Semiannual Report to Shareholders

Transcription

1 April 30, 2017 Semiannual Report to Shareholders Deutsche Gold & Precious Metals Fund Deutsche Gold & Precious Metals Fund 1

2 Contents 3 Letter to Shareholders 4 Performance Summary 7 Portfolio Management Team 8 Consolidated Portfolio Summary 9 Consolidated Investment Portfolio 12 Consolidated Statement of Assets and Liabilities 14 Consolidated Statement of Operations 15 Consolidated Statements of Changes in Net Assets 16 Consolidated Financial Highlights 20 Notes to Consolidated Financial Statements 33 Information About Your Fund's Expenses 35 Advisory Agreement Board Considerations and Fee Evaluation 40 Account Management Resources 42 Privacy Statement This report must be preceded or accompanied by a prospectus. To obtain a summary prospectus, if available, or prospectus for any of our funds, refer to the Account Management Resources information provided in the back of this booklet. We advise you to consider the fund's objectives, risks, charges and expenses carefully before investing. The summary prospectus and prospectus contain this and other important information about the fund. Please read the prospectus carefully before you invest. Any fund that concentrates in a particular segment of the market will generally be more volatile than a fund that invests more broadly. Emerging markets tend to be more volatile and less liquid than the markets of more mature economies, and generally have less diverse and less mature economic structures and less stable political systems than those of developed countries. Investing in foreign securities presents certain risks, such as currency fluctuations, political and economic changes, and market risks. This fund is non diversified and can take larger positions in fewer issues, increasing its potential risk. The fund may lend securities to approved institutions. Stocks may decline in value. See the prospectus for details. Deutsche Asset Management represents the asset management activities conducted by Deutsche Bank AG or any of its subsidiaries. NOT FDIC/NCUA INSURED NO BANK GUARANTEE MAY LOSE VALUE NOT A DEPOSIT NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY 2 Deutsche Gold & Precious Metals Fund

3 Letter to Shareholders Dear Shareholder: America s economic expansion, now in its eighth year, continues. Much of the damage from the Great Recession appears to have been repaired, and growth, while not spectacular, has been sufficient to support a stronger labor market. How long can this last? Our economists generally expect the economy to continue performing well this year. The labor markets should firm a bit further, and underlying inflation is edging closer to target. Against this backdrop, the U.S. stock markets have set a series of record highs thanks, in part, to expectations for a boost from Washington. The challenge is that the new administration is still finding its footing. So, while some combination of tax cuts, regulatory reforms, and spending increases in infrastructure and defense seems likely, the timing of implementation is unclear. It remains to be seen how the President s legislative agenda will translate into tangible results after running the gauntlet of political procedure and bargaining. We invite you to stay abreast of that process and our economists take on the impact for the markets and investors by visiting deutschefunds.com. The Insights section of our Web site offers up to date views on the global and domestic economies and the implications for each asset class. Thank you, as always, for allowing us to serve your investment needs. Best regards, Brian Binder President, Deutsche Funds Assumptions, estimates and opinions contained in this document constitute our judgment as of the date of the document and are subject to change without notice. Any projections are based on a number of assumptions as to market conditions and there can be no guarantee that any projected results will be achieved. Past performance is not a guarantee of future results. Deutsche Gold & Precious Metals Fund 3

4 Performance Summary April 30, 2017 (Unaudited) Class A 6 Month 1 Year 5 Year 10 Year Average Annual Total Returns as of 4/30/17 Unadjusted for Sales Charge 8.90% 12.50% 13.12% 5.45% Adjusted for the Maximum Sales Charge (max 5.75% load) 14.14% 17.53% 14.15% 6.01% S&P 500 Index 13.32% 17.92% 13.68% 7.15% S&P /Citigroup Gold & Precious Metals Index 7.90% 9.46% 11.67% 4.75% Average Annual Total Returns as of 3/31/17 (most recent calendar quarter end) Unadjusted for Sales Charge 12.88% 13.78% 5.15% Adjusted for the Maximum Sales Charge (max 5.75% load) 6.39% 14.79% 5.71% S&P 500 Index 17.17% 13.30% 7.51% S&P /Citigroup Gold & Precious Metals Index 17.16% 12.31% 4.41% Class C 6 Month 1 Year 5 Year 10 Year Average Annual Total Returns as of 4/30/17 Unadjusted for Sales Charge 9.21% 13.13% 13.79% 6.15% Adjusted for the Maximum Sales Charge (max 1.00% CDSC) 10.10% 13.13% 13.79% 6.15% S&P 500 Index 13.32% 17.92% 13.68% 7.15% S&P /Citigroup Gold & Precious Metals Index 7.90% 9.46% 11.67% 4.75% Average Annual Total Returns as of 3/31/17 (most recent calendar quarter end) Unadjusted for Sales Charge 12.05% 14.42% 5.84% Adjusted for the Maximum Sales Charge (max 1.00% CDSC) 12.05% 14.42% 5.84% S&P 500 Index 17.17% 13.30% 7.51% S&P /Citigroup Gold & Precious Metals Index 17.16% 12.31% 4.41% Class S 6 Month 1 Year 5 Year 10 Year Average Annual Total Returns as of 4/30/17 No Sales Charges 8.80% 12.24% 12.91% 5.22% S&P 500 Index 13.32% 17.92% 13.68% 7.15% S&P /Citigroup Gold & Precious Metals Index 7.90% 9.46% 11.67% 4.75% Average Annual Total Returns as of 3/31/17 (most recent calendar quarter end) No Sales Charges 13.23% 13.55% 4.90% S&P 500 Index 17.17% 13.30% 7.51% S&P /Citigroup Gold & Precious Metals Index 17.16% 12.31% 4.41% 4 Deutsche Gold & Precious Metals Fund

