Large Cap Value Fund
Small Cap Value Fund
Balanced Fund
International Value Fund
Annual Report
March 31, 1998
DEAN Family of Funds
2480 Kettering Tower
Dayton, Ohio 45423
Board of Trustees
Victor S. Curtis
Chauncey H. Dean
Dr. Robert D. Dean
Frank J. Perez
Dr. David H. Ponitz
Frank H. Scott
Gilbert P. Williamson
Investment Adviser
C.H. DEAN & ASSOCIATES, INC.
2480 Kettering Tower
Dayton, Ohio 45423
Underwriter
2480 SECURITIES LLC
2480 Kettering Tower
Dayton, Ohio 45423
Transfer Agent
COUNTRYWIDE FUND SERVICES, INC.
P.O. Box 5354
Cincinnati, Ohio 45201-5354
Shareholder Service
Nationwide: (Toll-Free) 888-899-8343 Cincinnati: 513-629-2285
Table of Contents
================================================================================
Chairman and President's Letter..................1
Discussions of Performance:
Small Cap Value Fund........................3
Large Cap Value Fund........................4
Balanced Fund...............................5
International Value Fund....................6
Fund Facts.......................................7
Portfolios of Investments:
Large Cap Value Fund........................9
Small Cap Value Fund.......................12
Balanced Fund..............................17
International Value Fund...................20
Financial Statements............................23
Notes to Financial Statements...................30
Auditor's Report................................35
<PAGE>
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CHAIRMAN AND PRESIDENT'S LETTER
================================================================================
To Investors in the Dean Family of Funds:
By almost any standard, the performance of the Dean Family of Funds during its
first 10 months represents a strong beginning. Three Dean Funds -- the Small Cap
Value, Large Cap Value and Balanced -- were launched on May 28, 1997. Our
International Value Fund began operation on October 13, 1997. By March 31, 1998,
each had achieved solid, double-digit returns.
Despite the special demands the startup of a mutual fund imposes, the Small Cap
and International Value Funds outperformed their benchmarks. Returns of the
Large Cap Value Fund and the Balanced Fund, though short of their benchmarks
during the 10-month period, still represented a very respectable startup.
It was certainly an exciting 10 months. While the market soared to new heights,
it was a sometimes bumpy ride. The Asian financial crisis in the fall of 1997
brought our first market correction (an 11% decline in the Dow) in seven years.
Then, reassured by generally good earnings reports and continued prospects for
low inflation and low interest rates, investors promptly resumed their bullish
ways. Meanwhile, overseas equity markets were highly volatile. Though
challenging, these conditions created rewarding opportunities for our new
International Value Fund, especially in Europe.
While we continue to find value opportunities for each of the Funds, we are
still concerned about the high valuations so common in the stock market today.
In the U.S., stock prices are selling at roughly 24 times anticipated earnings
on average. That ratio suggests to us that continued corporate earnings growth
is essential; any series of earnings disappointments could alter investor
confidence in a hurry.
Factors which could erode earnings growth include the wage pressures which are
building in the U.S. and the possible reverberations here from troubled Asian
economies. For U.S. producers, Japan and other Asian nations represent both
important export markets and potentially damaging price competition here. The
relative strength of the U.S. dollar works against American exports by making
them more expensive, while favoring imports by making them less expensive.
Still, there are formidable forces driving the stock market ahead. The
fundamentals for continued economic growth and low inflation are still very much
in place. Interest rates should remain low for the foreseeable future, a
prospect enhanced by balanced federal budgets. Productivity increases have made
the U.S. companies much stronger global competitors. And money is pouring into
the market as participation in mutual funds and 401(k) plans grows rapidly.
If this recitation of plusses and minuses is a bit perplexing, it represents the
real world of investing. It is, also, the very kind of mix which creates
opportunities for investors who emphasize the value approach. The Dean Family of
Funds combines the value approach with intensive research and rigorous
investment decision-making disciplines. Ten months is not a long time. Yet, our
results suggest, at least, that your Funds should perform well relative to the
market, whatever its long-term course.
Your participation and confidence are deeply appreciated. Please know that an
exceptional group of professionals here is dedicated to rewarding the trust you
have placed in us.
Sincerely,
/s/ Chauncey H. Dean /s/ Robert D. Dean
Chauncey H. Dean Robert D. Dean
Chairman of the Board and President and
Chief Executive Officer Chief Investment Officer
C.H. Dean & Associates, Inc. C.H. Dean & Associates, Inc.
<PAGE>
The Dean Approach to Value Investing
What does value investing mean to the Dean Family of Funds? Simply said, we try
to buy companies which are selling below their intrinsic value. To be more
specific, we believe that to make good money in the market it is imperative to
buy THAT WHICH IS NOT LOVED.
Stocks become loved when everything is going right for them-- when earnings
growth has been great and the company is sitting on top of the world. The market
then projects that success far into the future. Such projections can create a
lot of risk, and risk is one of the most important considerations in investing.
Some people argue that safety (reduced risk) is related to size, that a large
cap stock is less risky than a small cap stock. While large companies tend to
have more diversified client bases and larger product portfolios, this view of
risk implies that a stock becomes less risky as it is bid up in price. In other
words, it says the same company is safer valued at $10 billion by the market
than at $2 billion. This seems a dubious proposition. While a large business's
wider array of clients and products can lead to a more stable stream of
earnings, an investor can duplicate this by buying a portfolio of different
stocks.
As long as two stocks do not move in absolute lock step with each other,
a portfolio of two stocks will be less volatile than either of the individual
stocks. How much less volatile depends on how likely the two stocks are to move
together. A portfolio of two computer chip companies is more risky than a
portfolio of one computer chip and one potato chip company. The skills needed to
run the two companies are very different. We would rather hold two smaller
companies, each focusing on what they do best, than one large company which is a
collection of different businesses.
As a general proposition, the more diversified you are, the less risky you are.
But, more often than not, diversification is better achieved at the portfolio
level than at the corporate level.
While we can't express risk as a specific formula which fits all industries, we
believe it is a function of the following, in roughly this order: VALUATION,
BALANCE SHEET STRENGTH, STABILITY OF EARNINGS AND CASH FLOWS, MARKET POSITION
AND DIVERSITY, AND EARNINGS GROWTH POTENTIAL. Note that all of these, with the
exception of valuation, are attributes of the underlying company, not the stock.
If a company can grow at a high rate for a long time, it should be worth a
pretty penny. For example, if you could know with absolute certainty that a
company would grow its earnings at 15% per year, every year, for the next 30
years, what would it be worth? At 15%, $15,000 becomes $1,000,000 million in
30 years. Obviously, the market would be willing to pay a very high multiple of
current earnings for such a mythical company. But, relatively small changes in
growth rates or duration can make a huge difference. For example, if the growth
were 10% for 30 years, $15,000 would grow to less than $260,000. Furthermore, if
a company disappoints with earnings which are below the analysts' forecasts, or
if there is a major uncertainty over its near-term operations, the market often
sells it off violently. If the company above revealed that it was not going to
grow at 15% for 30 years but, rather, thought it might grow at 12% for five
years, the market would despise it. The multiple of current earnings paid for
the stock would plummet, even though it was still growing earnings at a
respectable pace.
It is also very important to note that this process works in reverse. If a
company which is expected to show consistent earnings growth of 5% puts together
a few years of 8% earnings growth, its stock price will start to soar, as long
as the new pace is seen as sustainable.
Thus, it is the market's collective perception of future earnings that causes
stock prices to go up and down. "Collective perception" is another way of
describing crowd behavior. Psychologists tell us that in a crowd, intelligent
people will often do stupid things. The crowd tends to extrapolate the past into
the future, both positive and negative. However, trends don't last forever.
At Dean, we prefer to focus on companies where the expectations are low.
If everyone expects bad things to happen, and they do, then the downside in
stock price is limited. If something good (or even not so bad) happens, good
things happen to the stock price.
At Dean we are interested first and foremost in the preservation and enhancement
of capital. While this does not mean that our stocks never go down, it does mean
that we tend to do best on a relative basis in difficult market environments.
What are our strategies for preserving capital while also enhancing it? Each of
the Funds takes a somewhat different path but the common denominator is our
value philosophy. You will see its application on the pages describing the
activities of each fund.
<PAGE>
SMALL CAP VALUE FUND
================================================================================
Diversity: a Virtue and a Necessity
The Small Cap Value Fund attempts to stay as fully invested as possible in
stocks at all times. Small cap stocks can be volatile on a day-to-day basis,
because of their low liquidity. However, we do not view them as risky per se.
Diversification is a virtue and a necessity in small cap funds. It reduces the
day-to-day, or even month-to-month volatility. Even though the portfolio is
invested in small and little-known companies, its diversity reduces risk, and
our investments will still adhere to the Dean discipline of capital
preservation.
Continuing to Climb with Small Cap Stocks
The Dean Small Cap Value Fund continues to chalk up impressive returns with
Class A shares up 11.65%1 in the first three months of 1998, up 33.86%1 since
its inception May 28, 1997 (assuming reinvestment of dividends). These returns
exceed those of its benchmark, the Russell 2000, which was up 10.06% and 27.44%,
respectively. While we do not believe such returns can be sustained
indefinitely, by either the Fund or the index, we are confident that our
disciplined value style can continue to outperform on a relative basis.
"Small" does not equate to "risky" in the Dean Small Cap Value Fund. A
significant portion of the Fund is invested in such areas as electric utilities
and REITs (real estate investment trusts). These help provide the Fund with a
dividend yield which exceeds that of the much larger cap S&P 500.
Other stocks in the Fund have been purchased at prices so low that there is very
little risk. For example, Jan Bell Marketing sells jewelry through leased space
in Sam's Clubs. It was purchased at less than 10x earnings, at an average cost
of $2.69 per share. Total market value was $70 million, though its net current
assets (cash plus inventories plus receivables minus all liabilities) were $95
million at the time. The company has since posted better-than-expected earnings
and is now selling for $4.75, up 77% from our average cost.
<TABLE>
<CAPTION>
1 The total returns shown do not include the effect of applicable sales loads.
Comparison of the Change in Value since May 28, 1997 of a $10,000 Investment in
the Dean Small Cap Value Fund and the Russell 2000 Index
Dean Small Cap Value Fund Total Returns Since Inception*
Class A 26.83%
Class C 20.63%
<S> <C> <C>
Russell 2000 Index Dean Small Cap Value Fund
Inception 10000 9475
May 97 10109 9475
Jun 97 10539 9750
Jul 97 11031 10366
Aug 97 11280 10678
Sep 97 12104 11465
Oct 97 11566 11313
Nov 97 11487 11341
Dec 97 11693 11360
Jan 98 11515 11478
Feb 98 12379 12209
Mar 98 12900 12683
*The chart above represents performance of Class A shares only, which will vary
from the performance of Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. The initial public offering of
Class A shares commenced on May 28, 1997, and the initial public offerinf of
Class C shares commenced on August 1, 1997.
Past performance is predictive of future performance.
</TABLE>
<PAGE>
LARGE CAP VALUE FUND
================================================================================
Low Prices: a Built-in Safety Factor
While the Large Cap Value Fund reflects the strength and stability of the
largest corporations, it does not have the benefit of a bond position. Thus, it
will tend to be more volatile than the Balanced Fund. Because of that
volatility, deeply discounted valuations are relied on to provide a sizable
margin of safety. Such stocks do not have grand expectations priced into them.
Since it is hard to disappoint when no one expects something exciting or good,
downside risk is reduced.
Solid Returns and a Careful Search for Value
The Fund continues to post strong absolute returns, with Class A shares up
24.11%1 between its inception on May 28, 1997, and March 31, 1998. Though solid,
these returns fall short of the 32.24% gain posted by the benchmark Russell 1000
Index during this period. While absolute returns of this magnitude are not
likely to continue indefinitely, either for the Fund or the Russell 1000, we
believe our relative performance should improve over time. On traditional value
measures, such as Price-to-Earnings and Price-to-Book Value, the Fund remains
far less expensive than the overall market.
