------

SHORT-TERM INVESTMENTS

$5,824,144 American Express Co., 1.79%,
due 07/22/02.......................... $ 5,824,144***
1,456,036 Bank of Nova Scotia, 1.8%,
due 07/15/02.......................... 1,456,036***
1,456,036 Bayerische Hypo-Und Vereinsbank AG,
1.8%, due 08/08/02.................... 1,456,036***
3,640,091 Bayerishche Hypo-Und Vereinsbank AG,
1.8%, due 09/19/02.................... 3,640,091***
2,962,073 Citibank, N.A., 1.79%, due 11/04/02..... 2,962,073***
3,928,430 Fleet National Bank, 2%,
due 07/03/02.......................... 3,928,430***
2,124,768 Investors Bank & Trust Depository
Reserve, 0.99%, due 07/01/02.......... 2,124,768
1,385,773 Merrill Lynch & Company, 1.91%,
due 11/26/02.......................... 1,385,773***
728,018 Merrill Lynch & Company, 1.92%,
due 04/16/03.......................... 728,018***
8,751,897 Merrimac Money Market Fund, 1.89%,
due 07/01/02.......................... 8,751,897***

Principal Market
Amount Value
---------- ------------

$1,456,036 National City Bank, 1.82%,
due 01/23/03.......................... $ 1,456,036***
2,912,072 Royal Bank of Canada, 1.94%,
due 07/01/02.......................... 2,912,072***
3,640,090 Royal Bank of Scotland, 1.83%,
due 08/16/02.......................... 3,640,090***
2,912,072 Toronto Dominion, 1.83%,
due 08/29/02.......................... 2,912,072***
1,456,042 U.S. Bank, 1.8%, due 11/06/02........... 1,456,042***
------------
TOTAL SHORT-TERM INVESTMENTS
(COST: $44,633,578) (17.2%)....... 44,633,578
------------
TOTAL INVESTMENTS (COST:
$378,099,700) (120.0%)............ 311,616,301

LIABILITIES IN EXCESS OF OTHER ASSETS
(-20.0%).............................. (52,012,333)
------------
NET ASSETS (100.0%)..................... $259,603,968
============

*** Represents investments of securities lending collateral (Note 3).
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Statement of Assets and Liabilities (Unaudited)
June 30, 2002
--------------------------------------------------------------------------------

ASSETS:
Investments, at Value (Cost: $378,099,700)
(Note 1).................................... $311,616,301
Receivables for Securities Sold............... 4,708,563
Interest and Dividends Receivable............. 2,122,065
-----------
Total Assets.............................. 318,446,929
-----------
LIABILITIES:
Distributions Payable......................... 10,669,928
Payables for Securities Purchased............. 5,235,908
Payables Upon Return of Securities Loaned
(Note 5).................................... 42,508,810
Accrued Investment Advisory Fees (Note 3)..... 135,988
Other Accrued Expenses........................ 292,327
-----------
Total Liabilities......................... 58,842,961
-----------
NET ASSETS........................................ $259,603,968
===========
Net Assets were comprised of:
Common Stock, par value $0.01 per share,
(75,000,000 shares authorized, 50,809,179
shares issued and outstanding).............. $ 508,092
Paid-in Capital............................... 396,695,375
Undistributed Net Realized (Loss) on
Investments................................. (47,835,187)
Net Unrealized (Depreciation) of
Investments................................. (66,483,399)
(Overdistributed) Net Investment Income....... (23,280,913)
-----------
NET ASSETS........................................ $259,603,968
===========
NET ASSET VALUE PER SHARE......................... $ 5.11
===========

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

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[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Statement of Operations (Unaudited)
Six Months Ended June 30, 2002
--------------------------------------------------------------------------------

INVESTMENT INCOME:
Interest (Note 1) (including security lending
fees of $31,551)............................ $ 6,116,125
Dividends (Note 1)............................ 3,912,819
-----------
Total Investment Income................... 10,028,944
-----------
EXPENSES:
Investment Advisory Fees (Note 3)............. 911,604
Accounting Fees (Note 3)...................... 37,120
Administration Fees........................... 59,803
Audit and Tax Service Fees.................... 17,661
Transfer Agent Fees........................... 29,893
Custodian Fees................................ 11,946
Directors' Fees & Expenses (Note 6)........... 42,151
Proxy Costs................................... 38,680
Listing Fees.................................. 25,227
Insurance Costs............................... 3,511
Legal Fees.................................... 43,489
Printing and Distribution Costs............... 11,940
Miscellaneous................................. 14,321
-----------
Total..................................... 1,247,346
-----------
Net Investment Income..................... 8,781,598
-----------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS
Net Realized (Loss) on Investments............ (5,736,669)
Change in Unrealized (Depreciation) of
Investments................................. (63,119,428)
-----------
Net Realized and Unrealized (Loss) on
Investments............................. (68,856,097)
-----------
DECREASE IN NET ASSETS RESULTING FROM
OPERATIONS...................................... $(60,074,499)
===========

