<PAGE>
ANNUAL REPORT, December 31, 1995
NAVELLIER PERFORMANCE FUNDS
920 Incline Way, Building I
Incline Village, NV 89450
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February 23, 1996
Dear Shareholder:
We are happy to welcome everyone to the new Navellier Aggresive Growth
Portfolio*. Although open for only one business day in 1995, we hope that the
Portfolio will be a success in 1996. The Portfolio became effective December
28, 1995 at a price of $10.00 per share and finished on December 31, 1995, at a
price of $9.99.
We are now in a slow growth environment where earnings momentum has decelerated
rapidly. The dramatic earnings slowdown is making stock selection more
important than ever. Although it appears that the entire stock market is very
strong as the Dow Industrials and S&P 500 make new highs, these stock market
indices are not expected to have much more than 2% earnings growth in 1996.
There is far better earnings growth in the NASDAQ market, but we must be very
selective, since the analysts no longer favor technology stocks, especially
semiconductor companies, like they did in 1995. New industry groups, such as
pharmaceuticals, medical technology, and oil service stocks, have had more
positive analyst support in 1996.
Typically the stock market rallies into the November presidential elections.
This year should be no different. The flow of funds into stock mutual funds
remains stronger than ever and is one of the primary reasons that the stock
market turned around after a sharp sell-off in early January 1996. Those stocks
that continue to have positive analysts' earnings revisions and strong earnings
momentum should continue to outperform. Unfortunately, there are fewer
outstanding stocks in 1996 than there were in 1995 due to the slowing earnings
momentum environment. This is an environment where good stock pickers should
prevail. Fortunately, we believe stock selection has always been one of our
strengths, so we remain optimistic on the Navellier Aggressive Growth
Portfolio's prospects for 1996.
We want to thank all the shareholders in the Navellier Aggressive Growth
Portfolio for your support and confidence in our money management firm.
Although we are new to the mutual fund business, we are striving to achieve
outstanding performance with specialty mutual funds, such as the Navellier
Aggressive Growth Portfolio. Always feel free to contact us if you have any
questions or if we can help you in any way.
Sincerely,
/s/ LOUIS G. NAVELLIER
LOUIS G. NAVELLIER
* This material has been preceded by a Navellier Performance Funds: Aggressive
Growth Portfolio prospectus.
<PAGE>
December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
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PORTFOLIO OF INVESTMENTS
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Market Value
Shares (Note 1)
- ----------------------------------------------------------
<C> <S> <C>
COMMON STOCKS
BANKS -- 2.42%
100 Zions Bancorporation $ 8,025
---------
CASINOS/GAMING -- 4.21%
600 Grand Casinos, Inc.* 13,950
---------
COMPUTER SOFTWARE -- 4.11%
500 Applix, Inc.* 13,625
---------
DATA COMMUNICATIONS/NETWORKING -- 7.55%
200 Ascend Communications, Inc.* 16,225
100 U.S. Robotics Corp.* 8,775
---------
25,000
---------
DIAGNOSTIC EQUIPMENT -- 4.11%
800 PPT Vision, Inc.* 13,600
---------
DIVERSIFIED TECHNOLOGY -- 4.36%
250 Input/Output, Inc.* 14,437
---------
EDUCATION -- 2.81%
600 Youth Services International, Inc.* 9,300
---------
ELECTRONICS -- 7.46%
200 C-Cube Microsystems, Inc.* 12,500
800 Thermo Voltek Corp.* 12,200
---------
24,700
---------
HEALTHCARE -- 7.52%
300 ABR Information Services, Inc.* 13,200
300 Health Management Systems, Inc.* 11,700
---------
24,900
---------
MEDICAL SUPPLIES -- 8.68%
300 Boston Scientific Corp.* 14,775
250 Medtronic, Inc. 13,969
---------
28,744
---------
PRINTING/PAPER PRODUCTS -- 4.17%
400 Day Runner, Inc.* 13,800
---------
RECREATION PRODUCTS -- 3.94%
400 Ride, Inc.* 13,050
---------
<CAPTION>
- ----------------------------------------------------------
Market Value
Shares (Note 1)
- ----------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (continued)
SEMICONDUCTORS AND RELATED -- 4.46%
300 Advanced Semiconductor Material Intl.* 14,775
--------
TELECOMMUNICATIONS -- 3.31%
200 Pairgain Technologies, Inc.* 10,950
--------
TRANSPORTATION EQUIPMENT -- 0.69%
100 Greenwich Air Service, Inc.* 2,300
--------
TOTAL COMMON STOCKS -- 69.80%
(COST $231,240) 231,156
--------
MUTUAL FUNDS -- 30.20%
Fund for Government Investors, Inc.
