Edgar Filing: ZWEIG FUND INC /MD/

Glossary

American Depositary Receipt (ADR): Represents shares of foreign companies
traded in U.S. dollars on U.S. exchanges that are held by a bank or a trust.
Foreign companies use ADRs in order to make it easier for Americans to buy
their shares.

Basis Point (bp): One-hundredth of a percentage point (0.01%). Basis points are
often used to measure changes in or differences between yields on fixed income
securities, since these often change by very small amounts.

Consumer Price Index (CPI): Measures the change in consumer prices of goods and
services, including housing, electricity, food, and transportation, as
determined by a monthly survey of the U.S. Bureau of Labor Statistics. Also
called the cost-of-living index.

Dow Jones Industrial Average/SM/ (the "Dow"): A price-weighted average of 30
blue chip stocks. The index is calculated on a total return basis with
dividends reinvested.

Federal funds rate: The interest rate charged on overnight loans of reserves by
one financial institution to another in the United States. The federal funds
rate is the most sensitive indicator of the direction of interest rates since
it is set daily by the market.

Federal Reserve (the "Fed"): The central bank of the United States, responsible
for controlling the money supply, interest rates and credit with the goal of
keeping the U.S. economy and currency stable. Governed by a seven-member board,
the system includes 12 regional Federal Reserve Banks, 25 branches and all
national and state banks that are part of the system.

Gross domestic product (GDP): An important measure of the United States'
economic performance, GDP is the total market value of all final goods and
services produced in the U.S. during any quarter or year.

Inflation: Rise in the prices of goods and services resulting from increased
spending relative to the supply of goods on the market.

Initial public offering (IPO): A company's first sale of stock to the public.

NASDAQ Composite(R) Index: A market capitalization-weighted index of all issues
listed in the NASDAQ (National Association Of Securities Dealers Automated
Quotation System) Stock Market, except for closed-end funds, convertible
debentures, exchange traded funds, preferred stocks, rights, warrants, units
and other derivative securities. The index is calculated on a total return
basis with dividends reinvested.

Reuters CRB (Commodity Research Bureau) Index: Tracks 17 component commodities
ranging from key economic indicators like gold and oil to other important
commodities such as cocoa, coffee and orange juice.

Reuters Estimates: Provides major institutional sell-side and buy-side firms,
financial data providers and corporations around the world with research and
analysis on over 14,500 active companies and 10,000 inactive companies in more
than 70 countries.

S&P 500(R) Index: A market capitalization-weighted index of 500 of the largest
U.S. companies. The index is calculated on a total return basis with dividends
reinvested.

Short Interest: The total number of shares of a security that have been sold
short by customers and securities firms that have not been repurchased to
settle short positions in the market.

Indexes cited are unmanaged and not available for direct investment; therefore
their performance does not reflect the expenses associated with the active
management of an actual portfolio.

April 15, 2005

Dear Fellow ZF Shareholder:

I am pleased to share with you the manager's report and commentary for The
Zweig Fund, Inc. for the quarter ended March 31, 2005. In it, Dr. Martin Zweig,
president of Zweig Consulting, sub-advisor to the Fund, presents his market
overview and outlook, and Carlton Neel, the Fund's portfolio manager, reports
on changes to the portfolio during the quarter, including sector allocations
and top holdings.

For the quarter ended March 31, 2005, The Zweig Fund's net asset value
increased 2.08%, including the $0.149 distribution paid on January 10, 2005.
During the same period the Standard & Poor's (S&P) 500(R) Index, lost 2.15%,
including dividends reinvested. The Fund's average equity exposure for the
quarter was 70%.

As previously announced, the Fund's distribution for the quarter ended March
31, 2005, was $0.149, payable on April 26, 2005 to shareholders of record on
April 8, 2005. Including this distribution, the Fund's total payout since
inception is $18.443.

For more information on The Zweig Fund, including performance and holdings,
visit the Individual Investors section of our Web site, PhoenixInvestments.com.

As always, we welcome our shareholders' comments and feedback.

Sincerely,

/s/ Daniel T. Geraci
Daniel T. Geraci
President
The Zweig Fund, Inc.

MARKET OVERVIEW AND OUTLOOK

The stock market began the new year with a whimper, with the Dow Jones
Industrial Average/SM/ ("the Dow") off 2.7% in January, its fourth losing
January in the last six years. The S&P 500 Index ended January down 2.5%, while
the NASDAQ Composite(R) Index dropped 5.2%, its worst January decline since
1990. Despite an occasional roller coaster ride, the Dow and the S&P each ended
the quarter down 2.6%, but the NASDAQ slumped 8.1%, maintaining its poorest
opening pace since 1990.