5 Institutional Class 6 Month 1 Year 5 Year Average Annual Total Returns as of 4/30/17 Life of Class * No Sales Charges 8.80% 12.35% 12.93% 9.82% S&P 500 Index 13.32% 17.92% 13.68% 8.91% S&P /Citigroup Gold & Precious Metals Index 7.90% 9.46% 11.67% 8.42% Average Annual Total Returns as of 3/31/17 (most recent calendar quarter end) No Sales Charges 13.23% 13.55% 9.67% S&P 500 Index 17.17% 13.30% 8.87% S&P /Citigroup Gold & Precious Metals Index 17.66% 12.31% 8.26% Performance in the Average Annual Total Returns table(s) above and the Growth of an Assumed $10,000 Investment line graph that follows is historical and does not guarantee future results. Investment return and principal fluctuate, so your shares may be worth more or less when redeemed. Current performance may differ from performance data shown. Please visit deutschefunds.com for the Fund's most recent month end performance. Fund performance includes reinvestment of all distributions. Unadjusted returns do not reflect sales charges and would have been lower if they had. The gross expense ratios of the Fund, as stated in the fee table of the prospectus dated March 1, 2017 are 1.70%, 2.42%, 1.44% and 1.38% for Class A, Class C, Class S and Institutional Class shares, respectively, and may differ from the expense ratios disclosed in the Financial Highlights tables in this report. Index returns do not reflect any fees or expenses and it is not possible to invest directly into an index. Performance figures do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Generally accepted accounting principles require adjustments to be made to the net assets of the Fund at period end for financial reporting purposes only, and as such, the total return based on the unadjusted net asset value per share may differ from the total return reported in the financial highlights. Deutsche Gold & Precious Metals Fund 5

6 Growth of an Assumed $10,000 Investment (Adjusted for Maximum Sales Charge) Deutsche Gold & Precious Metals Fund Class A S&P 500 Index S&P/Citigroup Gold & Precious Metals Index $20,000 $19,955 $15,000 $10,000 $5,000 $6,148 $5,382 $0 '07 '08 '09 '10 '11 '12 '13 Yearly periods ended April 30 The Fund's growth of an assumed $10,000 investment is adjusted for the maximum sales charge of 5.75%. This results in a net initial investment of $9,425. The growth of $10,000 is cumulative. Performance of other share classes will vary based on the sales charges and the fee structure of those classes. * Institutional Class commenced operations on March 3, The Standard & Poor's 500 (S&P 500) Index is an unmanaged, capitalization weighted index of 500 stocks. The index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The S&P/Citigroup Gold & Precious Metals Index is an unmanaged index that represents the precious metals industry component of the S&P/Citigroup Global Equity family of indices, which include more than 7,000 companies in more than 50 countries. Total returns shown for periods less than one year are not annualized. '14 '15 '16 '17 Class A Class C Class S Institutional Class Net Asset Value 4/30/17 $ 6.66 $ 6.29 $ 6.73 $ /31/16 $ 7.55 $ 7.10 $ 7.64 $ 7.65 Distribution Information (as of 4/30/17) Income Dividends, Six Months $.19 $.13 $.20 $.20 6 Deutsche Gold & Precious Metals Fund

7 Portfolio Management Team John W. Vojticek, Managing Director Portfolio Manager of the fund. Began managing the fund in Joined Deutsche Asset Management in 2004; previously worked as Principal at KG Redding and Associates, March 2004 September 2004; and previously Managing Director of Deutsche Asset Management from 1996 March Head and Chief Investment Officer of Liquid Real Assets for Deutsche Asset Management. BS, University of Southern California. Scott Ikuss, Vice President Portfolio Manager of the fund. Began managing the fund in Joined Deutsche Asset Management in Portfolio Analyst for Commodities: New York. BA, Rutgers, The State University of New Jersey. Deutsche Gold & Precious Metals Fund 7

8 Consolidated Portfolio Summary (Unaudited) Asset Allocation (As a % of the Consolidated Investment Portfolio excluding Securities Lending Collateral) 4/30/17 10/31/16 Common Stocks 99% 98% Cash Equivalents 1% 2% 100% 100% Quality Distribution (As a % of Common Stocks) 4/30/17 10/31/16 Group breakdown of the fund's common stocks Group I: Major producing companies 45% 59% Group II: Medium established producers 14% 8% Group III: Junior producers with medium cost production 9% 5% Group IV: Companies with some production on stream or in start up 6% 5% Group V: Primarily exploration companies with or without mineral resources 12% 8% Group VI: Royalty companies 13% 15% GroupVII: Diamonds 1% 100% 100% Ten Largest Equity Holdings at April 30, 2017 (53.4% of Net Assets) 1. Newmont Mining Corp. 9.0% 2. Barrick Gold Corp. 8.4% 3. Agnico Eagle Mines Ltd. 5.9% 4. Newcrest Mining Ltd. 5.1% 5. OceanaGold Corp. 5.1% 6. Silver Wheaton Corp. 4.7% 7. Franco Nevada Corp. 4.0% 8. Randgold Resources Ltd. 3.8% 9. B2Gold Corp. 3.8% 10. AngloGold Ashanti Ltd. 3.6% Consolidated portfolio holdings and characteristics are subject to change. For more complete details about the fund's consolidated investment portfolio, see page 9. A quarterly Fact Sheet is available on deutschefunds.com or upon request. Please see the Account Management Resources section on page 40 for contact information. 8 Deutsche Gold & Precious Metals Fund