Our search for value in large cap stocks has been rewarded in the utilities and
financial sectors. Valuations, especially in the financial services area, are
often well below average, despite steady earnings growth and strong balance
sheets. For example, Ambac Financial Group, a firm which specializes in insuring
municipal bonds, has gained more than 50% since being purchased for the Dean
Large Cap Value Fund. Even at that, it has been selling recently for 17x
earnings and only 2.3x an understated book value.
<TABLE>
<CAPTION>
1 The total returns shown do not include the effect of applicable sales loads.
Comparison of the Change in Value sine May 28, 1997 of a $10,000 Investment in
the Dean Large Cap Value Fund and the Russell 1000 Index
Dean Large Cap Value Fund Total Returns Since Inception*
Class A 17.60%
Class C 13.63%
Russell 1000 Index Dean Large Cap Value Fund
<S> <C> <C>
Inception 10000 9475
May 97 9998 9484
Jun 97 10415 9665
Jul 97 11262 10404
Aug 97 10724 10148
Sep 97 11314 10648
Oct 97 10944 10249
Nov 97 11423 10303
Dec 97 11656 10571
Jan 98 11740 10379
Feb 98 12580 11197
Mar 98 13214 11760
*The chart above represents performance of Class A shares only, which will vary
from the performance of Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. The initial public offering of
Class A shares commenced on May 28, 1997, and the initial public offering of
Class C shares commeced on August 19, 1997.
Past performance is predictive of future performance.
BALANCED FUND
</TABLE>
<PAGE>
Balanced Fund
================================================================================
Building Value by Limiting Risk
The Balanced Fund diversifies between stocks and bonds. Bonds are of high
quality and of medium length. Thus there is almost no risk of default and very
limited risk due to fluctuations in interest rates. Depending on overall
market risk, we vary the proportion in stocks and bonds slightly. The stocks
are solid companies which are currently out of favor. They have generally good,
if not spectacular, growth prospects but sell at a discount to the overall
market. This discount provides appreciation potential and lower risk.
STRENGTH FOLLOWED FOURTH QUARTER VOLATILITY
After a wild and volatile fourth quarter of 1997,
market participants put the Asian financial crisis in perspective. The first
quarter of 1998 saw U.S. markets respond positively to still-healthy corporate
earnings and robust economic performance. Individual investors continued to pour
money into mutual funds, providing further support to the bullish trend in
stocks.
The Balanced Fund's Class A shares gained 18.07%1 since its inception on May
28, 1997, compared to 22.00% for our 60/402 benchmark over that same period.
Given the Balanced Fund's relatively cautious investment posture during the
period, its performance represents a solid absolute return. The portfolio holds
important positions in relatively low-risk areas such as electric utilities
and REITs. Its diverse holdings also include attractive and reasonably valued
stocks in dynamic industries, such as technology. It holds stocks in the
automotive and retail sectors, which benefit from steady economic growth.
Financial services companies comprise a significant portion of the holdings,
because they are reasonably valued and benefit from the low-interest
environment.
During the quarter we added important positions in several stocks that clearly
fit our value criteria. As the price of oil declined steadily in recent
months, stocks of virtually all the oil service companies declined sharply. In
view of the long-term growth in demand for oil, this presented a very attractive
long-term investment opportunity.
Adhering to the Dean Balanced Fund's primary
objective of preservation of capital and competitive returns, we view the
current market as being relatively overvalued and prone to sharp volatility. We
will maintain a modestly conservative position in our investments but be alert
to new value opportunities.
<TABLE>
<CAPTION>
1 The total returns shown do not include the effect of applicable sales loads.
2 The 60/40 benchmark consists of 60% Russell 1000 Index and 40% Lehman Brothers
Comparison of the Change in Value since May 28, 1997 of a $10,000 Investment in
the Dean Balanced Fund, the Russell 1000 Index and the Lehman Brothers
Intermediate Government/Corporate Bond Index
Dean Balanced Fund Total Returns Since Inception*
Class A 11.87%
Class C 8.37%
Russell 1000 Index Dean Balanced Fund Lehman Brothers
Intermediate
Government/
Corporate Bond Index
<S> <C> <C> <C>
Inception 10000 9475 10000
May 97 9998 9484 10046
Jun 97 10415 9565 10137
Jul 97 11262 10220 10343
Aug 97 10724 10125 10291
Sep 97 11314 10373 10411
Oct 97 10944 10220 10526
Nov 97 11423 10197 10550
Dec 97 11656 10388 10634
Jan 98 11740 10494 10773
Feb 98 12580 10793 10765
Mar 98 13214 11187 10799
*The chart above represents performance of Class A shares only, which will vary
from the performanceof Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. The initial public offering of
Class A shares commenced on May 28, 1997, and the initial public offering of
Class C shares commenced on August 19, 1997.
Past performance is predictive of future performance.
</TABLE>
<PAGE>
INTERNATIONAL VALUE FUND
================================================================================
Selecting Value from a World of Stocks
The Dean International Value Fund seeks capital appreciation by investing
primarily in the common stocks of companies located in the United Kingdom,
Continental Europe and the Pacific Basin. Stocks favored are those of companies
with strong management and solid earnings potential, but which are trading at
relatively low valuations. Particular emphasis is given to growth rates and such
valuation measures as price-to-book value and price-to-cash flow. The Fund is
managed under a disciplined, bottom-up, value approach. Strict parameters as to
capitalization and valuation are followed with respect to both buying and
selling these investments.
Off to a Great Beginning
Launched on October 13, 1997, as the Asian financial crisis sent waves of
volatility through international equity markets, the Dean International Value
Fund, nevertheless, got off to an excellent start. It's 17.60%1 total return for
Class A shares through March 31, 1998, nearly tripled the 5.87% return of the
benchmark EAFE Index.
The Fund's heavy cash position in October was used aggressively to buy depressed
European and Canadian equities during the correction. The realization that
growth in Asia was declining depressed bond yields in the West, which served to
boost the markets for European and North American equities. Initially, the Fund
minimized its exposure to companies in troubled Japan and other Asian and Latin
American economies. Early in 1998, however, value opportunities began to emerge,
leading to increased investments in these economies.
During the first quarter of 1998, strong rallies occurred in international
equity markets, with Europe leading the way. The Fund's early focus on European
markets was well rewarded.
<TABLE>
<CAPTION>
1 The total returns shown do not include the effect of applicable sales loads.
Comparison of the Change in Value since October 13, 1997 of a $10,000 Investment
in the Dean International Value Fund and the Europe, Australia and Far East
Index (EAFE Index)
Dean Intenational Value Fund Total Returns Inception*
Class A 11.43%
Class C 17.50%
Europe, Australia and
Far East Index Dean International Value Fund
<S> <C> <C>
Inception 10000 9475
Oct 97 9273 9267
Nov 97 9179 9409
Dec 97 9258 9598
Jan 98 9682 9882
Feb 98 10303 10565
Mar 98 10620 11143
*The chart above represents performance of Class A shares only, which will vary
from the performance of Class C shares based on the difference in loads and fees
paid by shareholders in the different classes. The initial public offering of
Class A shares commenced on October 13, 1997, and the initial public offering of
Class C shares commenced on November 6, 1997.
Past performance is predictive of future performance.
</TABLE>
<PAGE>
FUND FACTS
<TABLE>
<CAPTION>
FUND FACTS
====================================================================================================================================
SMALL CAP VALUE FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Top Holdings
Jan Bell Marketing, Inc. Audiovox Corp. - Class A
M.D.C. Holdings, Inc. Castle Energy Corp.
Imperial Credit Commercial Mortgage Lennar Corp.
Advanced Marketing Services, Inc. LandAmerica Financial Group
Haverty Furniture Co., Inc. M/I Schottenstein Homes, Inc.
<S> <C>
Number of Positions ....................................................156
Median Price/Earnings Ratio ...........................................12.6
Portfolio Turnover (5/28/97 - 3/31/98) .................................62%
LARGE CAP VALUE FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Top Holdings
Bear Stearns Cos., Inc. Edwards (AG), Inc.
Clayton Homes, Inc. Food Lion, Inc. - Class A
Chase Manhattan Corp. Transatlantic Holdings, Inc.
Green Tree Financial Corp. Chrysler Corp.
Ambac Financial Group, Inc. Norfolk Southern Corp.
Number of Positions .....................................................59
Median Price/Earnings Ratio ...........................................15.5
Portfolio Turnover (5/28/97 - 3/31/98) .................................54%
BALANCED FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Top Equity Holdings
Ambac Financial Group, Inc. ECI Telecommunications Ltd.
News Corp. Ltd. Pfd. ADR Diamond Offshore Drilling
Tricon Global Restaurants Countrywide Credit Ind.
Chrysler Corp. NCR Corp.
Applied Materials Tidewater, Inc.