We think the single most important reason for the lackluster first quarter
was high oil prices. Oil prices started to spike late last year and were in the
vicinity of $41 a barrel around year-end. By the end of the first quarter, they
had climbed to around $56. The market also didn't do well because bond yields
were rising at the same time. The ten-year Treasury note yield started the year
between 4.15% and 4.20% and got up to 4.60% late in the quarter. In our opinion
the higher oil prices and bond rates were major factors in the market's poor
performance.

Stock market activity quieted down significantly in the first quarter. The
Dow gained or fell 1% or more in only 5 days compared to 15 days in the first
quarter of 2004 and 25 days in the first quarter of 1999. It's hard to say
whether that amount of volatility is bullish or bearish. Generally, extremely
high volatility tends to be a good sign for the market. Usually it occurs at
the capitulation end of a bear market or the take-off phase of a new bull
market. However, it doesn't always work that way.

For example, there was a lot of volatility from 2000 to 2001 and the market
still had a long way to go down. The same thing happened in the early 1930s.
And there is also an old saying on

Wall Street which may or may not be true: "Never short a dull market," dull
meaning lack of volatility. Sometimes the market just marks time, frustrates
investors by going nowhere and then explodes on the upside. However, we have
also seen market tops form with a lack of volatility, as well. In our opinion,
the level of stock market volatility may not be that useful a predictive tool.

Taking another baby step, the Federal Reserve ("The Fed") raised short-term
interest rates again in March, to 2.75% from 2.50%, its seventh quarter-point
increase since last June. While the Fed said it expects to continue to lift
rates at "a measured pace," it indicated for the first time in over four years
that it is concerned about inflation. The Fed said that, while longer-term
inflation remains well contained, pressures on inflation have picked up in
recent months and pricing power is more evident. It added that upside and
downside risks to sustainable growth should be roughly equal provided there is
"appropriate monetary policy." Stocks plunged sharply initially after the Fed
voiced its inflationary fears.

We don't know if inflation will pick up a lot or not. Remember, the Fed had
cut interest rates down to 1%, which we felt was too low. It may have been that
the Fed panicked because the economic recovery that began a few years ago
started out rather slowly -- so it kept on cutting rates. We didn't think the
Fed should have gone as low as it did. While it has been slow to raise rates,
it appears that the Fed is just bringing its rates back into a zone where they
probably should have been. It wouldn't concern us if the rate were to go to 3%
or 3.25%. However, if the federal funds rate climbed to 4% or 4.50%, we think
that could present a real problem for the market.

The White House announced that the federal budget deficit is expected to
rise this year to $427 billion. That would be about 3.5% of the nation's gross
domestic product. Federal Reserve chairman Alan Greenspan warned Congress that
the growing federal budget deficits are "unsustainable" and he urged lawmakers
to act now rather than later. Although a great deal of concern is being voiced
about the big deficit, its historic impact on the market may surprise many
people. Testing this relationship, we found that the market generally does
worse when the federal budget is at a surplus than when it runs at a deficit.
These are the facts. However, when you get a very large deficit and fiscal
policy is stimulative, you tend to get more inflation, which may be what is
happening now.

Another deficit that has been making news is the American trade deficit,
which rose 4.3% in February to hit an all-time high of $61.04 billion. The
Commerce Department reported that exports rose a mere $50 million, while
imports soared by $2.58 billion. For the first two months of this year, the
trade deficit is running at an annual rate of $717.2 billion, a full $100
billion higher than the trade imbalance for all of 2004. The high trade deficit
could be a problem for the market. It tends to show that the U.S. is not as
globally competitive as we used to be, as it is difficult to compete against
low labor costs in Asia and elsewhere. Eventually, as the dollar weakens, it
should help the deficit by making American goods cheaper, or at least make it
more expensive for the U.S. to buy foreign goods. However, that hasn't happened
yet.

Although the Fed maintains that longer-term inflation remains well
contained, the Reuters CRB (Commodity Research Bureau) Index, which covers 22
natural resources, reached a 24-year high of 322.42 in mid-March, but has since
slipped back 4.2% to 308.77. However, it is still up 9% for the year and up
about 64% from where it was in 2002. That's a pretty big move as far as
commodity prices are concerned, with much of it caused by the rise in oil.
However, we don't know how it will impact overall inflation because it doesn't
reflect labor costs, productivity and other business expenses. In any event, we
view it as a problem and a negative for the market.

