2000
SHAREHOLDER REPORTS
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NATIONAL INVESTORS
CASH MANAGEMENT FUND, INC.
TD WATERHOUSE DOW 30 FUND
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
BOARD OF DIRECTORS AND EXECUTIVE OFFICERS
<S> <C> <C>
DIRECTORS EXECUTIVE OFFICERS
Richard W. Dalrymple James F. Rittinger George A. Rio*
President of Partner President, Treasurer
Teamwork Mgmt., Inc. Satterlee Stephens and Chief Financial Officer
Burke & Burke LLP
Carolyn B. Lewis
President of Theodore Rosen
The CBL Group Chairman Christopher J. Kelley*
U.S. Energy Systems, Inc. Vice President and Secretary
Anthony J. Pace Managing Director of
President/CEO of Burnham Securities, Inc.
A. J. Pace & Co. Inc.
*Affiliated person of the Distributor
TD WATERHOUSE ASSET MANAGEMENT, INC.
BOARD OF DIRECTORS AND EXECUTIVE OFFICERS
DIRECTORS
Lawrence M. Waterhouse, Jr. Frank J. Petrilli Richard H. Neiman
Chairman Chairman, President and Executive Vice President,
TD Waterhouse Holdings, Inc. Chief Executive Officer General Counsel and Secretary
SENIOR OFFICERS
David A. Hartman B. Kevin Sterns Michele R. Teichner
Senior Vice President Executive Vice President Senior Vice President
Chief Investment Officer Chief Financial Officer & Treasurer Compliance, Operations
& Administration
SERVICE PROVIDERS
INVESTMENT MANAGER TRANSFER AGENT INDEPENDENT AUDITORS
TD Waterhouse Asset Management, Inc. National Investor Services Corp. Ernst & Young LLP
100 Wall Street 55 Water Street 787 Seventh Avenue
New York, NY 10005 New York, NY 10041 New York, NY 10019
ADMINISTRATOR & CUSTODIAN LEGAL COUNSEL
SHAREHOLDER SERVICING The Bank of New York Swidler Berlin Shereff
TD Waterhouse Investor Services, Inc. 100 Church Street Friedman, LLP
100 Wall Street New York, NY 10286 405 Lexington Avenue
New York, NY 10005 New York, NY 10174
Customer Service Department DISTRIBUTOR
1-800-934-4448 Funds Distributor, Inc. INDEPENDENT DIRECTORS COUNSEL
60 State Street Willkie Farr & Gallagher
Boston, MA 02109 153 East 53rd Street
New York, NY 10022
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
DEAR SHAREHOLDER:
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I am pleased to provide you with the National Investors Cash Management Fund,
Inc. (the "Fund") annual report for the fiscal year ended April 30, 2000.
During the year each of the Money Market, U.S. Government and Municipal
Portfolios attempted to provide maximum current income from high- quality money
market securities while maintaining a conservative investment portfolio to
ensure safety of principal. By April 30, 2000, assets in the three Portfolios
totaled approximately $1.5 billion.
PORTFOLIO RESULTS*
For the fiscal year ended April 30, 2000, the three money market Portfolios had
the following yields and returns.**
o The Money Market Portfolio had a seven-day yield of 5.95% on April 30,
2000, an annualized current yield of 4.89% and an annualized return of
5.00%.
o The U.S. Government Portfolio had a seven-day yield of 5.00% on April 30,
2000, an annualized current yield of 4.77% and an annualized return of
4.88%.
o The Municipal Portfolio had a seven-day yield of 3.77% on April 30, 2000, a
tax equivalent seven-day yield of 5.89% on April 30, 2000, an annualized
current yield of 2.82%, an annualized taxable equivalent current yield of
4.41%, an annualized return of 2.87%, and a taxable equivalent annualized
return of 4.48%(1).
COMMENTARY
First quarter 2000 Real Gross Domestic Product (GDP) growth was more than 5%.
With unemployment at a 30 year low, the underlying trend in core inflation
appears to be rising. The Federal Reserve Open Market Committee ("FOMC") raised
the Federal Funds and Discount Rate targets by 1/2 of 1 percent on May 16, 2000.
This was in addition to two previous increases of 1/4 of 1 percent since our
last report. In its comments at the time of the latest increase, the FOMC also
indicated that "...risks are weighted mainly toward conditions that may generate
heightened inflation pressures in the foreseeable future," which might indicate
a willingness to increase the Fed Funds rate again if the economy continues to
show strong growth. The pace and size of future increases are of great
significance to us in assessing market conditions.
Having shortened the average maturity of the Portfolios over the past two
quarters in anticipation of the FOMC increases, we have recently taken advantage
of higher rates to establish a slightly longer average maturity. We still
maintain a significant portion of the Portfolios in very short-term securities
to retain our flexibility in the face of increasing uncertainty in the fixed
income markets.
We look forward to continuing to meet your expanding investment needs in the
years to come.
Sincerely,
/s/ Frank J. Petrilli
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Frank J. Petrilli
Chairman
National Investor Services Corp.
June 8, 2000
*An investment in a money market portfolio is not insured nor guaranteed by the
Federal Deposit Insurance Corporation or any government agency. Although, the
Portfolios seek to preserve the value of your investment at $1.00 per share, it
is possible to lose money by investing in the Portfolios.
**Past performance is not a guarantee of future results. These returns are based
on a constant investment throughout the period, include reinvestment of
dividends and reflect a net return to the shareholder after all expenses,
inclusive of fee waivers. For the fiscal year ended April 30, 2000, the
Investment Manager and its affiliates waived a portion of their fees for the
Money Market, U.S. Government and Municipal Portfolios. Without these fee
waivers in effect, the seven-day yields at April 30, 2000, annualized current
yields and annualized returns, respectively, would have been 5.75%, 4.69% and
4.80% for the Money Market Portfolio, 4.80%, 4.57% and 4.68% for the U.S
Government Portfolio and 3.38%, 2.43% and 2.48% for the Municipal Portfolio. The
taxable equivalent seven-day yield at April 30, 2000, annualized taxable
equivalent return and yield for the Municipal Portfolio would have been 5.28%,
3.80% and 3.88%, respectively. The seven-day yield more closely reflects the
current earnings of a Portfolio than the annualized current yield and annualized
total return. Yield will fluctuate.
(1) Taxable equivalent return and yield at 36% marginal federal income tax rate.
Distributor: Funds Distributor, Inc.
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TABLE OF CONTENTS
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Statements of Assets and Liabilities........................7
Statements of Operations....................................8
Statements of Changes in Net Assets.........................9
Financial Highlights.......................................10
Notes to Financial Statements..............................11
Money Market Portfolio
Schedule of Investments.................................14
U.S. Government Portfolio
Schedule of Investments.................................17
Municipal Portfolio
Schedule of Investments.................................19
Notes to Schedules of Investments..........................22
Report of Independent Auditors.............................23
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 2000
<TABLE>
<CAPTION>
Money U.S.
Market Government Municipal
Portfolio Portfolio Portfolio
<S> <C> <C> <C>
ASSETS
Investments in securities, at value (including
repurchase agreements of $27,351,000,
$198,088,000, and $0, respectively) (Note 2) $ 767,366,658 $ 701,365,407 $ 38,823,847
Cash 123 876 147,020
Receivable from Investment Manager and
its affiliates (Note 3) -- -- 5,880
Interest receivable 5,048,731 4,228,867 273,144
Other assets 6,862 5,917 349
------------------ ------------------ -----------------
TOTAL ASSETS 772,422,374 705,601,067 39,250,240
LIABILITIES
Dividends payable to shareholders 343,460 296,379 13,130
Payable for investment securities purchased -- 24,606,444 --
Payable to Investment Manager and its
affiliates (Note 3) 464,591 400,118 --
Accrued expenses and other liabilities 97,143 101,790 9,418
------------------ ------------------ -----------------
TOTAL LIABILITIES 905,194 25,404,731 22,548
------------------ ------------------ -----------------
NET ASSETS $ 771,517,180 $ 680,196,336 $ 39,227,692
================== ================== =================
Net assets consist of:
Paid-in capital $ 771,523,324 $ 680,198,055 $ 39,228,021
Accumulated net realized losses from security
transactions (6,144) (1,719) (329)
Net assets, at value $ 771,517,180 $ 680,196,336 $ 39,227,692
------------------ ------------------ -----------------
Shares outstanding ($.0001 par value common
stock, 60 billion, 20
billion, and 20 billion
shares authorized, respectively) 771,523,324 680,198,055 39,228,021
================== ================== =================
Net asset value, redemption price and offering
price per share (Note 2) $ 1.00 $ 1.00 $ 1.00
================== ================== =================
</TABLE>
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
STATEMENTS OF OPERATIONS
For the Year Ended April 30, 2000
<TABLE>
<CAPTION>
Money U.S.
Market Government Municipal
Portfolio Portfolio Portfolio
INVESTMENT INCOME
<S> <C> <C> <C>
Interest income $ 44,789,999 $ 37,009,450 $ 1,523,921
------------------ ------------------ -----------------
EXPENSES
Investment management fees (Note 3) 2,781,731 2,348,811 150,093
Shareholder servicing fees (Note 3) 1,986,951 1,677,722 107,210
Transfer agent fees (Note 3) 1,589,561 1,342,178 85,769
Administration fees (Note 3) 794,780 671,089 42,884
Registration fees 117,872 66,366 55,587
Shareholder reports and mailing 111,254 86,834 1,912
Custody fees (Note 2) 77,887 84,934 11,930
Professional fees 36,096 29,614 2,041
Directors' fees 14,722 14,722 14,722
Other expenses 10,260 32,820 13,422
------------------ ------------------ -----------------
TOTAL EXPENSES 7,521,114 6,355,090 485,570
Fees waived/expenses reimbursed by the
Investment Manager and its affiliates (Note 3) (1,550,440) (1,314,185) (167,558)
------------------ ------------------ -----------------
NET EXPENSES 5,970,674 5,040,905 318,012
------------------ ------------------ -----------------
NET INVESTMENT INCOME 38,819,325 31,968,545 1,205,909
------------------ ------------------ -----------------
NET REALIZED LOSSES FROM SECURITY
TRANSACTIONS (8,275) (1,719) (329)
------------------ ------------------ -----------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 38,811,050 $ 31,966,826 $ 1,205,580
================== ================== =================
</TABLE>
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
Money U.S.