Number of Positions .....................................................47
Median Price/Earnings Ratio ...........................................17.4
Portfolio Turnover (5/28/97 - 3/31/98) .................................64%
<PAGE>
FUND FACTS
====================================================================================================================================
INTERNATIONAL VALUE FUND
- ------------------------------------------------------------------------------------------------------------------------------------
Top Countries
United Kingdom Germany
France Switzerland
Sweden Netherlands
Japan Italy
Canada Hong Kong
Top Holdings
BCE, Inc. Telefonica De Espana
Scudder Latin America INV TR Sanofi SA
Fuji Photo Film Bure Investment Aktiebola
Telecom Italia SPA Carrefour Supermarche
Novartis AG Telecomunicacoes Brazileiras SA
Number of Positions .....................................................83
Median Price/Earnings Ratio ...........................................26.4
Portfolio Turnover (10/1/97 - 3/31/98) ................................109%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LARGE CAP VALUE FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1998
====================================================================================================================================
Shares COMMON STOCKS -- 99.9% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
AEROSPACE -- 1.5%
2,000 Rockwell International Corp................................................ $ 114,750
---------------
AUTOMOTIVE -- 6.2%
4,500 Chrysler Corp.............................................................. 187,031
1,500 Ford Motor Co.............................................................. 97,219
1,300 General Motors Corp........................................................ 87,669
1,900 PACCAR Inc................................................................. 113,168
---------------
485,087
---------------
AUTOMOTIVE PARTS -- 1.0%
2,000 Genuine Parts Co........................................................... 76,250
---------------
BANKING -- 2.1%
1,300 Republic New York Corp..................................................... 173,388
---------------
BUILDING PRODUCTS -- 3.2%
1,000 Armstrong World Industries, Inc............................................ 86,563
1,500 Vulcan Materials Co........................................................ 164,250
---------------
250,813
---------------
CAPITAL GOODS -- 5.6%
6,000 AGCO Corp.................................................................. 178,125
3,000 Caterpiller Inc............................................................ 165,188
2,000 York International Corp.................................................... 90,000
---------------
433,313
---------------
CHEMICALS -- 7.0%
1,000 Dow Chemical Co., (The).................................................... 97,250
3,000 Great Lakes Chemical Corp.................................................. 162,000
2,000 Potash Corp. of Saskatchewan Inc........................................... 181,750
1,000 Rohm & Haas Co............................................................. 103,313
---------------
544,313
---------------
ELECTRONICS -- 2.7%
1,000 Avnet, Inc................................................................. 57,563
63 Raytheon Co. - Class A..................................................... 3,583
2,500 Raytheon Co. - Class B..................................................... 145,938
---------------
207,084
---------------
ENERGY -- 6.7%
1,500 Atlantic Richfield Co...................................................... 117,938
3,000 Phillips Petroleum Co...................................................... 149,812
4,000 Tidewater, Inc............................................................. 175,250
3,500 Union Texas Petroleum Holdings............................................. 77,438
---------------
520,438
---------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LARGE CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 99.9% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCIAL SERVICES -- 12.8%
3,400 Ambac Financial Group, Inc................................................. $ 198,687
4,000 Bear Stearns Cos., Inc..................................................... 205,500
1,500 Chase Manhattan Corp....................................................... 202,312
4,500 Edwards (A.G.), Inc........................................................ 196,875
7,000 Green Tree Financial Corp.................................................. 199,062
---------------
1,002,436
---------------
HEALTH CARE -- 1.0%
2,000 Mallinckrodt, Inc.......................................................... 79,000
---------------
HOUSING -- 2.6%
10,000 Clayton Homes, Inc......................................................... 202,500
---------------
INSURANCE -- 13.0%
2,000 AFLAC, Inc................................................................. 126,500
1,500 American National Insurance Co............................................. 146,437
800 General Re Corp............................................................ 176,500
2,000 Jefferson-Pilot Corp....................................................... 177,875
500 SAFECO Corp................................................................ 27,328
1,500 Transamerica Corp.......................................................... 174,750
2,500 Transatlantic Holdings, Inc................................................ 189,062
---------------
1,018,452
---------------
MEDIA -- 0.6%
2,000 News Corporation Ltd. (The) (ADR).......................................... 46,000
---------------
METALS -- 4.2%
2,800 Phelps Dodge Corp.......................................................... 180,775
2,000 USX-U.S. Steel Group, Inc. ................................................ 75,500
4,000 Worthington Industries, Inc................................................ 72,500
---------------
328,775
---------------
MORTGAGE SERVICES -- 4.1%
2,500 Countrywide Credit Industries, Inc......................................... 132,969
2,400 MBIA, Inc.................................................................. 186,000
---------------
318,969
---------------
RETAIL -- 5.1%
3,500 Dillard's, Inc............................................................. 129,281
18,000 Food Lion, Inc. - Class A.................................................. 192,375
2,500 Toys "R" Us, Inc.(a) ...................................................... 75,156
---------------
396,812
---------------
TECHNOLOGY -- 1.1%
2,500 NCR Corp.(a) .............................................................. 82,656
---------------
TELECOMMUNICATIONS -- 1.6%
3,000 Alltel Corp. .............................................................. 131,063
---------------
<PAGE>
LARGE CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 99.9% Value
- ------------------------------------------------------------------------------------------------------------------------------------
TOBACCO -- 3.2%
1,700 Loews Corp................................................................. $ 177,225
1,000 Philip Morris Cos., Inc.................................................... 41,688
1,000 UST, Inc................................................................... 32,250
---------------
251,163
---------------
TRANSPORTATION -- 4.7%
3,000 CSX Corp................................................................... 178,500
5,000 Norfolk Southern Corp...................................................... 186,875
---------------
365,375
---------------
UTILITIES -- 9.9%
2,000 Consolidated Edison Co. of New York, Inc................................... 93,500
6,000 DPL Inc.................................................................... 117,000
4,000 Houston Industries, Inc.................................................... 115,000
5,000 Illinova Corp.............................................................. 150,937
6,000 NIPSCO Industries, Inc..................................................... 168,000
4,500 Southern Co................................................................ 124,594
---------------
769,031
---------------
TOTAL COMMON STOCKS (COST $6,718,817) ..................................... $ 7,797,668
---------------
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Face Value MONEY MARKET -- 0.5% Value
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
$ 39,056 Star Treasury Fund (Cost $39,056).......................................... $ 39,056
---------------
TOTAL INVESTMENTS AT VALUE-- 100.4% (COST $6,757,873) ..................... $ 7,836,724
LIABILITIES IN EXCESS OF OTHER ASSETS-- (0.4)% ............................ ( 30,680 )
---------------
NET ASSETS-- 100.0% ....................................................... $ 7,806,044
===============
(a) Non-income producing security.
ADR - American Depository Receipt
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1998
====================================================================================================================================
Shares COMMON STOCKS -- 97.7% Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
AUTOMOTIVE -- 2.5%
8,000 Excel Industries, Inc...................................................... $ 165,000
7,000 Global Motorsport Group, Inc.(a) .......................................... 126,875
7,000 Oshkosh Truck Corp......................................................... 133,000
2,000 Republic Automotive Parts, Inc.(a) ........................................ 36,250
5,000 TBC Corp.(a) .............................................................. 50,000
---------------
511,125
---------------
AUTOMOTIVE PARTS -- 0.9%
2,000 Arvin Industries, Inc. .................................................... 81,875
10,000 R & B, Inc.(a) ........................................................... 103,750
---------------
185,625
---------------
BUILDING PRODUCTS -- 4.3%
5,000 American Residential Services, Inc.(a) .................................... 49,688
2,000 Ameron International Corp.................................................. 116,875
8,000 Building Materials Holding Corp.(a) ....................................... 109,000
9,000 Cameron Ashley Building Products(a) ....................................... 164,810
28,000 Martin Industries, Inc..................................................... 152,250
13,000 Patrick Industries, Inc.................................................... 202,310
5,000 Ryerson Tull, Inc.(a) ..................................................... 96,250
---------------
891,183
---------------
BUILDING SUPPLIES -- 0.8%
13,000 Wolohan Lumber Co.......................................................... 169,000
---------------
CAPITAL GOODS -- 4.7%
5,000 Amcast Industrial Corp..................................................... 108,125
5,000 Baldwin Technology Co., Inc. - Class A(a) ................................. 27,500
11,000 Bridgeport Machines, Inc.(a) .............................................. 129,250
4,000 Central Sprinkler Corp.(a) ................................................ 56,000
15,000 Defiance, Inc.............................................................. 123,750
10,000 Global Industrial Technologies, Inc.(a) ................................... 165,000
3,000 Hardinge, Inc.............................................................. 102,375
12,000 Perini Corp.(a) ........................................................... 108,000
8,000 Tractor Supply Co.(a) ..................................................... 165,000
---------------
985,000
---------------
CHEMICALS -- 0.7%
7,000 Mississippi Chemical Corp.................................................. 140,438
---------------
<PAGE>
SMALL CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 97.7% Value
- ------------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS -- 4.5%
13,760 Bell Industries, Inc.(a) .................................................. $ 194,360
8,000 Cherry Corp. - Class A(a) ................................................. 144,000
3,000 Cherry Corp. - Class B(a) ................................................. 52,500
3,500 ESCO Electronics Corp.(a) ................................................. 57,750
10,000 IEC Electronics Corp.(a) .................................................. 91,250
2,000 Marshall Industries(a) .................................................... 66,750
11,000 MicroAge, Inc.(a) ......................................................... 138,875
5,000 Petroleum Development Corp.(a) ............................................ 29,687
4,000 Providence Energy Corp..................................................... 83,750
6,000 SED International Holdings, Inc.(a) ....................................... 68,250
---------------
927,172
---------------
ENERGY -- 4.2%
7,300 BP Prudhoe Bay Royalty Trust............................................... 107,219
3,000 CMS Energy Corp. - Class G................................................. 75,938
16,000 Castle Energy Corp.(a) .................................................... 280,000
6,000 Crown Central Petroleum Corp.(a) .......................................... 111,750
3,000 Giant Industries, Inc...................................................... 61,500
30,000 High Plains Corp.(a) ...................................................... 80,625
5,000 NUI Corp................................................................... 136,875
3,000 Torch Energy Royalty Trust................................................. 21,938
---------------
875,845
---------------
FINANCIAL SERVICES -- 1.2%
17,000 EZCORP, Inc. - Class A(a) ................................................. 201,875
3,000 United Cos. Financial Corp................................................. 53,438
---------------
255,313
---------------
FOOD -- 2.6%
9,000 Fleming Cos., Inc.......................................................... 178,313
15,000 M&F Worldwide Corp.(a) .................................................... 135,938
10,000 Mauna Loa Macadamia Partners, L.P. - Class A............................... 38,125
10,000 Nash-Finch Co.............................................................. 198,750
---------------
551,126
---------------
FURNITURE -- 1.0%
12,000 Flexsteel Industries, Inc.................................................. 166,500
2,000 Pulaski Furniture Corp..................................................... 45,750
---------------
212,250
---------------
GAMING -- 0.9%
5,000 Ameristar Casinos(a) ...................................................... 28,750
9,000 Grand Casinos, Inc.(a) .................................................... 153,563
---------------
182,313
---------------
HEALTH CARE -- 1.6%
16,000 Ramsay Health Care, Inc.(a) ............................................... 50,000
10,000 Safeguard Health Enterprises, Inc.(a) ..................................... 87,500
85,000 Staff Builders, Inc. - Class A(a) ......................................... 191,250
---------------
328,750
---------------
<PAGE>
SMALL CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 97.7% Value
- ------------------------------------------------------------------------------------------------------------------------------------
HOUSING -- 10.4%
10,000 Beazer Homes USA, Inc.(a) ................................................. $ 256,875
10,000 Cavalier Homes, Inc........................................................ 114,375
8,000 Del Webb Corp.............................................................. 244,000
12,000 Engle Homes, Inc........................................................... 201,000
24,000 Hovnanian Enterprises Inc. - Class A(a) ................................... 253,500
7,966 Lennar Corp................................................................ 274,329
17,000 M.D.C. Holdings, Inc....................................................... 301,750
12,200 M/I Schottenstein Homes, Inc.(a) .......................................... 266,875
1,100 Pulte Corp................................................................. 51,150
20,000 Zaring National Corp.(a) .................................................. 205,000
---------------
2,168,854
---------------
INSURANCE -- 8.6%
6,000 ALLIED Life Financial Corp................................................. 129,000
2,500 Chartwell Re Corp.......................................................... 84,688
1,300 Citizens Corp.............................................................. 40,463
1,733 Donegal Group, Inc......................................................... 40,509
12,000 EMC Insurance Group, Inc................................................... 160,500
3,000 FBL Financial Group, Inc. - Class A........................................ 151,875
1,300 Farm Family Holdings, Inc.(a) ............................................. 50,375
4,200 Harleysville Group, Inc.................................................... 109,200
6,000 LandAmerica Financial Group, Inc........................................... 271,500
600 Navigators Group, Inc. (The)(a) ........................................... 11,250
4,000 PXRE Corp.................................................................. 124,000
5,000 SCPIE Holdings Inc......................................................... 155,000
600 Selective Insurance Group, Inc............................................. 16,125