Bearing out the Fed's contention that pricing power is more evident, the
Labor Department reported that the Consumer Price Index climbed

0.4% in February, the fastest pace since last October. Average prices are now
3% higher than a year earlier and have risen some 1.6% from the end of 2001.
However, hourly wages and average weekly earnings did not keep up, gaining only
2.6% over last year. To us, the 3% increased pricing level is not too bad. The
problem may be that if it starts to move higher, the Fed will likely do
something about it -- and if the Fed continues to raise rates, it could play
havoc with the economy. The real problem with inflation is that the cure
(higher interest rates) can be worse than the disease (inflation). One thing is
certain in our view -- it's not great for the market if inflation keeps heating
up.

While consumer prices rose, the Federal Reserve reported that consumer debt
grew at an annual rate of 6.6% in January -- the fastest pace in three months.
This was an increase of $11.5 billion from December, which in turn jumped 5%
from November. Since consumer spending is such an important part of our
economy, it could be a problem if debt gets excessive. The monthly numbers
really bounce around quite a bit. If the rate of change in consumer spending or
consumer debt gets really high, it would likely signal an overheated economy,
which could mean higher inflation and move us closer to higher interest rates.

While mergers and acquisitions seemed to help prop up the market last year,
that isn't apparently happening this year so far. There were $264 billion in
deals reported in the first quarter, little changed from the $263.7 billion in
the fourth quarter. These figures are currently fairly high and there are
likely to be many more deals because corporate America is awash with cash. When
a company holds too much cash and doesn't do anything with it, the company
often becomes a target. And if a company holds too much cash and decides to do
something with it, one probable option is to buy other companies. We think the
high rate of deals will continue and will be a positive for the market.

After a spurt in initial public offerings (IPOs) in January and February,
the pace slowed during March, according to Thomson Financial. During the first
quarter, 41 companies went public, the same number as a year ago, which was the
strongest first quarter since 2000. It doesn't appear that new offerings are
excessive compared to 2000 or 1999. If IPO activity were to overheat, that
would likely be a negative for the market, but we aren't there yet.

Gross domestic product (GDP) in the U.S. rose at a 3.8% annual rate in the
fourth quarter of last year, significantly higher than the 3.1% growth
previously estimated, the Commerce Department reported. For all of 2004, GDP
expanded 4.4%, the fastest pace since 1999. These numbers are always revised
quite a bit so it's best not to put a lot of faith in them. However, the
economy appears fairly strong right now and its future direction will depend a
lot on where interest rates go. As indicated earlier, if rates were to rise,
the economy would likely slow.

The Labor Department reported that the nation added about 110,000 new jobs
in March, less than half of what Wall Street analysts had predicted. The pace
was much slower than in February when 243,000 jobs were added. March had the
smallest gain in employment since last July, yet surprisingly, the market took
a hit when these figures were released. These figures appear bullish to us.
With a slow job growth rate, the Fed is far less likely to increase rates. If
the economy were to remain moderately strong or weaken slightly, we believe it
would probably be a plus for the market.

We have seen a sharp decline in the rate of earnings growth. According to
Reuters Estimates, analysts expect earnings in the S&P 500 Index to climb 8.1%
in the first quarter of 2005 over the year-ago quarter. While positive, this
figure is far below the 20.4% gain in the fourth quarter of 2004. And looking
ahead, analysts predict a 7.6% rise for earnings in the second quarter

of 2005. Although the rate of earnings growth has slowed, we believe there is
no cause for concern. Because we are coming off rather strong numbers, these
figures seem fairly normal at this point in the business cycle.

While earnings have been receding, dividends are surging. Standard and
Poor's reports that dividends in the S&P 500 increased 15.3% in 2004 to $19.43.
It was the biggest payout year since 1977. Also, Standard & Poor's forecasted
that this year's dividends will total $21.80 -- a 12.2% gain. The firm said
that this was perhaps the best two-year period since the 51.5% gain in 1949 and
1950. It is important to note that, even at the projected numbers, the dividend
yield of about 1.9% appears rather skimpy. Still, on the whole, the greater
dividend payments are a positive for the market.

