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DEAN INVESTMENT ASSOCIATES
Dean Family of Funds
Large Cap Value Fund
Small Cap Value Fund
Balanced Fund
International Value Fund
Annual Report
March 31, 2000
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CHAIRMAN AND PRESIDENT'S LETTER
To Investors in the Dean Family of Funds
Thank you for choosing the Dean Family of Funds to help you achieve your
long-term investment objectives. We recognize that the past year has perhaps
tested your patience as the value style of investing has been out-of-favor in
the marketplace. Our portfolio managers, however, are more enthusiastic than
ever about the opportunities the market has created for shareholders to purchase
high quality, innovative, market-leading businesses at tremendous valuations. We
remain extremely confident that the investments made today in the Dean Funds
will reward our shareholders well into the future.
We invite you to read on as we outline what has happened in the markets during
the past year to create these compelling valuations and what we believe the
future has in store for financial assets. Following this letter are the
individual reports from our portfolio managers that provide invaluable insights
into the investment discipline and holdings for each of our Funds.
Market Review
The year was characterized by a strong economic expansion both domestically and
across most of the globe. However, investors and monetary policymakers grew
increasingly concerned during the year that this vigorous economic activity
would put upward pressure on prices. Indeed, although it remained at relatively
low levels, inflation did accelerate prompting the Federal Reserve to raise
interest rates on multiple occasions. As the Fed adopted a tightening bias on
the interest rate front, it simultaneously pumped up the money supply going into
the New Year due to Y2K concerns. These contradictory policies muted the effects
of their actions, and we believe may lengthen the tightening process.
Bonds, of course, posted negative returns for the year due to their inverse
relationship with interest rates. As usual, price declines were greatest for
long-term bonds and less for short-term issues. On the surface, it appeared that
the equity market applauded the strong economic picture. Masked by strong
performance in the major market averages, however, has been an amazing
divergence in stock performance. Prices soared toward the end of 1999 for most
technology-related stocks while virtually every other segment of the market
languished. Indeed, more than 60% of all stocks listed on the New York Stock
Exchange and about 50% of those listed on the NASDAQ market declined during the
year. Furthermore, about a third of the stocks on both exchanges fell by greater
than 20%. Perhaps even more surprising than this divergence was the fact that it
occurred in a rising interest rate environment, which tends to depress stock
prices, especially growth stocks, because it discounts the present value of
future earnings.
Market Outlook
The temptation for investors to chase hot performance has been more intense than
ever during the past year. More and more dollars have been chasing an
ever-narrowing list of "can't lose" stocks, which in the short-term creates a
self-fulfilling prophecy. During these volatile times we must remind ourselves
of the most important tenant of investing: Emotions drive stock prices over the
short-term - Fundamentals and Valuations drive stock prices over the long-term.
Recently, investors have been mesmerized by the prospects for growth in revenue
and profits among some technology stocks, but have chosen to ignore the actual
profits of other companies. The companies whose stocks we hold in the Dean Funds
generally have solid track records of growth and profitability. While there is
little argument that great opportunities will be born from the proliferation of
the Internet and wireless communication, the ultimate financial beneficiaries of
these technologies have yet to be decided. In fact, it appears that traditional
industries may reap many of the benefits of e-business by exploiting new
distribution channels and cost containing measures.
Although the first quarter of the new millenium began in much the same fashion
as last year ended, we have since witnessed a sharp reversal of this trend with
the broader market, and value stocks in particular, outperforming the major
averages at the time of this writing. Of course, financial markets are ever
cyclical. Stocks of all styles, sizes, and sectors rotate in and out of favor in
unpredictable fashion. That is why we recommend investors maintain well
diversified portfolios of attractively valued securities, such as those in our
Family of Funds, to provide a solid foundation for long-term investment success.
Sincerely,
/s/ /s/
Chauncey H. Dean Stephen M. Miller
Chairman of the Board and Chief Executive Officer President
C.H. Dean & Associates, Inc. Dean Family of Funds
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DEAN LARGE CAP VALUE FUND
Performance Review
For the fiscal year 2000, the Dean Large Cap Value fund posted a total return of
4.4% versus the Russell 1000 Value Index return of 6.3%. Value stocks remained
out-of-favor for most of the period as the market continued to focus on growth
at what seemed like any valuation. The Fund performed slightly below the
benchmark for the year due to its overweighted position in what has been dubbed
"old economy" stocks.
Although internet-related stocks dominated the market over the period, the Large
Cap Value Fund maintained its focus on risk management and its traditional value
discipline. While we are enthusiastic about the opportunities that new
technologies continually have to offer, we view individual stocks as the present
value of their future stream of net income. Consequently, we have favored
companies with long histories of profitability and strong cash flows.
Furthermore, we like to buy the stocks of these businesses at valuations below
that of the overall market. It is exactly these types of values that the market
has been ignoring over the past year.
Portfolio Holdings
We own stocks of companies that should benefit directly from the proliferation
of the Internet such as Intel and Hewlett-Packard. We also own companies that
should benefit indirectly from their use of the Internet. In fact, many of the
"old economy" companies should benefit from the net behind the scenes by making
their operations more efficient. Finally, we own companies that really should
not be impacted at all by the Internet. For example, Vulcan Materials, the
fund's second largest holding is far from glamorous - they are in the business
of selling crushed rock. But then consider that federal road construction in the
areas where it operates is scheduled to rise by over 50%, and a generally
healthy economy is fueling demand for commercial construction. It strikes us as
highly unlikely that anybody will displace them by selling "e-rock" over the
Internet.
Another area of concentration in the Fund is the oil service and offshore
drilling area, which occupy our first and third largest holdings. We expect that
the price of oil is likely to remain in the mid-$20s. At that level, oil
companies with have ample cash flow to explore for new oil. Big new oil fields
are more likely to be discovered in deep water than any other place. The drop in
oil prices two years ago greatly curtailed exploration activity, so there is
plenty of pent up demand to find new oil supplies. As they start to drill, these
companies are very well positioned to benefit from both rising demand and
prices.
Interest rates have been rising for almost a year now. While this has hurt the
relative performance of the financial services firms we hold, most of them are
relatively unaffected by rising rates at an operational level. Some, such as
MGIC Investment actually see their earnings increase in a rising interest rate
environment. We suspect that we are probably in the 7th inning of this round of
Fed rate increases. Our financial stocks have a very attractive combination of
growing earnings and low valuations. Our nine major financial holdings have an
average price-to-earnings ratio, based on this year's expected earnings, of only
12.0x which is less than half that of the S&P 500 despite an average expected
growth rate of 11%. This is coupled with a dividend yield that is twice that of
the S&P 500.
Outlook
Over the last few weeks, the market has begun to recognize value stocks. We will
continue to stubbornly practice our disciplined value approach, knowing that in
the end, old fashioned virtues like earnings, book value, dividends and strong
balance sheets will be rewarded.
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[GRAPH OMITTED]
Comparison of the Change in Value of a $10,000 Investment
in the Dean Large Cap Value Fund - Class A*, the Russell 1000 Index
and the Russell 1000 Value Index
from May 28, 1997 to March 31, 2000
------------------------------------
Dean Large Cap Value Fund $ 10,865
Russell 1000 $ 18,696
Russell 1000 Value $ 14,942
Average Annual Total Returns**
1 Year Since Inception*
Class A 4.38% 4.93%
Class C 1.38% 0.81%
*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 commenced on August 19, 1997.
**Total return above is presented without the effect of sales load or contigent
deferred sales charges. Had the charges been incurred, total returns would be as
follows:
1 Year Since Inception**
Class A -1.10% 2.96%
Class C 0.38% 0.81%
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DEAN SMALL CAP VALUE FUND
Performance Review
The past year was a difficult one for small cap investors with a deep value
orientation such as your fund. For the year ending March 2000, the Small Cap
Value Fund returned -0.53% and the benchmark Russell 2000 Value posted a 13.2%
return. The Fund's underperformance versus its benchmark was a result of owning
stocks with extremely low valuations. There existed an inverse relationship
during the period between valuation and performance. Even within the Russell
2000 Value benchmark, it was the most expensive stocks that posted the best
returns.
Investors have just started to pay attention to valuations, earnings, and
fundamentals. This environment bodes well for your fund because, historically, a
strategy of investing in small capitalization companies with very low prices
relative to net income, revenue, and assets has proved to be very profitable
over the long term.