8,000 Stewart Information Services Corp.......................................... 246,000
3,000 Terra Nova (Bermuda) Holdings Ltd. - Class A............................... 91,500
3,000 Trenwick Group Inc......................................................... 112,500
---------------
1,794,485
---------------
METALS -- 7.1%
6,000 Ampco-Pittsburgh Corp...................................................... 111,000
9,000 Atchison Casting Corp.(a) ................................................. 140,625
15,000 Bayou Steel Corp.(a) ...................................................... 102,188
3,500 Cleveland-Cliffs Inc....................................................... 188,125
4,000 Commercial Metals Co....................................................... 140,000
14,000 National Steel Corp. - Class B(a) ......................................... 239,750
3,000 Pitt-Des Moines, Inc....................................................... 144,000
7,050 Roanoke Electric Steel Co.................................................. 145,406
10,000 Rouge Industries, Inc. - Class A........................................... 155,625
11,000 Steel of West Virginia, Inc.(a) ........................................... 112,750
---------------
........................................................................ 1,479,469
---------------
MISCELLANEOUS -- 0.9%
8,000 Arctic Cat, Inc............................................................ 74,500
4,000 CTG Resources, Inc......................................................... 102,750
---------------
........................................................................ 177,250
---------------
MORTGAGE SERVICES -- 0.7%
6,000 MMI Cos., Inc.............................................................. 144,375
---------------
SMALL CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 97.7% Value
- ------------------------------------------------------------------------------------------------------------------------------------
PAPER AND CONTAINERS -- 0.8%
17,000 Mercer International, Inc.................................................. $ 166,813
---------------
REAL ESTATE -- 7.4%
9,000 Commercial Net Lease Realty................................................ 158,625
5,000 Criimi Mae, Inc............................................................ 77,188
13,000 Dynex Capital, Inc......................................................... 156,000
5,000 Health Care REIT, Inc...................................................... 137,500
10,000 Horizon Group, Inc......................................................... 123,125
19,000 Imperial Credit Commercial Mortgage Investment Corp........................ 285,000
3,000 PMC Commerical Trust....................................................... 58,875
7,000 RFS Hotel Investors, Inc................................................... 127,750
4,000 Ramco-Gershenson Properties Trust.......................................... 81,500
3,000 Redwood Trust, Inc......................................................... 70,500
9,000 Thornburg Mortgage Asset Corp.............................................. 142,875
10,000 Winston Hotels, Inc........................................................ 132,500
---------------
1,551,438
---------------
RESTAURANTS -- 2.6%
1,000 Bertucci's, Inc.(a) ....................................................... 7,687
14,000 Cooker Restaurant Corp..................................................... 140,875
11,000 Rare Hospitality International, Inc.(a) ................................... 130,625
25,000 Ryan's Family Steak Houses, Inc.(a) ....................................... 226,563
4,000 Uno Restaurant Corp.(a) ................................................... 28,500
---------------
534,250
---------------
RETAIL -- 16.1%
15,000 Advanced Marketing Services, Inc.(a) ...................................... 281,250
6,800 Blair Corp................................................................. 155,550
5,000 Burlington Industries, Inc.(a) ............................................ 87,812
15,000 Dixie Group, Inc. (The) ................................................... 173,438
15,000 Duckwall-ALCO Stores, Inc.(a) ............................................. 228,750
15,000 Dyersburg Corp............................................................. 117,187
10,000 Farah Inc.(a) ............................................................. 63,125
9,000 Friedman's Inc. - Class A(a) .............................................. 182,813
25,000 GT Bicycles, Inc.(a) ...................................................... 154,688
15,000 Haverty Furniture Co., Inc................................................. 281,250
13,000 Ingles Markets, Inc. - Class A............................................. 175,500
62,900 Jan Bell Marketing, Inc.(a) ............................................... 310,568
6,800 Lifetime Hoan Corp......................................................... 78,200
6,000 Marsh Supermarkets, Inc. - Class B......................................... 93,750
11,000 Mikasa, Inc................................................................ 148,500
13,000 Movie Gallery, Inc.(a) .................................................... 99,125
12,000 REX Stores Corp.(a) ....................................................... 177,000
10,000 Rival Co. (The)............................................................ 172,500
5,000 Sportman's Guide, Inc. (The)(a) ........................................... 30,000
3,000 Superior Surgical Manufacturing Co., Inc................................... 52,500
3,000 Supreme International Corp.(a) ............................................ 37,500
8,000 Syms Corp.(a) ............................................................. 113,000
15,000 Tultex Corp.(a) ........................................................... 57,187
15,000 Worldtex, Inc.(a) ......................................................... 113,438
---------------
3,384,631
---------------
<PAGE>
SMALL CAP VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 97.7% Value
- ------------------------------------------------------------------------------------------------------------------------------------
SEMICONDUCTOR -- 2.1%
8,000 Kulicke & Soffa Industries, Inc.(a) ....................................... $ 174,000
10,000 Newcor, Inc................................................................ 92,500
11,000 Tower Semiconductor Ltd.(a) ............................................... 100,375
27,000 Xicor, Inc.(a) ............................................................ 70,875
---------------
........................................................................ 437,750
---------------
TECHNOLOGY -- 1.7%
20,000 Kentek Information Systems, Inc............................................ 158,750
11,000 Nam Tai Electronics, Inc. ................................................. 187,688
---------------
........................................................................ 346,438
---------------
TELECOMMUNICATIONS -- 2.2%
8,400 Atlantic Tele-Network, Inc.(a) ............................................ 92,400
42,000 Audiovox Corp. - Class A(a) ............................................... 280,875
11,000 Emerging Communications, Inc.(a) .......................................... 77,000
---------------
........................................................................ 450,275
---------------
TOBACCO -- 0.7%
9,000 Standard Commercial Corp................................................... 143,438
---------------
TRANSPORTATION -- 0.5%
5,000 Pittson Burlington Group................................................... 78,125
500 Sea Containers, LTD. - Class A............................................. 19,280
---------------
........................................................................ 97,405
---------------
UTILITY -- 6.0%
5,000 Central Hudson Gas & Electric.............................................. 218,125
10,000 Central Vermont Public Service............................................. 148,750
4,000 Commonwealth Energy System................................................. 159,500
7,000 Eastern Utilities Associates............................................... 190,750
6,000 Rochester Gas & Electric Corp.............................................. 195,000
7,000 TNP Enterprises, Inc....................................................... 231,438
2,500 United Illuminating Co..................................................... 120,937
---------------
........................................................................ 1,264,500
---------------
TOTAL COMMON STOCKS (COST $17,670,094) .................................... $ 20,356,511
---------------
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Face Value MONEY MARKET -- 0.4% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
$ 71,682....................................Star Treasury Fund (Cost $71,682) $ 71,682
---------------
TOTAL INVESTMENTS AT VALUE-- 98.1% (COST $17,741,776) ..................... $ 20,428,193
OTHER ASSETS IN EXCESS OF LIABILITIES-- 1.9% .............................. 401,397
---------------
NET ASSETS-- 100.0% ....................................................... $ 20,829,590
===============
(a) Non-income producing security.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BALANCED FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1998
====================================================================================================================================
Shares COMMON STOCKS -- 60.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
AIRLINES -- 0.8%
2,500 Comair Holdings, Inc....................................................... $ 66,250
---------------
AUTOMOTIVE -- 3.3%
3,500 Chrysler Corp.............................................................. 145,469
2,000 Ford Motor Co.............................................................. 129,625
---------------
275,094
---------------
CAPITAL GOODS -- 3.5%
3,000 AGCO Corp.................................................................. 89,063
2,100 Briggs & Stratton Corp..................................................... 96,206
2,000 Trinity Industries, Inc.................................................... 109,750
---------------
295,019
---------------
CHEMICALS -- 1.4%
1,250 Potash Corp. of Saskatchewan Inc........................................... 113,594
---------------
DATA STORAGE -- 1.3%
4,150 Seagate Technology, Inc.(a) ............................................... 104,787
---------------
ELECTRONICS -- 2.1%
1,000 Avnet, Inc. ............................................................... 57,563
2,050 Raytheon Co. - Class B..................................................... 119,669
---------------
177,232
---------------
ENERGY -- 3.2%
3,000 Diamond Offshore Drilling, Inc. ........................................... 136,125
3,000 Tidewater, Inc............................................................. 131,438
---------------
267,563
---------------
FINANCIAL SERVICES -- 4.0%
3,000 Ambac Financial Group, Inc................................................. 175,313
500 Chase Manhattan Corp. (The)................................................ 67,437
3,100 Green Tree Financial Corp.................................................. 88,156
---------------
330,906
---------------
GOVERNMENT SPONSORED ENTERPRISES -- 1.1%
1,500 Federal National Mortgage Association...................................... 94,875
---------------
HEALTH CARE -- 1.2%
3,000 Columbia/HCA Healthcare Corp............................................... 96,750
---------------
HOUSING -- 1.5%
6,200 Clayton Homes, Inc......................................................... 125,550
---------------
INSURANCE -- 2.8%
2,000 AFLAC, Inc................................................................. 126,500
4,000 Frontier Insurance Group, Inc.............................................. 110,500
---------------
237,000
---------------
<PAGE>
BALANCED FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 60.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
MEDIA -- 3.8%
2,000 Comcast Corp............................................................... $ 70,625
2,000 Cox Communications, Inc. - Class A(a) ..................................... 84,000
7,000 News Corporation Ltd. (The) (ADR).......................................... 161,000
---------------
315,625
---------------
MORTGAGE SERVICES -- 3.1%
2,500 Countrywide Credit Industries, Inc......................................... 132,969
1,600 PMI Group, Inc. (The)...................................................... 129,200
---------------
262,169
---------------
RESTAURANTS -- 2.9%
10,000 Ryan's Family Steak Houses, Inc.(a) ....................................... 90,625
5,000 Tricon Global Restaurants, Inc.(a) ....................................... 150,313
---------------
240,938
---------------
RETAIL -- 2.0%
1,000 Payless ShoeSource, Inc.(a) ............................................... 75,250
3,000 Toys "R" Us, Inc.(a) ...................................................... 90,187
---------------
165,437
---------------
REAL ESTATE -- 4.4%
2,500 Health Care Property Investors, Inc........................................ 92,343
4,000 Merry Land & Investment Co., Inc........................................... 89,500
3,000 Simon DeBartolo Group, Inc................................................. 102,750
6,000 United Dominion Realty Trust, Inc.......................................... 87,000
---------------
371,593
---------------
SEMICONDUCTOR -- 3.1%
4,000 Applied Materials, Inc.(a) ................................................ 141,250
1,500 Intel Corp. ............................................................... 117,093
---------------
258,343
---------------
TECHNOLOGY -- 4.3%
4,500 ECI Telecommunications Ltd. ............................................... 138,375
4,000 NCR Corp.(a) .............................................................. 132,250
6,000 Wall Data, Inc.(a) ........................................................ 90,000
---------------
360,625
---------------
TELECOMMUNICATIONS -- 2.3%
4,000 360 Communications Co.(a) ................................................. 125,000
900 Sprint Corp................................................................ 60,918
---------------
185,918
---------------
TOBACCO -- 1.3%
2,650 Phillip Morris Cos., Inc................................................... 110,472
---------------
TRANSPORTATION -- 2.0%
1,500 CSX Corp................................................................... 89,250
2,000 Norfolk Southern Corp...................................................... 74,750
---------------
164,000
---------------
<PAGE>
BALANCED FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 60.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
UTILITIES -- 4.8%
4,000 Houston Industries, Inc.................................................... $ 115,000
4,000 Illinova Corp.............................................................. 120,750
3,000 NIPSCO Industries, Inc..................................................... 84,000
3,000 Southern Co................................................................ 83,063
---------------
........................................................................ 402,813
---------------
TOTAL COMMON STOCKS (COST $4,341,672) ..................................... $ 5,022,553
---------------
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Shares Fixed Income -- 33.8% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
300,000 U.S. Treasury Note, 6.375%, 7/15/99....................................... $ 302,813
300,000 U.S. Treasury Note, 5.875%, 11/15/99....................................... 301,219
250,000 Federal National Mortgage Association, 5.620%, 3/15/01.................... 249,759
250,000 U.S. Treasury Note, 6.125%, 12/31/01....................................... 253,594
300,000 EI Dupont De Nemours, 6.500%, 9/01/02...................................... 304,857
300,000 Countrywide Credit Industries, Inc., 6.280%, 1/15/03....................... 297,644
300,000 Federal National Mortgage Association, 5.250%, 1/15/03.................... 292,850
250,000 Hilton Hotels Corp., 7.000%, 7/15/04....................................... 248,222
300,000 U.S. Treasury Note, 6.500%, 10/15/06....................................... 314,625
250,000 Federal National Mortgage Association, 7.500%, 2/02/07.................... 255,377
---------------
TOTAL FIXED INCOME (COST $2,815,529) ...................................... $ 2,820,960
---------------
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Face Value MONEY MARKET AND EQUIVALENTS-- 5.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
402,000 KZH ING PP, CP 4/02/98.................................................... $ 401,937
32,347 Star Treasury Fund......................................................... 32,347
---------------
TOTAL MONEY MARKET AND EQUIVALENTS (COST $434,284) ........................ $ 434,284
---------------
TOTAL INVESTMENTS AT VALUE-- 99.2% (COST $7,591,485) ...................... $ 8,277,797
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.8% .............................. 68,763
---------------
NET ASSETS-- 100.0% ....................................................... $ 8,346,560
===============
(a) Non-income producing security.