Another fairly decent sign for the market is the building up of short
interest. The number of short-selling positions not yet closed out on the New
York Stock Exchange increased 5.1% in mid-March to 8.4 billion from 8 billion
in mid-February. Year-to-date through March, short interest was up 9.1%,
including a 3.5% gain from mid-February. While short interest is not the most
reliable market indicator, it can be viewed more positive than not.

The dollar showed surprising strength in the first quarter, after a year in
which the dollar dipped to its lowest level since the launch of the euro in
1999. At this writing, the euro has weakened 4.4% against the dollar and the
dollar is up 4.5% against the yen. While the market was probably hurt by the
weakness in the dollar, it hasn't really gone anywhere since the dollar began
to strengthen. While the market seems inclined to be more favorable when the
dollar is stronger, it's a challenging call. We have tested this relationship
extensively and cannot find a correlation. However, at this point, with so many
people worried about a weak dollar, it would probably be helpful if the dollar
were stronger, but not if the Fed has to boost interest rates to accomplish
that result.

With March marking the fifth anniversary of the stock market bubble, much
has been written recently comparing the markets then and now. Aside from the
fact that we consider the NASDAQ very overpriced, the market is not behaving as
if it were in a bubble. That doesn't preclude the possibility of a bear market,
but the market certainly is not like it was back in 1999 and early 2000. To sum
it up, we view the cash that corporations are holding as the main market
positive. Evaluations are not great but earnings appear to be okay on a
relative basis. There are signs of a slight pick-up in pessimism, which we view
as a positive. The main negative is the prospect of higher interest rates
looming. On the whole, we view the indicators as moderately positive, and so
are roughly 70% invested in equities at this writing.

Sincerely,

[GRAPHIC]

Martin E. Zweig, Ph.D.
President
Zweig Consulting LLC

The preceding information is the opinion of portfolio management. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts will be realized.

PORTFOLIO COMPOSITION

As of March 31, 2005, our leading stock market sectors included financials,
industrials, health care, consumer staples and information technology. Although
there were changes in allocation amounts, all of these sectors were listed in
our previous quarterly report. During the first quarter, we added to our
positions in industrials and financials and trimmed our holdings in
telecommunication and energy.

As of March 31, 2005, our top individual positions included Burlington
Resources, Continental Airlines, Georgia-Pacific, Goldman Sachs, Halliburton,
Kimberly-Clark, Merck, Morgan Stanley, United Defense and UnitedHealth Group.
Of these, two are new holdings since the last quarter: Continental Airlines and
Goldman Sachs. We also added to our positions in Georgia-Pacific and Merck.
There were no changes in the number of shares owned in the other companies
listed.

No longer among our top holdings are Fox Entertainment, which we sold out,
and Allstate, Altria Group, Archer Daniels Midland, C.R. Bard, Dow Chemical,
and Sanofi-Aventis, in all of which we trimmed our positions. There were no
changes in our holdings of Amgen, PACCAR, and Wells Fargo, although these
companies are no longer in our listing of top holdings.

Sincerely,

[SIGNATURE]

/s/ Carlton Neel
Carlton Neel
Executive Vice President
Phoenix/Zweig Advisers LLC

THE ZWEIG FUND, INC.

SCHEDULE OF INVESTMENTS AND SECURITIES SOLD SHORT

March 31, 2005
(Unaudited)

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

INVESTMENTS
DOMESTIC COMMON STOCKS 67.27%
CONSUMER DISCRETIONARY -- 6.70%
Comcast Corp. Class A/(b)/.................... 190,000 $ 6,418,200
Home Depot, Inc............................... 140,000 5,353,600
McDonald's Corp............................... 175,000 5,449,500
Nike, Inc. Class B............................ 72,000 5,998,320
Viacom, Inc. Class B.......................... 175,000 6,095,250
------------
29,314,870
------------
CONSUMER STAPLES -- 9.79%
Altria Group, Inc./(d)/....................... 95,000 6,212,050
Archer-Daniels Midland Co..................... 260,000 6,390,800
Costco Wholesale Corp......................... 125,000 5,522,500
Kimberly-Clark Corp........................... 100,000 6,573,000
Molson Coors Brewing Co....................... 80,000 6,173,600
Procter & Gamble Co........................... 113,200 5,999,600
Sara Lee Corp................................. 270,000 5,983,200
------------
42,854,750
------------
ENERGY -- 7.13%
Burlington Resources, Inc..................... 130,000 6,509,100
ConocoPhillips................................ 55,000 5,931,200
Halliburton Co................................ 150,000 6,487,500
Occidental Petroleum Corp..................... 85,000 6,049,450
Valero Energy Corp............................ 85,000 6,227,950
------------
31,205,200
------------
FINANCIALS -- 12.40%
Allstate Corp................................. 115,000 6,216,900
Bank of America Corp./(d)/.................... 130,000 5,733,000
Capital One Financial Corp.................... 75,000 5,607,750
Goldman Sach Group, Inc....................... 60,000 6,599,400
Huntington Bancshares, Inc.................... 250,000 5,975,000
Morgan Stanley................................ 115,000 6,583,750
National City Corp............................ 165,000 5,527,500