Portfolio Holdings
In selecting individual securities for the Fund, we remain true to our
discipline and see many compelling opportunities in this market segment.
Incredibly, many of the fund's stocks would still be cheap at twice their price.
To give you an idea of just how inexpensive the stocks in the Fund are consider
that the average price-to-earnings ratio of the Fund is only 7.6 versus 27 for
the S&P 500 Index. The average price-to-book value ratio is only 80% vs. 657%
for the S&P 500 Index. The stocks in the fund yield 2.9% versus the S&P 500
Index, which yields only 1.2%.
For example, we own several "old economy" stocks that do not offer the sizzle of
a dot.com, but provide the substance of earnings and profitability. Namely, the
homebuilding and real estate investment trust (REIT) sectors represent over 20%
of the portfolio. These industries trade at substantial discounts to the market
yet offer compelling fundamentals and valuations.
Clearly there are sectors of the market in which we invested that have not
worked out for us yet. For example, we think that the long- term demographic
trends strongly favor the nursing home industry. However, over the short term,
changes in the way the government pays for Medicare patients have been painful
for these companies. Clearly the pain has lasted much longer and been more
severe than we anticipated. However, more and more people are entering the age
when they will need to go to nursing homes, and there is nothing that is likely
to change that fact. We fully expect these stocks to be resurrected. At current
prices they could rise several fold before they reached their former peaks.
Outlook
We are well aware that this past year has been distinctly unpleasant for
disciplined value investors. This, however, is not unprecedented. Any
disciplined and sound investment strategy will fail to produce the expected
investment results over a given short period of time. Similarly, a sound and
disciplined investment strategy will be positioned to produce very satisfying
investment results when the market environment changes as markets always do.
We remain convinced that the last few years will prove to be the anomaly, not
the previous fifty years. In our opinion, today's Small Cap Value stocks offer a
very compelling opportunity for investors. Expectations are low, valuations are
very low, and the potential for improvement is strong. Since March 2000, the
market has started to reward patient, fundamental investors who place a premium
on value. We believe that this change will become a trend and benefit the fund.
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[GRAPH OMITTED]
Comparison of the Change in Value of a $10,000 Investment
in the Dean Small Cap Value Fund - Class A*, the Russell 2000 Index
and the Russell 2000 Value Index
from May 28, 1997 to March 31, 2000
------------------------------------
Dean Small Cap Value Fund $ 9,655
Russell 2000 $ 14,651
Russell 2000 Value $ 11,539
Average Annual Total Returns**
1 Year Since Inception*
Class A -0.53% 0.67%
Class C -1.11% -3.47%
*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 commenced on August 19, 1997.
**Total return above is presented without the effect of sales load or contigent
deferred sales charges. Had the charges been incurred, total returns would be as
follows:
1 Year Since Inception**
Class A -5.85% -1.23%
Class C -2.26% -3.47%
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DEAN BALANCED FUND
Performance Review
The 1999 and early 2000 U.S. stock market has left many veteran investors
speechless and puzzled. The speed of the rise in many of the technology and
telecommunications related stocks has been as amazing as the violent fall of
most other stocks. Indeed, until around early March, most U.S. stocks had been
declining since April 1998. The popular market averages, led by the NASDAQ
Composite, have been almost exclusively driven by technology stocks.
Basic investment principles such as price-to-earning ratios and price-to-cash
flow ratios were being abandoned. Our portfolio was not an exception. Over the
last 12 months, the Fund returned -3.5 %, while the benchmark (60% Russell 1000
Value and 40% Lehman Brothers Intermediate Government/Corporate Bond Index)
posted 4.6% return. The difficult environment for our value discipline
negatively effected our equity investments while the generally rising trend in
interest rates held back the performance of the fixed income investments in the
Fund.
Portfolio Holdings
We hold stocks in businesses that are growing and are selling for attractive
valuations, providing us the opportunity to grow the invested capital with a
moderate level of investment risk. The valuations on the Fund's equity holdings
are significantly below the popular averages such as the S&P 500.
Among the largest holdings in the equity portfolio of the balanced fund is
HCA-The Health Care Company (HCA). HCA is the largest hospital management
company in the U.S. HCA has restructured its portfolio of owned and operated
hospitals by selling or spinning-off the under performing or non-core assets.
The improved fundamentals are supported by HCA achieving healthy price increases
from the managed care companies. Health care related stocks are expected to
perform well in the current volatile equity market as earnings should generally
be insulated from concerns about interest rates and other economic news.
Another one of the Balanced Fund's largest positions is Tricon Global, the
second largest fast food restaurant company in the U.S. The company operates the
Pizza Hut, Kentucky Fried Chicken, and Taco Bell chains. Since being spun-off
from Pepsi in late 1997, Tricon has met or exceeded its earnings goals and has
significantly reduced the debt level with its strong free cash flow. However,
the stock market is not currently giving full credit for the tremendous progress
made by the company as the shares sell at a very modest multiple to earnings and
cash flow.
Asset Allocation
The Fund maintained its stock exposure in the 55% to 60% range during the period
while the bond exposure remained around the 35% level with cash investments
comprising the remainder of the Fund's net assets.
Outlook
We are confident of the quality of the Fund's holdings. While we are not
satisfied with the Fund's recent performance, the market volatility and the
disfavor of value stocks in the recent past has allowed us to position the Fund
with good businesses at undervalued prices. The sharp reversal in the technology
stocks, which began in early March, actually benefited the vast majority of the
Fund's stock holdings as the investors selling tech stocks reinvested part of
the proceeds into the undervalued areas of the market. Indeed, the Fund's
holdings gained value during the brunt of the sharp decline during the
March/April period.
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[GRAPH OMITTED]
Comparison of the Change in Value of a $10,000 Investment
in the Dean Balanced Fund - Class A*, the Russell 1000 Index, the Russell 1000 Value Index
and the Lehman Brothers Intermediate Government/Corporate Bond Index
from May 28, 1997 to March 31, 2000
------------------------------------
Dean Balanced Fund $ 10,446
Russell 1000 $ 18,696
Russell 1000 Value $ 14,942
Lehman Brothers Intermediate Govt/Corp Bond Index $ 11,696
</TABLE>
Average Annual Total Returns**
1 Year Since Inception*
Class A -3.52% 3.49%
Class C -5.24% -0.12%
*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 commenced on August 19, 1997.
**Total return above is presented without the effect of sales load or contigent
deferred sales charges. Had the charges been incurred, total returns would be as
follows:
1 Year Since Inception**
Class A -8.59% 1.55%
Class C -6.17% -0.12%
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<PAGE>
DEAN INTERNATIONAL VALUE FUND
Performance Review
The Dean International Value Fund strongly outperformed both its benchmark and
its peer group over the year, returning 69.26% versus the EAFE Index that
returned 25.4% and the Morningstar International Fund average of 44.6%.
Portfolio Holdings
Low valuations and opportunities in restructuring companies prompted an
overweighting in Japan from a previous underweighted position. Cyclicals,
telecommunication, and technology sectors were particularly favored. Star
performers included Matsushita Communications, Softbank, and Fujitsu.
The UK continued to be underweighted in view of its unattractive interest rate
outlook and the overvaluation of Sterling. The Fund was also underweighted in
Continental Europe in view of these markets' valuations and growth prospects.
Throughout the year the Fund was consistently overweighted in technology and
telecommunication sectors. Financials, consumer staples, and healthcare sectors
were underweighted. This led to substantial outperformance. Some of the biggest
percentage gainers in this area were Transiciel, Ericsson and Nortel.
Emerging market exposure was increased as the Fund moved to an overweighted
position in the Latin American economies, which started to show signs of
improvement, and offered tremendous value.
The strong returns and high valuations of the technology and telecommunication
sectors provided the opportunity to reduce holdings in early 2000. Financials,
pharmaceuticals, and consumer staples were increased due to compelling
valuations. Euro weakness and the appearance of value led to renewed interest in
Continental equities.
Outlook
Market volatility has increased recently as monetary policy starts to tighten
and excessive increases in some sectors have been retraced. The more defensive
sectors continue to look favorable on depressed valuations. The Fund remains
committed to core stocks in the technology and telecommunication sectors because
of attractive valuations and strong growth prospects. We continue to be positive
on the prospects for the global economy, as central banks have begun to tighten
monetary policy to engineer a soft landing.