(Cost $100,000) 100,000
--------
TOTAL INVESTMENTS -- 100.00%
(COST $331,240) $331,156
========
</TABLE>
* Non-income producing.
See Notes to Financial Statements.
2
<PAGE>
December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
ASSETS
Securities at Value (Note 1, see portfolio for cost information)....... $331,156
Receivable for Shares Purchased........................................ 200,000
Interest Receivable.................................................... 37
Unamortized Organizational Costs (Note 1).............................. 125,790
--------
Total Assets........................................................... 656,983
--------
LIABILITIES
Payable for Securities Purchased....................................... 231,240
Investment Advisory Fee Payable (Note 2)............................... 10
Administrative Fee Payable (Note 2).................................... 4
Distribution Plan Fee Payable (Note 4)................................. 2
Organizational Expenses Payable to Adviser (Note 1).................... 125,790
--------
Total Liabilities...................................................... 357,046
--------
NET ASSETS............................................................. $299,937
========
Shares Outstanding..................................................... 30,020
========
Net Asset Value Per Share.............................................. $9.99
========
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
3
<PAGE>
For the Period December 28, 1995
(Commencement of Operations)
to December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
INVESTMENT INCOME
Interest (Note 1)....................................................... $ 37
-----
Total Investment Income................................................. 37
-----
EXPENSES
Investment Advisory Fee (Note 2)........................................ 10
Administrative Fee (Note 2)............................................. 2
Distribution Plan Fees (Note 4)......................................... 2
Organizational Expense (Note 1)......................................... 210
-----
Total Expenses.......................................................... 224
Less Expenses Reimbursed by Investment Advisor (Note 2)................. (208)
-----
Net Expenses............................................................ 16
-----
NET INVESTMENT INCOME................................................... 21
-----
Net Realized Gain on Investments........................................ --
Net Change in Unrealized Depreciation of Investments.................... (84)
-----
NET LOSS ON INVESTMENTS................................................. (84)
-----
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS.................... $ (63)
=====
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</TABLE>
See Notes to Financial Statements.
4
<PAGE>
For the Period December 28, 1995
(Commencement of Operations)
to December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
FROM INVESTMENT ACTIVITIES
Net Investment Income................................................. $ 21
Net Realized Gain on Investment Transactions.......................... --
Net Change in Unrealized Depreciation of Investments.................. (84)
--------
Net Decrease in Net Assets Resulting from Operations.................. (63)
DISTRIBUTIONS TO SHAREHOLDERS
From Net Investment Income............................................ --
From Net Realized Capital Gains....................................... --
FROM SHARE TRANSACTIONS (NOTE 6)...................................... 200,000
--------
Net Increase in Net Assets............................................ 199,937
NET ASSETS -- Beginning of Period..................................... 100,000
--------
NET ASSETS -- End of Period........................................... $299,937
========
- --------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
For the Period December 28, 1995
(Commencement of Operations)
to December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------
Per Share Operating Performance:
Net Asset Value -- Beginning of Period............................. $10.00
-------
Net Investment Income.............................................. 0.002
Net Realized and Unrealized Losses on Securities................... (0.008)
-------
Net Decrease in Net Asset Value Resulting from Operations.......... (0.006)
Distributions to Shareholders:
From Net Investment Income........................................ --
From Net Realized Capital Gains................................... --
-------
Net Decrease in Net Asset Value.................................... (0.01 )
-------
Net Asset Value -- End of Period................................... $ 9.99
=======
Total Investment ReturnB............................................. (0.10)%
Ratios to Average Net Assets:
Expenses After Reimbursement (Note 2).............................. 2.00 %A
Expenses Before Reimbursement (Note 2)............................. 27.25 %A
Net Investment Income.............................................. 2.59 %A
Supplementary Data:
Portfolio Turnover Rate............................................ --
Number of Shares Outstanding at End of Period (000's omitted)...... 30
</TABLE>
- --------
A Annualized.