Market Government Municipal
Portfolio Portfolio Portfolio
Year Period Year Period Year Period
Ended Ended Ended Ended Ended Ended
April 30, April 30, April 30, April 30, April 30, April 30,
2000 1999* 2000 1999* 2000 1999*
------------ ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income $ 38,819,325 $ 5,183,187 $ 31,968,545 $ 4,583,848 $ 1,205,909 $ 163,200
Net realized gains (losses)
from security transactions (8,275) 2,131 (1,719) -- (329) --
--------------- --------------- --------------- --------------- ------------- --------------
Net increase in net assets
from operations 38,811,050 5,185,318 31,966,826 4,583,848 1,205,580 163,200
--------------- --------------- --------------- --------------- ------------- --------------
DISTRIBUTIONS TO
SHAREHOLDERS:
From net investment income (38,819,325) (5,183,187) (31,968,545) (4,583,848) (1,205,909) (163,200)
--------------- --------------- --------------- --------------- ------------- --------------
CAPITAL SHARE
TRANSACTIONS
($1.00 per share):
Proceeds from shares sold 5,237,525,350 1,459,671,640 3,623,096,576 1,260,234,991 193,033,440 69,144,309
Shares issued in reinvestment
of dividends 38,560,310 5,098,742 31,744,579 4,511,436 1,196,047 159,932
Payments for shares redeemed (5,225,521,690) (743,861,028) (3,614,655,138) (624,759,389) (195,666,476) (28,664,231)
--------------- --------------- --------------- --------------- ------------- --------------
Net increase (decrease) in net assets
from capital share transactions 50,563,970 720,909,354 40,186,017 639,987,038 (1,436,989) 40,640,010
--------------- --------------- --------------- --------------- ------------- --------------
TOTAL INCREASE (DECREASE) IN
NET ASSETS 50,555,695 720,911,485 40,184,298 639,987,038 (1,437,318) 40,640,010
NET ASSETS:
Beginning of year 720,961,485 50,000 640,012,038 25,000 40,665,010 25,000
--------------- --------------- --------------- --------------- ------------- --------------
End of year $ 771,517,180 $ 720,961,485 $ 680,196,336 $ 640,012,038 $ 39,227,692 $ 40,665,010
=============== =============== =============== =============== ============= ==============
<FN>
* The Fund commenced operations on May 20, 1998.
</FN>
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PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of common stock outstanding, total investment return, ratios to
average net assets and other supplemental data for the periods indicated. This information has been derived from each Portfolio's
financial statements.
Money U.S.
Market Government Municipal
Portfolio Portfolio Portfolio
Year Period Year Period Year Period
Ended Ended Ended Ended Ended Ended
April 30, April 30, April 30, April 30, April 30, April 30,
2000 1999* 2000 1999* 2000 1999*
------------ ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net asset value,
beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Net investment income 0.049 0.049 0.048 0.014 0.028 0.010
--------------- --------------- --------------- --------------- ------------- --------------
Distributions from net
investment income (0.049) (0.049) (0.048) (0.014) (0.028) (0.010)
--------------- --------------- --------------- --------------- ------------- --------------
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
=============== =============== =============== =============== ============= ==============
Ratios
Ratio of expenses to average
net assets 0.75% 0.75%(A) 0.75% 0.75%(A) 0.74% 0.74%(A)
Ratio of net investment income to
average net assets 4.89% 4.26%(A) 4.77% 4.10%(A) 2.82% 2.31%(A)
Decrease reflected in above net
expense ratio due to waivers/
reimbursements by the
Investment Manager and
its affiliates (Note 3) 0.20% 0.38%(A) 0.20% 0.37%(A) 0.39% 0.86%(A)
Supplemental Data
Total investment return (B) 5.00% 5.23%(A) 4.88% 1.47%(A) 2.87% 1.07%(A)
Net assets, end of period $ 771,517,180 $ 720,961,485 $ 680,196,336 $ 640,012,038 $ 39,227,692 $ 40,665,010
=============== =============== =============== =============== ============= ==============
Average net assets $ 793,427,494 $ 128,275,220 $ 669,931,306 $ 117,827,697 $ 42,806,126 $ 7,448,507
=============== =============== =============== =============== ============= ==============
* The Fund commenced operations on May 20, 1998.
(A) Annualized.
(B) Total investment return is calculated assuming a purchase of shares on the first day and a sale on the last day of the period
reported and includes reinvestment of dividends.
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000
NOTE 1 -- ORGANIZATION
National Investors Cash Management Fund, Inc. (the "Fund") was organized as a
Maryland corporation on August 19, 1996. The Fund is registered as an open-end,
diversified management investment company with the Securities and Exchange
Commission under the Investment Company Act of 1940, as amended (the "Act").
Shares of the Fund are registered under the Securities Act of 1933, as amended.
The Fund currently has three investment portfolios. These financial statements
relate to three money market portfolios of the Fund (each a "Portfolio" and
collectively the "Portfolios"), each of which is a diversified investment
portfolio. The investment objective of each of the Money Market Portfolio, the
U.S. Government Portfolio and the Municipal Portfolio is to seek maximum current
income to the extent consistent with liquidity and preservation of capital. The
Money Market Portfolio has the flexibility to invest broadly in U.S.
dollar-denominated securities of domestic and foreign issuers. The U.S.
Government Portfolio offers an added measure of safety by investing exclusively
in obligations issued or guaranteed by the U.S. government, its agencies or
instrumentalities. The Municipal Portfolio offers investors federally tax-exempt
income by investing primarily in municipal securities.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the Fund's significant accounting policies:
Computation of Net Asset Value -- It is each Portfolio's policy to maintain a
continuous net asset value of $1.00 per share. Each Portfolio has adopted
certain investment, portfolio valuation and dividend and distribution policies
to enable it to do so. There is no assurance, however, that each Portfolio will
be able to maintain a stable net asset value of $1.00 per share.
Securities Valuation -- Each Portfolio's securities are valued using the
amortized cost method, which approximates market value. The amortized cost
method involves initially valuing a security at its original cost and thereafter
assuming a constant amortization to maturity of any discount or premium. At
April 30, 2000, the cost of investments of each Portfolio for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes.
Repurchase Agreements -- The Fund may enter into repurchase agreements with
financial institutions deemed to be creditworthy by the Fund's Investment
Manager, subject to the seller's agreement to repurchase and the Fund's
agreement to resell such securities at a mutually agreed upon price. Securities
purchased subject to repurchase agreements are deposited with the Fund's
custodian and, pursuant to the terms of the repurchase agreement, must have an
aggregate market value greater than or equal to the repurchase price plus
accrued interest at all times. If the value of the underlying securities falls
below the value of the repurchase price plus accrued interest, the Fund will
require the seller to deposit additional collateral by the next business day. If
the request for additional collateral is not met, or the seller defaults on its
repurchase obligation, the Fund maintains the right to sell the underlying
securities at market value and may claim any resulting loss against the seller.
Investment Income -- Interest income is accrued as earned. Discounts and
premiums on securities purchased are amortized in accordance with income tax
regulations which approximate generally accepted accounting principles. Under
the terms of the custody agreement, each Portfolio receives net earnings credits
based on available cash balances left on deposit. Income earned under this
arrangement is included in interest income.
Distributions to Shareholders -- Dividends arising from net investment income
are declared daily and paid monthly. With respect to each Portfolio, net
realized short-term capital gains, if any, may be distributed during the year
and net realized long-term capital gains, if any, are distributed at least once
each year. Income distributions and capital gain distributions are determined in
accordance with income tax regulations.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000
(CONTINUED)
Securities Transactions -- Securities transactions are accounted for on the
trade date. Realized gain and loss from securities transactions are recorded on
a specific identification basis.
Expenses -- Expenses directly attributable to each Portfolio are charged to that
Portfolio's operations. Expenses that are applicable to all Portfolios are
allocated on a pro rata basis.
Use of Estimates -- The Fund's financial statements are prepared in accordance
with generally accepted accounting principles, which may require the use of
management estimates and assumptions. Actual results could differ from these
estimates.
Federal Income Taxes -- It is each Portfolio's policy to comply with the special
provisions of the Internal Revenue Code available to regulated investment
companies. As provided therein, in any fiscal year in which a Portfolio so
qualifies, and distributes at least 90% of its taxable net income, the Portfolio
(not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Portfolio's intention to declare as
dividends in each calendar year at least 98% of its net investment income
(earned during the calendar year) and 98% of its net realized capital gains
(earned during the twelve months ended October 31) plus undistributed amounts
from prior years.
As of April 30, 2000, for Federal income tax purposes the following Portfolios
have capital loss carryforwards available to offset future capital gains, if
any:
<TABLE>
<CAPTION>
Amount Expires
--------- ---------
<S> <C> <C>
Money Market Portfolio $3,806 2008
U.S. Government Portfolio $1,719 2008
Municipal Portfolio $329 2008
</TABLE>
NOTE 3 -- INVESTMENT MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES OF
THE INVESTMENT MANAGER
Under the terms of an Investment Management Agreement with TD Waterhouse Asset
Management, Inc. (the "Investment Manager"), a majority-owned subsidiary of The
Toronto-Dominion Bank, for the investment management services furnished to each
Portfolio, such Portfolio pays the Investment Manager an annual investment
management fee, on a graduated basis, equal to .35 of 1% of the first $1 billion
of average daily net assets of each such Portfolio, .34 of 1% of the next $1
billion, and .33 of 1% of average daily net assets of each such Portfolio over
$2 billion. The Investment Manager has agreed to waive a portion of its fee
payable by the Municipal Portfolio through September 1, 2000, so that the actual
fee payable annually by such Portfolio during such period would be equal to .25
of 1% of its average daily net assets. For the year ended April 30, 2000, the
Investment Manager voluntarily waived management fees of $288,078, $239,451 and
$52,525 for the Money Market Portfolio, the U.S. Government Portfolio and the
Municipal Portfolio, respectively.
TD Waterhouse Investor Services, Inc. ("TD Waterhouse"), an affiliate of the
Investment Manager, has been retained under an Administration Agreement to
perform certain administrative services for the Fund. For the administrative
services rendered to the Fund, each Portfolio pays TD Waterhouse a monthly fee
at an annual rate of .10 of 1% of each Portfolio's average daily net assets. For
the year ended April 30, 2000, TD Waterhouse voluntarily waived administration
fees of $82,308, $68,414 and $15,800 for the Money Market Portfolio, the U.S.
Government Portfolio and the Municipal Portfolio, respectively.
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000
(CONTINUED)
TD Waterhouse has been retained under a Shareholder Services Agreement to
perform certain shareholder services necessary for the operation of the Fund.