<PAGE>
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[GRAPH OMITTED]
Comparison of the Change in Value of a $10,000 Investment
in the Dean International Value Fund - Class A*
and the Morgan Stanley EAFE Index
from October 13, 1997 to March 31, 2000
------------------------------------
Dean International Value Fund $ 19,958
Morgan Stanley EAFE Index $ 14,121
Average Annual Total Returns**
1 Year Since Inception*
Class A 69.26% 35.27%
Class C 68.54% 36.18%
*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 August 19, 1997.
**Total return above is presented without the effect of sales load or contigent
deferred sales charges. Had the charges been incurred, total returns would be as
follows:
1 Year Since Inception**
Class A 60.37% 32.35%
Class C 67.54% 36.18%
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<PAGE>
DEAN FAMILY OF FUNDS
FUND FACTS
LARGE CAP VALUE FUND
Top Holdings
Diamond Offshore Drilling AMBAC, Inc.
Vulcan Materials Co. AT&T Corp.
Tidewater Inc. News Corporation Ltd.
Albertson's Inc. Intel Corp.
Honeywell Texaco Inc.
Number of Positions..............................46
Median Price/Earnings Ratio......................19.2
Portfolio Turnover...............................71%
SMALL CAP VALUE FUND
Top Holdings
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London Pac Group Ltd. Cameron Ashley Bldg Products
Cherry Corp. Beazer Homes USA Inc.
Genesee & Wyoming Exponet Inc.
M/I Schottenstein RFS Hotel Invs Inc.
Winston Hotels Inc. Amercia West Holding Corp Class B
Number of Positions..............................111
Median Price/Earnings Ratio......................7.3
Portfolio Turnover...............................90%
</TABLE>
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DEAN FAMILY OF FUNDS
FUND FACTS
BALANCED FUND
Top Equity Holdings
North Fork Bancopr MGIC Investmetn Corp.
Columbia HCA Exxon Mobil Corp.
Tricon Global Bell Atlantic
Ambac, Inc. Fleet Boston Corp.
Diamond Offshore Drilling Tidewater Inc.
Number of Positions..............................38
Median Price/Earnings Ratio......................17.1
Portfolio Turnover...............................196%
INTERNATIONAL VALUE FUND
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Top Holdings
Vodafone Airtouch Transiciel
Fujitsu Total Fina
Real Time Systemized Entertainment Ericsson
Sony Corp. Glaxo Wellcome
Telesp Celular Participacoes SA BCE Inc.
Number of Positions..............................87
Median Price/Earnings Ratio......................34.6
Portfolio Turnover...............................157%
</TABLE>
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LARGE CAP VALUE FUND
PORTFOLIO OF INVESTMENTS
March 31, 2000
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS -98.55% Value
----------------------------------------------------------------------------------------------------------
AEROSPACE & DEFENSE - 1.70%
63 Raytheon Co Class A.............................................$ 1,193
10,000 Raytheon Co Class B............................................. 180,000
-----------------
181,193
-----------------
AGRICULTURAL - 0.47%
1,000 Potash Corp Saskatch*........................................... 50,000
-----------------
AUTO MANUFACTURER - 4.51%
5,000 Ford Motor Co................................................... 230,625
5,000 Paccar Inc...................................................... 250,000
-----------------
480,625
-----------------
BANKS - 9.37%
8,000 BB&T............................................................ 224,000
3,000 Chase Manhattan Corp*........................................... 261,563
8,000 Fleet Boston Corp............................................... 297,000
8,000 Washington Mutual............................................... 215,500
-----------------
998,063
-----------------
COMPUTER HARDWARE - 5.14%
2,000 Hewlett-Packard Co.............................................. 266,250
7,000 NCR Corporation*................................................ 280,875
-----------------
547,125
-----------------
COMPONENTS - 3.46%
7,000 Honeywell International Inc .................................... 368,813
-----------------
COMPUTER SYSTEMS - 1.11%
1,000 Intl Business Machines Corp..................................... 118,000
-----------------
CONSTRUCTION SERVICE - 1.90%
20,000 Clayton Homes Inc............................................... 202,500
-----------------
DRUGS & HEALTHCARE - 3.15%
7,000 McKesson HBOC Inc............................................... 147,000
3,000 Merck & Co Inc.................................................. 188,813
-----------------
335,813
-----------------
SEMICONDUCTOR-ELECTRIC - 3.10%
2,500 Intel Corp...................................................... 330,000
-----------------
ENGINEERING/CONSTRUCTION - 0.79%
2,000 USG Corporation................................................. 83,875
-----------------
ENTERTAINMENT - 1.17%
3,000 Walt Disney Company............................................. 124,125
-----------------
FINANCIAL SERVICES - 4.86%
430 Aegon N.V. Ord Adr Machines Corp*............................... 34,481
141 Berkshire Hathaway Class B*..................................... 257,043
4,000 Fannie Mae...................................................... 225,500
-----------------
517,024
-----------------
HEALTHCARE-DIVERSE & SERVICES - 2.85%
12,000 Columbia HCA Healthcare......................................... 303,750
-----------------
INDUSTRIAL PRODUCTS - 3.66%
8,500 Vulcan Materials Co............................................. 389,406
-----------------
<PAGE>
LARGE CAP VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 98.55% Value
----------------------------------------------------------------------------------------------------------
INSURANCE - 12.16%
7,000 Ambac, Inc...................................................... 352,187
6,000 AFLAC Inc....................................................... 273,750
4,000 Allstate Corp................................................... 94,750
1,500 American Nat'l Insur............................................ 86,250
4,000 Hartford Life Inc Class A....................................... 187,500
6,500 MGIC Investment Corp............................................ 299,813
-----------------
1,294,250
-----------------
MEDIA - 3.14%
7,000 News Corporation Ltd............................................ 333,812
-----------------
MANUFACTURING DIVERSIFIED - 0.11%
698 Delphi ......................................................... 11,299
-----------------
OIL & NATURAL GAS - 9.34%
10,000 Diamond Offshore Drilling....................................... 399,375
3,500 Exxon Mobil Corp................................................ 273,437
6,000 Texaco Inc...................................................... 321,750
-----------------
994,562
-----------------
REAL ESTATE INVESTMENT TRUST - 1.34%
16,000 Host Marriott Corp.............................................. 143,000
-----------------
RESTAURANTS - 5.83%
12,000 Albertson's Inc................................................. 372,000
8,000 Tricon Global Restaurant Inc*................................... 249,000
-----------------
621,000
-----------------
RETAIL - 3.30%
2,000 Federated Department Store*..................................... 84,500
12,000 TJX Companies Inc............................................... 267,000
-----------------
351,500
-----------------
SHIPPING - 3.59%
12,000 Tidewater Inc................................................... 381,750
-----------------
TELECOMMUNICATIONS - 9.95%
4,000 Alltel Corp..................................................... 252,250
6,000 AT&T Corp....................................................... 339,750
3,500 Bell Atlantic Corp.............................................. 215,687
4,000 Sprint Corp..................................................... 252,000
-----------------
1,059,687
-----------------
TELEMARKETING - 2.54%
7,000 Convergys Corp*................................................. 270,812
-----------------
Total Common Stock (Cost $9,608,016)............................ $ 10,491,984
-----------------
<PAGE>
LARGE CAP VALUE FUND (continued)
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Face Amount MONEY MARKET AND EQUIVALENTS - 1.36% Value
----------------------------------------------------------------------------------------------------------
$ 145,055 Firstar Treasury Money Market................................... $ 145,055
-----------------
Total Money Market and Equivalents (Cost $145,055).............. 145,055
-----------------
Total Investments at Value (Cost $9,753,071) - 99.91%........... 10,637,039
-----------------
Other Assets in Excess of Liabilities- 0.09%.................... 9,603
-----------------
Net Assets - 100.00%............................................ $ 10,646,642
=================
*Non-income producing security.
See accompanying notes to financial statements.