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

--------------------------------------------------------------------------------
[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Statement of Changes in Net Assets
--------------------------------------------------------------------------------

Six Months Ended
June 30, 2002 Year Ended
(Unaudited) December 31, 2001
---------------- -----------------

INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net Investment Income............... $ 8,781,598 $ 17,315,495
Net Realized (Loss) on
Investments....................... (5,736,669) (42,806,531)
Change in Unrealized (Depreciation)
of Investments.................... (63,119,428) (19,945,446)
------------ ------------
(Decrease) in Net Assets
Resulting from Operations..... (60,074,499) (45,436,482)
------------ ------------
Distributions to Shareholders:
From Net Investment Income.......... (8,781,598) (17,315,495)
In Excess of Net Investment
Income............................ (12,540,218) (10,700,116)
Return of Capital................... -- (10,888,437)
------------ ------------
Total Distributions to
Shareholders.................. (21,321,816) (38,904,048)
------------ ------------
Capital Share Transactions:
Shares Issued through Exercise of
Common Stock Subscription Rights
(8,450,030 for the year ended
December 31, 2001) (Note 7)....... -- 65,656,733
Shares Issued in Reinvestment of
Dividends (163,496 for the six
months ended June 30, 2002 and
623,429 for the year ended
December 31, 2001)................ 1,422,837 5,706,722
------------ ------------
Increase in Net Assets Resulting
from Net Capital Share
Transactions...................... 1,422,837 71,363,455
------------ ------------
Total (Decrease) in Net
Assets........................ (79,973,478) (12,977,075)
NET ASSETS:
Beginning of Period..................... 339,577,446 352,554,521
------------ ------------
End of Period........................... $259,603,968 $339,577,446
============ ============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:

TCW Convertible Securities Fund, Inc. (the "Fund") was incorporated in
Maryland on January 13, 1987 as a diversified, closed-end investment management
company and is registered under the Investment Company Act of 1940, as amended.
The Fund commenced operations on March 5, 1987. The Fund's investment objective
is to seek a total investment return, comprised of current income and capital
appreciation through investment principally in convertible securities. In
accordance with the requirements of new Rule 35d-1 under the 1940 Act, the Fund
will invest, under normal market conditions, at least 80% of its net assets,
plus any borrowings for investment purposes in convertible securities. The 80%
investment policy described above is non-fundamental and may be changed by the
Board of Directors to become effective upon at least 60 days' notice to
shareholders.

The preparation of the accompanying financial statements requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
income and expenses during the reporting period. Actual results could differ
from those estimates.

The following is a summary of the significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with accounting principles generally
accepted in the United States of America.

SECURITY VALUATION: Securities traded on national exchanges are valued at the
last reported sales price or the mean of the current bid and asked prices if
there are no sales in the trading period. Other securities which are traded on
the over-the-counter market are valued at the mean of the current bid and asked
prices. Short-term debt securities with maturities of 60 days or less at the
time of purchase are valued at amortized cost. Other short-term debt securities
are valued on a mark-to-market basis until such time as they reach a remaining
maturity of 60 days, where upon they will be valued at amortized value using
their value of the 61st day prior to maturity.

SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME: Security transactions are
recorded on the trade date. Dividend income is recorded on the ex-dividend date,
while interest income is recorded on the accrual basis. Discounts and premiums
on securities purchased are recognized as interest income and expense,
respectively, using a constant yield to maturity method. Realized gains and
losses on investments are recorded on the basis of identified cost.

DISTRIBUTIONS: The Fund intends to distribute its investment company taxable
income quarterly and to distribute any net realized capital gains at least
annually, to the extent required for U.S. federal income tax purposes. The Board
of Directors also may, in its discretion, choose to pay distributions in excess
of net investment income and net realized capital gains, though it is not
required to do so.

Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from accounting principles generally
accepted in the United States of

America. These differences may be primarily due to differing treatments for
losses deferred due to wash sales and spillover distributions. Permanent book
and tax basis differences relating to shareholder distributions will result in
reclassifications to paid-in-capital and may affect net investment income per
share.

REPURCHASE AGREEMENTS: The Fund may invest in repurchase agreements secured by
U.S. Government Securities. A repurchase agreement arises when the Fund
purchases a security and simultaneously agrees to resell it to the seller at an
agreed upon future date. The Fund requires the seller to maintain the value of
the securities, marked to market daily, at not less than the repurchase price.
If the seller defaults on its repurchase obligation, the Fund could suffer
delays, collection expenses and losses to the extent that the proceeds from the
sale of the collateral are less than the repurchase price. The Fund did not
enter into any repurchase agreements for the six months ended June 30, 2002.

NOTE 2--FEDERAL INCOME TAXES:

It is the policy of the Fund to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and distribute all of
its net taxable income, including any net realized gains on investments, to its
shareholders. Therefore, no federal income tax provision is required.

For the six months ended June 30, 2002 the Fund recognized on a tax basis a
net realized loss of $5,743,593 on security transactions.

At June 30, 2002, net unrealized depreciation for federal income tax
purposes is comprised of the following components;

Appreciated securities............................ $ 5,922,787
Depreciated securities............................ (72,435,388)
------------
Net unrealized (depreciation)..................... $(66,512,601)
============
Cost of securities for federal income tax
purposes........................................ $333,495,324
============

NOTE 3--INVESTMENT ADVISORY AND SERVICE FEES:

TCW Investment Management Company (the "Advisor") is the investment advisor
of the Fund. As compensation for the services rendered, facilities provided, and
expenses borne, the Advisor is paid a monthly fee by the Fund computed at the
annual rate of 0.75% of the first $100 million of the Fund's average net assets
and 0.50% of the Fund's average net assets in excess of $100 million.

NOTE 4--PURCHASES AND SALES OF SECURITIES:

For the six months ended June 30, 2002, purchases and sales or maturities of
investment securities (excluding short-term investments) aggregated $120,211,947
and $132,573,071, respectively. There were no purchases or sales of U.S.
Government securities for the six months ended June 30, 2002.

NOTE 5--SECURITY LENDING:

During the six months ended June 30, 2002, the Fund lent securities to
brokers. The brokers provided collateral, which must be maintained at

--------------------------------------------------------------------------------
[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Notes to Financial Statements (Unaudited) (continued)
--------------------------------------------------------------------------------
not less than 100% of the value of the loaned securities, to secure the
obligation. At June 30, 2002, the cash received from the borrowing broker was
invested in short-term investments valued at $42,508,810 which is 102.9% of the
value of the loaned securities.

NOTE 6--DIRECTORS' FEES:

Directors who are not affiliated with the Advisor received, as a group,
aggregate fees and expenses of $42,151 from the Fund for the six months ended
June 30, 2002. Certain officers and/ or directors of the Fund are also officers
and/or directors of the Investment Advisor.

NOTE 7--RESTRICTED SECURITIES:

The Funds are permitted to invest in securities that are subject to legal or
contractual restrictions on resale. These securities generally may be resold in
transactions exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time consuming negotiations
and expense, and prompt sale at an acceptable price may be difficult. There are
no restricted securities (excluding 144A issues) at June 30, 2002.

NOTE 8--COMMON STOCK SUBSCRIPTION RIGHTS:

Non-transferable rights to subscribe to shares of the Fund's common stock
were issued to shareholders of record on June 29, 2001. The rights entitled the
shareholders to acquire one share of newly issued common stock for four rights
held. At the termination of the subscription period on August 2, 2001, 8,450,030
shares of common stock were subscribed at a price of $7.77 per share.