The shareholder service plan adopted by the Fund provides that each Portfolio
pays TD Waterhouse a monthly fee at an annual rate of .25 of 1% of average daily
net assets. For the year ended April 30, 2000, TD Waterhouse voluntarily waived
shareholder services fees of $1,015,438, $869,491 and $67,632 for the Money
Market Portfolio, the U.S. Government Portfolio and the Municipal Portfolio,
respectively.
The Fund has entered into a Transfer Agency and Dividend Disbursing Agency
Agreement with National Investor Services Corp. (the "Transfer Agent"), an
affiliate of the Investment Manager, to perform transfer and dividend disbursing
agency related services. For such services, each Portfolio pays the Transfer
Agent a monthly fee at an annual rate of .20 of 1% of average daily net assets.
For the year ended April 30, 2000, the Transfer Agent voluntarily waived
$164,616, $136,829 and $31,601 of its transfer agent fees for the Money Market
Portfolio, the U.S. Government Portfolio and the Municipal Portfolio,
respectively.
The Investment Manager or its affiliates waived fees and/or reimbursed expenses
so that each Portfolio's annual expense ratio will not exceed 0.75% for the
Money Market Portfolio, 0.75% for the U.S. Government Portfolio and 0.74% for
the Municipal Portfolio through September 1, 2000.
Each Director who is not an "interested person" as defined in the Act, who
serves on the Board of Directors of one or more portfolios in the "Fund Complex"
(which includes the Fund, TD Waterhouse Trust and TD Waterhouse Family of Funds,
Inc.), receives:
1. a base annual retainer of $12,000, payable quarterly,
2. a supplemental annual retainer of $5,000, if serving on the Board of
Directors of more than one company in the Fund Complex, and
3. a meeting fee of $2,000 for each meeting attended.
Compensation is allocated between the companies and among the respective
portfolios.
NOTE 4 -- FEDERAL TAX INFORMATION (UNAUDITED)
In accordance with Federal tax requirements, the Municipal Portfolio designates
substantially all the dividends paid from net investment income during the year
ended April 30, 2000 as "exempt-interest dividends." As required by Federal
regulations, shareholders will receive notification of their portion of the
Fund's taxable ordinary dividends and capital gains distributions paid (if any)
for the 2000 calendar year early in 2001.
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<TABLE>
<CAPTION>
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MONEY MARKET PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
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CORPORATE OBLIGATIONS
<S> <C> <C>
ASSET-BACKED OBLIGATIONS--19.7%
$ 38,000,000 Aquinas Funding LLC, due 5/1/00 (Other Support: MBIA & Rabobank Nederland) (Note E) 6.07 $ 38,000,000
35,000,000 Corporate Receivables Corp., due 5/17/00 (Note E) 6.06 34,906,200
10,000,000 Dakota Certificate Program, due 7/12/00 (Note E) 6.24 9,877,200
10,000,000 Forrestal Funding Master Trust, Ser. 1999A, due 6/13/00
(Counterparty: Bank of America NT & SA) (Note E) 6.10 9,928,214
3,598,352 IKON Receivables, LLC, Ser 99-2, Cl. A-1, 6.14%, due 10/15/00 (Insured: AMBAC) 6.14 3,598,351
680,160 IKON Receivables, LLC, Ser. 99-1, Cl. A-1, 5.11%, due 6/15/00 (Insured: AMBAC) 5.11 680,160
15,000,000 Intrepid Funding Master Trust, Ser. 1999A, due 7/6/00
(Counterparty: Bank of America NT & SA) (Note E) 6.25 14,830,875
7,000,000 Liberty Lighthouse U.S. Capital Co. LLC, 6.18%, due 5/11/00 (Notes A, E) 6.29 6,997,865
8,500,000 Long Lane Master Trust IV, Ser. 1999A, due 5/3/00
(CounterParty: BankBoston, N.A.) (Note E) 6.06 8,497,152
10,000,000 Long Lane Master Trust IV, Ser.1999-A, due 5/30/00
(Counterparty: BankBoston. N.A.) (Note E) 6.14 9,950,781
15,000,000 RACERS Series 1999-16-MM-MBS Notes, 6.15%, due 5/2/00
(GTY: National Westminster Bank PLC) (Notes A, E) 6.15 15,000,000
--------------
152,266,798
--------------
BROKER/DEALER OBLIGATIONS--9.1%
5,000,000 Bear Stearns Cos., Inc., 6.23%, due 5/12/00 (Note A) 6.15 5,000,432
5,000,000 Bear Stearns Cos., Inc., 6.21%, due 5/23/00 (Note A) 6.25 4,998,972
5,000,000 Bear Stearns Cos., Inc., 6.18%, due 5/30/00 (Note A) 6.18 5,000,000
25,000,000 Bear Stearns Cos., Inc., 6.16%, due 6/16/00 (Note A) 6.16 25,000,000
5,000,000 Goldman Sachs Group, L.P., 6.32%, due 5/24/00 (Notes A, E) 6.11 5,006,718
25,000,000 Salomon Smith Barney Holdings, Inc., due 5/26/00 6.08 24,894,965
--------------
69,901,087
--------------
FINANCE & INSURANCE OBLIGATIONS--7.6%
2,850,000 Associates Corp. of North America, 7.13%, due 5/15/00 5.15 2,852,064
1,725,000 CIT Group Holdings, Inc., 6.20%, due 10/20/00 6.36 1,723,392
5,000,000 Ford Motor Credit, 5.77%, due 2/12/01 6.61 4,969,104
4,000,000 General Motors Acceptance Corp., 7.50%, due 5/23/00 6.10 4,003,237
2,500,000 General Motors Acceptance Corp., 8.13%, due 3/1/01 6.80 2,527,480
5,000,000 GMAC Australia Finance, 6.19%, due 5/19/00 (Note A) 6.08 5,000,259
4,000,000 GMAC Australia Finance, 6.36%, due 7/10/00 (Note A) 6.26 4,000,805
8,000,000 Sigma Finance Inc., 6.85%, due 2/26/01 (Note E) 6.85 8,000,000
25,000,000 Sigma Finance, Inc., 6.13%, due 6/15/00 (Notes A, E) 6.13 25,000,000
--------------
58,076,341
--------------
INDUSTRIAL & OTHER OBLIGATIONS--4.5%
20,000,000 International Lease Finance Corp., 6.11%, due 5/1/00 (Note A) 6.03 20,014,844
5,000,000 PepsiCo, Inc., 6.80%, due 5/15/00 5.40 5,002,529
10,000,000 Southern California Edison Co., 6.25%, due 5/25/00 (Note A) 6.25 10,000,000
--------------
35,017,373
--------------
------------------------------------------------------------------------------------------------------------------------------------
14
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<TABLE>
<CAPTION>
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MONEY MARKET PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
LOAN PARTICIPATIONS--4.2%
$ 17,000,000 Four Times Square Partners, L.P., 6.15%, due 6/2/00
(GTY: Prudential Ins. Co. of America;
Other support: Chase Manhattan Bank) (Note B) 6.15 $ 17,000,000
15,685,000 International Lease Finance Corp., 6.13%, due 5/3/00
(Other support: Chase Manhattan Bank) 6.13 15,685,000
--------------
32,685,000
--------------
TOTAL CORPORATE OBLIGATIONS--45.1% 347,946,599
--------------
BANK OBLIGATIONS
BANK NOTES--12.2%
25,000,000 Bank of Scotland Treasury Services, 6.28%, due 7/19/00 (GTY: Bank of Scotland) (Note A) 6.28 24,997,814
25,000,000 First National Bank of Chicago, 5.50%, due 6/5/00 6.12 24,978,754
9,000,000 Bank One, N.A., 6.23%, due 3/14/01 6.78 8,963,423
10,000,000 Bankers Trust New York Corp. (Deutsche Bank AG), 6.16%, due 5/8/00 (Note A) 6.12 10,002,052
5,000,000 Branch Banking & Trust Co., 6.35%, due 5/1/00 (Note A) 6.42 4,998,578
5,000,000 First Union National Bank, 6.16%, due 5/15/00 (Note A) 6.08 5,002,929
5,000,000 Fleet National Bank, 6.13%, due 5/1/00 (Note A) 6.03 5,003,526
10,000,000 Fleet National Bank, 6.30%, due 5/1/00 (Note A) 6.17 10,009,031
--------------
93,956,107
--------------
DOMESTIC BANK CERTIFICATES OF DEPOSIT--1.3%
10,000,000 Regions Bank, 6.10%, due 7/5/00 6.10 10,000,000
--------------
DOMESTIC BANK SUPPORTED OBLIGATIONS--2.6%
2,500,000 CEGW, Inc. Tax. Notes, VRDN Ser. 1999, 6.25%, optional put 5/1/00
(LOC: PNC Bank, N.A.) (Note C) 6.16 2,500,000
6,400,000 Mark-Lynn Foods, Inc. Tax VRDN Ser. 2000, 6.23%, due 5/4/00
(LOC: Bank of America, N.A.) (Note C) 6.09 6,400,000
11,325,000 Provena Health CP Rev. Notes, Ser. 1998, due 5/17/00 (LOC: 75% Bank of America, N.A.,
25% Bank One, N.A.) 6.07 11,295,052
--------------
20,195,052
--------------
FOREIGN BANK SUPPORTED OBLIGATIONS--25.3%
19,000,000 Banca Serfin S.A., Institucion de Banca Multiple, Grupo Financiero Serfin, due 6/12/00
(LOC: Barclays Bank PLC) 6.13 18,867,443
20,000,000 Banco de Galicia y Buenos Aires, S.A., due 7/25/00
(LOC: Bayerische Hypo -und Vereinsbank AG) 6.35 19,704,861
5,000,000 Banco Rio de la Plata, S.A., due 6/7/00 (LOC: Banco Santander Central Hispanoamerica) 6.09 4,969,167
19,850,000 Comision Federal de Electricidad, due 5/2/00 (LOC: Westdeutsche Landesbank GZ) 6.12 19,846,642
5,023,000 CSN Overseas, Ser. B, due 6/27/00 (LOC: Banco Santander Central Hispanoamerica) 6.16 4,975,282
16,888,000 CSN Overseas, Ser. B, due 6/28/00 (LOC: Banco Santander Central Hispanoamerica) 6.10 16,725,293
5,000,000 Garanti Funding Corp., Ser. I, due 6/6/00 (LOC: Bayerische Hypo -und Vereinsbank AG) 6.07 4,970,850
31,177,000 Holy Cross Health System Corp. CP Notes, Ser. 1996, due 5/24/00
(LOC: 2/3 KBC Bank, 1/3 Northern Trust Co.) 6.11 31,055,895
7,000,000 PEMEX Capital, Inc., due 6/6/00 (LOC: Barclays Bank PLC) 6.08 6,958,070
2,810,000 St. Francis Place LP Tax. MFH VRDN (St. Francis Place) Ser. 98, 6.25%, due 5/4/00
(LOC: Credit Suisse First Boston) (Note C, E) 6.16 2,810,000
35,000,000 UBS Finance (DE), due 5/1/00 (GTY: UBS AG) 6.04 35,000,000
20,000,000 Unibanco-Uniao de Bancos Brasileiros, Ser. A, due 7/13/00
(LOC: Westdeutsche Landesbank GZ) 6.09 19,766,400
10,000,000 Unibanco-Uniao de Bancos Brasileiros, Ser. C, due 4/11/01 (LOC: Barclays Bank PLC) 6.86 9,384,750
--------------
195,034,653
--------------
------------------------------------------------------------------------------------------------------------------------------------
15
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<PAGE>
<TABLE>
<CAPTION>
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MONEY MARKET PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
YANKEE BANK CERTIFICATES OF DEPOSIT--3.2%
$ 15,000,000 Deutsche Bank AG, 5.36%, due 5/22/00 5.42 $ 14,999,585
10,000,000 Societe Generale, 6.50%, due 1/8/01 6.55 9,996,719
--------------
24,996,304
--------------
TOTAL BANK OBLIGATIONS--44.6% 344,182,116
--------------
TAXABLE MUNICIPAL OBLIGATIONS--6.2%
13,257,000 Austin, TX (City of), Travis & Williamson Cty. Comb. Utility System Taxable CP,
due 5/17/00 (LOC: Landesbank Hessen-Thueringen GZ) 6.07 13,221,943
8,000,000 CA Pollution Control Fin. Auth. Env. Imp. Rev. Bonds
(Atlantic Richfield Co. Proj.) Ser. 1997, 6.10%,
due 5/3/00 (GTY: Atlantic Richfield Co.) (Note E) 6.10 8,000,000
9,500,000 CA Pollution Control Fin. Auth. Env. Imp. Rev. Bonds (Shell Oil Co. Proj.)