9 Consolidated Investment Portfolio as of April 30, 2017 (Unaudited) Shares Value ($) Common Stocks (a) 99.6% Australia 16.6% Evolution Mining Ltd. 1,503,159 2,577,545 Newcrest Mining Ltd. 336,046 5,324,517 Northern Star Resources Ltd. 894,777 2,867,639 OceanaGold Corp. (b) 1,625,972 5,300,594 Regis Resources Ltd. 521,656 1,277,314 (Cost $15,716,347) 17,347,609 Canada 52.7% Agnico Eagle Mines Ltd. 129,717 6,200,530 Alamos Gold, Inc. A 163,254 1,168,449 Asanko Gold, Inc.* (c) 730,673 1,771,750 AuRico Metals, Inc.* 360, ,537 B2Gold Corp.* 1,591,310 3,998,530 Barrick Gold Corp. 523,875 8,757,795 Belo Sun Mining Corp.* (c) 1,994, ,637 Continental Gold, Inc.* (c) 283, ,884 Detour Gold Corp.* 147,643 1,865,750 Dominion Diamond Corp. 67, ,119 Eldorado Gold Corp. 457,617 1,672,839 Franco Nevada Corp. 61,651 4,193,018 Goldcorp, Inc. 240,840 3,355,757 Guyana Goldfields, Inc.* 263,313 1,305,907 Kinross Gold Corp.* 302,170 1,051,469 Kirkland Lake Gold Ltd.* 364,083 2,520,482 MAG Silver Corp.* 141,005 1,725,053 New Gold, Inc.* 616,291 1,747,223 Osisko Gold Royalties Ltd. 103,942 1,107,151 Pretium Resources, Inc.* 101,667 1,007,695 Roxgold, Inc.* 248, ,772 Silver Standard Resources, Inc.* 166,102 1,713,282 Silver Wheaton Corp. 245,560 4,900,227 Torex Gold Resources, Inc.* 129,350 2,190,815 (Cost $52,346,591) 55,181,671 Jersey 1.9% Centamin PLC (Cost $910,388) 862,249 1,975,591 Mexico 1.1% Fresnillo PLC (d) (Cost $786,297) 61,146 1,149,930 Peru 1.5% Hochschild Mining PLC (c) (d) (Cost $1,591,215) 475,051 1,564,056 The accompanying notes are an integral part of the consolidated financial statements. Deutsche Gold & Precious Metals Fund 9

10 Shares Value ($) South Africa 5.1% Anglo American Platinum Ltd.* 39, ,185 AngloGold Ashanti Ltd. 330,543 3,739,579 Petra Diamonds Ltd.* 400, ,465 (Cost $7,397,074) 5,399,229 United Kingdom 6.2% Acacia Mining PLC 478,598 2,452,244 Randgold Resources Ltd. 45,880 4,043,786 (Cost $6,401,770) 6,496,030 United States 14.5% Argonaut Gold, Inc.* 450, ,367 Newmont Mining Corp. 279,156 9,438,265 Royal Gold, Inc. 39,814 2,814,054 Tahoe Resources, Inc. 268,194 2,172,980 (Cost $13,814,363) 15,150,666 Total Common Stocks (Cost $98,964,045) 104,264,782 Securities Lending Collateral 3.9% Deutsche Government & Agency Securities Portfolio Deutsche Government Cash Institutional Shares, 0.67% (e) (f) (Cost $4,102,418) 4,102,418 4,102,418 Cash Equivalents 0.5% Deutsche Central Cash Management Government Fund, 0.80% (e) (Cost $489,201) 489, ,201 % of Net Assets Value ($) Total Consolidated Investment Portfolio (Cost $103,555,664) ,856,401 Other Assets and Liabilities, Net (4.0) (4,180,941) Net Assets ,675,460 * Non income producing security. The cost for federal income tax purposes was $130,401,871. At April 30, 2017, net unrealized depreciation for all securities based on tax cost was $21,545,470. This consisted of aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost of $13,573,240 and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value of $35,118,710. (a) Securities are listed in country of domicile. (b) Listed on the Toronto Stock Exchange. The accompanying notes are an integral part of the consolidated financial statements. 10 Deutsche Gold & Precious Metals Fund