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SMALL CAP VALUE FUND
PORTFOLIO OF INVESTMENTS
March 31, 2000
-----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 100.55% Value
-----------------------------------------------------------------------------------------------------------
AGRICULTURAL - 0.47%
21,000 Standard Coml Corp.............................................. $ 73,500
-----------------
AIRLINES - 1.48%
15,000 America West Holding Corp Class B*.............................. 232,500
-----------------
APPAREL - 0.94%
15,000 Perry Ellis International Inc*.................................. 148,125
-----------------
AUTO PARTS - 0.82%
14,000 Amcast Industrial Corp.......................................... 128,625
-----------------
BANKS - 0.73%
7,000 Coastal Bancorp................................................. 114,625
-----------------
BUILDING MATERIALS - 1.13%
5,000 Ameron International Inc ....................................... 177,812
-----------------
BUSINESS FORMS - 0.89%
19,000 Franklin Covey Co*.............................................. 138,938
-----------------
COMPUTER EQUIP/SERV - 1.40%
7,000 Miami Computer*................................................. 219,625
-----------------
CONSUMER LOANS - 2.60%
15,000 Advanta Corp.................................................... 217,266
26,000 Delta Financial Corp*........................................... 52,000
35,000 EZCORP Inc...................................................... 137,813
-----------------
407,079
-----------------
CONSULTING SERVICES - 1.54%
22,000 Exponet Inc*.................................................... 242,000
-----------------
DISTRIBUTORS - 1.06%
8,000 Advanced Marketing Services Inc................................. 166,000
-----------------
DRUGS & HEALTHCARE - 0.41%
10,000 Bergen Brunswig - Class A....................................... 65,000
-----------------
ELECTRIC EQUIPMENT - 1.94%
20,000 Cherry Corp* ................................................... 303,750
-----------------
<PAGE>
SMALL CAP VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 100.55% Value
----------------------------------------------------------------------------------------------------------
ELECTRONICS - 0.84%
8,000 Nam Tai Electronics............................................. $ 131,000
-----------------
FINANCIAL SERVICES - 0.41%
10,000 American Home Mortgage Holdings*................................ 63,750
-----------------
FOOD & BEVERAGE - 1.39%
3,000 Fleming Cos Inc................................................. 45,937
21,000 M & F Worldwide Corp*........................................... 91,875
5,000 Nash Finch Co................................................... 40,625
5,000 Todhunter Intl Inc*............................................. 40,000
-----------------
218,437
-----------------
FUNERAL/BURIAL SVCS AND EQUIP - 2.14%
30,000 Stewart Enter Class A........................................... 146,250
41,000 York Group Inc.................................................. 189,625
-----------------
335,875
-----------------
FURNITURE/FIXTURES - 2.01%
12,500 Flexsteel Inds Inc.............................................. 153,125
41,000 Heilig Meyers Co................................................ 161,437
-----------------
314,562
-----------------
HOUSEHOLD PRODUCTS - 0.66%
36,000 Tandycrafts Inc*................................................ 103,500
-----------------
HEALTHCARE SERVICES - 0.73%
27,900 Children's Comprehensive Services*.............................. 115,088
-----------------
HEAVY CONSTRUCTION - 1.57%
25,000 Perini Corp*.................................................... 110,937
6,000 Pitt Des Moines Inc............................................. 135,750
-----------------
246,687
-----------------
HUMAN RESOURCES - 1.58%
22,000 Personnel Group Amer Inc*....................................... 136,125
25,000 SOS Staffing Svcs*.............................................. 110,937
-----------------
247,062
-----------------
INDUSTRIAL PRODUCTS - 1.22%
9,000 ESCO Electrs Corp*.............................................. 150,750
1,000 Federal Screw Wks............................................... 40,000
-----------------
190,750
-----------------
INSURANCE - 7.65%
15,000 Gainsco, Inc.................................................... 89,063
24,000 London Pac Group Ltd............................................ 558,000
9,000 Landamerica Finl Group Inc...................................... 176,625
12,000 Stewart Information Svcs Corp................................... 189,750
12,900 Trenwick Group Inc.............................................. 185,437
-----------------
1,198,875
-----------------
LONG-TERM CARE - 1.02%
45,000 Beverly Enterprises Inc*........................................ 160,313
-----------------
MACHINERY AGRICULTURAL - 1.28%
11,000 Gehl Co*........................................................ 200,750
-----------------
<PAGE>
SMALL CAP VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 100.55% Value
----------------------------------------------------------------------------------------------------------
MACHINERY INDUSTRIAL - 1.48%
11,000 AMPCO - Pittsburgh Corp.........................................$ 119,625
11,000 Hardinge Inc.................................................... 112,750
-----------------
232,375
-----------------
MINING AND METALS - 1.81%
3,500 Cleveland Cliffs Inc............................................ 82,469
8,000 Dayton Superior Corp Class A*................................... 201,500
-----------------
283,969
-----------------
OIL AND NATURAL GAS - 4.05%
20,000 Kaneb Services Inc*............................................. 110,000
20,000 Key Energy Services*............................................ 226,250
10,000 Pride Intl Inc*................................................. 227,500
8,000 Trico Marine Services Inc*...................................... 70,500
-----------------
634,250
-----------------
PHARMACEUTICAL - 0.56%
30,000 Questcor Pharmaceutical Corp*................................... 88,125
-----------------
PRINTING EQUIPMENT - 0.37%
30,000 Baldwin Technology Inc Class A*................................. 58,125
-----------------
REAL ESTATE INVESTMENT TRUST - 15.65%
18,000 Boykin Lodging Co............................................... 212,625
11,000 Brandywine Rlty................................................. 188,375
8,000 Crown Amern Rlty................................................ 42,500
7,000 Eastgroup Properties............................................ 150,500
30,000 Equity Inns Inc................................................. 202,500
8,000 Glenborough Rlty Tr............................................. 116,500
4,000 Health Care Reit Inc............................................ 56,250
3,407 Healthcare Rlty Tr.............................................. 57,706
31,000 Jameson Inns Inc................................................ 203,437
5,000 Mid-Amer Apr Cmnyts............................................. 113,438
2,400 New Plan Excel Rlty............................................. 32,250
7,000 Pacific Gulf.................................................... 137,375
15,000 Ramco-Gershenson................................................ 213,750
22,000 RFS Hotel Invs Inc.............................................. 237,875
3,750 Starwood Financial.............................................. 64,922
21,000 Thornburg Mtg Asset Corp........................................ 156,187
35,000 Winston Hotels Inc.............................................. 266,875
-----------------
2,453,065
-----------------
RESIDENTIAL CONSTRUCTION - 7.91%
13,000 Beazer Homes USA Inc*........................................... 243,750
18,000 Engle Homes Inc................................................. 175,500
10,000 MDC Holdings.................................................... 175,000
17,000 M / I Schottenstein............................................. 268,813
8,000 Ryland Group Inc................................................ 152,000
12,000 Standard Pac Corp............................................... 120,750
7,000 Webb Del Corp................................................... 104,563
-----------------
1,240,376
-----------------
RESTAURANTS - 0.92%
19,000 Cooker Restaurant Corp.......................................... 49,875
15,000 Landry Seafood*................................................. 94,688
-----------------
144,563
-----------------
<PAGE>
SMALL CAP VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 100.55% Value
----------------------------------------------------------------------------------------------------------
RETAIL - 15.32%
12,500 Blair Corp......................................................$ 200,000
31,000 Bon-Ton Stores*................................................. 93,970
19,000 Building Materials Holding Corp*................................ 172,187
15,000 Cameron Ashley Building Products*............................... 258,750
10,000 Central Garden & Pet Co*........................................ 98,750
10,000 Duckwall Alco Stores*........................................... 81,250
31,000 Elder Beerman Stores Corp*...................................... 178,250
30,000 Friedmans Inc................................................... 184,689
17,900 Jan Bell Marketing*............................................. 51,462
15,000 Keystone Automotive Industries Inc*............................. 88,125
10,000 Marsh Supermarkets.............................................. 90,000
50,000 Movie Gallery Inc*.............................................. 207,815
16,000 Patrick Industries.............................................. 123,000
8,000 REX Stores Corp*................................................ 204,500
15,000 Syms*........................................................... 60,000
30,000 TBC Corp*....................................................... 151,875
15,000 Wolohan Lmbr Co................................................. 157,500
-----------------
2,402,123
-----------------
RAILROAD - 2.02%
17,500 Genesee & Wyoming*.............................................. 271,250
6,666 Rail America Inc*............................................... 44,996
-----------------
316,246
-----------------
SHIPPING - 0.60%
5,000 Stolt Nielsen S A............................................... 94,375
-----------------
SPORTING GOODS - 1.11%
22,000 K2 Inc.......................................................... 174,625
-----------------
STEEL - 2.16%
10,000 Atchison Casting*............................................... 70,000
5,000 Commercial Metals............................................... 136,177
45,000 Bayou Steel Corp*............................................... 132,188
-----------------
338,365
-----------------
TELECOMMUNICATIONS - 0.91%
12,000 Atlantic Tele Network Inc....................................... 142,500
-----------------
TEXTILE MANUFACTURE - 0.42%
15,000 Dixie Group..................................................... 66,563
-----------------
TOYS AND GAMES - 0.33%
12,000 Zindart Ltd ADR*................................................ 52,500
-----------------
TRANSPORT EQUIPMENT - 2.38%
20,000 Greenbrier Companies............................................ 156,250
15,000 Wabash National Corp............................................ 216,563
-----------------
372,813
-----------------
TRANSPORTATION -1.33%
15,000 Offshore Logistics*............................................. 208,125
-----------------
TRUCKING - 2.88%
15,000 Arkansas Best Corp*............................................. 157,500
25,000 Motor Cargo*.................................................... 115,625
15,000 Old Dominion Freight*........................................... 179,063
-----------------
452,188
-----------------
WHOLESALE MISCELLANEOUS - 0.41%
12,000 Primesource Corp 64,124
-----------------
<PAGE>
SMALL CAP VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 100.55% Value
----------------------------------------------------------------------------------------------------------
Total Common Stock (Cost $17,935,645)........................... $ 15,763,623
-----------------
----------------------------------------------------------------------------------------------------------
Shares PREFERRED STOCKS - 0.53% Value
----------------------------------------------------------------------------------------------------------
4,200 Bradley Real Estate, Inc,....................................... $ 82,425
----------------
Total Preferred Stocks (Cost $102,575).......................... $ 82,425
----------------
Total Investments at Value (Cost $18,038,220) - 101.07%......... 15,846,048
----------------
Liabilities in Excess of Other Assets - (1.07%)................. (168,197)
-----------------
Net Assets - 100.00%............................................ $ 15,677,851
=================
*Non-income producing security.