ADR - American Depository Receipt
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL VALUE FUND
PORTFOLIO OF INVESTMENTS
MARCH 31, 1998
====================================================================================================================================
Shares COMMON STOCKS -- 99.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Argentina -- 0.6%
1,240 Perez Compac SA............................................................ $ 8,395
---------------
Australia -- 3.4%
750 Brambles Industries Limited................................................ 15,642
1,280 Commonwealth Bank of Australia............................................. 15,247
14,500 Pasminco Limited .......................................................... 15,866
---------------
46,755
---------------
Belgium -- 1.9%
48 Kredietbank NV............................................................. 25,793
---------------
Brazil -- 3.3%
350,000 Telecomunicacoes Brazileiras SA............................................ 45,434
---------------
Canada -- 7.0%
1,560 BCE, Inc................................................................... 65,268
420 BCE Mobile Communications Inc.(a) ......................................... 12,537
1,010 National Bank of Canada.................................................... 18,891
---------------
96,696
---------------
Denmark -- 1.0%
300 ISS International Service System A/S(a) ................................... 14,341
---------------
Finland -- 0.8%
245 Pohjola Insurance Group.................................................... 11,350
---------------
France -- 11.4%
370 AGF (Assurances Generales de France)....................................... 20,824
116 Axa-UAP.................................................................... 11,945
45 Carrefour SA............................................................... 26,510
140 Elf Aquitaine SA........................................................... 18,348
40 L'OREAL.................................................................... 18,593
120 Leon de Bruxelles(a) ...................................................... 12,493
244 Sanofi SA.................................................................. 28,001
390 Transiciel SA(a) .......................................................... 21,087
---------------
157,801
---------------
Germany -- 6.8%
130 Axa Colonia Konzern AG..................................................... 15,851
170 Deutsche Bank AG........................................................... 12,745
160 Dis Deutscher Industrie Service AG(a) ..................................... 9,647
25 Karstadt AG................................................................ 9,733
26 Mannesmann AG ............................................................. 19,036
50 Philipp Holzmann AG(a) .................................................... 11,626
280 RWE AG..................................................................... 15,103
---------------
93,741
---------------
Greece -- 1.0%
610 Goody's SA................................................................. 14,498
---------------
<PAGE>
INTERNATIONAL VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 99.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
Hong Kong -- 3.4%
1,000 Cheung Kong (Holdings) Ltd................................................. $ 7,098
5,000 Cheung Kong Infrastructure Holdings........................................ 14,907
2,000 Hutchison Whampoa Ltd...................................................... 14,068
2,000 Shanghai Industrial Holdings Ltd........................................... 8,183
10,000 Zhehuang Expressway Co. Ltd.(a) ........................................... 2,530
---------------
46,786
---------------
Italy -- 3.7%
1,290 Istituto Bancario San Paolo di Torino ..................................... 18,081
4,260 Telecom Italia SPA......................................................... 33,571
---------------
51,652
---------------
Japan -- 8.3%
300 Acom Company, Ltd.......................................................... 14,961
600 Aiwa Co., Ltd.............................................................. 16,828
2,000 Dai-Ichi Kangyo Bank Ltd................................................... 14,548
1,000 Fuji Photo Film............................................................ 37,195
4,000 Sakura Bank Ltd............................................................ 14,188
200 Sony Corporation........................................................... 16,948
---------------
114,668
---------------
Netherlands -- 3.9%
620 ABN AMRO Holding NV........................................................ 14,305
2,700 AND International Publishers Plc(a) ....................................... 14,376
478 Koninklijke PTT Nederland NV............................................... 24,764
---------------
53,445
---------------
Norway -- 1.1%
3,600 Christiania Bank Og Kreditkasse............................................ 15,299
---------------
Portugual -- 0.9%
250 Portugal Telecom SA........................................................ 13,004
---------------
Singapore -- 1.2%
3,000 Oversea-Chinese Banking Corporation Ltd.................................... 16,905
---------------
Spain -- 3.0%
60 Grupo Acciona SA........................................................... 12,076
655 Telefonica de Espana ...................................................... 28,868
---------------
40,944
---------------
Sweden -- 9.8%
950 Astra AB - Class A......................................................... 19,608
1,770 Investment AB Bure......................................................... 26,790
1,800 Nordbanken Holding AB...................................................... 11,934
330 Pharmacia & Upjohn, Inc.................................................... 14,241
210 Skandia Forsakrings AB..................................................... 13,686
286 Svenska Handelsbanken...................................................... 13,237
490 Telefonaktiebolaget LM Ericsson............................................ 23,292
380 Volvo AB................................................................... 12,097
---------------
134,885
---------------
<PAGE>
INTERNATIONAL VALUE FUND (continued)
====================================================================================================================================
Shares COMMON STOCKS -- 99.2% Value
- ------------------------------------------------------------------------------------------------------------------------------------
Switzerland -- 4.0%
17 Novartis .................................................................. $ 30,086
9 Swiss Life................................................................. 7,610
11 UBS - Union Bank of Switzerland............................................ 17,967
---------------
55,663
---------------
United Kingdom -- 20.6%
2,340 B.A.T. Industries Plc...................................................... 23,511
600 Bank of Scotland........................................................... 7,013
400 Barclays Plc............................................................... 11,970
470 British Aerospace Plc...................................................... 15,466
870 British Energy Plc......................................................... 7,645
1,800 British Telecommunications Plc............................................. 19,563
540 Commercial Union Plc....................................................... 10,517
850 Compass Group Plc.......................................................... 14,476
1,420 Energis Plc(a) ............................................................ 13,376
260 Glaxo Wellcome Plc......................................................... 6,905
1,500 Imperial Tobacco Group Plc................................................. 11,040
300 National Westminster Bank Plc.............................................. 5,491
580 Railtrack Group Plc........................................................ 9,538
960 Reed International Plc..................................................... 9,710
600 Royal & Sun Alliance Insurance Group Plc................................... 7,601
1,080 Royal Bank of Scotland Group Plc........................................... 16,738
1,320 ScottishPower Plc.......................................................... 12,390
20,910 Scudder Latin America Investment Trust Plc ................................ 37,905
800 SmithKline Beecham Plc..................................................... 10,021
525 Smiths Industries Plc...................................................... 7,649
1,640 Unilever Plc............................................................... 15,421
1,115 Vodafone Group Plc(a) ..................................................... 11,623
---------------
285,569
---------------
Closed-end Foreign Funds -- 2.1%
84 Societe Generale Baltic Republics Fund(a) ................................. 18,582
120 Ukraine Fund Ltd.(a) ...................................................... 10,020
---------------
28,602
---------------
TOTAL INVESTMENTS AT VALUE-- 99.2% (COST $1,226,254) ...................... $ 1,372,226
---------------
OTHER ASSETS IN EXCESS OF LIABILITIES-- 0.8% .............................. 10,919
---------------
NET ASSETS-- 100.0% ....................................................... $ 1,383,145
---------------
(a) Non-income producing security.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 1998
====================================================================================================================================
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments in securities:
At acquisition cost......................... $ 6,757,873 $ 17,741,776 $ 7,591,485 $ 1,226,254
============ ============== ============= =============
At value (Note 2)........................... $ 7,836,724 $ 20,428,193 $ 8,277,797 $ 1,372,226
Cash .......................................... -- -- -- 101,067
Cash denominated in foreign currencies
(at cost $42,783) -- -- -- 42,400
Net unrealized appreciation on forward foreign currency
exchange contracts (Note 6)................. -- -- -- 5,347
Dividends and interest receivable.............. 8,098 29,479 45,452 1,654
Receivable for securities sold................. -- 431,581 -- 21,572
Receivable for capital shares sold............. 9,475 52,079 21,384 1,983
Receivable from Adviser (Note 4)............... 3,136 -- 1,946 3,317
Organization expenses, net (Note 2)............ 12,880 12,880 12,880 --
Other assets................................... 8,166 16,428 8,335 15,756
------------ -------------- ------------- -------------
TOTAL ASSETS ............................... 7,878,479 20,970,640 8,367,794 1,565,322
------------ -------------- ------------- -------------
LIABILITIES
Dividends payable.............................. 298 -- 2,681 --
Payable for securities purchased............... -- -- -- 157,467
Payable for capital shares redeemed............ 59,962 111,187 1,975 --
Payable to affiliates (Note 4)................. 6,400 19,518 6,400 6,400
Other liabilities.............................. 5,775 10,345 10,178 18,310
------------ -------------- ------------- -------------
TOTAL LIABILITIES .......................... 72,435 141,050 21,234 182,177
------------ -------------- ------------- -------------
NET ASSETS .................................... $ 7,806,044 $ 20,829,590 $ 8,346,560 $ 1,383,145
============ ============== ============= =============
Net assets consist of:
Paid-in capital................................ $ 6,621,536 $ 17,338,540 $ 7,452,425 $ 1,215,110
Undistributed net investment income............ -- 13,908 -- --
Accumulated net realized gains from security
transactions................................ 105,657 790,725 207,823 15,487
Net unrealized appreciation on investments..... 1,078,851 2,686,417 686,312 145,972
Net unrealized appreciation on translation of assets and
liabilities in foreign currencies........... -- -- -- 6,576
------------ -------------- ------------- -------------
Net assets..................................... $ 7,806,044 $ 20,829,590 $ 8,346,560 $ 1,383,145
============ ============== ============= =============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 1998 (continued)
====================================================================================================================================
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRICING OF CLASS A SHARES
Net assets applicable to Class A shares........ $ 7,669,807 $ 19,437,554 $ 7,262,670 $ 1,295,896
============ ============== ============= =============
Shares of beneficial interest outstanding (unlimited
number of shares authorized, no par value).. 628,288 1,514,344 629,043 110,223
============ ============== ============= =============
Net asset value and redemption price per share
(Note 2) $ 12.21 $ 12.84 $ 11.55 $ 11.76
============ ============== ============= =============
Maximum offering price per share (Note 2)...... $ 12.89 $ 13.55 $ 12.19 $ 12.41
============ ============== ============= =============
PRICING OF CLASS C SHARES
Net assets applicable to Class C shares........ $ 136,237 $ 1,392,036 $ 1,083,890 $ 87,249
============ ============== ============= =============
Shares of beneficial interest outstanding (unlimited
number of shares authorized, no par value).. 11,205 108,873 94,079 7,443
============ ============== ============= =============
Net asset value, offering price and redemption price
per share (Note 2).......................... $ 12.16 $ 12.79 $ 11.52 $ 11.72
============ ============== ============= =============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended March 31, 1998(A)
====================================================================================================================================
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Dividends (net of foreign withholding taxes of
$628 for the International Value Fund)...... $ 102,964 $ 257,025 $ 57,385 $ 2,729
Interest.................................... 10,462 24,945 155,346 --
------------ -------------- ------------- -------------
TOTAL INVESTMENT INCOME .................. 113,426 281,970 212,731 2,729
------------ -------------- ------------- -------------
EXPENSES
Investment advisory fees (Note 4)........... 52,709 127,902 57,457 4,452
Registration fees - Common.................. 6,730 9,443 6,944 12,782
Registration fees - Class A................. 11,063 11,960 11,098 6
Registration fees - Class C................. 11,113 11,113 11,096 6
Accounting services fees (Note 4)........... 27,000 27,000 27,000 15,000
Shareholder services and transfer agent fees -
Class A (Note 4).......................... 10,800 10,800 10,800 6,000
Class C (Note 4).......................... 9,600 9,600 9,600 6,000
Distribution expenses - Class A (Note 4).... -- 5,533 -- --
Administration fees (Note 4)................ 9,000 12,639 9,000 5,000
Custodian fees.............................. 4,373 12,424 4,548 9,800