11 (c) (d) (e) (f) All or a portion of these securities were on loan. In addition, "Other Assets and Liabilities, Net" may include pending sales that are also on loan. The value of securities loaned at April 30, 2017 amounted to $3,963,062, which is 3.8% of net assets. Listed on the London Stock Exchange. Affiliated fund managed by Deutsche Investment Management Americas Inc. The rate shown is the annualized seven day yield at period end. Represents collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates. Fair Value Measurements Various inputs are used in determining the value of the Fund'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 Fund's own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. The following is a summary of the inputs used April 30, 2017 in valuing the Fund's investments. For information on the Fund's policy regarding the valuation of investments, please refer to the Security Valuation section of Note A in the accompanying Notes to Consolidated Financial Statements. Assets Level 1 Level 2 Level 3 Total Common Stocks Australia $ 17,347,609 $ $ $ 17,347,609 Canada 55,181,671 55,181,671 Jersey 1,975,591 1,975,591 Mexico 1,149,930 1,149,930 Peru 1,564,056 1,564,056 South Africa 5,399,229 5,399,229 United Kingdom 6,496,030 6,496,030 United States 15,150,666 15,150,666 Short Term Investments (g) 4,591,619 4,591,619 Total $108,856,401 $ $ $108,856,401 As a result of the fair valuation model utilized by the Fund, certain international securities transferred from Level 2 to Level 1. During the period ended April 30, 2017, the amount of the transfers between Level 2 and Level 1 was $ 30,444,947. Transfers between price levels are recognized at the beginning of the reporting period. (g) See Consolidated Investment Portfolio for additional detailed categorizations. The accompanying notes are an integral part of the consolidated financial statements. Deutsche Gold & Precious Metals Fund 11

12 Consolidated Statement of Assets and Liabilities as of April 30, 2017 (Unaudited) Assets Investments: Investments in non affiliated securities, at value (cost $98,964,045) including $3,963,062 of securities loaned $ 104,264,782 Investments in Deutsche Government & Agency Securities Portfolio (cost $4,102,418)* 4,102,418 Investment in Deutsche Central Cash Management Government Fund (cost $489,201) 489,201 Total investments in securities, at value (cost $103,555,664) 108,856,401 Cash 107 Foreign currency, at value (cost $128,250) 129,004 Receivable for Fund shares sold 32,737 Dividends receivable 65,875 Interest receivable 2,907 Foreign taxes recoverable 1,615 Other assets 47,712 Total assets 109,136,358 Liabilities Payable upon return of securities loaned 4,102,418 Payable for Fund shares redeemed 123,055 Accrued management fee 45,320 Accrued Trustees' fees 282 Other accrued expenses and payables 189,823 Total liabilities 4,460,898 Net assets, at value $ 104,675,460 Net Assets Consist of Accumulated distributions in excess of net investment income (5,297,609) Net unrealized appreciation (depreciation) on: Investments 5,300,737 Foreign currency 721 Accumulated net realized gain (loss) (194,953,775) Paid in capital 299,625,386 Net assets, at value $ 104,675,460 * Represents collateral on securities loaned. The accompanying notes are an integral part of the consolidated financial statements. 12 Deutsche Gold & Precious Metals Fund

13 Consolidated Statement of Assets and Liabilities as of April 30, 2017 (Unaudited) (continued) Net Asset Value Class A Net Asset Value and redemption price per share ($21,682,489 3,255,995 outstanding shares of beneficial interest, $.01 par value, unlimited number of shares authorized) $ 6.66 Maximum offering price per share ( of $6.66) $ 7.07 Class C Net Asset Value, offering and redemption price (subject to contingent deferred sales charge) per share ($9,326,035 1,482,690 outstanding shares of beneficial interest, $.01 par value, unlimited number of shares authorized) $ 6.29 Class S Net Asset Value, offering and redemption price per share ($71,909,798 10,685,192 outstanding shares of beneficial interest, $.01 par value, unlimited number of shares authorized) $ 6.73 Institutional Class Net Asset Value, offering and redemption price per share ($1,757, ,971 outstanding shares of beneficial interest, $.01 par value, unlimited number of shares authorized) $ 6.73 The accompanying notes are an integral part of the consolidated financial statements. Deutsche Gold & Precious Metals Fund 13

14 Consolidated Statement of Operations for the six months ended April 30, 2017 (Unaudited) Investment Income Income: Dividends (net of foreign taxes withheld of $38,764) $ 536,000 Interest 11 Income distributions Deutsche Central Cash Management Government Fund 3,856 Securities lending income, net of borrower rebates 5,372 Total income 545,239 Expenses: Management fee 451,733 Administration fee 54,100 Services to shareholders 140,380 Distribution and service fees 75,815 Custodian fee 16,849 Professional fees 63,288 Reports to shareholders 24,008 Registration fees 35,805 Trustees' fees and expenses 2,681 Other 5,031 Total expenses before expense reductions 869,690 Expense reductions (241,446) Total expenses after expense reductions 628,244 Net investment income (loss) (83,005) Realized and Unrealized Gain (Loss) Net realized gain (loss) from: Investments (10,889,723) Written options (68,276) Foreign currency (67,400) (11,025,399) Change in net unrealized appreciation (depreciation) on: Investments (623,943) Foreign currency 999 (622,944) Net gain (loss) (11,648,343) Net increase (decrease) in net assets resulting from operations $ (11,731,348) The accompanying notes are an integral part of the consolidated financial statements. 14 Deutsche Gold & Precious Metals Fund