See accompanying notes to financial statements.
<PAGE>
BALANCED FUND
PORTFOLIO OF INVESTMENTS
March 31, 2000
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 64.27% Value
----------------------------------------------------------------------------------------------------------
AEROSPACE & DEFENSE - 1.36%
7,500 Raytheon Co Class B............................................. $ 135,000
-----------------
AGRICULTURAL - 1.01%
2,000 Potash Corp Saskatch*........................................... 100,000
-----------------
AUTO MANUFACTURER - 0.84%
1,000 General Motors Corp............................................. 82,813
-----------------
BANKS - 6.87%
6,000 Bank One........................................................ 206,250
1,300 Chase Manhattan Corp*........................................... 113,344
6,000 Fleet Boston Corp............................................... 222,750
8,000 North Fork Bancorp.............................................. 138,000
-----------------
680,344
-----------------
BUSINESS FORMS - 0.54%
2,000 Deluxe Corp*.................................................... 53,250
-----------------
CHEMICALS - 0.80%
1,500 Dupont Co....................................................... 79,313
-----------------
COMMUNICATIONS EQUIP - 1.15%
7,000 Citizens Utilities B*........................................... 114,188
-----------------
COMPUTER HARDWARE - 2.43%
600 Hewlett-Packard Co.............................................. 79,875
4,000 NCR Corporation*................................................ 160,500
-----------------
240,375
-----------------
COMPONENTS - 1.06%
2,000 Honeywell International Inc..................................... 105,375
-----------------
COMPUTER SYSTEMS - 0.58%
1,500 Affiliated Computer Services Class A*........................... 57,000
-----------------
DIVERSIFIED CONGLOMERATES - 1.97%
1,000 Minn. Mining. & Mfg. ........................................... 88,938
5,000 Philip Morris Inc............................................... 105,937
-----------------
194,875
-----------------
DRUGS & HEALTHCARE - 2.63%
7,000 McKesson HBOC Inc............................................... 147,000
1,800 Merck & Co Inc.................................................. 113,287
-----------------
260,287
-----------------
SEMICONDUCTOR-ELECTRIC - 1.73%
1,300 Intel Corp...................................................... 171,600
-----------------
FINANCIAL SERVICES - 1.71%
3,000 Fannie Mae...................................................... 169,125
-----------------
<PAGE>
BALANCED FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 64.27% Value
----------------------------------------------------------------------------------------------------------
HEALTHCARE SERVICES - 3.20%
12,500 HCA - The Healthcare Company.................................... $ 316,406
----------------
INSURANCE - 7.36%
4,000 AFLAC, Inc...................................................... 182,500
6,000 Ambac Inc....................................................... 301,875
5,300 MGIC Investment Corp............................................ 244,462
-----------------
728,837
-----------------
MEDIA - 1.45%
3,000 News Corporation Ltd............................................ 143,062
-----------------
OIL & NATURAL GAS - 7.09%
7,000 Diamond Offshore Drilling....................................... 279,562
3,000 Exxon Mobil Corp................................................ 234,375
3,500 Texaco Inc...................................................... 187,687
-----------------
701,624
-----------------
REAL ESTATE INVESTMENT TRUST - 1.81%
20,000 Host Marriott Corp.............................................. 178,750
-----------------
RESTAURANTS - 5.34%
7,000 Albertson's Inc................................................. 217,000
10,000 Tricon Global Restaurant Inc*................................... 311,250
-----------------
528,250
-----------------
SHIPPING - 2.25%
7,000 Tidewater Inc................................................... 222,688
-----------------
SOFTWARE PRODUCTS - 0.49%
1,500 Network Associates*............................................. 48,375
-----------------
TELECOMMUNICATIONS - 5.74%
6,000 AT&T Corp....................................................... 339,750
3,700 Bell Atlantic................................................... 228,012
-----------------
567,762
-----------------
TELEMARKETING - 1.95%
5,000 Convergys Corp*................................................. 193,438
-----------------
UTILITIES - 1.53%
7,000 The Southern Company............................................ 151,812
-----------------
WASTE MANAGEMENT - 1.38%
10,000 Waste Management Inc............................................ 136,876
-----------------
Total Common Stock (Cost $6,231,447)............................ $ 6,361,425
-----------------
<PAGE>
BALANCED FUND (continued)
----------------------------------------------------------------------------------------------------------
Par Value FIXED INCOME OBLIGATIONS - 32.84% Value
----------------------------------------------------------------------------------------------------------
$ 300,000 PHH Corp, 7.02%, 11/09/01....................................... $ 298,183
450,000 Federal National Mortgage Association, 5.25%, 01/15/03.......... 430,063
300,000 Morgan Stanley Dean, 5.625%, 01/20/04........................... 282,280
300,000 Federal Home Loan Bank, 6.10%, 02/15/04......................... 284,693
300,000 Federal Home Loan Bank, 5.62%, 04/29/04......................... 288,449
300,000 Househould Finance, 6.00%, 05/01/04............................. 284,108
150,000 Cox Radio Inc, 6.375%, 05/15/05................................. 139,836
250,000 Tennessee Valley Auth, 6.375%, 06/15/05......................... 251,444
300,000 Washington Water Power, 5.99%, 12/10/07......................... 273,863
300,000 New Plan Excel, 7.40%, 09/15/09................................. 288,416
150,000 Commercial Credit Co, 6.625%, 06/01/15.......................... 148,141
300,000 First Union, 6.18%, 06/15/36.................................... 280,825
-----------------
Total Fixed Income Obligations (Cost $3,359,309)............... $ 3,250,301
-----------------
----------------------------------------------------------------------------------------------------------
Face Amount MONEY MARKET AND EQUIVALENTS - 2.74% Value
----------------------------------------------------------------------------------------------------------
$ 271,461 Firstar Treasury Money Market................................... $ 271,461
-----------------
Total Money Market and Equivalents (Cost $271,461).............. 271,461
-----------------
Total Investments at Value (Cost $9,862,217) - 99.86%........... 9,883,187
-----------------
Other Assets in Excess of Liabilities - 0.14%................... 14,293
-----------------
Net Assets - 100.00%............................................ $ 9,897,480
=================
*Non-income producing security.