B Total return for periods of less than one year are not annualized.
- --------------------------------------------------------------------------------
See Notes to Financial Statements.
6
<PAGE>
December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
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NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies
The Navellier Performance Funds (the "Fund") is registered with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, (the "Act") as an open-end investment company which offers its shares
in a series of no-load non-diversified and diversified portfolios. The Fund
presently consists of one portfolio, the Navellier Aggressive Growth Portfolio
(the "Portfolio"), a non-diversified open-end management portfolio. The
following is a summary of significant accounting policies which the Fund
follows:
(a) Listed securities are valued at the last sales price of the New York
Stock Exchange and other major exchanges. Over-the-Counter securities are
valued at the last sales price. If market quotations are not readily
available, the Board of Trustees will value the Fund's securities in good
faith. The Trustees will periodically review this method of valuation and
recommend changes which may be necessary to assure that the Fund's
instruments are valued at fair value.
(b) Security transactions are recorded on the trade date (the date the
order to buy or sell is executed). Interest income is accrued on a daily
basis. Dividend income is recorded on the ex-dividend date. Realized gains
and losses from securities transactions are computed on an identified cost
basis.
(c) Dividends from net investment income are declared and paid annually.
Dividends are re-invested in additional shares unless shareholders request
payment in cash. Net capital gains, if any, are distributed annually.
(d) The Fund intends to comply with the provisions of the Internal Revenue
Code applicable to regulated investment companies and will distribute all net
investment income to its shareholders. Therefore, no Federal income tax
provision is required.
(e) Organizational expenses of the Fund totaling $126,000 as of December
28, 1995, are being deferred and will be amortized over 60 months beginning
with the public offering of shares. Any redemption by an initial investor
during the amortization period will be reduced by a prorata portion of any of
the unamortized organization expenses. Such proration is to be calculated by
dividing the number of initial shares redeemed by the number of initial
shares outstanding at the date of redemption. At December 31, 1995,
unamortized organization costs were $125,790.
2. Investment Advisory and Distributor Agreements
Investment advisory services are provided by Navellier Management, Inc.
("Adviser"). Under an agreement with the Adviser, the Fund pays a fee at the
annual rate of 1.25% of the daily net assets of the Portfolio. The Adviser also
receives an annual fee equal to 0.25% of the Fund's average daily net assets in
connection with the rendering of services under the administrative services
agreement and is reimbursed by the Fund for operating expenses incurred on
behalf of the Fund. An officer and trustee of the Fund is also an officer and
director of the Adviser.
Under an agreement between the Fund and the Adviser related to payment of
operating expenses, the Adviser has reserved the right to seek reimbursement
for the present and future operating expenses of the Fund paid by the Adviser,
at any time upon notice to the Fund. During the year ended December 31, 1995,
the Adviser voluntarily waived reimbursement for substantially all of the
operating expenses which were paid on behalf of the Fund.
Navellier Securities Corp. (the "Distributor") acts as the Fund's Distributor
and is registered as a broker-dealer under the Securities and Exchange Act of
1934. The Distributor, which is the principal underwriter of the Fund's shares,
renders its services to the Fund pursuant to a distribution agreement. An
officer and trustee of the Fund is also an officer and director of the
Distributor.