15 Consolidated Statements of Changes in Net Assets Increase (Decrease) in Net Assets Six Months Ended April 30, 2017 (Unaudited) Year Ended October 31, 2016 Operations: Net investment income (loss) $ (83,005) $ (430,985) Net realized gain (loss) (11,025,399) (16,944,450) Change in net unrealized appreciation (depreciation) (622,944) 65,149,572 Net increase (decrease) in net assets resulting from operations (11,731,348) 47,774,137 Distributions to shareholders from: Net investment income: Class A (651,719) Class C (201,911) Class S (2,121,397) Institutional Class (37,767) Total distributions (3,012,794) Fund share transactions: Proceeds from shares sold 12,180,891 44,095,278 Reinvestment of Distributions 2,832,602 Payments for shares redeemed (19,955,506) (44,018,528) Redemption fees 11,374 11,664 Net increase (decrease) in net assets from Fund share transactions (4,930,639) 88,414 Increase (decrease) in net assets (19,674,781) 47,862,551 Net assets at beginning of period 124,350,241 76,487,690 Net assets at end of period (including accumulated distributions in excess of net investment income of $5,297,609 and $2,201,810, respectively) $ 104,675,460 $ 124,350,241 The accompanying notes are an integral part of the consolidated financial statements. Deutsche Gold & Precious Metals Fund 15

16 Consolidated Financial Highlights Six Months Ended 4/30/17 Class A (Unaudited) Selected Per Share Data Years Ended October 31, Net asset value, beginning of period $ 7.55 $ 4.67 $ 5.66 $ 8.02 $15.36 $20.83 Income (loss) from investment operations: Net investment income (loss) a (.01) (.03).00 *** (.02).01 (.06) Net realized and unrealized gain (loss) (.69) 2.91 (.99) (2.34) (7.23) (2.05) Total from investment operations (.70) 2.88 (.99) (2.36) (7.22) (2.11) Less distributions from: Net investment income (.19) (.12) (.02) Net realized gains (3.34) Total distributions (.19) (.12) (3.36) Redemption fees.00 ***.00 ***.00 ***.00 ***.00 ***.00 *** Net asset value, end of period $ 6.66 $ 7.55 $ 4.67 $ 5.66 $ 8.02 $15.36 Total Return (%) b,c (8.90) ** (17.49) (29.43) (47.32) (10.14) Ratios to Average Net Assets and Supplemental Data Net assets, end of period ($ millions) Ratio of expenses before expense reductions (%) 1.75 * Ratio of expenses after expense reductions (%) 1.27 * Ratio of net investment income (loss) (%) (.27) * (.50).02 (.24).08 (.37) Portfolio turnover rate (%) 37 ** a Based on average shares outstanding during the period. b Total return does not reflect the effect of any sales charges. c Total return would have been lower had certain expenses not been reduced. * Annualized ** Not annualized *** Amount is less than $ Deutsche Gold & Precious Metals Fund

17 Class C Six Months Ended 4/30/17 (Unaudited) Years Ended October 31, Selected Per Share Data Net asset value, beginning of period $ 7.10 $ 4.43 $ 5.41 $ 7.72 $14.78 $20.30 Income (loss) from investment operations: Net investment income (loss) a (.03) (.08) (.04) (.07) (.07) (.17) Net realized and unrealized gain (loss) (.65) 2.75 (.94) (2.24) (6.98) (2.01) Total from investment operations (.68) 2.67 (.98) (2.31) (7.05) (2.18) Less distributions from: Net investment income (.13) (.01) Net realized gains (3.34) Total distributions (.13) (.01) (3.34) Redemption fees.00 ***.00 ***.00 ***.00 ***.00 ***.00 *** Net asset value, end of period $ 6.29 $ 7.10 $ 4.43 $ 5.41 $ 7.72 $14.78 Total Return (%) b,c (9.21) ** (18.11) (29.92) (47.71) (10.84) Ratios to Average Net Assets and Supplemental Data Net assets, end of period ($ millions) Ratio of expenses before expense reductions (%) 2.45 * Ratio of expenses after expense reductions (%) 2.02 * Ratio of net investment income (loss) (%) (1.01) * (1.25) (.73) (.98) (.67) (1.17) Portfolio turnover rate (%) 37 ** a Based on average shares outstanding during the period. b Total return does not reflect the effect of any sales charges. c Total return would have been lower had certain expenses not been reduced. * Annualized ** Not annualized *** Amount is less than $.005. Deutsche Gold & Precious Metals Fund 17

18 Class S Six Months Ended 4/30/17 (Unaudited) Years Ended October 31, Selected Per Share Data Net asset value, beginning of period $ 7.64 $ 4.72 $ 5.70 $ 8.05 $15.42 $20.93 Income (loss) from investment operations: Net investment income (loss) a (.00) *** (.02) ***.04 (.03) Net realized and unrealized gain (loss) (.71) 2.94 (1.00) (2.35) (7.27) (2.07) Total from investment operations (.71) 2.92 (.98) (2.35) (7.23) (2.10) Less distributions from: Net investment income (.20) (.14) (.07) Net realized gains (3.34) Total distributions (.20) (.14) (3.41) Redemption fees.00 ***.00 ***.00 ***.00 ***.00 ***.00 *** Net asset value, end of period $ 6.73 $ 7.64 $ 4.72 $ 5.70 $ 8.05 $15.42 Total Return (%) b (8.80) ** (17.19) (29.19) (47.24) (9.99) Ratios to Average Net Assets and Supplemental Data Net assets, end of period ($ millions) Ratio of expenses before expense reductions (%) 1.46 * Ratio of expenses after expense reductions (%) 1.02 * Ratio of net investment income (loss) (%) (.01) * (.25) (.19) Portfolio turnover rate (%) 37 ** a Based on average shares outstanding during the period. b Total return would have been lower had certain expenses not been reduced. * Annualized ** Not annualized *** Amount is less than $ Deutsche Gold & Precious Metals Fund