See notes to schedule of investments and securities sold short

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

FINANCIALS (CONTINUED)
Wachovia Corp.............................. 110,000 $ 5,600,100
Wells Fargo & Co........................... 108,000 6,458,400
------------
54,301,800
------------
HEALTH CARE -- 8.60%
Amgen, Inc./(b)/........................... 105,000 6,112,050
Bard (C.R.), Inc........................... 90,000 6,127,200
Bristol-Myers Squibb Co.................... 250,000 6,365,000
Merck & Co., Inc........................... 205,000 6,635,850
Pfizer, Inc................................ 200,000 5,254,000
UnitedHealth Group, Inc.................... 75,000 7,153,500
------------
37,647,600
------------
INDUSTRIALS -- 11.79%
AMR Corp./(b)/............................. 500,000 5,350,000
Boeing Co. (The)........................... 100,000 5,846,000
Continental Airlines, Inc. Class B/(b)/.... 580,000 6,983,200
Deere & Co./(d)/........................... 86,000 5,773,180
L-3 Communication Holdings, Inc............ 80,000 5,681,600
Norfolk Southern Corp...................... 170,000 6,298,500
Paccar, Inc................................ 85,000 6,153,150
United Defense Industries, Inc............. 130,000 9,544,600
------------
51,630,230
------------
INFORMATION TECHNOLOGY -- 6.23%
Cisco Systems, Inc./(b)/................... 315,000 5,635,350
Intel Corp................................. 250,000 5,807,500
International Business Machines Corp....... 65,000 5,939,700
Microsoft Corp............................. 175,000 4,229,750
Qualcomm, Inc. ............................ 155,000 5,680,750
------------
27,293,050
------------
MATERIALS -- 3.26%
Dow Chemical Co./(d)/...................... 115,000 5,732,750
Freeport-McMoRan Copper & Gold, Inc. Class B 50,000 1,980,500
Georgia-Pacific Corp....................... 185,000 6,565,650
------------
14,278,900
------------
TELECOMMUNICATION -- 1.37%
AT&T Corp.................................. 320,000 6,000,000
------------
Total Domestic Common Stocks (Identified Cost
$251,649,266)............................... 294,526,400
------------

See notes to schedule of investments and securities sold short

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

FOREIGN COMMON STOCKS/(c)/ 7.30%
CONSUMER DISCRETIONARY -- 1.94%
Honda Motor Co., Ltd. ADR (Japan)/(d)/............ 240,000 $ 6,009,600
Sony Corp. ADR (Japan)............................ 62,000 2,481,240
------------
8,490,840
------------
HEALTH CARE -- 2.76%
Angiotech Pharmaceuticals (United States)......... 400,000 6,140,000
Sanofi Aventis ADR (France)....................... 140,000 5,927,600
------------
12,067,600
------------
INFORMATION TECHNOLOGY -- 2.60%
Amdocs Ltd. (United States)/(b)/.................. 200,000 5,680,000
Nokia OYJ ADR (Finland)........................... 370,000 5,709,100
------------
11,389,100
------------
Total Foreign Common Stocks (Identified Cost
$30,208,966)........................................ 31,947,540
------------
PREFERRED STOCKS 0.04%
FINANCIALS -- 0.04%
Citibank NA Series A 6.34% Pfd.................... 2,000 201,438
------------
Total Preferred Stocks (Identified Cost $202,000)..... 201,438
------------

Par
(000's)
----------
U.S. GOVERNMENT SECURITIES 12.08%
U.S. TREASURY NOTES -- 12.08%
U.S. Treasury Note 12.75%, 11/15/10............... $50,000 52,867,200
------------
Total U.S. Government Securities (Identified Cost
$58,923,127)........................................ 52,867,200
------------

Contracts
----------
OPTIONS 0.00%
Japan Yen Call Option expiring 4/26/05 @ 102...... 50,000,000 23,600
------------
Total Options (Identified Cost $258,795).............. 23,600
------------
Total Long Term Investments -- 86.69% (Identified Cost
$341,242,154)....................................... 379,566,178
------------