Postage and supplies........................ 5,983 14,442 5,432 1,028
Trustees' fees and expenses................. 5,763 5,763 5,763 2,752
Insurance expense........................... 3,758 3,758 3,758 --
Reports to shareholders..................... 1,900 4,497 1,863 --
Amortization of organization expenses (Note 2) 2,892 2,892 2,892 --
Other expenses.............................. 2,151 4,325 2,544 3,916
------------ -------------- ------------- -------------
TOTAL EXPENSES ........................... 164,835 274,091 169,795 66,742
Fees waived and common expenses
reimbursed by Adviser (Note 4)............ ( 46,607) ( 17,445) ( 44,231 ) ( 53,501 )
Class C expenses reimbursed by Adviser (Note 4) ( 20,468) ( 16,684) ( 16,291 ) ( 5,663 )
------------ -------------- ------------- -------------
NET EXPENSES ............................. 97,760 239,962 109,273 7,578
------------ -------------- ------------- -------------
NET INVESTMENT INCOME (LOSS) .................. 15,666 42,008 103,458 ( 4,849 )
------------ -------------- ------------- -------------
REALIZED AND UNREALIZED GAINS (LOSSES) Net realized gains (losses) from: (Note
5)
Security transactions..................... 199,457 1,496,720 263,495 21,655
Foreign currency transactions............. -- -- -- ( 1,319 )
Net change in unrealized appreciation on: (Note 5)
Investments............................... 1,078,851 2,686,417 686,312 145,972
Translation of assets and liabilities in
foreign currencies -- -- -- 6,576
------------ -------------- ------------- -------------
NET REALIZED AND UNREALIZED GAINS ON
INVESTMENTS AND FOREIGN CURRENCIES ......... 1,278,308 4,183,137 949,807 172,884
------------ -------------- ------------- -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS ................................. $ 1,293,974 $ 4,225,145 $ 1,053,265 $ 168,035
============ ============== ============= =============
(A)Except for the International Value Fund which represents the period from
October 13, 1997 to March 31, 1998.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
For the Year Ended March 31, 1998(A)
====================================================================================================================================
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment income (loss)................ $ 15,666 $ 42,008 $ 103,458 $ ( 4,849 )
Net realized gains from security transactions 199,457 1,496,720 263,495 21,655
Net realized losses from foreign currency
transactions -- -- -- ( 1,319 )
Net change in unrealized appreciation on
investments 1,078,851 2,686,417 686,312 145,972
Net change in unrealized appreciation on
translation of assets and liabilities in
foreign currencies -- -- -- 6,576
------------ -------------- ------------- -------------
Net increase in net assets from operations..... 1,293,974 4,225,145 1,053,265 168,035
------------ -------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income, Class A......... ( 15,639) ( 27,790) ( 96,636 ) --
From net investment income, Class C......... ( 27) ( 310) ( 6,822 ) --
From net realized gains, Class A............ ( 93,134) ( 679,224) ( 50,850 ) --
From net realized gains, Class C............ ( 666) ( 26,771) ( 4,822 ) --
------------ -------------- ------------- -------------
Decrease in net assets from distributions
to shareholders............................. ( 109,466) ( 734,095) ( 159,130 ) --
------------ -------------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS:
CLASS A
Proceeds from shares sold................... 7,408,080 16,889,610 7,467,827 1,135,513
Net asset value of shares issued in
reinvestment of distributions to shareholders 100,180 609,751 142,246 --
Payments for shares redeemed................ ( 1,043,356) ( 1,485,185) ( 1,219,159 ) ( 308 )
------------ -------------- ------------- -------------
Net increase in net assets from Class A
share transactions.......................... 6,464,904 16,014,176 6,390,914 1,135,205
------------ -------------- ------------- -------------
CLASS C
Proceeds from shares sold................... 125,961 1,324,235 1,017,191 79,905
Net asset value of shares issued in
reinvestment of distributions to shareholders 690 26,186 11,331 --
Payments for shares redeemed................ ( 4,019) ( 59,057) ( 11 ) --
------------ -------------- ------------- -------------
Net increase in net assets from Class C
share transactions.......................... 122,632 1,291,364 1,028,511 79,905
------------ -------------- ------------- -------------
Net increase in net assets from capital share
transactions 6,587,536 17,305,540 7,419,425 1,215,110
------------ -------------- ------------- -------------
TOTAL INCREASE IN NET ASSETS .................. 7,772,044 20,796,590 8,313,560 1,383,145
NET ASSETS:
Beginning of year (Note 1).................. 34,000 33,000 33,000 --
------------ -------------- ------------- -------------
End of year................................. $ 7,806,044 $ 20,829,590 $ 8,346,560 $ 1,383,145
============ ============== ============= =============
UNDISTRIBUTED NET INVESTMENT INCOME ........... $ -- $ 13,908 $ -- $ --
============ ============== ============= =============
(A)Except for the International Value Fund which represents the period from
October 13, 1997 to March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
For the Year Ended March 31, 1998 (continued)(A)
====================================================================================================================================
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
- ------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE ACTIVITY:
CLASS A
Shares sold................................. 711,149 1,585,565 725,255 110,251
Shares issued in reinvestment of distributions
to shareholders........................... 9,315 53,022 13,140 --
Shares redeemed............................. ( 95,576) ( 127,543) ( 112,652 ) ( 28 )
------------ -------------- ------------- -------------
Net increase in shares outstanding.......... 624,888 1,511,044 625,743 110,223
Shares outstanding, beginning of year....... 3,400 3,300 3,300 --
------------ -------------- ------------- -------------
Shares outstanding, end of year............. 628,288 1,514,344 629,043 110,223
============ ============== ============= =============
CLASS C
Shares sold................................. 11,518 111,598 93,039 7,443
Shares issued in reinvestment of distributions
to shareholders........................... 64 2,283 1,041 --
Shares redeemed............................. ( 377) ( 5,008) ( 1 ) --
------------ -------------- ------------- -------------
Net increase in shares outstanding.......... 11,205 108,873 94,079 7,443
Shares outstanding, beginning of year....... -- -- -- --
------------ -------------- ------------- -------------
Shares outstanding, end of year............. 11,205 108,873 94,079 7,443
============ ============== ============= =============
(A)Except for the International Value Fund which represents the period from
October 13, 1997 to March 31, 1998.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout the Period
From Initial Public Offering of Shares(A) through March 31, 1998
====================================================================================================================================
Large Cap Value Fund Small Cap Value Fund
Class A Class C Class A Class C
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period......... $ 10.00 $ 10.76 $ 10.00 $ 10.95
------------ -------------- ------------- -------------
Income from investment operations:
Net investment income (loss)................ 0.03 ( 0.01) 0.03 ( 0.02 )
Net realized and unrealized gains
on investments............................ 2.36 1.56 3.30 2.33
------------ -------------- ------------- -------------
Total from investment operations............... 2.39 1.55 3.33 2.31
------------ -------------- ------------- -------------
Less distributions:
From net investment income.................. ( 0.03) ( 0.00) ( 0.02 ) ( 0.00 )
From net realized gains..................... ( 0.15) ( 0.15) ( 0.47 ) ( 0.47 )
------------ -------------- ------------- -------------
Total distributions............................ ( 0.18) ( 0.15) ( 0.49 ) ( 0.47 )
------------ -------------- ------------- -------------
Net asset value at end of period............... $ 12.21 $ 12.16 $ 12.84 $ 12.79
============ ============== ============= =============
Total return(B) ............................... 24.11% 14.63% 33.86% 21.63%
============ ============== ============= =============
Net assets at end of period.................... $ 7,669,807 $ 136,237 $19,437,554 $ 1,392,036
============ ============== ============= =============
Ratio of expenses to average net assets:(C)
Before waiver of fees by Adviser............ 2.72% 52.73% 1.98% 6.41%
After waiver of fees by Adviser............. 1.84% 2.59% 1.84% 2.59%
Ratio of net investment income (loss)
to average net assets(C) ................... 0.30% ( 0.55%) 0.35% ( 0.42%)
Portfolio turnover rate(C)..................... 54% 54% 62% 62%
Average commission rate per share.............. $ 0.0600 $ 0.0600 $ 0.0589 $ 0.0589
(A) Initial public offering date............... 5-28-97 8-19-97 5-28-97 8-1-97
(B) Total returns shown exclude the effect of applicable sales loads and are not
annualized.
(C) Annualized.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DEAN FAMILY OF FUNDS
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout the Period
From Initial Public Offering of Shares(A) through March 31, 1998
====================================================================================================================================
Balanced Fund International Value Fund
Class A Class C Class A Class C
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period......... $ 10.00 $ 10.71 $ 10.00 $ 9.89
------------ -------------- ------------- -------------
Income from investment operations:
Net investment income (loss)................ 0.17 0.07 ( 0.05 ) ( 0.04 )
Net realized and unrealized gains
on investments and foreign currency....... 1.62 0.92 1.81 1.87
------------ -------------- ------------- -------------
Total from investment operations............... 1.79 0.99 1.76 1.83
------------ -------------- ------------- -------------
Less distributions:
From net investment income.................. ( 0.16) ( 0.10) -- --
From net realized gains..................... ( 0.08) ( 0.08) -- --
------------ -------------- ------------- -------------
Total distributions........................... ( 0.24) ( 0.18) -- --
------------ -------------- ------------- -------------
Net asset value at end of period............... $ 11.55 $ 11.52 $ 11.76 $ 11.72
============ ============== ============= =============
Total return(B) ............................... 18.07% 9.37% 17.60% 18.50%
============ ============== ============= =============
Net assets at end of period.................... $ 7,262,670 $ 1,083,890 $ 1,295,896 $ 87,249
============ ============== ============= =============
Ratio of expenses to average net assets:(C)
Before waiver of fees by Adviser............ 2.60% 7.39% 16.66% 58.89%
After waiver of fees by Adviser............. 1.84% 2.59% 2.04% 2.82%
Ratio of net investment income (loss)
to average net assets(C) ................... 1.85% 0.99% ( 1.30% ) ( 1.94%)
Portfolio turnover rate(C) .................... 64% 64% 109% 109%
Average commission rate per share.............. $ 0.0600 $ 0.0600 $ 0.0368 $ 0.0368
(A) Initial public offering date............... 5-28-97 8-1-97 10-13-97 11-6-97
(B) Total returns shown exclude the effect of applicable sales loads and are not
annualized.
(C) Annualized.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
DEAN FAMILY OF FUNDS
NOTES TO FINANCIAL STATEMENTS
March 31, 1998
================================================================================
1. Organization
The Dean Family of Funds (the Trust) is registered under the Investment Company
Act of 1940, as amended (the 1940 Act), as an open-end management investment
company. The Trust was organized as an Ohio business trust under a Declaration
of Trust dated December 18, 1996. The Trust has established four fund series,
the Large Cap Value Fund, the Small Cap Value Fund, the Balanced Fund, and the
International Value Fund (the Funds). The Trust was capitalized on March 17,
1997, when the initial shares of each Fund (except for the International Value
Fund) were purchased at $10.00 per share. The initial public offering of shares
of the International Value Fund commenced on October 13, 1997. The Trust had no
operations prior to the public offering of shares except for the initial
issuance of shares.
The Large Cap Value Fund seeks to provide growth of capital over the long-term
by investing primarily in the common stocks of large companies.
The Small Cap Value Fund seeks to provide capital appreciation by investing
primarily in the common stocks of small companies.
The Balanced Fund seeks to preserve capital while producing a high total return
by allocating its assets among equity securities, fixed-income securities and
money market instruments.
The International Value Fund seeks to provide long-term capital growth by
investing primarily in the common stocks of foreign companies.
The Funds each offer two classes of shares: Class A shares (sold subject to a
maximum front-end sales load of 5.25% and a distribution fee of up to 0.25% of
the average daily net assets) and Class C shares (sold subject to a maximum
contingent deferred sales load of 1% if redeemed within a one-year period from
purchase and a distribution fee of up to 1% of average daily net assets). Each
Class A and Class C share of a Fund represents identical interests in the Fund's
investment portfolio and has the same rights, except that (i) Class C shares
bear the expenses of higher distribution fees, which is expected to cause Class
C shares to have a higher expense ratio and to pay lower dividends than Class A
shares; (ii) certain other class specific expenses will be borne solely by the
class to which such expenses are attributable; and (iii) each class has
exclusive voting rights with respect to matters relating to its own distribution
arrangements.
2. Significant Accounting Policies
The following is a summary of the Trust's significant accounting policies:
Security valuation -- The Funds' portfolio securities are valued as of the close
of business of the regular session of trading on the New York Stock Exchange
(currently 4:00 p.m., Eastern time). Securities traded on a national stock
exchange or quoted by NASDAQ are valued based upon the closing price on the
principal exchange where the security is traded, or, if not traded on a
particular day, at the closing bid price. U.S. Government obligations are valued
at their most recent bid prices as obtained from one or more of the major market
makers for such securities. With respect to the International Value Fund, the
U.S. dollar value of foreign securities and forward foreign currency exchange
contracts is determined using spot and forward currency exchange rates,
respectively, supplied by a quotation service.