19 Institutional Class Six Months Ended 4/30/17 (Unaudited) Years Ended October 31, Selected Per Share Data Net asset value, beginning of period $ 7.65 $ 4.72 $ 5.71 $ 8.06 $15.44 $20.97 Income (loss) from investment operations: Net investment income (loss) a.00 *** (.02).02 (.00) *** (.01) (.02) Net realized and unrealized gain (loss) (.72) 2.95 (1.01) (2.35) (7.22) (2.07) Total from investment operations (.72) 2.93 (.99) (2.35) (7.23) (2.09) Less distributions from: Net investment income (.20) (.15) (.10) Net realized gains (3.34) Total distributions (.20) (.15) (3.44) Redemption fees.00 ***.00 ***.00 ***.00 ***.00 ***.00 *** Net asset value, end of period $ 6.73 $ 7.65 $ 4.72 $ 5.71 $ 8.06 $15.44 Total Return (%) b (8.80) ** (17.34) (29.16) (47.22) (9.94) Ratios to Average Net Assets and Supplemental Data Net assets, end of period ($ millions) Ratio of expenses before expense reductions (%) 1.35 * Ratio of expenses after expense reductions (%) 1.02 * Ratio of net investment income (loss) (%).13 * (.24).29 (.01) (.05) (.14) Portfolio turnover rate (%) 37 ** a Based on average shares outstanding during the period. b Total return would have been lower had certain expenses not been reduced. * Annualized ** Not annualized *** Amount is less than $.005. Deutsche Gold & Precious Metals Fund 19

20 Notes to Consolidated Financial Statements (Unaudited) A. Organization and Significant Accounting Policies Deutsche Gold & Precious Metals Fund (the Fund ) is a non diversified series of Deutsche Securities Trust (the Trust ), which 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 Fund offers multiple classes of shares which provide investors with different purchase options. Class A shares are subject to an initial sales charge. Class B shares automatically converted to Class A shares on February 10, 2016 and are no longer offered. Class B shares were not subject to an initial sales charge and are subject to higher ongoing expenses than Class A shares and a contingent deferred sales charge payable upon certain redemptions. Class C shares are not subject to an initial sales charge but are subject to higher ongoing expenses than Class A shares and a contingent deferred sales charge payable upon certain redemptions within one year of purchase. Class C shares do not automatically convert into another class. Class S shares are not subject to initial or contingent deferred sales charges and are only available to a limited group of investors. Institutional Class shares are not subject to initial or contingent deferred sales charges and are generally available only to qualified institutions. Investment income, realized and unrealized gains and losses, and certain fund 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 such as services to shareholders, distribution and service fees and certain other class specific expenses. Differences in class level expenses may result in payment of different per share dividends by class. All shares of the Fund have equal rights with respect to voting subject to class specific arrangements. The Fund's consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ( U.S. GAAP ) which require the use of management estimates. Actual results could differ from those estimates. The Fund qualifies as an investment company under Topic 946 of Accounting Standards Codification of U.S. GAAP. The policies described below are followed consistently by the Fund in the preparation of its consolidated financial statements. 20 Deutsche Gold & Precious Metals Fund

21 Principles of Consolidation. The Fund intends to gain exposure to the commodities markets by investing a portion of its assets in a wholly owned subsidiary, Cayman Precious Metals Fund, Inc., organized under the laws of the Cayman Islands (the Subsidiary ). Among other investments, the Subsidiary may invest in gold coin and bullion and other precious metals; commodity linked derivative instruments, such as options and futures; and exchange traded funds. The Subsidiary may also invest in debt securities, some of which are intended to serve as margin or collateral for the Subsidiary's derivatives positions. The Subsidiary may also invest available cash in affiliated money market funds. The Subsidiary is managed by the same portfolio managers that manage the Fund. As of April 30, 2017, the Fund's investment in the Subsidiary was $126,335, representing 0.12% of the Fund's total assets. The consolidated financial statements include the accounts of the Fund and the Subsidiary. All inter company transactions and balances have been eliminated. Security Valuation. Investments 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. Various inputs are used in determining the value of the Fund'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 Fund's own assumptions in determining the fair value of investments). The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Equity securities and commodities are valued at the most recent sale price or official closing price reported on the exchange (U.S. or foreign) or over the counter market on which they trade. Securities or commodities 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 and are generally categorized as Level 1. For certain 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, a fair valuation model may be used. This fair valuation model takes into account comparisons to the valuation of American Depository Receipts (ADRs), exchange traded funds and certain indices and these securities are categorized as Level 2. Investments in open end investment companies are valued at their net asset value each business day and are categorized as Level 1. Deutsche Gold & Precious Metals Fund 21