See notes to schedule of investments and securities sold short

Par
(000's) Value
------- ------------

SHORT-TERM INVESTMENTS 13.46%
FEDERAL AGENCY SECURITIES -- 4.62%
FNMA 7.00%, 7/15/05 (Identified Cost $20,244,426) $20,000 $ 20,223,060
------------
COMMERCIAL PAPER -- 8.84%
Consolidated Edison, Inc. 2.83%, 4/1/05......... 5,700 5,700,000
RABOBANK USA 2.82%, 4/1/05...................... 13,000 13,000,000
UBS Finance Delaware LLC 2.83%, 4/1/05.......... 20,000 20,000,000
------------
Total Commercial Paper (Identified Cost $38,700,000) 38,700,000
------------
Total Short-Term Investments (Identified cost
$58,944,426)................................... 58,923,060
------------
Total Investments (Identified Cost $400,186,580) --
100.15%........................................ 438,489,238/(a)/
Securities Sold Short (Proceeds $14,208,568) --
(3.56)%........................................ (15,631,050)
Other Assets Less Liabilities -- 3.41%........... 14,965,371
------------
Net Assets -- 100.00%............................ $437,823,559
============

--------
(a) Federal Tax information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $56,890,684 and gross
depreciation of $19,831,034 for federal tax purposes. At March 31, 2005,
the aggregate cost of securities for federal income tax purposes was
$401,429,588.
(b) Non-income producing.
(c) Foreign Common Stocks are determined based on the country in which the
security is issued. The country of risk is determined based on criteria in
Note 1E "Foreign security country determination" in the Notes to Schedule
of Investments and Securities Sold Short.
(d) Position, or portion thereof, has been segregated to collateralize
securities sold short.

See notes to schedule of investments and securities sold short

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

SECURITIES SOLD SHORT
DOMESTIC COMMON STOCKS -- (2.04)%
CONSUMER DISCRETIONARY -- (1.52)%
Wendy's International, Inc................... 170,000 $ 6,636,800
-----------
UTILITIES -- (0.52)%
Reliant Resources, Inc....................... 200,000 2,276,000
-----------
Total Domestic Common Stocks (Proceeds $7,340,044) 8,912,800
-----------
EXCHANGE TRADED FUNDS -- (1.52)%
iShares Russell 2000 Index Fund (Proceeds
$6,868,524)................................ 55,000 6,718,250
-----------
Total Securities Sold Short (Proceeds $14,208,568) 15,631,050/(e)/
===========

--------
(e) Federal Tax information: Net unrealized depreciation of securities sold
short is comprised of gross appreciation of $150,274 and gross
depreciation of $1,572,756 for federal income tax purposes. At March 31,
2005, the aggregate proceeds of securities sold short for federal income
tax purposes was ($14,208,568).

See notes to schedule of investments and securities sold short

THE ZWEIG FUND, INC.

FINANCIAL HIGHLIGHTS

March 31, 2005
(Unaudited)

Net Asset Value
Total Net Assets per share
-------------------------- --------------

Beginning of period: December 31, 2004.................. $440,643,475 $ 6.02
Net investment income (loss)......................... $ 1,777,747 $ 0.02
Net realized and unrealized gain (loss) on
investments........................................ 6,314,062 0.09
Dividends from net investment income and
distributions from net long-term and short-term
capital gains*..................................... (10,911,725) (0.15)
Net asset value of shares issued to shareholders in
reinvestment of dividends resulting in issuance of
common stock....................................... -- --
------------ ------
Net increase in net assets/net asset value........... (2,819,916) (0.04)
------------ ------
End of period: March 31, 2005........................... $437,823,559 $ 5.98
============ ======

--------
*Please note that the tax status of our distributions is determined at the
end of the taxable year. However, based on interim data, we estimate that
10% of distributions represent return of capital and 74% represent excess
gain distributions which are taxable as ordinary income.

THE ZWEIG FUND, INC.

NOTES TO SCHEDULE OF INVESTMENTS AND SECURITIES SOLD SHORT

March 31, 2005
(Unaudited)

NOTE 1 -- SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Zweig Fund in the preparation of its Schedule of Investments
and Securities Sold Short. The preparation of its Schedule of Investments and
Securities Sold Short in conformity with accounting principals generally
accepted in the United States of America requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
contingent assets and liabilities at the date of the its Schedule of
Investments and Securities Sold Short. Actual results could differ from those
estimates.