7
<PAGE>
December 31, 1995 NAVELLIER AGGRESSIVE GROWTH PORTFOLIO
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3. Transfer Agent and Custodian
Rushmore Trust and Savings, FSB, ("Rushmore Trust"), provides transfer
agency, dividend disbursing and other shareholder services to the Fund. In
addition, Rushmore Trust serves as custodian of the Fund's assets. Fees paid to
Rushmore Trust are based upon a fee schedule approved by the Board of Trustees.
4. Distribution Plan
The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Act, whereby it reimburses the Distributor or others in an amount not
to exceed 0.25% per annum of the average daily net assets of the Portfolio for
expenses incurred in the promotion and distribution of shares of the Portfolio.
These expenses include, but are not limited to, the printing of prospectuses,
statements of additional information, and reports used for sales purposes,
expenses of preparation of sales literature and related expenses (including
Distributor personnel), advertisements and other distribution-related expenses,
including a prorated portion of the Distributor's overhead expenses
attributable to the distribution of shares. Such payments are made monthly. The
12b-1 fee includes, in addition to promotional activities, the amount the Fund
may pay to the Distributor or others as a service fee to reimburse such parties
for personal services provided to shareholders of the Fund and/or the
maintenance of shareholder accounts. Such Rule 12b-1 fees are made pursuant to
the Plan and distribution agreements entered into between such service
providers and the Distributor or the Fund directly.
5. Securities Transactions
For the period ended December 31, 1995, purchases of securities were $231,240
and there were no sales of securities. These totals exclude short-term
securities.
6. Share Transactions
On December 31, 1995, the Fund is authorized to issue an unlimited number of
shares of capital stock with no stated par value. Transactions in shares and
dollars of the Fund were as follows:
<TABLE>
<CAPTION>
SHARES DOLLARS
------ --------
<S> <C> <C>
Shares Sold................................................... 20,020 $200,000
Shares Issued in Reinvestment of Dividends.................... -- --
------ --------
20,020 $200,000
Shares Redeemed............................................... -- --
------ --------
Net Increase.................................................. 20,020 $200,000
====== ========
</TABLE>
7. Net Unrealized Appreciation/Depreciation of Investments
As of December 31, 1995, net depreciation of investments for Federal income
tax purposes was $84, of which $2,176 related to appreciated investments and
$2,260 related to depreciated investments. At December 31, 1995, the cost of
the Fund's securities for Federal income tax purposes was $331,240.
8. Net Assets
At December 31, 1995, net assets consisted of the following:
<TABLE>
<S> <C>
Paid-in Capital..................................................... $300,000
Net Investment Income............................................... 21
Net Unrealized Depreciation on Investments.......................... (84)
Accumulated Realized Gain on Investments............................ --
--------
NET ASSETS.......................................................... $299,937
========
</TABLE>
8
<PAGE>
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INDEPENDENT AUDITORS' REPORT
The Shareholders and Board
of Trustees of The
Navellier Performance
Funds:
We have audited the statement of assets and liabilities, including the
portfolio of investments, of the Navellier Aggressive Growth Portfolio of The
Navellier Performance Funds (the "Fund") as of December 31, 1995, and the
related statements of operations, of changes in net assets, and financial
highlights for the period December 28, 1995 (commencement of operations) to
December 31, 1995. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned at December 31, 1995 by correspondence with the custodian and brokers.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the net assets of the Navellier Aggressive
Growth Portfolio of The Navellier Performance Funds at December 31, 1995, the
results of its operations, the changes in its net assets, and the financial
highlights for the stated period in conformity with generally accepted
accounting principles.
DELOITTE & TOUCHE LLP
Washington, D.C.
February 23, 1996
9
<PAGE>
NAVELLIER
--------------------------------------------------------------------
PERFORMANCE
--------------------------------------------------------------------
FUNDS
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ANNUAL REPORT
DECEMBER 31, 1995