22 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 Board and are generally categorized as Level 3. In accordance with the Fund's valuation procedures, factors considered 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 or issuer'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. Disclosure about the classification of fair value measurements is included in a table following the Fund's Consolidated Investment Portfolio. Securities Lending. Brown Brothers Harriman & Co., as the lending agent, lends securities of the Fund to certain financial institutions under the terms of its securities lending agreement. During the term of the loans, the Fund continues to receive interest and dividends generated by the securities and to participate in any changes in their market value. The Fund requires the borrowers of the securities to maintain collateral with the Fund consisting of either cash or 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 agent will use its best effort to obtain additional collateral on the next business day to meet required amounts under the securities lending agreement. As of period end, any securities on loan were collateralized by cash. During the six months ended April 30, 2017, the Fund invested the cash collateral into a joint trading account in affiliated money market funds,including Deutsche Government & Agency Securities Portfolio, managed by Deutsche Investment Management Americas Inc. Deutsche Investment Management Americas Inc. receives a management/administration fee (0.10% annualized effective rate as of April 30, 2017) on the cash collateral invested in Deutsche Government & Agency Securities Portfolio. The Fund 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 Fund or the borrower may 22 Deutsche Gold & Precious Metals Fund

23 terminate the loan at any time, and the borrower, after notice, is required to return borrowed securities within a standard time period. 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. If the Fund is not able to recover securities lent, the Fund may sell the collateral and purchase a replacement investment in the market, incurring the risk that the value of the replacement security is greater than the value of the collateral. The Fund 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. As of April 30, 2017, the Fund had securities on loan, which were classified as common stock in the Investment Portfolio. The value of the related collateral exceeded the value of the securities loaned at period end. As of period end, the remaining contractual maturity of the collateral agreements was overnight and continuous. Foreign Currency Translations. The books and records of the Fund are maintained in U.S. dollars. Investment securities and other assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the prevailing exchange rates at period end. Purchases and sales of investment securities, income and expenses are translated into U.S. 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 acquisition and disposition of foreign currencies, and the difference between the amount of net investment income accrued and the U.S. dollar amount actually received. The 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. Taxes. The Fund'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, the Fund may be subject to taxes imposed by the governments of countries in which it invests and are generally based on income and/or capital gains earned or repatriated. Estimated tax liabilities on certain foreign securities are recorded on an accrual basis and are reflected as components of interest income or net change in unrealized gain/loss on investments. Tax liabilities realized as a result of security sales are reflected as a component of net realized gain/loss on investments. Deutsche Gold & Precious Metals Fund 23

24 Income from certain direct investments in commodities and investments in commodity linked derivatives does not constitute qualifying income to the Fund. Receipt of such income could cause the Fund to be subject to tax at the Fund level. The IRS has issued a private letter ruling to the Fund stating that such income earned through its wholly owned Subsidiary constitutes qualifying income. The Fund is required to increase its taxable income by its share of the Subsidiary's income, including net gains from commodities and commodity linked transactions. Net investment losses of the Subsidiary cannot be deducted by the Fund in the current period nor carried forward to offset taxable income for future periods. At October 31, 2016, the Fund had a net tax basis capital loss carryforward of approximately $162,284,000, which may be applied against realized net taxable capital gains indefinitely, including short term losses ($24,309,000) and long term losses ($137,975,000). The Fund has reviewed the tax positions for the open tax years as of October 31, 2016 and has determined that no provision for income tax and/or uncertain tax provisions is required in the Fund's consolidated financial statements. The Fund's federal tax returns for the prior three fiscal years remain open subject to examination by the Internal Revenue Service. Distribution of Income and Gains. Distributions from net investment income of the Fund, if any, are declared and distributed to shareholders annually. Net realized gains from investment transactions, in excess of available capital loss carryforwards, would be taxable to the Fund if not distributed, and, therefore, will be distributed to shareholders at least annually. The Fund may also make additional distributions for tax purposes if necessary. The timing and characterization of certain income and capital gain 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 investments in foreign denominated investments, investments in passive foreign investment companies 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, the Fund may periodically make reclassifications among certain of its capital accounts without impacting the net asset value of the Fund. The tax character of current year distributions will be determined at the end of the current fiscal year. 24 Deutsche Gold & Precious Metals Fund

25 Expenses. Expenses of the Trust arising in connection with a specific fund are allocated to that fund. Other Trust expenses which cannot be directly attributed to a fund are apportioned among the funds in the Trust based upon the relative net assets or other appropriate measures. Redemption Fees. Prior to February 1, 2017, the Fund imposed a redemption fee of 2% of the total redemption amount on Fund shares redeemed or exchanged within 15 days of buying them, either by purchase or exchange (subject to certain exceptions). This fee was assessed and retained by the Fund for the benefit of the remaining shareholders. The redemption fee was accounted for as an addition to paid in capital. Contingencies. In the normal course of business, the Fund may enter into contracts with service providers that contain general indemnification clauses. The Fund's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet been made. However, based on experience, the Fund expects the risk of loss to be remote. 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 Fund is informed of such dividends. Realized gains and losses from investment transactions are recorded on an identified cost basis. Proceeds from litigation payments, if any, are included in net realized gain (loss) from investments. B. Derivative Instruments 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. The Fund may write or purchase interest rate swaption agreements which are options to enter into a pre defined swap agreement. The interest rate swaption agreement will specify whether the buyer of the swaption will be a fixed rate receiver or a fixed rate payer upon exercise. Certain options, including options on indices, will require cash settlement by the Fund if exercised. For the six months ended April 30, 2017, the Fund entered written options for non-hedging purposes to seek to enhance potential gains and purchased options for hedging purposes. If the Fund writes a covered call option, the Fund foregoes, in exchange for the premium, the opportunity to profit during the option period from an Deutsche Gold & Precious Metals Fund 25