Share valuation -- The net asset value per share of each class of shares of each
Fund is calculated daily by dividing the total value of a Fund's assets
attributable to that class, less liabilities attributable to that class, by the
number of shares of that class outstanding. The maximum offering price of Class
A shares of each Fund is equal to the net asset value per share plus a sales
load equal to 5.54% of the net asset value (or 5.25% of the offering price). The
offering price of Class C shares of each Fund is equal to the net asset value
per share.
The redemption price per share of Class A shares and Class C shares of each Fund
is equal to net asset value per share. However, Class C shares of each Fund are
subject to a contingent deferred sales load of 1% of the original purchase price
if redeemed within a one-year period from the date of purchase.
<PAGE>
Investment income -- Dividend income is recorded on the ex-dividend date.
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.
Distributions to shareholders -- The Large Cap Value Fund, the Balanced Fund and
the International Value Fund each expects to distribute substantially all of its
net investment income, if any, on a quarterly basis. The Small Cap Value Fund
expects to distribute substantially all of its net investment income, if any, on
an annual basis. Each Fund expects to distribute any net realized long-term
capital gains at least once each year. Management will determine the timing and
frequency of the distributions of any net realized short-term capital gains.
Organization expenses -- Expenses of organization have been capitalized and are
being amortized on a straight-line basis over five years. In the event any of
the initial shares of a Fund are redeemed during the amortization period, the
redemption proceeds will be reduced by a pro rata portion of any unamortized
organization expenses in the same proportion as the number of initial shares
being redeemed bears to the number of initial shares of the Fund outstanding at
the time of the redemption.
Security transactions -- Security transactions are accounted for on the trade
date. Securities sold are valued on a specific identification basis.
Estimates -- The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is each 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 a Fund so qualifies
and distributes at least 90% of its taxable net income, the Fund (but 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 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.
<TABLE>
<CAPTION>
The following information is based upon the federal income tax cost of portfolio
investments as of March 31, 1998:
- ------------------------------------------------------------------------------------------------------------------------------------
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Equity Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Gross unrealized appreciation.................. $ 1,193,332 $ 3,215,867 $ 829,199 $ 161,973
Gross unrealized depreciation.................. ( 114,481) ( 529,450) ( 142,887 ) ( 16,001 )
------------ -------------- ------------- -------------
Net unrealized appreciation.................... $ 1,078,851 $ 2,686,417 $ 686,312 $ 145,972
============ ============== ============= =============
- ------------------------------------------------------------------------------------------------------------------------------------
The Federal income tax cost of portfolio investments is equal to book cost as
shown on the statement of assets and liabilities.
</TABLE>
3. Investment Transactions
For the period ended March 31, 1998, purchases and proceeds from sales of
portfolio securities, other than short-term investments, amounted to $9,392,502
and $2,873,183, respectively, for the Large Cap Value Fund, $24,425,156 and
$8,251,829, respectively, for the Small Cap Value Fund, $10,371,359 and
$3,477,375, respectively, for the Balanced Fund and $1,607,781 and $403,182 for
the International Value Fund.
4. Transactions with Affiliates
Certain trustees and officers of the Trust are also officers of C.H. Dean &
Associates, Inc. (the Adviser) or of Countrywide Fund Services, Inc. (CFS),
the administrative services agent, shareholder servicing and transfer agent, and
accounting services agent for the Trust.
<PAGE>
INVESTMENT ADVISORY AND SUB-ADVISORY AGREEMENT
The Funds' investments are managed by the Adviser pursuant to the terms of an
Advisory Agreement. Each Fund pays the Adviser an investment management fee,
computed and accrued daily and paid monthly, at an annual rate of 1.00% of its
average daily net assets for the Large Cap Value Fund, Small Cap Value Fund and
Balanced Fund and 1.25% of its average daily net assets for the International
Value Fund.
Newton Capital Management Ltd. (Newton Capital) has been retained by the Adviser
to manage the investments of the International Value Fund. The Adviser (not the
Fund) pays Newton Capital a fee for its services equal to the rate of 0.50% of
its average value of the Fund's daily net assets.
In order to voluntarily reduce operating expenses during the year ended March
31, 1998, the Adviser waived $46,607 of its advisory fees and reimbursed $20,468
of Class C expenses for the Large Cap Value Fund; waived $17,445 of its advisory
fees and reimbursed $16,684 of Class C expenses for the Small Cap Value Fund;
waived $44,231 of its advisory fees and reimbursed $16,291 of Class C expenses
for the Balanced Fund; and waived its entire advisory fee of $4,452 and
reimbursed $49,049 of common expenses and $5,663 of Class C expenses for the
International Value Fund.
ADMINISTRATION AGREEMENT
Under the terms of an Administration Agreement, CFS supplies non-investment
related administrative and compliance services for the Funds. CFS supervises the
preparation of tax returns, reports to shareholders, reports to and filings with
the Securities and Exchange Commission and state securities commissions, and
materials for meetings of the Board of Trustees. For these services, CFS
receives a monthly fee from each Fund at an annual rate of 0.10% on its average
daily net assets up to $100 million; 0.075% on the next $100 million of such net
assets; and 0.05% on such net assets in excess of $200 million, subject to a
$1,000 minimum monthly fee.
TRANSFER AGENT AND SHAREHOLDER SERVICING AGREEMENT
Under the terms of a Transfer, Dividend, Shareholder Service and Plan Agency
Agreement, CFS maintains the records of each shareholder's account, answers
shareholders' inquiries concerning their accounts, processes purchases and
redemptions of the Funds shares, acts as dividend and distribution disbursing
agent and performs other shareholder service functions. For these services, CFS
receives a monthly fee based on the number of shareholder accounts in each class
of each Fund, subject to a $1,200 minimum monthly fee for each class of shares
of a Fund. In addition, each Fund pays out-of-pocket expenses, including but not
limited to, postage and supplies.
ACCOUNTING SERVICES AGREEMENT
Under the terms of an Accounting Services Agreement, CFS calculates the daily
net asset value per share and maintains the financial books and records of the
Funds. For these services, CFS receives a monthly fee of $3,000 from each Fund.
In addition, each Fund pays certain out-of-pocket expenses incurred by CFS in
obtaining valuations of such Fund's portfolio securities.
UNDERWRITING AGREEMENT
2480 Securities LLC (Underwriter), an affiliate of the Adviser, serves as
principal underwriter for the Funds and, as such, is the exclusive agent for the
distribution of shares of the Funds. Under the terms of the Underwriting
Agreement between the Trust and the Underwriter, the Underwriter earned $1,840,
$10,480, $2,068 and $856 from underwriting and broker commissions on the sale of
shares of the Large Cap Value Fund, Small Cap Value Fund, Balanced Fund, and
International Value Fund, respectively, during the period ended March 31, 1998.
PLANS OF DISTRIBUTION
The Trust has a Plan of Distribution (Class A Plan) under which Class A shares
may directly incur or reimburse the Adviser for expenses related to the
distribution and promotion of shares. The annual limitation for payment of such
expenses under the Class A Plan is 0.25% of average daily net assets
attributable to such shares.
The Trust also has a Plan of Distribution (Class C Plan) which provides for two
categories of payments. First, the Class C Plan provides for the payment to the
Underwriter of an account maintenance fee, in an amount equal to an annual rate
of 0.25% of a Fund's average daily net assets allocable to Class C shares. In
addition, the Class C shares may directly incur or reimburse the Underwriter in
an amount not to exceed 0.75% per annum of a Fund's average daily net assets
allocable to Class C shares for certain distribution-related expenses incurred
in the distribution and promotion of the Fund's Class C shares.
<PAGE>
5. Foreign Currency Translation
With respect to the International Value Fund, amounts denominated in or expected
to settle in foreign currencies are translated into U.S. dollars based on
exchange rates on the following basis:
A. The market values of investment securities and other assets and liabilities
are translated at the closing rate of exchange each day.
B. Purchases and sales of investment securities and income and expenses are
translated at the rate of exchange prevailing on the respective dates of
such transactions.
C. The Fund does not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from those
resulting from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gains or
losses from investments. Reported net realized foreign exchange gains or
losses arise from 1) sales of foreign currencies, 2) currency gains or
losses realized between the trade and settlement dates on securities
transactions, and 3) the difference between the amounts of dividends,
interest, and foreign withholding taxes recorded on the Fund's books, and
the U.S. dollar equivalent of the amounts actually received or paid.
Reported net unrealized foreign exchange gains or losses arise from changes
in the value of assets and liabilities, other than investments, resulting
from changes in exchange rates.
6. Forward Foreign Currency Exchange Contracts
The International Value Fund enters into foreign currency exchange contracts as
a way of managing foreign exchange rate risk. The Fund may enter into these
contracts for the purchase or sale of a specific foreign currency at a fixed
price on a future date as a hedge or cross-hedge against either specific
transactions or portfolio positions. The objective of the Fund's foreign
currency hedging transactions is to reduce the risk that the U.S. dollar value
of the Fund's securities denominated in foreign currency will decline in value
due to changes in foreign currency exchange rates. All foreign currency exchange
contracts are "marked-to-market" daily at the applicable translation rates
resulting in unrealized gains or losses. Realized and unrealized gains or losses
are included in the Fund's Statement of Assets and Liabilities and Statement of
Operations. Risks may arise upon entering into these contracts from the
potential inability of counterparties to meet the terms of their contracts and
from unanticipated movements in the value of a foreign currency relative to the
U.S. dollar.
<TABLE>
<CAPTION>
As of March 31, 1998, the International Value Fund had forward foreign currency
exchange contracts outstanding as follows:
- ------------------------------------------------------------------------------------------------------------------------------------
Net Unrealized
Settlement To Receive Initial Market Appreciation
Date (To Deliver) Value Value (Depreciation)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CONTRACTS TO SELL
04/02/98............................ ( 82,026 )DKK $ ( 11,651) $ ( 11,635 ) $ 16
04/15/98............................ ( 23,000 )AUD ( 15,507) ( 15,237 ) 270
05/15/98............................ ( 292,000 )FRF ( 48,402) ( 47,298 ) 1,104
05/15/98............................ ( 25,800 )GBP ( 41,979) ( 43,176 ) ( 1,197 )
05/15/98............................ ( 32,500 )NLG ( 15,873) ( 15,646 ) 227
06/15/98............................ ( 12,409,000 )JPY ( 99,842) ( 94,285 ) 5,557
07/15/98............................ ( 60,300 )CHF ( 42,791) ( 40,088 ) 2,703
08/14/98 ( 121,400 )CAD ( 84,784 ) ( 85,515 ) ( 731 )
08/14/98 ( 152,700 )HKD ( 19,420 ) ( 17,998 ) 1,422
09/15/98 ( 57,400 )DEM ( 31,707 ) ( 31,364) 343
10/15/98............................ ( 22,000 )AUD ( 14,643) ( 14,610 ) 33
03/15/99............................ ( 185,300 )HKD ( 23,329) ( 23,207 ) 122
-------------- ------------- -------------
Total sell contracts................... ( 449,928) ( 440,059 ) 9,869
-------------- ------------- -------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Net Unrealized
Settlement To Receive Initial Market Appreciation
Date (To Deliver) Value Value (Depreciation)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CONTRACTS TO BUY
04/01/98............................ 7,294 CHF $ 4,797 $ 4,784 $ (13 )
04/01/98............................ 16,370 DEM 8,882 8,852 (30 )
04/01/98............................ 1,347,871 JPY 10,223 10,108 ( 115 )
04/01/98............................ 92,136 SEK 11,575 11,525 ( 50 )
04/02/98............................ 5,521 AUD 3,666 3,661 ( 5 )
04/02/98............................ 14,787 GBP 24,898 24,762 ( 136 )
05/15/98............................ 292,000 FRF 48,926 47,299 ( 1,627 )
07/15/98............................ 60,300 CHF 42,687 40,088 ( 2,599 )
08/14/98............................ 34,300 CAD 24,189 24,161 (28 )
08/14/98 2,414 GBP 3,941 4,022 81
-------------- ------------- -------------
Total buy contracts.................... 183,784 179,262 ( 4,522 )
-------------- ------------- -------------
NET CONTRACTS ......................... $ ( 266,144) $ ( 260,797 ) $ 5,347
============== ============= =============
- ------------------------------------------------------------------------------------------------------------------------------------
AUD - Australian Dollar
GBP - British Pound Sterling
CAD - Canadian Dollar
HKD - Hong Kong Dollar
CHF - Swiss Franc
JPY - Japanese Yen
DEM - German Mark
NLG - Netherland Guilder
DKK - Danish Krone
SEK - Swedish Krona
FRF - French Franc
</TABLE>
<PAGE>
Report of Independent Auditors To the Shareholders and Board of Trustees of
Dean Family of Funds
================================================================================
================================================================================
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of Dean Family of Funds (comprising,
respectively, Large Cap Value Fund, Small Cap Value Fund, Balanced Fund, and
International Value Fund) (the Funds) as of March 31, 1998, and the related
statements of operations, statements of changes in net assets, and the financial
highlights presented herein for the periods ended March 31, 1998. These
financial statements and financial highlights are the responsibility of the
Funds' 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 and financial highlights. Our procedures included confirmation of
securities owned as of March 31, 1998, 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 audit provides 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 Dean Family of Funds
as of March 31, 1998, and the results of their operations, the changes in their
net assets, and their financial highlights presented herein for the periods
ended March 31, 1998, in conformity with generally accepted accounting
principles.