Ser. 1998A, 6.10%, due 5/17/00 (GTY: Shell Oil Co.) 6.10 9,500,000
5,000,000 City of Olathe, KS, Tax. IRB (Garmin Int'l, Inc. Proj.)
Ser. 2000 VRDN, 6.23%, due 5/4/00 (LOC: Bank of America, N.A.) (Note C) 6.14 5,000,000
12,165,000 San Francisco International Airport, Taxable CP Notes, Ser. C, 6.16%, due 5/22/00
(LOC: Societe Generale) 6.16 12,165,000
--------------
TOTAL TAXABLE MUNICIPAL OBLIGATIONS--6.2% 47,886,943
--------------
REPURCHASE AGREEMENT--3.6%
27,351,000 ABN AMRO
~dated 4/28/00, due 5/1/00, in the amount of $27,364,311
~fully collateralized by $22,800,000 FNMA notes, coupon 5.90%,
due 6/18/01, value $23,010,391
~and $4,925,000 FHLB notes, coupon 5.88%, due 9/17/01, value $4,889,516 5.84 27,351,000
--------------
TOTAL INVESTMENTS--99.5% 767,366,658
OTHER ASSETS AND LIABILITIES, NET--0.5% 4,150,522
--------------
NET ASSETS--100.0% $ 771,517,180
==============
PLEASE SEE ACCOMPANYING NOTES TO THE SCHEDULES OF INVESTMENTS AND FINANCIAL STATEMENTS.
------------------------------------------------------------------------------------------------------------------------------------
16
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
U.S. GOVERNMENT PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
FEDERAL FARM CREDIT BANK--4.5%
$ 1,000,000 Notes, 5.00%, due 5/3/00 5.00 $ 999,943
30,000,000 Notes, 5.87%, due 5/3/00 5.92 29,999,936
--------------
30,999,879
--------------
FEDERAL HOME LOAN BANK--8.2%
30,000,000 Notes, 5.87%, due 5/12/00 (Note A) 5.96 29,999,234
1,000,000 Notes, 5.15%, due 5/17/00 5.75 999,667
1,860,000 Notes, 5.13%, due 5/19/00 5.74 1,859,393
1,000,000 Notes, 5.63%, due 6/2/00 5.83 999,735
10,000,000 Notes, 5.54%, due 7/12/00 5.86 9,992,707
2,660,000 Notes, 5.50%, due 7/14/00 6.13 2,655,926
5,720,000 Notes, 5.56%, due 7/14/00 5.84 5,716,302
3,250,000 Notes, 5.71%, due 7/14/00 5.88 3,247,802
--------------
55,470,766
--------------
FEDERAL HOME LOAN MORTGAGE CORP.--3.1%
1,100,000 Notes, 6.54%, due 5/19/00 5.74 1,100,384
20,000,000 Notes, 5.20%, due 11/16/00 6.33 19,878,296
--------------
20,978,680
--------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION--40.3%
15,000,000 Mortgage-backed Discount Notes, due 5/1/00 5.85 15,000,000
35,000,000 Mortgage-backed Discount Notes, due 5/1/00 5.84 35,000,000
11,560,000 Mortgage-backed Discount Notes, due 5/2/00 5.87 11,558,144
9,500,000 Mortgage-backed Discount Notes, due 5/10/00 5.94 9,486,106
20,000,000 Mortgage-backed Discount Notes, due 6/1/00 6.01 19,898,044
17,500,000 Mortgage-backed Discount Notes, due 7/3/00 6.09 17,317,169
25,000,000 Mortgage-backed Discount Notes, due 8/1/00 6.26 24,606,445
35,000,000 Notes, 6.12%, due 5/1/00 (Note A) 6.15 34,995,668
15,000,000 Notes, 5.89%, due 5/10/00 (Note A) 5.95 14,999,779
6,500,000 Notes, 5.65%, due 6/12/00 5.55 6,500,096
2,000,000 Notes, 8.90%, due 6/12/00 6.07 2,005,568
7,500,000 Notes, 5.46%, due 6/21/00 5.45 7,500,000
20,000,000 Notes, 5.62%, due 8/9/00 5.79 19,991,093
1,000,000 Notes, 5.65%, due 8/25/00 6.41 997,194
25,125,000 Notes, 4.45%, due 10/16/00 6.15 24,931,070
10,000,000 Notes, 5.23%, due 1/8/01 6.45 9,921,791
19,650,000 Notes, 5.25%, due 2/12/01 6.51 19,465,860
--------------
274,174,027
--------------
STUDENT LOAN MARKETING ASSOCIATION--13.2%
25,000,000 Notes, 6.46%, due 5/2/00 (Note A) 6.46 24,988,996
30,000,000 Notes, 6.48%, due 5/2/00 (Note A) 6.42 29,996,349
35,000,000 Notes, 6.48%, due 5/2/00 (Note A) 6.44 34,993,710
--------------
89,979,055
--------------
------------------------------------------------------------------------------------------------------------------------------------
17
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<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
U.S. GOVERNMENT PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT GUARANTEED OBLIGATIONS--4.7%
$ 9,800,000 Overseas Private Investment Corp. Ser. 165A, 6.13%, due 5/8/00 (Note A) 6.04 $ 9,800,000
10,500,000 Overseas Private Investment Corp. Ser. 165D, 6.13%, due 5/8/00 (Note A) 6.04 10,500,000
7,000,000 Overseas Private Investment Corp. Ser. 165F, 6.13%, due 5/8/00 (Note A) 6.04 7,000,000
4,375,000 Overseas Private Investment Corp. Ser. 165N, 6.13%, due 5/8/00 (Note A) 6.04 4,375,000
--------------
31,675,000
--------------
REPURCHASE AGREEMENTS--29.1%
88,088,000 ABN AMRO
~dated 4/28/00, due 5/1/00, in the amount of $88,130,869
~fully collateralized by $92,135,000 U.S. Government securities,
coupon range 0% to 6.95%,
maturity range 7/13/00 to 8/27/09, value $89,850,633 5.84 88,088,000
50,000,000 Morgan Stanley & Co. Inc.
~dated 4/25/00, due 5/2/00, in the amount of $50,057,556
~fully collateralized by $79,893,396 U.S. Government securities,
coupon range 5.5% to 8.0%,
maturity range 12/01/03 to 7/01/28, value $51,000,141 5.92 50,000,000
60,000,000 Prudential Securities, Inc.
~dated 4/28/00, due 5/1/00, in the amount of $60,029,150
~fully collateralized by $61,758,000 U.S. Government securities,
coupon range 0% to 5.75%,
maturity range 4/25/02 to 7/15/03, value $61,200,765 5.83 60,000,000
--------------
198,088,000
--------------
TOTAL INVESTMENTS--103.1% 701,365,407
OTHER ASSETS AND LIABILITIES, NET--(3.1)% (21,167,071)
--------------
NET ASSETS--100.0% $ 680,196,336
==============
PLEASE SEE ACCOMPANYING NOTES TO THE SCHEDULES OF INVESTMENTS AND FINANCIAL STATEMENTS.
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18
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<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MUNICIPAL PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL OBLIGATIONS:
<S> <C> <C>
ALASKA--0.49%
$ 190,000 Anchorage Port & Terminal Rev. Bonds, 6.00%, due 2/1/01 (Insured: MBIA) 4.30 $ 192,348
--------------
DISTRICT OF COLUMBIA--0.51%
200,000 GO Bonds, 7.10%, due 6/1/00 (Insured: FSA) 3.55 200,585
--------------
GEORGIA--4.29%
1,684,000 Dekalb Cty. Hsg. Auth. SFM, Ser.1997A VRDN, 5.25% (LIQ: Bank of New York) (Note C) 5.25 1,684,000
--------------
ILLINOIS--12.17%
250,000 Berwyn Rev. Bonds (MacNeal Memorial Hosp. Association Proj.) 4.50%,
due 6/1/00 (Insured: AMBAC) 3.50 250,206
1,000,000 DFA (Illinois Power Co. Proj.) VRDN, 5.20% (LOC: First National Bank Chicago) (Note C) 5.20 1,000,000
800,000 DFA (Kindlon Partners Proj.) VRDN, 5.14% (LOC: LaSalle National Bank) (Note C) 5.14 800,000
400,000 Lake Cty. Solid Waste Rev. Bonds (Countryside Landfill Inc.) VRDN, 5.25%
(LOC: Morgan Guaranty Trust) (Note C) 5.25 400,000
125,000 Sales Tax Rev. Bonds, Ser. K, 6.60%, due 6/15/00 4.50 125,303
900,000 Southwestern IL Dev. Auth. Solid Waste Disp. (Shell Oil Co. - Wood River Proj.)