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL VALUE FUND
PORTFOLIO OF INVESTMENTS
March 31, 2000
-----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 87.51% Value
-----------------------------------------------------------------------------------------------------------
ARGENTINA - 1.42%
44,000 Telecom Argentina Class B....................................... $ 305,923
-----------------
AUSTRALIA - 2.08%
4,900 Brambles Industries Limited..................................... 124,619
41,000 Cable & Wireless Optus Limited.................................. 164,249
44,000 John Fairfax Holdings........................................... 158,907
-----------------
447,775
-----------------
BELGIUM - 1.34%
2,300 Lernout & Hauspie............................................... 264,500
315 Roularta Media Group............................................ 23,178
-----------------
287,678
-----------------
BRAZIL - 0.69%
2,357,107 Banco Bradesco SA............................................... 14,859
490,000 Petroleo Brasileiros SA......................................... 133,381
-----------------
148,240
-----------------
CANADA - 6.98%
17,000 Abitibi Consolidated Inc........................................ 163,349
5,800 Alcan Aluminium Ltd............................................. 193,959
3,600 BCE Inc......................................................... 448,822
22,700 Fletcher Challenge CDA Ltd Class A.............................. 250,172
7,300 Teleglobe Inc................................................... 198,616
6,800 Telesystem International Wireless............................... 247,073
-----------------
1,501,991
-----------------
CZECK REPUBLIC - 2.18%
35,000 Ceska Sporitelna................................................ 198,379
12,400 Cesky Telecom................................................... 269,571
-----------------
467,950
-----------------
DENMARK - 0.54%
1,300 Navision Software............................................... 116,959
-----------------
FINLAND - 1.53%
1,230 Nokia........................................................... 260,099
3,000 Satama Interactive.............................................. 68,893
-----------------
328,992
-----------------
<PAGE>
INTERNATIONAL VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 87.51% Value
----------------------------------------------------------------------------------------------------------
FRANCE - 12.39%
2,500 Aventis SA...................................................... $ 136,829
1,460 Axa............................................................. 206,895
300 Bouygues SA..................................................... 237,681
2,850 Carrefour SA.................................................... 365,147
23,700 Elior........................................................... 249,450
300 Havas Advertising............................................... 162,185
1,870 Stmicroelectronics.............................................. 343,546
3,200 Total Fina...................................................... 479,188
2,640 Transiciel...................................................... 483,996
-----------------
2,664,917
-----------------
GERMANY - 9.28%
3,300 Aventis SA...................................................... 173,668
6,500 Jenoptik........................................................ 177,256
3,700 LHS Group....................................................... 159,315
3,500 Nemetschek...................................................... 227,729
1,000 Phone.com Inc................................................... 150,225
20,000 Real Time Systemized Entertainment.............................. 547,316
380 SAP............................................................. 216,343
8,200 Starmedia Network............................................... 266,769
1,200 Va Linux System Inc............................................. 77,504
-----------------
1,996,125
-----------------
GREAT BRITIAN - 12.99%
5,000 Arm Hldgs....................................................... 302,329
39,900 BP Amoco........................................................ 365,071
61,305 Dixons Group.................................................... 283,883
24,000 Freeserve....................................................... 190,300
15,800 Glaxo Wellcome.................................................. 452,473
28,400 HSBC Hldgs...................................................... 335,743
18,000 National Grid Group............................................. 164,550
14,100 State Bank of India............................................. 138,533
101,079 Vodafone Airtouch............................................... 561,997
-----------------
2,794,879
-----------------
HONG KONG - 1.01%
12,000 Hutchison Whampoa............................................... 216,529
-----------------
IRELAND - 0.61%
13,300 Independent New & Media......................................... 130,442
-----------------
ITALY - 3.58%
600 I.NET........................................................... 101,043
225,000 Parmalat Finanziaria SPA........................................ 250,383
28,100 Telecom Italia SPA.............................................. 419,443
-----------------
770,869
-----------------
<PAGE>
INTERNATIONAL VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares COMMON STOCKS - 87.51% Value
----------------------------------------------------------------------------------------------------------
JAPAN - 11.51%
5,000 Canon Inc....................................................... $ 216,936
18,000 Fujitsu......................................................... 552,820
11,000 NEC Corp........................................................ 324,965
25 Nippon Telegraph ............................................... 397,309
500 Softbank Corp................................................... 446,058
3,800 Sony Corp....................................................... 537,220
-----------------
2,475,308
-----------------
MEXICO - 1.28%
63,600 Carso Global Telecom............................................ 195,645
23,000 Grupo Televisa SA............................................... 78,930
-----------------
274,575
-----------------
NETHERLANDS - 3.37%
2,780 ING Groep NV.................................................... 150,558
4,700 Seagulls Hldgs NV............................................... 143,910
5,400 SNT Group NV.................................................... 173,093
2,200 VNU NV.......................................................... 129,567
7,100 Wegener Arcade CVA.............................................. 127,040
-----------------
724,168
-----------------
POLAND - 2.45%
37,000 KGHM Polska Miedz............................................... 269,694
28,000 Telekomunikacja................................................. 256,302
-----------------
525,996
-----------------
PORTUGAL -1.87%
18,200 Portugal Telecom................................................ 233,356
1,900 PT Multimedia SGPS.............................................. 169,074
-----------------
402,430
-----------------
SINGAPORE - 1.10%
25,000 Chartered Semi-conductor........................................ 236,773
-----------------
SOUTH KOREA - 2.34%
2,600 Korea Telecom................................................... 230,536
84 SK Telecom...................................................... 273,603
-----------------
504,139
-----------------
SPAIN - 3.08%
13,800 BCO Sant Cent Hisp.............................................. 148,286
9,000 Indra Sistemas SA............................................... 216,152
11,800 Telefonica SA................................................... 298,077
-----------------
662,515
-----------------
SWEDEN - 3.16%
5,300 Ericsson........................................................ 465,590
4,540 Skandia Insurance............................................... 214,913
-----------------
680,503
-----------------
SWITZERLAND - 0.73%
115 Novartis........................................................ 157,281
-----------------
Total Common Stock (Cost $14,266,360) .......................... $ 18,822,957
-----------------
INTERNATIONAL VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
Shares PREFERRED STOCK - 9.44% Value
----------------------------------------------------------------------------------------------------------
5,000,000 Embratel Participa SA........................................... 126,075
57,000,000 Tele Celular Sul Participacoes SA-Pfd........................... 293,983
20,800,000 Telesp Celular Participacoes SA................................. 488,710
13,000,000 Tele Centro Sul Participacoes SA................................ 212,321
358,072,341 Tele Leste Celular Participacoes SA............................. 430,918
11,300,000 Tele Norte Leste Participacoes SA............................... 300,470
48,300,000 Tele Nordeste Celular Participacoes SA.......................... 177,146
-----------------
Total Preferred Stock (Cost $1,356,562) ........................ $ 2,029,623
----------------------------------------------------------------------------------------------------------