/s/ Ernst & Young LLP
Ernst & Young LLP
Cincinnati, Ohio
May 19, 1998
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 11
<NAME> LARGE CAP VALUE FUND - CLASS A
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 6,757,873
<INVESTMENTS-AT-VALUE> 7,836,724
<RECEIVABLES> 20,709
<ASSETS-OTHER> 8,166
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 7,878,479
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 72,435
<TOTAL-LIABILITIES> 72,435
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 6,621,536
<SHARES-COMMON-STOCK> 628,288
<SHARES-COMMON-PRIOR> 3,400
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 105,657
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,078,851
<NET-ASSETS> 7,669,807
<DIVIDEND-INCOME> 102,964
<INTEREST-INCOME> 10,462
<OTHER-INCOME> 0
<EXPENSES-NET> 97,760
<NET-INVESTMENT-INCOME> 15,666
<REALIZED-GAINS-CURRENT> 199,457
<APPREC-INCREASE-CURRENT> 1,078,851
<NET-CHANGE-FROM-OPS> 1,293,974
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 15,639
<DISTRIBUTIONS-OF-GAINS> 93,134
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 711,149
<NUMBER-OF-SHARES-REDEEMED> 95,576
<SHARES-REINVESTED> 9,315
<NET-CHANGE-IN-ASSETS> 7,635,807
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 52,709
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 164,835
<AVERAGE-NET-ASSETS> 6,228,097
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 2.36
<PER-SHARE-DIVIDEND> .03
<PER-SHARE-DISTRIBUTIONS> .15
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.21
<EXPENSE-RATIO> 1.84
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 13
<NAME> LARGE CAP VALUE FUND - CLASS C
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 6,757,873
<INVESTMENTS-AT-VALUE> 7,836,724
<RECEIVABLES> 20,709
<ASSETS-OTHER> 8,166
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 7,878,479
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 72,435
<TOTAL-LIABILITIES> 72,435
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 6,621,536
<SHARES-COMMON-STOCK> 11,205
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 105,657
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 1,078,851
<NET-ASSETS> 136,237
<DIVIDEND-INCOME> 102,964
<INTEREST-INCOME> 10,462
<OTHER-INCOME> 0
<EXPENSES-NET> 97,760
<NET-INVESTMENT-INCOME> 15,666
<REALIZED-GAINS-CURRENT> 199,457
<APPREC-INCREASE-CURRENT> 1,078,851
<NET-CHANGE-FROM-OPS> 1,293,974
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 27
<DISTRIBUTIONS-OF-GAINS> 666
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 11,518
<NUMBER-OF-SHARES-REDEEMED> 377
<SHARES-REINVESTED> 64
<NET-CHANGE-IN-ASSETS> 136,237
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 52,709
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 164,835
<AVERAGE-NET-ASSETS> 67,705
<PER-SHARE-NAV-BEGIN> 10.76
<PER-SHARE-NII> (.01)
<PER-SHARE-GAIN-APPREC> 1.56
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> .15
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.16
<EXPENSE-RATIO> 2.59
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 21
<NAME> SMALL CAP VALUE FUND - CLASS A
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 17,741,776
<INVESTMENTS-AT-VALUE> 20,428,193
<RECEIVABLES> 513,139
<ASSETS-OTHER> 16,428
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 20,970,640
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 141,050
<TOTAL-LIABILITIES> 141,050
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,338,540
<SHARES-COMMON-STOCK> 1,514,344
<SHARES-COMMON-PRIOR> 3,300
<ACCUMULATED-NII-CURRENT> 13,908
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 790,725
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,686,417
<NET-ASSETS> 19,437,554
<DIVIDEND-INCOME> 257,025
<INTEREST-INCOME> 24,945
<OTHER-INCOME> 0
<EXPENSES-NET> 239,962
<NET-INVESTMENT-INCOME> 42,008
<REALIZED-GAINS-CURRENT> 1,496,720
<APPREC-INCREASE-CURRENT> 2,686,417
<NET-CHANGE-FROM-OPS> 4,225,145
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 27,790
<DISTRIBUTIONS-OF-GAINS> 679,224
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,585,565
<NUMBER-OF-SHARES-REDEEMED> 127,543
<SHARES-REINVESTED> 53,022
<NET-CHANGE-IN-ASSETS> 19,404,554
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 127,902
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 274,091
<AVERAGE-NET-ASSETS> 14,716,298
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 3.30
<PER-SHARE-DIVIDEND> .02
<PER-SHARE-DISTRIBUTIONS> .47
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.84
<EXPENSE-RATIO> 1.84
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 23
<NAME> SMALL CAP VALUE FUND - CLASS C
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 17,741,776
<INVESTMENTS-AT-VALUE> 20,428,193
<RECEIVABLES> 513,139
<ASSETS-OTHER> 16,428
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 20,970,640
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 141,050
<TOTAL-LIABILITIES> 141,050
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,338,540
<SHARES-COMMON-STOCK> 108,873
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 13,908
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 790,725
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,686,417
<NET-ASSETS> 1,392,036
<DIVIDEND-INCOME> 257,025
<INTEREST-INCOME> 24,945
<OTHER-INCOME> 0
<EXPENSES-NET> 239,962
<NET-INVESTMENT-INCOME> 42,008
<REALIZED-GAINS-CURRENT> 1,496,720
<APPREC-INCREASE-CURRENT> 2,686,417
<NET-CHANGE-FROM-OPS> 4,225,145
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 310
<DISTRIBUTIONS-OF-GAINS> 26,771
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 111,598
<NUMBER-OF-SHARES-REDEEMED> 5,008
<SHARES-REINVESTED> 2,283
<NET-CHANGE-IN-ASSETS> 1,392,036
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 127,902
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 274,091
<AVERAGE-NET-ASSETS> 688,794
<PER-SHARE-NAV-BEGIN> 10.95
<PER-SHARE-NII> (.02)
<PER-SHARE-GAIN-APPREC> 2.33
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> .47
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.79
<EXPENSE-RATIO> 2.59
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 31
<NAME> BALANCED FUND - CLASS A
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 7,591,485
<INVESTMENTS-AT-VALUE> 8,277,797
<RECEIVABLES> 68,782
<ASSETS-OTHER> 8,335
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 8,367,794
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 21,234
<TOTAL-LIABILITIES> 21,234
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,452,425
<SHARES-COMMON-STOCK> 629,043
<SHARES-COMMON-PRIOR> 3,300
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 207,823
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 686,312
<NET-ASSETS> 7,262,670
<DIVIDEND-INCOME> 57,385
<INTEREST-INCOME> 155,346
<OTHER-INCOME> 0
<EXPENSES-NET> 109,273
<NET-INVESTMENT-INCOME> 103,458
<REALIZED-GAINS-CURRENT> 263,495
<APPREC-INCREASE-CURRENT> 686,312
<NET-CHANGE-FROM-OPS> 1,053,265
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 96,636
<DISTRIBUTIONS-OF-GAINS> 50,850
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 725,255
<NUMBER-OF-SHARES-REDEEMED> 112,652
<SHARES-REINVESTED> 13,140
<NET-CHANGE-IN-ASSETS> 7,229,670
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 57,457
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 169,795
<AVERAGE-NET-ASSETS> 6,375,881
<PER-SHARE-NAV-BEGIN> 10.00
<PER-SHARE-NII> .17
<PER-SHARE-GAIN-APPREC> 1.62
<PER-SHARE-DIVIDEND> .16
<PER-SHARE-DISTRIBUTIONS> .08
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.55
<EXPENSE-RATIO> 1.84
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 33
<NAME> BALANCED FUND - CLASS C
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 7,591,485
<INVESTMENTS-AT-VALUE> 8,277,797
<RECEIVABLES> 68,782
<ASSETS-OTHER> 8,335
<OTHER-ITEMS-ASSETS> 12,880
<TOTAL-ASSETS> 8,367,794
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 21,234
<TOTAL-LIABILITIES> 21,234
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 7,452,425
<SHARES-COMMON-STOCK> 94,079
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 207,823
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 686,312
<NET-ASSETS> 1,083,890
<DIVIDEND-INCOME> 57,385
<INTEREST-INCOME> 155,346
<OTHER-INCOME> 0
<EXPENSES-NET> 109,273
<NET-INVESTMENT-INCOME> 103,458
<REALIZED-GAINS-CURRENT> 263,495
<APPREC-INCREASE-CURRENT> 686,312
<NET-CHANGE-FROM-OPS> 1,053,265
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 6,822
<DISTRIBUTIONS-OF-GAINS> 4,822
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 93,039
<NUMBER-OF-SHARES-REDEEMED> 1
<SHARES-REINVESTED> 1,041
<NET-CHANGE-IN-ASSETS> 1,083,890
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 57,457
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 169,795
<AVERAGE-NET-ASSETS> 613,312
<PER-SHARE-NAV-BEGIN> 10.71
<PER-SHARE-NII> .07
<PER-SHARE-GAIN-APPREC> .92
<PER-SHARE-DIVIDEND> .10
<PER-SHARE-DISTRIBUTIONS> .08
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.52
<EXPENSE-RATIO> 2.59
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0001027624
<NAME> DEAN FAMILY OF FUNDS
<SERIES>
<NUMBER> 41
<NAME> INTERNATIONAL VALUE FUND -CLASS A
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 1,226,254
<INVESTMENTS-AT-VALUE> 1,372,226
<RECEIVABLES> 28,526
<ASSETS-OTHER> 15,756
<OTHER-ITEMS-ASSETS> 148,814
<TOTAL-ASSETS> 1,565,322
<PAYABLE-FOR-SECURITIES> 157,467
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 24,710
<TOTAL-LIABILITIES> 182,177
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1,215,110
<SHARES-COMMON-STOCK> 110,223
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 15,487
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 152,548
<NET-ASSETS> 1,295,896
<DIVIDEND-INCOME> 2,729
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 7,578
<NET-INVESTMENT-INCOME> (4,849)
<REALIZED-GAINS-CURRENT> 20,336
<APPREC-INCREASE-CURRENT> 152,548
<NET-CHANGE-FROM-OPS> 168,035
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 110,251
<NUMBER-OF-SHARES-REDEEMED> 28
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 1,295,896
<ACCUMULATED-NII-PRIOR> 0
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<TABLE> <S> <C>
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<NAME> DEAN FAMILY OF FUNDS
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<NAME> INTERNATIONAL VALUE FUND -CLASS C
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