Ser. 95 VRDN, 6.20% (Note C) 6.20 900,000
1,300,000 Will Cty. Facs. Rev. Bonds (Amoco Chem. Co. Proj.) Ser. 98 VRDN, 6.20% (Note C) 6.20 1,300,000
--------------
4,775,509
--------------
KENTUCKY--7.65%
300,000 Asset & Liability Agency Rev. Bonds (Proj. Notes) Ser. A, 4.00%, due 6/7/00
(LOC: Commerzbank AG) 4.00 300,000
1,000,000 Mayfield IDR Bonds (Seaboard Farms of KY Inc. Proj.) VRDN, 5.15%
(LOC: SunTrust Bank) (Note C) 5.15 1,000,000
400,000 Mayfield (KY League of Cities Pooled Lease Fin. Prog.) Ser. 1996 VRDN, 5.20%
(LOC: PNC Bank) (Note C) 5.20 400,000
800,000 Pendleton Cty. (KY Assoc. of Ctys. Lease Trust Prog.) Ser. 1989, 3.90%, due 6/2/00
(LOC: Commonwealth Bank of Australia) 3.90 800,000
500,000 Pulaski Cty. Solid Waste Rev. Bonds (National Rural Utilities
Coop. Fin. Corp.- Eastern KY Power)
Ser. B, 4.05%, put 8/15/00 4.05 500,000
--------------
3,000,000
--------------
LOUISIANA--3.31%
1,300,000 Calcasieu Parish Pub. Trust Auth. Rev. Bonds (WPT Corp. Proj.) Ser. 1997 VRDN, 5.20%
(LOC: Morgan Guaranty Trust) (Note C) 5.20 1,300,000
--------------
MAINE--0.51%
200,000 Educ. Loan Marketing Corp. Rev. Bonds (Student Loan) Ser. A4, 5.60%, due 11/1/00 4.40 201,162
--------------
MARYLAND--1.28%
500,000 Anne Arundel Cty. (Baltimore Gas & Electric Proj.) Ser. 1985, 4.00%, due 6/6/00
(SBPA: Bank of New York, Chemical) 4.00 500,000
--------------
MASSACHUSETTS--3.85%
250,000 Carver GO Bonds, 4.15%, due 8/15/00 (Insured: FSA) 4.00 250,102
360,000 IDA Rev. Bonds (Hazen Paper Co.) VRDN, 5.15% (LOC: Bank of Boston) (Note C) 5.15 360,000
400,000 IDA Rev. Bonds (October Co. Inc. Proj.) VRDN, 5.15% (LOC: Bank of Boston) (Note C) 5.15 400,000
500,000 Worchester GO BAN, 4.40%, due 8/30/00 3.85 500,879
--------------
1,510,981
--------------
MINNESOTA--2.55%
1,000,000 Waseca, Rice & Steele Ctys. ISD Notes, 4.45%, due 3/30/01 4.40 1,000,432
--------------
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19
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<PAGE>
<TABLE>
<CAPTION>
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MUNICIPAL PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MISSISSIPPI--1.40%
$ 550,000 Jackson Cty. Sewer Fac. Rev. Bonds (Chevron USA Inc. Proj.) VRDN, 6.25% (Note C) 6.25 $ 550,000
--------------
MISSOURI--3.57%
1,400,000 Env. Imp. & Energy Res. Auth. (Assoc. Elec. Coop.) Ser. 93M VRDN, 5.00%
(GTY: National Rural Utilities Coop. Fin. Corp.) (Note C) 5.00 1,400,000
--------------
MONTANA--0.42%
165,000 Higher Educ. Student Assistance Corp. Rev. Bonds, Ser. 1993A, 5.05%, due 12/1/00 4.25 165,746
--------------
NEVADA--0.51%
200,000 Henderson Cty. GO Bonds, Ser. A, 4.80%, due 5/1/00 (Insured: FGIC) 3.50 200,000
--------------
NEW HAMPSHIRE--2.61%
1,025,000 Business Fin. Auth. (Foundation for Seacoast Health) Ser. A VRDN, 5.25%
(LOC: Fleet Bank) (Note C) 5.25 1,025,000
--------------
NEW JERSEY--1.39%
145,000 Keyport SD GO Bonds, 5.50%, due 2/1/01 (Insured: FGIC) 4.45 146,108
400,000 Transportation Corp. Rev. Bonds, Capital Grant Antic. Notes, Ser. A, 5.00%,
due 9/1/00 (Insured: FSA) 4.40 400,743
--------------
546,851
--------------
NEW MEXICO--1.39%
545,000 Student Loan Rev. Bonds, Ser. IIA, 4.75%, due 12/1/00 4.10 546,999
--------------
OHIO--5.74%
800,000 Air Quality Dev. Auth. Rev. Bonds (Cleveland Elec. Co. Proj.) Ser. B, 3.90%,
due 6/1/00 (LIQ: FGIC) 3.90 800,000
1,450,000 Hsg. Rev. Bonds, Ser. CMC2 VRDN, 5.20% (LIQ: Chase Manhattan Bank) (Note C) 5.20 1,450,000
--------------
2,250,000
--------------
OKLAHOMA--4.98%
245,000 Tulsa IDA Rev. Bonds (St. Johns Med. Center) 4.40%, due 2/15/01 (Insured: MBIA) 4.40 245,000
370,000 Tulsa Parking Auth. Rev. Bonds (Williams Center Proj.) Ser. A, 3.90%, put 5/15/00
(LOC: Nationsbank) 3.90 370,000
1,340,000 Water Resources Board, State Loan Prog. Rev. Bonds, Ser. 1999, 4.10%, put 9/1/00
(SBPA: Bayerische Landesbank GZ) 4.10 1,340,000
--------------
1,955,000
--------------
PENNSYLVANIA--3.57%
700,000 Carbon Cty. IDA Res. Rec. Rev. (Panther Creek Proj.) Ser. 1990A, 3.75%, due 5/11/00
(LOC: National Westminster Bank) 3.75 700,000
300,000 Venango IDA (Scrubgrass Proj.) Ser. 1993, 3.95%, due 6/8/00
(LOC: National Westminster Bank) 3.95 300,000
400,000 Venango IDA (Scrubgrass Proj.) Ser. 1993, 4.00%, due 6/8/00
(LOC: National Westminster Bank) 4.00 400,000
--------------
1,400,000
--------------
RHODE ISLAND--1.28%
500,000 Hsg. & Mortgage Fin. Corp. Rev. Bonds (Homeownership Opportunity)
Ser. 28B, 3.75%, due 10/1/00 (GIC: FGIC) 4.60 497,295
--------------
SOUTH CAROLINA--4.33%
400,000 Florence Cty. Solid Waste Disp. Rev. Bonds (Roche Carolina, Inc.) Ser. 97 VRDN, 6.25%
(LOC: Union Bank of Switzerland) (Note C) 6.25 400,000
1,300,000 Florence Cty. Solid Waste Disp. Rev. Bonds (Roche Carolina, Inc.) Ser. 98 VRDN, 6.25%
(LOC: Deutsche Bank) (Note C) 6.25 1,300,000
--------------
1,700,000
--------------
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20
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<PAGE>
<TABLE>
<CAPTION>
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NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
MUNICIPAL PORTFOLIO o SCHEDULE OF INVESTMENTS
April 30, 2000
PRINCIPAL ANNUALIZED
AMOUNT YIELD (%) VALUE
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
SOUTH DAKOTA--5.41%
$ 170,000 HDA (Homeownership Mortgage Bonds) Ser. 1997B, 4.00%, due 5/1/00 4.50 $ 169,684
1,700,000 Sioux Falls Rev. Bonds (Evangelical Lutheran Proj.) VRDN, 5.15%
(SBPA: Norwest Bank) (Note C) 5.15 1,700,000
250,000 Student Loan Fin. Corp. Rev. Bonds, Ser. A, 5.85%, due 8/1/00
(Escrowed in U.S. Government Securities) (Note D) 4.75 250,675
--------------
2,120,359
--------------
TENNESSEE--4.08%
200,000 McKenzie Cty. IDB Rev. Bonds (Noma Outdoor Products Inc. Proj.) VRDN, 5.15%
(LOC: Wachovia Bank) (Note C) 5.15 200,000
1,400,000 Metropolitan Government Davidson Cty. (ABN-AMRO Munitops) Ser. 1999-1, 3.35%, put 5/3/00
(LIQ: ABN-AMRO Bank) (Note E) 3.35 1,400,000
--------------
1,600,000
--------------
TEXAS--8.25%
200,000 Austin Util. Sys. Rev. Bonds, Ser. A, 9.50%, prerefunded @ 100, due 5/15/00 (Note D) 3.35 200,459
350,000 Austin Util. Sys. Rev. Bonds, Ser. A, 10.00%, prerefunded @ 100, due 5/15/00 (Note D) 3.65 350,829
185,000 Brazos Higher Educ. Rev. Bonds, Ser. A-2, 5.75%, due 6/1/00 (GTY: Student Loans) 4.65 185,156
200,000 Brazos Higher Educ. Rev. Bonds, Ser. C-1, 6.20%, due 11/1/00 (GTY: Student Loans) 4.70 201,447
400,000 Brazos River Auth. Rev. Bonds (Texas Util. Elec. Co. Proj.) Ser. 1994A, 3.85%, due 5/12/00
(LOC: Canadian Imperial Bank of Commerce) 3.85 400,000
200,000 Gulf Coast Waste Disposal Auth. Solid Waste Rev. Bonds (Amoco Oil Proj.)
Ser. 1994 VRDN, 6.20% (Note C) 6.20 200,000
600,000 Gulf Coast Waste Disposal Auth. Solid Waste Rev. Bonds (Citgo Petroleum Corp. Proj.)