A. Security Valuation:

Equity securities are valued at the official closing price (typically last
sale) on the exchange on which the securities are primarily traded, or if no
closing price is available, at the last bid price.

Debt securities are valued on the basis of broker quotations or valuations
provided by a pricing service, which, in determining value, utilizes
information with respect to recent sales, market transactions in comparable
securities, quotations from dealers, and various relationships between
securities in determining value.

As required, some securities and other assets, if any, are valued at fair
value as determined in good faith by or under the direction of the Directors.

Certain foreign common stocks may be fair valued in cases where closing
prices are not readily available or are deemed not reflective of readily
available market prices. For example, significant events (such as movement in
the U.S. securities market, or other regional and local developments) may occur
between the time that foreign markets close (where the security is principally
traded) and the time that the Fund calculates its net asset value (generally,
the close of the NYSE) that may impact the value of securities traded in these
foreign markets. In these cases, information from an external vendor may be
utilized to adjust closing market prices of certain foreign common stocks to
reflect their fair value. Because the frequency of significant events is not
predictable, fair valuation of certain foreign common stocks may occur on a
frequent basis.

Short-term investments having a remaining maturity of 60 days or less are
valued at amortized cost, which approximates market.

B. Security Transactions and Related Income:

Security transactions are recorded on the trade date. Dividend income is
recorded on the exdividend date, or in the case of certain foreign securities,
as soon as the Fund is notified. Interest income is recorded on the accrual
basis. The Fund amortizes premiums and accretes discounts using the effective
interest method. Realized gains and losses are determined on the identified
cost basis.

C. Foreign Currency Translation:

Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at
the trade date. The gain or loss resulting from a change in currency exchange
rates between the trade and settlement dates of a portfolio transaction is
treated as a gain or loss on foreign currency. Likewise, the gain or loss
resulting from a change in currency exchange rates between the date income is
accrued and paid is treated as a gain or loss on foreign currency. The Fund
does not isolate that portion of the results of operations arising from changes
in exchange rates and that portion arising from changes in the market prices of
securities.

D. Forward Currency Contracts:

The Fund may enter into forward currency contracts in conjunction with the
planned purchase or sale of foreign denominated securities in order to hedge
the U.S. dollar cost or proceeds. Forward currency contracts involve, to
varying degrees, elements of market risk in excess of the amount recognized in
the Statement of Assets and Liabilities. Risks arise from the possible
movements in foreign exchange rates or if the counterparty does not perform
under the contract.

A forward currency contract involves an obligation to purchase or sell a
specific currency at a future date, which may be any number of days from the
date of the contract agreed upon by the parties, at a price set at the time of
the contract. These contracts are traded directly between currency traders and
their customers. The contract is marked-to-market daily and the change in
market value is recorded by the Fund as an unrealized gain or loss. When the
contract is closed or offset with the same counterparty, the Fund records a
realized gain or loss equal to the change in the value of the contract when it
was opened and the value at the time it was closed or offset.

E. Foreign Security Country Determination:

A combination of the following criteria is used to assign the countries of
risk listed in the schedule of investments and securities sold short: country
of incorporation, actual building address, primary exchange on which the
security is traded and country in which greatest percentage of company revenue
is generated.

F. Options:

The Fund may write covered options or purchase options contracts for the
purpose of hedging against changes in the market value of the underlying
securities or foreign currencies. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When a written option is
exercised, the proceeds on sales or amounts paid are adjusted by the amount of
premium received.

The Fund may purchase options, which are included in the Fund's Schedule of
Investments and Securities Sold Short and subsequently marked-to-market to
reflect the current value of the option. When a purchased option is exercised,
the cost of the security is adjusted by the amount of premium paid. The risk
associated with purchased options is limited to the premium paid. As of March
31, 2005, the Fund has one option outstanding.