26 increase in the market value of the underlying security above the exercise price. If the Fund 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 Fund'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 Fund'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. There were no open purchased option and written option contracts as of April 30, For the six months ended April 30, 2017, the investment in purchased options contracts had a total value generally indicative of a range from $0 to approximately $150,000, and written option contracts had a total value generally indicative of a range from $0 to approximately $87,000. The amount of realized gains and losses on derivative instruments recognized in Fund earnings during the six months ended April 30, 2017 and the related location in the accompanying Statement of Operations is summarized in the following tables by primary underlying risk exposure: Purchased Written Realized Gain (Loss) Options Options Total Equity Contracts (a) $ 63,463 $ (68,276) $ (4,813) Each of the above derivatives is located in the following Consolidated Statement of Operations accounts: (a) Net realized gain (loss) from investments (includes purchased options) and written options, respectively C. Purchases and Sales of Securities During the six months ended April 30, 2017, purchases and sales of investment securities (excluding short term investments) aggregated $39,749,534 and $45,521,055, respectively. D. 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 the Fund 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 the Fund. 26 Deutsche Gold & Precious Metals Fund

27 Under the Investment Management Agreement with the Advisor, the Fund pays a monthly management fee based on the Fund's average daily net assets, computed and accrued daily and payable monthly, at the following annual rates: First $500 million of the Fund's average daily net assets.835% Over $500 million of such net assets.785% Accordingly, for the six months ended April 30, 2017, the fee pursuant to the Investment Management Agreement was equivalent to an annualized rate (exclusive of any applicable waivers/reimbursements) of 0.835% of the Fund's average daily net assets. For the period from November 1, 2016 through February 28, 2017, the Advisor had contractually agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the total annual operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of each class as follows: Class A 1.25% Class C 2.00% Class S 1.00% Institutional Class 1.00% Effective March 1, 2017 through September 30, 2017, the Advisor has contractually agreed to waive its fees and/or reimburse certain operating expenses of the Fund to the extent necessary to maintain the total annual operating expenses (excluding certain expenses such as extraordinary expenses, taxes, brokerage and interest) of certain classes as follows: Class A 1.30% Class C 2.05% Class S 1.05% Institutional Class 1.05% For the six months ended April 30, 2017, fees waived and/or expenses reimbursed for each class are as follows: Class A $ 56,386 Class C 20,709 Class S 161,983 Institutional Class 2,368 $ 241,446 Deutsche Gold & Precious Metals Fund 27

28 Administration Fee. Pursuant to an Administrative Services Agreement, DIMA provides most administrative services to the Fund. For all services provided under the Administrative Services Agreement, the Fund pays the Advisor an annual fee ( Administration Fee ) of 0.10% of the Fund's average daily net assets, computed and accrued daily and payable monthly. For the six months ended April 30, 2017, the Administration Fee was $54,100, of which $9,064 is unpaid. Service Provider Fees. Deutsche AM Service Company ( DSC ), an affiliate of the Advisor, is the transfer agent, dividend paying agent and shareholder service agent for the Fund. Pursuant to a sub transfer agency agreement between DSC and DST Systems, Inc. ( DST ), DSC has delegated certain transfer agent, dividend paying agent and shareholder service agent functions to DST. DSC compensates DST out of the shareholder servicing fee they receive from the Fund. For the six months ended April 30, 2017, the amounts charged to the Fund by DSC were as follows: Total Unpaid at Services to Shareholders Aggregated April 30, 2017 Class A $ 11,232 $ 7,659 Class C 2,230 1,555 Class S 44,952 30,248 Institutional Class $ 58,514 $ 39,528 Distribution and Service Fees. Under the Fund's Class C 12b 1 plan, Deutsche AM Distributors, Inc. ( DDI ), an affiliate of the Advisor, receives a fee ( Distribution Fee ) of 0.75% of average daily net assets of Class C shares. In accordance with the Fund's Underwriting and Distribution Services Agreement, DDI enters into related selling group agreements with various firms at various rates for sales of Class C shares. For the six months ended April 30, 2017, the Distribution Fee was as follows: Total Unpaid at Distribution Fee Aggregated April 30, 2017 Class C $ 36,218 $ 6,057 In addition DDI provides information and administrative services for a fee ( Service Fee ) to Class A and C shareholders at an annual rate of up to 0.25% of average daily net assets for each such class. DDI in turn has various agreements with financial services firms that provide these services and pays these fees based upon the assets of shareholder 28 Deutsche Gold & Precious Metals Fund