Ser. 1995 VRDN, 6.25%, (LOC: Nationsbank) (Note C) 6.25 600,000
1,000,000 San Marcos IDC Rev. Bonds (TB Woods Inc. Proj.) VRDN, 5.20% (LOC: PNC Bank) (Note C) 5.20 1,000,000
100,000 South Texas Higher Educ. Auth. Rev. Bonds, Ser. A1, 4.75%, due 12/1/00 4.50 100,139
--------------
3,238,030
--------------
VARIOUS STATES--3.60%
1,224,084 Pitney Bowes Credit Corp. Leasetops Muni Trust, Ser. 1998-2 VRDN, 5.41%,
(LIQ: Pitney Bowes Credit Corp.) (Note C, E) 5.41 1,224,084
188,769 Pitney Bowes Credit Corp. Leasetops Muni Trust, Ser. 1999-2 VRDN, 5.46%,
(LIQ: Pitney Bowes Credit Corp.) (Note C, E) 5.46 188,769
--------------
1,412,853
--------------
VIRGINIA--2.81%
1,100,000 Isle of Wight IDA Rev. Bonds (Smithfield Ham & Produce Co.) VRDN, 5.20%
(LOC: Nationsbank) (Note C) 5.20 1,100,000
--------------
WASHINGTON--5.74%
1,000,000 HFC Rev. Bonds (Lake Washington Apt. Proj.) VRDN, 5.20% (LOC: Bank of America) (Note C) 5.20 1,000,000
250,000 Motor Vehicle Fuel Tax GO Bonds, 4.75%, due 9/1/00 3.90 250,691
1,000,000 Port of Seattle Rev. Bonds,VRDN Ser. 1997, 5.25%
(LOC: Canadian Imperial Bank of Commerce) (Note C) 5.25 1,000,000
--------------
2,250,691
--------------
WISCONSIN--1.28%
220,000 Colby SD GO Bonds, 3.75%, due 6/1/00 (Insured: FSA) 3.70 220,009
280,000 Superior GO Bonds, 4.10%, due 12/1/00 (Insured: FSA) 4.10 279,997
--------------
500,006
--------------
TOTAL MUNICIPAL OBLIGATIONS--98.97% 38,823,847
OTHER ASSETS AND LIABILITIES, NET--1.03% 403,845
--------------
NET ASSETS--100.00% $ 39,227,692
==============
PLEASE SEE ACCOMPANYING NOTES TO THE SCHEDULES OF INVESTMENTS AND FINANCIAL STATEMENTS.
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21
</TABLE>
<PAGE>
--------------------------------------------------------------------------------
NATIONAL INVESTORS CASH MANAGEMENT FUND, INC.
NOTES TO SCHEDULE OF INVESTMENTS
April 30, 2000
(A) Variable rate securities. The rates shown are the current rates on
April 30, 2000. Dates shown represent the next interest reset
date.
(B) This obligation was acquired for investment, not with intent to
distribute or sell. It is restricted as to public resale. This
obligation was acquired at a cost of par. On April 30, 2000, the
value of this security, valued at cost, is $17,000,000
representing 2.2% of net assets of the Money Market Portfolio.
(C) Securities payable on demand. The interest rate, which is subject
to change, is based upon bank prime rates or an index of market
rates.
(D) Bonds which are prerefunded or escrowed to maturity are
collateralized by U.S. Government securities which are held in
escrow and are used to pay principal and interest on the municipal
issue and to retire the bonds in full at the earliest refunding
date.
(E) Security exempt from registration under the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At April
30, 2000, these securities amounted to $201,775,855, or 26.2% of
net assets in the Money Market Portfolio and $2,812,853, or 7.17%
of net assets in the Municipal Portfolio.
DESCRIPTION OF ABBREVIATIONS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
AMBAC American Municipal Bond Assurance Corporation IDR Industrial Development Revenue Bond
BAN Bond Anticipation Note IRB Industrial Revenue Bond
CP Commercial Paper ISD Independent School District
DFA Developmental Finance Authority LIQ Liquidity Agreement
FGIC Financial Guaranty Insurance Company LLC Limited Liability Corporation
FSA Financial Security Assurance Inc. LOC Letter of Credit
GIC Guaranteed Investment Contract LP Limited Partnership
GO General Obligation MBIA Municipal Bond Investors Assurance Insurance Corporation
GTY Guarantee MFH Multi-Family Housing
HDA Housing Development Authority SBPA Standby Bond Purchase Agreement
HFC Housing Finance Commission SD School District
IDA Industrial Development Authority SFM Single Family Mortgages
IDB Industrial Development Bond VRDN Variable Rate Demand Note
IDC Industrial Development Corporation
</TABLE>
--------------------------------------------------------------------------------
| This Report has been prepared for shareholders and may be distributed to |
| others only if preceded or accompanied by a current prospectus. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
22
<PAGE>
--------------------------------------------------------------------------------
Report of Ernst & Young LLP, Independent Auditors
Shareholders and Board of Directors
National Investors Cash Management Fund, Inc.
We have audited the accompanying statements of assets and liabilities, including
the schedules of investments, of National Investors Cash Management Fund, Inc.
(comprising, respectively, the Money Market Portfolio, the U.S. Government
Portfolio and the Municipal Portfolio) as of April 30, 2000, and the related
statements of operations for the year then ended, and the statements of changes
in net assets and financial highlights for the year then ended, and for the
period from May 20, 1998 (commencement of operations) to April 30, 1999. 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 audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of April 30, 2000 by correspondence with the
custodian and others. 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 audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective Portfolios constituting National Investors Cash Management
Fund, Inc. at April 30, 2000, the results of their operations for the year then
ended, and the changes in their net assets and the financial highlights for the
year then ended and for the period from May 20, 1998 to April 30, 1999, in
conformity with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
New York, New York
June 5, 2000
--------------------------------------------------------------------------------
23
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<PAGE>
|-------------------------------|
| 2000 |
|-------------------------------|
| |
| SEMIANNUAL REPORT |
| |
| April 30, 2000 (Unaudited) |
| |
| |
| |
| |
| |
| |
| TD Waterhouse Dow 30 Fund |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
-------------------------------
25
<PAGE>
<TABLE>
<CAPTION>
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TD WATERHOUSE TRUST
BOARD OF TRUSTEES AND EXECUTIVE OFFICERS
<S> <C> <C>
TRUSTEES EXECUTIVE OFFICERS
George F. Staudter Carolyn B. Lewis George A. Rio*
Director of Koger Equity, Inc. President of President, Treasurer
Independent Financial Consultant The CBL Group and Chief Financial Officer
Richard W. Dalrymple Lawrence J. Toal Christopher J. Kelley*
President of Teamwork Mgmt., Inc. Chairman/President/CEO of Vice President and Secretary
Dime Bancorp, Inc.
*Affiliated person of the Distributor
TD WATERHOUSE ASSET MANAGEMENT, INC.
BOARD OF DIRECTORS AND SENIOR OFFICERS
DIRECTORS
Lawrence M. Waterhouse, Jr. Frank J. Petrilli Richard H. Neiman
Chairman Chairman, President and Executive Vice President,
TD Waterhouse Holdings, Inc. Chief Executive Officer General Counsel and Secretary
SENIOR OFFICERS
David A. Hartman B. Kevin Sterns Michele R. Teichner
Senior Vice President Executive Vice President Senior Vice President
Chief Investment Officer Chief Financial Officer & Treasurer Compliance, Operations
& Administration
SERVICE PROVIDERS
INVESTMENT MANAGER TRANSFER AGENT INDEPENDENT AUDITORS
TD Waterhouse Asset Management, Inc. National Investor Services Corp. Ernst & Young LLP
100 Wall Street 55 Water Street 787 Seventh Avenue
New York, NY 10005 New York, NY 10041 New York, NY 10019
ADMINISTRATOR & CUSTODIAN LEGAL COUNSEL
SHAREHOLDER SERVICING The Bank of New York Swidler Berlin Shereff
TD Waterhouse Investor Services, Inc. 100 Church Street Friedman, LLP
100 Wall Street New York, NY 10286 405 Lexington Avenue
New York, NY 10005 New York, NY 10174
Customer Service Department DISTRIBUTOR
1-800-934-4448 Funds Distributor, Inc. INDEPENDENT TRUSTEES COUNSEL
60 State Street Willkie Farr & Gallagher
Boston, MA 02109 153 East 53rd Street
New York, NY 10022
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26
</TABLE>
<PAGE>
--------------------------------------------------------------------------------
TD WATERHOUSE DOW 30 FUND
DEAR SHAREHOLDER:
--------------------------------------------------------------------------------
We are pleased to provide you with the semiannual report for the TD Waterhouse
Dow 30 Fund (the "Fund") for the six month period ended April 30, 2000. Total
net assets were approximately $180 million as of April 30, 2000. Despite
significant volatility in the latter half of this six month period, the Dow
Jones Industrial AverageSM ("DJIA"SM) ended nearly unchanged, starting at 10,730
on October 31, 1999 and finishing at 10,734 on April 30, 2000. The DJIA peaked
at 11,722 in mid-January before hitting a low of 9,796 in early March. Since
this bottom, the DJIA has rebounded but has experienced a substantial degree of
instability, along with other major market indices. On a total return basis,
which includes reinvested dividends, the six month return for the DJIA was
+0.76%. Your Fund had a total return for the same period of +0.60%, after
expenses. Since the investment objective of the Fund is to match the performance
of the DJIA before Fund expenses, we are pleased with these results. As with any
investment, past performance is no guarantee of future results and there is no
guarantee that the Fund's investment objective will be achieved in the future.
We will continue to work diligently seeking to achieve the objective of the Fund
and to provide our shareholders with an investment vehicle designed to closely
emulate the performance of the DJIA.