G. Short Sales:

A short sale is a transaction in which the Fund sells a security it does not
own in anticipation of a decline in market price. To sell a security short, the
Fund must borrow the security. The Fund's obligation to replace the security
borrowed and sold short will be fully collateralized at all times by the
proceeds from the short sale retained by the broker and by cash and securities
deposited in a segregated account with the Fund's custodian. If the price of
the security sold short increases between the time of the short sale and the
time the Fund replaces the borrowed security, the Fund will realize a loss, and
if the price declines during the period, the Fund will realize a gain. Any
realized gain will be decreased by, and any realized loss increased by, the
amount of transaction costs. Dividends on short sales are recorded as an
expense to the Fund on ex-dividend date. At March 31, 2005 the value of
securities sold short amounted to $15,631,050 against which collateral of
$36,943,640 was held. The collateral includes the deposits with broker for
securities held short and the value of the segregated investments held long, as
shown in the Schedule of Investments and Securities Sold Short. Short selling
used in the management of the Fund may accelerate the velocity of potential
losses if the prices of securities sold short appreciate quickly. Stocks
purchased may decline in value at the same time stocks sold short may
appreciate in value, thereby increasing potential losses.

H. Indemnifications:

Under the Fund's organizational documents, its directors and officers are
indemnified against certain liabilities arising out of the performance of their
duties to the Fund. In addition, the Fund enters into contracts that contain a
variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to these contracts and expects the risk of loss to be remote.

NOTE 2 -- CREDIT RISK AND ASSET CONCENTRATIONS

In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such investments
may be volatile. The consequences of political, social or economic changes in
these markets may have disruptive effects on the market prices of these
investments and the income they generate, as well as a fund's ability to
repatriate such amounts.

The Fund may invest a high percentage of its assets in specific sectors of
the market in its pursuit of a greater investment return. Fluctuations in these
sectors of concentration may have a greater impact on the Fund, positive or
negative, than if the Fund did not concentrate its investments in such sectors.

NOTE 3 -- PROXY VOTING PROCEDURES

The Adviser votes proxies relating to portfolio securities in accordance
with procedures that have been approved by the Fund's Board of Directors. You
may obtain a description of these procedures, along with information regarding
how the Fund voted proxies during the most recent twelve-month period ended
June 30, 2004, free of charge, by calling "toll-free" 800-243-1574. This
information is also available through the Securities and Exchange Commission's
website at http://www.sec.gov.

NOTE 4 -- FORM N-Q INFORMATION

Effective September 30, 2004, the Fund files a complete schedule of
portfolio holdings with the Securities and Exchange Commission (the "SEC") for
the first and third quarters of each fiscal year on Form N-Q. Form N-Q is
available on the SEC's website at http://www.sec.gov. Form N-Q may be reviewed
and copied at the SEC's Public Reference Room. Information on the operation of
the SEC's Public Reference Room can be obtained at
http://www.sec.gov/info/edgar/prrules.htm.

--------------------------------------------------------------------------------

KEY INFORMATION
1-800-272-2700 Zweig Shareholder Relations:
For general information and literature, as well as updates on net
asset value, share price, major industry groups and other key
information

REINVESTMENT PLAN

Many of you have questions about our reinvestment plan. We urge
shareholders who want to take advantage of this plan and whose shares are
held in "Street Name," to consult your broker as soon as possible to
determine if you must change registration into your own name to participate.

-----------------

Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may from time to time purchase its shares of
common stock in the open market when Fund shares are trading at a discount from
their net asset value.

OFFICERS AND DIRECTORS
Daniel T. Geraci
Director, President and Chief Executive Officer

Carlton Neel
Executive Vice President

David Dickerson
Senior Vice President

Marc Baltuch
Vice President

Moshe Luchins
Vice President

Kevin J. Carr
Secretary

Nancy Curtiss
Treasurer

Charles H. Brunie
Director

Wendy Luscombe
Director

Alden C. Olson, Ph.D.
Director

James B. Rogers, Jr.
Director

R. Keith Walton
Director

Investment Adviser
Phoenix/Zweig Advisers LLC
900 Third Avenue
New York, NY 10022

Fund Administrator
Phoenix Equity Planning Corporation
56 Prospect St.
P.O. Box 150480
Hartford, CT 06115-0480

Custodian
The Bank of New York
One Wall Street
New York, NY 10286

Transfer Agent
EquiServe Trust Co., N.A.
P.O. Box 43010
Providence, RI 02940-3010

Legal Counsel
Katten Muchin Zavis Rosenman
575 Madison Avenue
New York, NY 10022

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This report is transmitted to the shareholders of The Zweig Fund, Inc. for
their information. This is not a prospectus, circular or representation
intended for use in the purchase of shares of the Fund or any securities
mentioned in this report.

PXP 4132 Q1-05

Quarterly Report

Zweig

The Zweig Fund, Inc.

March 31, 2005

[GRAPHIC]

PHOENIX
INVESTMENT PARTNERS, LTD.