Face Amount CLOSED-END FOREIGN FUNDS - 1.40% Value
----------------------------------------------------------------------------------------------------------
1,750 Baltic Republic................................................. $ 126,656
109,000 Amerindo Internet Fund Plc...................................... 173,899
-----------------
Total Closed-end Foreign Fund (Cost $336,423) .................. 300,555
----------------
----------------------------------------------------------------------------------------------------------
Face Amount MONEY MARKET - 1.81% Value
----------------------------------------------------------------------------------------------------------
$ 388,372 Dreyfus Cash Mgmt............................................... $ 388,372
----------------
Total Money Market and Equivalents (Cost $388,372) ............. 388,372
-----------------
Total Investments at Value - (Cost $16,347,717) - 100.15%....... 21,541,507
-----------------
Liabilities in Excess of Other Assets- (0.15%).................. (32,619)
-----------------
Net Assets -100.00%.............................................. $ 21,508,888
=================
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL VALUE FUND (continued)
----------------------------------------------------------------------------------------------------------
DIVERSIFICATION OF ASSETS: Percentage
----------------------------------------------------------------------------------------------------------
Banks 2.76%
Computer Hardware 5.08%
Data Processing 2.10%
Diversified Conglomerate 1.48%
Drugs & Healthcare 3.99%
Electronics 4.03%
Paper and Forest Products 1.79%
Groceries 1.58%
Insurance 2.48%
Internet 3.84%
Media 2.16%
Mining & Minerals 1.17%
Oil & Natural Gas 5.26%
Restaurants 1.08%
Retail 2.33%
Software & Computers 3.29%
Software Products 4.92%
Telecommunications 22.40%
Wireless Communication 2.19%
Other 26.22%
------
Total 100.15%
Liabilities in Excess of Other Assets (0.15)%
--------
Grand Total 100.00%
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
DEAN FAMILY OF FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
March 31, 2000
---------------------------------------------------------------------------------------------------------------------------
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
---------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At amortized cost.............................. $ 9,753,071 $ 18,038,220 $ 9,862,217 $ 16,347,717
============= ============== ============ ============
At value (Note 2).............................. $ 10,637,039 $ 15,846,048 $ 9,883,187 $ 21,541,507
Cash.............................................. 7,115 ----- ----- -----
Cash denominated in foreign currency(Cost$536,545) ----- ----- ----- 533,975
Dividends and interest receivable................. 14,291 55,258 74,204 30,735
Receivable for securities sold.................... ----- 113,206 ----- 557,611
Receivable for capital shares sold................ 10,199 99,647 67,408 71,529
Organization expenses, net (Note 2)............... 6,570 6,570 6,570 -----
Other assets...................................... 13,658 26,300 15,956 35,324
------------- ------------- -------------- --------------
TOTAL ASSETS................................... 10,688,872 16,147,029 10,047,325 22,770,681
LIABILITIES
Bank overdraft.................................... ----- 46,692 33,440 63
Net unrealized depreciation on forward foreign
currency exchange contracts (Note 6)............. ----- ----- ----- 477,067
Dividends payable................................. 5,837 67,429 51,228 -----
Payable for securities purchased.................. ----- 89,063 ----- 721,637
Payable for capital shares redeemed............... 18,535 232,766 14,354 22,794
Payable to affiliates (Note 4).................... 14,694 18,003 35,272 13,524
Other liabilities................................. 3,164 15,225 15,551 26,708
------------- ----------- ------------ -------------
TOTAL LIABILITIES.............................. 42,230 469,178 149,845 1,261,793
------------- ----------- ------------ -------------
NET ASSETS........................................ $ 10,646,642 $ 15,677,851 $ 9,897,480 $ 21,508,888
============= ============= =========== ===========
Net assets consist of:
Paid-in capital................................... $ 10,344,065 $ 19,567,592 $10,505,988 $ 14,083,417
Undistributed net investment income............... (5,651) (41,551) (3,843) (7,687)
Accumulated net realized gains (losses) from security
transactions................................... (575,740) (1,656,018) (625,635) 2,737,458
Net unrealized appreciation (depreciation)
on investments................................. 883,968 (2,192,172) 20,970 5,193,790
Net unrealized appreciation (depreciation) on translation
of assets and liabilities in foreign currencies.. ----- ----- ----- (498,090)
------------- ------------- ----------- ------------
Net assets........................................ $ 10,646,642 $ 15,677,851 $ 9,897,480 $ 21,508,888
============ ============= =========== ============
PRICING OF CLASS A SHARES
Net assets applicable to Class A shares........... $ 10,134,912 $ 13,333,607 $ 8,606,480 $ 19,605,996
Shares of beneficial interest outstanding (unlimited
numbers of shares authorized, no par value)... 912,016 1,489,998 846,938 974,724
Net asset value and redemption price per share (Note 2)$ 11.11 $ 8.95 $ 10.16 $ 20.11
Maximum offering price per share (Note 2)......... $ 11.73 $ 9.45 $ 10.72 $ 21.22
PRICING OF CLASS C SHARES
Net assets applicable to Class C shares........... $ 511,730 $ 2,344,244 $ 1,291,000 $ 1,902,892
Shares of beneficial interest outstanding (unlimited
numbers of shares authorized, no par value)... 47,800 266,523 129,085 96,303
Net asset value, offering price, and redemption
price per share (Note 2)....................... $ 10.71 $ 8.80 $ 10.00 $ 19.76
See accompanying notes to financial statements.
</TABLE>
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENTS OF OPERATIONS
Year-Ended March 31, 2000
<TABLE>
<S> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------------------------------
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
---------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends (net of foreign withholding taxes of
$16,221 for the International Value Fund)...... $ 189,512 $ 561,451 $ 135,616 $ 159,456
Interest.......................................... 14,484 31,823 322,668 1,022
----------- ----------- --------- ---------
TOTAL INVESTMENT INCOME........................ 203,996 593,274 458,284 160,478
EXPENSES
Investment advisory fees (Note 4)................. 106,970 191,195 116,876 162,144
Accounting services fees (Note 4)................. 31,417 31,688 31,417 31,417
Shareholders services and transfer agent fees.....
Class A (Note 4)............................... 15,392 15,783 14,839 15,084
Class C (Note 4)............................... 9,652 10,886 10,061 9,933
Custodian Fees.................................... 9,552 21,903 12,410 57,145
Registration fees - Common........................ 4,905 5,411 5,310 6,024
Registration fees - Class A....................... 4,198 4,076 4,143 4,182
Registration fees - Class C....................... 4,132 4,385 4,117 4,412
Administration fees (Note 4)...................... 12,346 17,712 12,584 12,402
Postage and supplies.............................. 6,781 16,163 7,158 8,121
Trustees' fees and expenses....................... 2,486 2,486 2,486 2,486
Professional fees................................. 13,066 16,487 14,001 17,641
Reports to shareholders........................... 6,243 13,380 6,325 7,588
Insurance expense................................. 1,696 2,733 1,934 1,304
Amortization of organization expenses (Note 2).... 3,156 3,156 3,156 -----
Distribution expenses - (Note 4)
12b-1 Fees - Class A.............................. 1,508 454 1,378 -----
12b-1 Fees - Class C.............................. 1,200 ----- 1,200 -----
Other expenses.................................... 5,174 17,860 9,038 40,968
----------- ----------- --------- ---------
TOTAL EXPENSES................................. 239,874 375,758 258,433 380,851
Fees waived and reimbursed by Adviser............. (36,132) (10,132) (29,672) (103,391)
----------- ----------- --------- ---------
NET EXPENSES................................... 203,742 365,626 228,761 277,460
----------- ----------- --------- ---------
NET INVESTMENT INCOME (LOSS)...................... 254 227,648 229,523 (116,982)
REALIZED & UNREALIZED GAINS (LOSSES)
Net realized gains (losses) from:
Security transactions.......................... (405,221) (1,175,621) (425,355) 4,227,540
Foreign currency transactions (Note 5)......... ----- ----- ----- (153,921)
Net change in unrealized appreciation/depreciation on:
Investments.................................... 770,094 690,309 (315,269) 4,485,028
Foreign currency translation (Note 5).......... ----- ----- ----- (501,465)
NET REALIZED & UNREALIZED
GAINS (LOSSES) ON INVESTMENTS &
FOREIGN CURRENCIES............................. 364,873 (485,312) (740,724) 8,057,184
NET INCREASE (DECREASE) IN NET ASSETS.............