[GRAPHIC OMITTED]
In the printed version of the document, a line graph appears which depicts
the following plot points:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
3/30/98 4/30/98 5/31/98 6/30/98 7/31/98 8/31/98 9/30/98
Dow 30 Fund $10,000.00 $10,328.48 $10,170.18 $10,245.24 $10,171.23 $ 8,652.88 $ 9,014.46
DIJA Index $10,000.00 $10,324.82 $10,162.94 $10,234.98 $10,161.24 $ 8,646.34 $ 9,008.32
10/31/98 11/30/98 12/31/98 1/31/99 2/28/99 3/31/99 4/30/99
Dow 30 Fund $9,879.56 $10,507.42 $10,594.84 $10,803.44 $10,767.91 $ 11,336.26 $12,500.03
DIJA Index $9,874.30 $10,503.96 $10,592.72 $10,802.14 $10,768.08 $ 11,338.80 $12,505.09
5/31/99 6/30/99 7/31/99 8/31/99 9/30/99 10/31/99 11/30/99
Dow 30 Fund $12,255.08 $12,747.73 $12,384.68 $12,614.08 $12,052.36 $ 12,517.46 $12,709.43
DIJA Index $12,267.22 $12,759.93 $12,399.21 $12,631.30 $12,072.40 $ 12,537.48 $12,734.36
12/31/99 1/31/00 2/29/00 3/31/00 4/30/00
Dow 30 Fund $13,438.66 $12,790.28 $11,857.76 $ 12,804.64 $12,587.58
DIJA Index $13,474.72 $12,827.23 $11,897.54 $ 12,844.39 $12,630.85
</TABLE>
----------------------------------------------------------
| Dow 30 Fund Average Annual Total Return as of 4/30/00: |
| One Year: 0.76% |
| Since Inception (3/30/98): 11.72% |
----------------------------------------------------------
Note: Performance data quoted represents past performance. As with all
investments, past performance is no guarantee of future results. The
return is based on a constant investment throughout the period, includes
reinvestment of dividends and reflects a net return to the shareholders
after all expenses, inclusive of fee waivers. Without this waiver, the
Fund's total return would have been lower. The returns shown for the DJIA
reflect the reinvestment of dividends, but do not include any expenses,
since an index has none. It is not possible to invest in an index. The
investment return and principal value of an investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than
their original cost.
The price performance of each of the DJIA stocks during the six months ended
April 30, 2000 is shown in the chart on the following page. As can be seen in
the chart, there was an unusually wide disparity in performance among the
individual stocks. During the period, Home Depot executed a 3-for-2 stock split.
--------------------------------------------------------------------------------
27
<PAGE>
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
Price Price
Appreciation* DJIA Component Appreciation* DJIA Component
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
82.3% Hewlett-Packard Co. -2.6% American Express Co.
-------------------------------------------------------------------------------------------------------------------
64.2% The Walt Disney Co. -7.6% McDonald's Corp.
-------------------------------------------------------------------------------------------------------------------
63.8% Intel Corp. -9.0% Minnesota Mining & Mfg Co.
-------------------------------------------------------------------------------------------------------------------
33.3% General Motors Corp. -12.6% Merck & Co., Inc.
-------------------------------------------------------------------------------------------------------------------
16.0% General Electric Co. -13.2% Philip Morris Cos. Inc.
-------------------------------------------------------------------------------------------------------------------
13.5% Int'l Business Machines Corp. -13.8% The Boeing Co.
-------------------------------------------------------------------------------------------------------------------
11.4% Home Depot Inc. -14.0% SBC Communications Inc.
-------------------------------------------------------------------------------------------------------------------
9.8% Citigroup Inc. -18.9% Eastman Kodak Co.
-------------------------------------------------------------------------------------------------------------------
6.8% Alcoa Inc. -20.2% The Coca-Cola Company
-------------------------------------------------------------------------------------------------------------------
4.9% Exxon Mobil Corp. -21.2% Johnson & Johnson
-------------------------------------------------------------------------------------------------------------------
2.8% United Technologies Corp. -24.6% Microsoft Corp.
-------------------------------------------------------------------------------------------------------------------
-0.1% AT&T Corp. -26.4% E.I. du Pont de Nemours and Co.
-------------------------------------------------------------------------------------------------------------------
-1.6% Honeywell International -28.6% Caterpillar Inc.
-------------------------------------------------------------------------------------------------------------------
-1.9% J.P. Morgan & Co., Inc. -30.2% International Paper Co.
-------------------------------------------------------------------------------------------------------------------
-2.3% Wal-Mart Stores, Inc. -43.1% The Proctor & Gamble Co.
-------------------------------------------------------------------------------------------------------------------
</TABLE>
(C) 2000 Dow Jones & Company
Notes: *Percentages reflect each stock's price appreciation only. They do not
include reinvested dividends. The stocks are listed from the best
performer to the worst over the most recent six month period.
Performance quoted represents past performance and is not a guarantee of
future results.
The U.S. stock market's performance over the Fund's most recent semiannual
period was marked by strong volatility. Investor sentiment was influenced by the
debate on "New Economy" versus "Old Economy" stocks as well as a renewed focus
on stock valuations relative to companies' earnings. Another critical factor
influencing the market was continued worry about rising interest rates resulting
from the Federal Reserve Open Market Committee's ("Federal Reserve") attempt to
prevent the rise of inflation from an overheating domestic economy. While the
U.S. economy expanded at a strong pace over the last two calendar quarters,
growing at annualized rates of 7.3% and 5.4% respectively, the continuation of
this exceptionally strong growth may be doubtful in the face of continued
interest rate hikes. The impact of the Federal Reserve's interest rate increases
on corporate earnings, stock prices, economic growth and inflation are uncertain
at this point in time.
Looking forward to the next twelve months, the market's direction will likely be
primarily affected by interest rates, inflationary trends, corporate profits,
and money investment flows. In light of today's economic and market
environments, we believe the overall quality and underlying financial strength
of the companies comprising the DJIA can provide a solid investment foundation
for our shareholders' investments in the Fund.
We welcome additional investments into the Fund, and provide a number of
attractive ways to invest or add to current positions. The minimum initial
investment is $1,000 and $100 for subsequent purchases, although these minimums
may be waived for existing customers of TD Waterhouse Investor Services, Inc.
("TD Waterhouse"). For TD Waterhouse IRA accounts, there are no minimum or
subsequent investment requirements. A periodic investment plan is also available
which requires a minimum investment of $100 monthly or $300 quarterly. Keep in
mind, however, that periodic investing neither guarantees a profit nor protects
against a loss in a declining market. You may contact TD Waterhouse's mutual
funds service department at 1-800-457-6516 or your local branch office for more
information.
Sincerely,
/s/Frank J. Petrilli
Frank J. Petrilli
President and Chief Operating Officer
TD Waterhouse Group, Inc.
June 8, 2000
An investment in the Fund is neither FDIC-insured nor guaranteed by the U. S.
Government and is not a deposit or obligation guaranteed by any bank and is
subject to investment risk, including possible loss of the principal amount
invested.
Distributor: Funds Distributor, Inc.
-------------------------------------------------------------------------------
28
<PAGE>
--------------------------------------------------------------------------------
--------------------------------
TABLE OF CONTENTS
--------------------------------
Schedule of Investments 30
Statement of Assets and Liabilities 31
Statement of Operations 32
Statement of Changes in Net Assets 33
Financial Highlights 34
Notes to Financial Statements 35
--------------------------------------------------------------------------------
29
<PAGE>
TD WATERHOUSE DOW 30 FUND
SCHEDULE OF INVESTMENTS
April 30, 2000
(Unaudited)
NUMBER OF
SHARES VALUE
--------------------------------------------------------------------------------
COMMON STOCKS
Alcoa Inc. 82,877 $ 5,376,645
American Express Co. 82,877 12,436,730
AT&T Corp. 82,877 3,869,320
The Boeing Co. 82,877 3,289,181
Caterpillar Inc. 82,877 3,268,462
Citigroup Inc. 82,877 4,926,002
The Coca-Cola Company 82,877 3,900,399
E.I. du Pont de Nemours and Co. 82,877 3,931,478
Eastman Kodak Co. 82,877 4,635,932
Exxon Mobil Corp. 82,877 6,438,507
General Electric Co. 82,877 13,032,408
General Motors Corp. 82,877 7,759,359
Hewlett-Packard Co. 82,877 11,188,395
Home Depot Inc. 82,877 4,646,292
Honeywell International 82,877 4,641,112
Intel Corp. 82,877 10,509,839
International Business Machines Corp. 82,877 9,251,145
International Paper Co. 82,877 3,045,730
J.P. Morgan & Co., Inc. 82,877 10,639,335
Johnson & Johnson 82,877 6,837,352
McDonald's Corp. 82,877 3,159,686
Merck & Co., Inc. 82,877 5,759,952
Microsoft Corp.(A) 82,877 5,780,671
Minnesota Mining & Manufacturing Co. 82,877 7,168,861
Philip Morris Cos. Inc. 82,877 1,812,934
The Proctor & Gamble Co. 82,877 4,941,541
SBC Communications Inc. 82,877 3,631,049
United Technologies Corp. 82,877 5,153,913
Wal-Mart Stores, Inc. 82,877 4,589,314
The Walt Disney Co. 82,877 3,589,610
-----------
TOTAL COMMON STOCKS (cost $165,277,189)--99.5% 179,211,153
-----------
OTHER (cost $1,323,971)--0.8%
DiamondsSM Trust, Series 1 12,558 1,349,200
-----------
TOTAL INVESTMENTS (cost $166,601,160)--100.3% 180,560,353
OTHER ASSETS AND LIABILITIES, NET--(0.3%) (453,135)
-----------
NET ASSETS--100.0% $180,107,218
============
(A) Non-income producing security
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
--------------------------------------------------------------------------------
30
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
TD WATERHOUSE DOW 30 FUND
STATEMENT OF ASSETS AND LIABILITIES
April 30, 2000
(Unaudited)
<S> <C>
ASSETS
Investments in securities, at value (cost $166,601,160) $180,560,353
Dividends receivable 113,731
Receivable for capital shares sold 187,180
Receivable for investment securities sold 632,577
Receivable from Investment Manager & affiliates (Note 3) 29,936
Other assets 2,058
-------------
TOTAL ASSETS 181,525,835
LIABILITIES
Bank overdraft 1,052,331
Payable for investment securities purchased 1,842
Payable for capital shares redeemed 322,274
Other accrued expenses 42,170
-------------
TOTAL LIABILITIES 1,418,617
-------------
NET ASSETS $180,107,218
=============
Net assets consist of:
Paid-in capital $163,270,202
Undistributed net investment income 322
Accumulated net realized gains from security transactions 2,877,501
Net unrealized appreciation on investments 13,959,193
-------------
Net assets, at value $180,107,218
=============
Shares of beneficial interest outstanding 16,784,519
=============
Net asset value, redemption price and offering price per share (Note 2) $ 10.73
=============
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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31
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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TD WATERHOUSE DOW 30 FUND
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2000
(Unaudited)
<S> <C>
INVESTMENT INCOME
Dividend income $ 1,305,340
Interest income 4,026
------------
TOTAL INVESTMENT INCOME 1,309,366
------------
EXPENSES
Shareholder servicing fees (Note 3) 226,376
Investment management fees (Note 3) 181,100
Transfer agent fees (Note 3) 45,276
Shareholder reports and mailing 71,077
Custody fees (Note 2) 39,113
Registration fees 35,193
Trustees' fees and expenses 14,667
Professional fees 12,808
Other expenses 12,352
------------
TOTAL EXPENSES 637,962
Fees waived/expenses reimbursed by the Investment Manager
and its affiliates (Note 3) (411,589)
------------
NET EXPENSES 226,373
------------
NET INVESTMENT INCOME 1,082,993
------------
REALIZED AND UNREALIZED GAINS ON INVESTMENTS
Net realized gains from security transactions 3,460,090
Net change in unrealized appreciation/depreciation on investments (3,185,406)
------------
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS 274,684
------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 1,357,677
============
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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32
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
TD WATERHOUSE DOW 30 FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended Year
April 30, Ended
2000 October 31,
(Unaudited) 1999
<S> <C> <C>
OPERATIONS:
Net investment income $ 1,082,993 $ 1,622,456
Net realized gains from security transactions 3,460,090 2,545,555
Net change in unrealized appreciation/depreciation on investments (3,185,406) 17,310,316
-------------- -------------
Net increase in net assets from operations 1,357,677 21,478,327
-------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income (1,082,671) (1,622,456)
From net realized gains on security transactions (3,057,262) --
In excess of net investment income -- (2,724)
-------------- -------------
Total distributions to shareholders (4,139,933) (1,625,180)
-------------- -------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 69,667,666 155,677,326
Shares issued in reinvestment of dividends 4,139,933 1,625,180
Payments for shares redeemed (66,229,570) (64,055,262)
-------------- -------------
Net increase in net assets from capital share transactions 7,578,029 93,247,244
-------------- -------------
TOTAL INCREASE IN NET ASSETS 4,795,773 113,100,391
NET ASSETS:
Beginning of period 175,311,445 62,211,054
-------------- -------------
End of period $180,107,218 $175,311,445
============== =============
Undistributed net investment income $ 322 $ --
============== =============
CAPITAL STOCK TRANSACTIONS:
Shares sold 6,431,732 15,233,177
Shares issued for dividends reinvested 382,177 159,759
Shares redeemed (6,370,240) (6,294,226)
-------------- -------------
Net increase in shares outstanding 443,669 9,098,710
============== =============
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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33
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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TD WATERHOUSE DOW 30 FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of beneficial interest outstanding, total investment
return, ratios to average net assets and other supplemental data for each period indicated. This information has been derived from
the Fund's financial statements.