NOTE 9--REPORT OF ANNUAL MEETING OF SHAREHOLDERS:

The Annual Meeting of Shareholders of the Fund was held on July 18, 2002. At
the meeting, the following matters were submitted to a shareholder vote and
approved by a vote of a majority of the Fund's outstanding shares; (i) the
election of Ernest O. Ellison, John C. Argue, Norman Baker, Jr., Richard W.
Call, Matthew K. Fong, John A. Gavin, Patrick C. Haden, Charles A. Parker and
Robert G. Sims as Directors to serve until the next annual meeting of the Fund's
shareholders and until their successors are elected and qualify (each Director
received 46,431,429 affirmative votes; votes exceptions 396,964 and votes
withheld 1,084,432); and (ii) the ratification of the selection of Deloitte &
Touche LLP as independent auditors of the Fund for the fiscal year ending
December 31, 2002 (votes for 47,005,600; votes against 479,461 and abstentions
427,764). 50,809,179 shares were outstanding on the record date of this meeting
and 47,912,825 shares entitled to vote were present in person or by proxy at the
meeting.

--------------------------------------------------------------------------------
[TCW LOGO]
TCW CONVERTIBLE SECURITIES FUND, INC.
Financial Highlights
--------------------------------------------------------------------------------

SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2002 -------------------------------------------------------------
(UNAUDITED) 2001(A) 2000 1999 1998 1997
------------- --------- --------- --------- --------- ---------

Net Asset Value Per Share, Beginning of
Period................................ $ 6.70 $ 8.48 $ 11.32 $ 9.37 $ 9.21 $ 8.51
-------- -------- -------- -------- -------- --------
Income from Operations:
Net Investment Income................. 0.17(5) 0.38(5) 0.35(5) 0.35(5) 0.35(5) 0.35(5)
Impact to Capital for Shares Issued... -- (0.01) -- -- (0.01) (0.01)
Impact to Capital for Shares
Repurchased........................ -- -- 0.02 -- -- --
Net Realized and Unrealized Gains
(Losses) on Securities............. (1.34) (1.31) (0.80) 3.15 0.85 1.23
-------- -------- -------- -------- -------- --------
Total from Investment
Operations.................. (1.17) (0.94) (0.43) 3.50 1.19 1.57
-------- -------- -------- -------- -------- --------
Less Distributions:
Distributions from Net Investment
Income............................. (0.17) (0.38) (0.35) (0.35) (0.35) (0.35)
Distributions in Excess of Net
Investment Income.................. (0.25) (0.22) -- -- -- --
Distributions from Net Realized
Gain............................... -- -- (2.06) (1.20) (0.68) (0.52)
Distributions from Paid-in-Capital.... -- (0.24) -- -- -- --
-------- -------- -------- -------- -------- --------
Total Distributions........... (0.42) (0.84) (2.41) (1.55) (1.03) (0.87)
-------- -------- -------- -------- -------- --------
Net Asset Value Per Share, End of
Period................................ $ 5.11 $ 6.70 $ 8.48 $ 11.32 $ 9.37 $ 9.21
======== ======== ======== ======== ======== ========
Market Value Per Share, End of Period... $ 6.26 $ 8.55 $ 10.38 $ 9.56 $ 9.63 $ 9.63
======== ======== ======== ======== ======== ========
Total Investment Return (1)............. (21.86)%(4) (9.27)% 34.95% 16.10% 11.41% 12.98%
Net Asset Value Total Return (2)........ (17.98)%(4) (10.89)% (4.79)% 39.16% 13.34% 19.10%

RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in
thousands)............................ $259,604 $339,577 $352,555 $477,608 $393,588 $355,061
Ratio of Expenses to Average Net
Assets................................ 0.80%(3) 0.75% 0.69% 0.68% 0.73% 0.74%
Ratio of Net Investment Income to
Average Net Assets.................... 5.61%(3) 5.16% 2.88% 3.47% 3.73% 3.95%
Portfolio Turnover Rate................. 38.54%(4) 129.57% 159.44% 119.92% 124.51% 132.99%

(1) Based on market value per share, adjusted for reinvestment of
distributions.
(2) Based on net asset value per share, adjusted for reinvestment of
distributions.
(3) Annualized.
(4) For the six months ended June 30, 2002 and not indicative of a full year's
operating results.
(5) Computed using average shares outstanding throughout the period.
(a) Effective January 1, 2001, the Fund adopted the provisions of the AICPA
Audit Guide and Accounting Guide for Investment Companies and began
amortizing premium on debt securities. The effect of this change for the
year ended December 31, 2001 was a decrease in net investment income and
increase in net realized and unrealized gains and losses by less than $0.01
per share and decreased the ratio of net investment income to average net
assets from 5.18% to 5.16%. Per share data and ratio/ supplemental data for
periods prior to December 31, 2000 have not been restated to reflect this
change in presentation.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

[TCW LOGO]-Registered Trademark-