Six Months
Ended Year Period
April 30, Ended Ended
2000 October 31, October 31,
(Unaudited) 1999 1998*
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period $ 10.73 $ 8.59 $ 8.78
-------------- ----------------- --------------
INVESTMENT OPERATIONS
Net investment income 0.06 0.14 0.08
Net realized and unrealized gains (losses)
on investments 0.19 2.14 (0.19)
-------------- ----------------- --------------
TOTAL FROM INVESTMENT OPERATIONS 0.25 2.28 (0.11)
-------------- ----------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS
Distributions from net investment income (0.06) (0.14) (0.08)
Distributions from capital gains (0.19) -- --
-------------- ----------------- --------------
TOTAL DISTRIBUTIONS (0.25) (0.14) (0.08)
Net asset value, end of period $ 10.73 $ 10.73 $ 8.59
============== ================= ==============
RATIOS
Ratio of net expenses to average net assets 0.25%(A) 0.25% 0.25%(A)
Ratio of net investment income to
average net assets 1.20%(A) 1.37% 1.48%(A)
Decrease reflected in above expense ratio
due to waivers/reimbursements by the
Investment Manager and its affiliates (Note 3) 0.46%(A) 0.43% 0.55%(A)
SUPPLEMENTAL DATA
Portfolio turnover rate 26%(A) 47% 8%(A)
Total investment return 0.60%(B) 26.72%(B) (1.19%)(B)
Net assets, end of period $ 180,107,218 $ 175,311,445 $ 62,211,054
=============== ================= ===============
Average net assets $ 181,954,112 $ 118,399,466 $ 28,460,853
=============== ================= ===============
<FN>
* The Fund commenced operations on March 31, 1998.
(A) Annualized.
(B) Total investment return is calculated assuming a purchase of shares on the
first day and a sale on the last day of the period reported and includes
reinvestment of dividends.
</FN>
PLEASE SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
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TD WATERHOUSE DOW 30 FUND
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
NOTE 1 -- ORGANIZATION
TD Waterhouse Trust (the "Trust") was organized as a Delaware business trust on
August 6, 1999. The Trust is registered as an open-end management investment
company with the Securities and Exchange Commission under the Investment Company
Act of 1940, as amended (the "Act"). Shares of beneficial interest of the Trust
are registered under the Securities Act of 1933, as amended. The investment
objective of the Fund is to seek to track the total return of the Dow Jones
Industrial Average before Fund expenses. The Fund commenced operations on March
31, 1998 and became part of the Trust on November 5, 1999. It is a
non-diversified portfolio.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the Fund's significant accounting policies:
Share Valuation -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
are equal to the net asset value per share.
Securities Valuation -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern Time). Securities which are traded over-the-counter
are valued at the last sales price, if available, otherwise, at the last quoted
bid price. Securities traded on a national stock exchange are valued based upon
the closing price on the principal exchange where the security is traded.
Repurchase Agreements -- The Fund may enter into repurchase agreements with
financial institutions, deemed to be creditworthy by the Fund's Investment
Manager, subject to the seller's agreement to repurchase and the Fund's
agreement to resell such securities at a mutually agreed upon price. Securities
purchased subject to repurchase agreements are deposited with the Fund's
custodian and, pursuant to the terms of the repurchase agreement, must have an
aggregate market value greater than or equal to the repurchase price plus
accrued interest at all times. If the value of the underlying securities falls
below the value of the repurchase price plus accrued interest, the Fund will
require the seller to deposit additional collateral by the next business day. If
the request for additional collateral is not met, or the seller defaults on its
repurchase obligation, the Fund maintains the right to sell the underlying
securities at market value and may claim any resulting loss against the seller.
Investment Income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Under the terms of the custody agreement, the
Fund receives net earnings credits based on available cash balances left on
deposit. Income earned under this arrangement is included in interest income.
Distributions to Shareholders -- Dividends arising from net investment income,
if any, are declared daily and paid monthly. Net realized short-term capital
gains, if any, may be distributed during the year and net realized long-term
capital gains, if any, are distributed at least once each year. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations.
Securities Transactions -- Securities transactions are accounted for on the
trade date. Realized gain and loss from securities transactions are recorded on
a specific identification basis.
Expenses -- Expenses directly attributable to the Fund are charged to the Fund's
operations.
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35
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TD WATERHOUSE DOW 30 FUND
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
(CONTINUED)
Use of Estimates -- The Fund's financial statements are prepared in accordance
with generally accepted accounting principles, which may require the use of
management estimates and assumptions. Actual results could differ from these
estimates.
Federal Income Taxes -- It is the Fund's policy to comply with the special
provisions of the Internal Revenue Code available to regulated investment
companies. As provided therein, in any fiscal year in which the Fund so
qualifies, and distributes at least 90% of its taxable net income, the Fund (not
the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
NOTE 3 -- INVESTMENT MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
OF THE INVESTMENT MANAGER
Under the terms of an Investment Management Agreement with TD Waterhouse Asset
Management, Inc. (the "Investment Manager"), a majority-owned subsidiary of The
Toronto-Dominion Bank, for the investment management services furnished to the
Fund, the Fund pays the Investment Manager an annual investment management fee,
equal to .20 of 1% of the average daily net assets of the Fund. The Investment
Manager currently anticipates that it will limit the Fund's overall expense
ratio to no more than 0.25% on an annual basis; however, effective January 1,
2000 the investment manager may limit expenses on an annual basis to no more
than 0.45%. All expense limitations are voluntary. For the six months ended
April 30, 2000, the Investment Manager voluntarily waived $164,636 of its
investment management fee.
TD Waterhouse Investor Securities, Inc. ("TD Waterhouse"), an affiliate of the
Investment Manager, has been retained under an Administration Agreement to
perform certain administrative services for the Fund. For the administrative
services rendered to the Fund, the Investment Manager (not the Fund) pays TD
Waterhouse a monthly fee at an annual rate of .10 of 1% of the Fund's average
daily net assets.
TD Waterhouse has been retained under a Shareholder Services Agreement to
perform certain shareholder services necessary for the operation of the Fund.
The shareholder service plan adopted by the Fund provides that the Fund pay TD
Waterhouse, a monthly fee at an annual rate of up to .25 of 1% of average daily
net assets. For the six months ended April 30, 2000, TD Waterhouse voluntarily
waived $205,795 of its shareholder servicing fee for the Fund.
The Fund has entered into a Transfer Agency and Dividend Disbursing Agency
Agreement with National Investor Services Corp. (the "Transfer Agent"), an
affiliate of the Investment Manager, to perform transfer and dividend disbursing
agency-related services. For such services, the Fund pays the Transfer Agent a
monthly fee at an annual rate of .05 of 1% of average daily net assets. For the
six months ended April 30, 2000, the Transfer Agent voluntarily waived $41,159
of its transfer agent fee for the Fund.
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36
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TD WATERHOUSE DOW 30 FUND
NOTES TO FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
(CONTINUED)
Each Trustee who is not an "interested person" ("independent Trustee") as
defined in the Act, who serves on the Board of Trustees of one or more
portfolios in the "Fund Complex" (which includes the Trust, TD Waterhouse Family
of Funds, Inc. and National Investors Cash Management Fund, Inc.) receives:
1. a base annual retainer of $12,000, payable quarterly;
2. a supplemental annual retainer of $5,000, if serving on the Board of
Trustees/Directors of more than one company in the Fund Complex, and
3. a meeting fee of $2,000 for each meeting attended.
Compensation is allocated between the companies and among the respective
portfolios.
The Fund placed all of its portfolio transactions with TD Waterhouse. There were
no commissions paid to TD Waterhouse for the six months ended April 30, 2000.
NOTE 4 - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investment securities, other
than short-term investments, amounted to $27,975,743 and $23,214,327
respectively, for the six months ended April 30, 2000.
The cost of portfolio investments for Federal income tax purposes was
$166,601,160 as of April 30, 2000. Accordingly, net unrealized appreciation for
Federal income tax purposes aggregated $13,959,193, consisting of $29,159,523
gross unrealized appreciation and $15,200,330 gross unrealized depreciation.
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| This Report has been prepared for shareholders and may be distributed |
| to others only if preceded or accompanied by a current prospectus. |
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