FROM OPERATIONS................................ $ 365,127 $ (257,664) $ (511,101) $7,940,202
=========== ============ =========== ==========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<S> <C> <C> <C> <C>
Large Cap Value Fund Small Cap Value Fund
Year Year Year Year
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
2000 1999 2000 1999
FROM OPERATIONS:
Net investment income............................. $ 254 $ 40,594 $ 227,648 $ 152,914
Net realized gains (losses) from security
transactions ..................................... (405,221) (170,647) (1,175,621) (32,334)
Net change in unrealized appreciation/depreciation
on investments................................. 770,094 (964,977) 690,309 (5,568,898)
------------- ----------- ------------ ------------
Net increase (decrease) in net assets from operations 365,127 (1,095,030) (257,664) (5,448,318)
------------- ----------- ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income, Class A............ (5,614) (40,478) (234,500) (105,005)
From net investment income, Class C............ (291) (116) (46,481) (11,617)
From net realized gains, Class A............... ----- (101,336) ----- (1,122,796)
From net realized gains, Class C............... ----- (4,193) ----- (154,410)
------------- ----------- ------------ -------------
Decrease in net assets from distributions
to shareholders................................ (5,905) (146,123) (280,981) (1,393,828)
-------------- ----------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS:
Class A
Proceeds from shares sold...................... 1,812,505 3,174,933 2,510,418 3,036,967
Net asset value of shares issued in
reinvestment of distributions to shareholders..... 5,083 129,680 211,327 1,100,297
Payments for shares redeemed................... (1,380,371) (447,120) (4,503,468) (2,030,441)
------------- ----------- ----------- -----------
Net increase in net assets from Class A
Share transactions............................. 437,217 2,857,493 (1,781,723) 2,106,823
------------- ------------ ----------- ------------
Class C
Proceeds from shares sold...................... 386,237 422,413 1,667,134 1,994,365
Net asset value of shares issued in
reinvestment of distributions to shareholders ----- 4,298 36,474 157,601
Payments for shares redeemed................... (383,017) (2,112) (1,745,062) ( 206,560)
------------ ----------- ----------- -------------
Net increase (decrease) in net assets from Class C
Share transactions............................. 3,220 424,599 (41,454) 1,945,406
-------------- ----------- ------------- -------------
Net increase in assets from capital share transactions 440,437 3,282,092 (1,823,177) 4,052,229
-------------- ----------- ------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS........... 799,659 2,040,939 (2,361,822) (2,789,917)
NET ASSETS:
Beginning of year.............................. 9,846,983 7,806,044 18,039,673 20,829,590
-------------- ----------- ------------- ------------
End of year.................................... $ 10,646,642 $ 9,846,983 $ 15,677,851 $ 18,039,673
============== ========== ============= ============
UNDISTRIBUTED NET INVESTMENT INCOME............... $ (5,651) $ ----- $ (41,551) $ 50,200
============== =========== ============= ============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
<TABLE>
<S> <C> <C> <C> <C>
Large Cap Value Fund Small Cap Value Fund
Year Year Year Year
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
2000 1999 2000 1999
CAPITAL SHARE ACTIVITY:
Class A
Shares sold.................................... 165,599 76,753 253,552 270,810
Shares issued in reinvestment of distributions
to shareholders.............................. 458 11,659 23,995 110,385
Shares redeemed................................ (128,526) (42,215) (479,679) (203,409)
------------ ----------- ------------- ----------
Net increase (decrease) in shares outstanding.. 37,531 246,197 (202,132) 177,786
Shares outstanding, beginning of year.......... 874,485 628,288 1,692,130 1,514,344
--------------- ----------- ------------ -----------
Shares outstanding, end of year................ 912,016 874,485 1,489,998 1,692,130
=============== =========== ============ ===========
Class C
Shares sold.................................... 34,255 38,912 171,850 178,737
Shares issued in reinvestment of distributions
to shareholders.............................. ----- 388 4,216 15,961
Shares redeemed................................ (36,767) (193) (192,399) (20,715)
Net increase (decrease) in shares outstanding.. (2,512) 39,107 (16,333) 173,983
--------------- ----------- -------------- --------
Shares outstanding, beginning of year.......... 50,312 11,205 282,856 108,873
--------------- ----------- -------------- ---------
Shares outstanding, end of year................ 47,800 50,312 266,523 282,856
=============== =========== ================= =========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<S> <C> <C> <C> <C>
Balanced Fund International Value Fund
Year Year Year Year
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
2000 1999 2000 1999
FROM OPERATIONS:
Net investment income (loss)...................... $ 229,523 $ 195,055 $ (116,982) $ (43,198)
Net realized gains (losses) from:
Security transactions.......................... (425,355) (127,866) 4,227,540 (115,075)
Foreign currency transactions.................. ----- ----- (153,921) (124,824)
Net change in unrealized appreciation/depreciation on:
Investments.................................... (315,269) (350,073) 4,485,028 562,790
Foreign currency translation................... ----- ----- (501,463) (3,203)
-------------- -------------- ------------- -----------
Net increase (decrease) in net assets from operations (511,101) (282,884) 7,940,202 276,490
-------------- ------------- ------------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income, Class A............ (201,579) (176,745) ----- -----
From net investment income, Class C............ (25,340) (18,310) ----- -----
From net realized gains, Class A............... ----- (243,853) (581,344) (15,554)
From net realized gains, Class C............... ----- (43,568) (71,848) (3,492)
------------ ----------- -------------- ----------
Decrease in net assets from distributions
to shareholders................................ (226,919) (482,476) (653,192) (19,046)
------------ ----------- -------------- ----------
FROM CAPITAL SHARE TRANSACTIONS:
Class A
Proceeds from shares sold...................... 881,512 4,763,587 7,315,297 4,672,561
Net asset value of shares issued in
reinvestment of distributions to shareholders 186,364 391,315 549,618 14,769
Payments for shares redeemed................... (2,219,190) (1,361,306) (770,188) (223,152)
--------------- ----------- --------------- ------------
Net increase (decrease) in net assets from Class A
Share transactions............................. (1,151,314) 3,793,596 7,094,727 4,464,178
--------------- ----------- ---------------- -------------
Class C
Proceeds from shares sold...................... 764,774 1,087,900 341,340 1,334,040
Net asset value of shares issued in
reinvestment of distributions to shareholders 19,107 56,830 54,718 3,359
Payments for shares redeemed................... (1,274,025) (242,568) (704,375) (6,698)
--------------- ----------- --------------- ----------
Net increase (decrease) in net assets from Class C
Share transactions............................. (490,144) 902,162 (308,317) 1,330,701
---------------- ----------- ---------------- -----------
Net increase (decrease)
in assets from capital share transactions......... (1,641,458) 4,695,735 6,786,410 5,794,879
-------------- ------------- ---------------- ------------
TOTAL (DECREASE) INCREASE IN NET ASSETS.......... (2,379,478) 3,930,398 14,073,420 6,052,323
NET ASSETS:
Beginning of year.............................. 12,276,958 8,346,560 7,435,468 1,383,145
------------- ---------- ----------- ------------
End of year.................................... $ 9,897,480 $12,276,958 $ 21,508,888 $ 7,435,468
============= =========== ============== ============
UNDISTRIBUTED NET INVESTMENT INCOME............... $ (3,843) $ ----- $ 7,687 $ ----
============= =========== ============== ============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
DEAN FAMILY OF FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
<TABLE>
<S> <C> <C> <C> <C>
Balanced Fund International Value Fund
Year Year Year Year
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
2000 1999 2000 1999
CAPITAL SHARE ACTIVITY:
Class A
Shares sold.................................... 82,833 425,764 515,105 389,709
Shares issued in reinvestment of distributions
to shareholders.............................. 18,034 35,797 36,326 1,216
Shares redeemed................................ (220,172) (124,361) (58,736) (19,119)
------------- ----------- ----------- ----------
Net (decrease) increase in shares outstanding.. (119,305) 337,200 492,695 371,806
Shares outstanding, beginning of year.......... 966,243 629,043 482,029 110,223
-------------- ----------- ----------- ----------
Shares outstanding, end of year................ 846,938 966,243 974,724 482,029
============== =========== =============== ===========
Class C
Shares sold.................................... 72,970 98,933 23,272 111,186
Shares issued in reinvestment of distributions
to shareholders.............................. 1,852 5,214 3,665 279
Shares redeemed................................ (121,513) (22,450) (48,981) (561)
-------------- ------------ ------------- ----------
Net (decrease) increase in shares outstanding.. (46,691) 81,697 (22,044) 110,904
Shares outstanding, beginning of year.......... 175,776 94,079 118,347 7,443
-------------- ----------- ------------- -------
Shares outstanding, end of year................ 129,085 175,776 96,303 118,347
============== =========== ============== =========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
DEAN FAMILY OF FUNDS
LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class A
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 10.65 $ 12.21 $ 10.00
-------------- -------------- --------------
Income (loss) from investment operations:
Net investment income (loss)................... 0.01 0.05 0.03
Net realized and unrealized gains (losses)
on investments............................... 0.46 (1.44) 2.36
--------------- ------------- ---------------
Total from investment operations.................. 0.47 (1.39) 2.39
--------------- ------------- ---------------
Less distributions:
From net investment income..................... (0.01) (0.05) (0.03)
From net realized gains........................ ------ (0.12) (0.15)
---------------- -------------- ---------------
Total distributions............................... (0.01) (0.17) (0.18)
---------------- -------------- ----------------
Net asset value at end of period.................. $ 11.11 $ 10.65 $ 12.21
================ ================ ================
Total return (b).................................. 4.38% (11.48)% 24.11%
=============== ================ ===============
Net assets at end of period....................... $ 10,134,912 $ 9,315,112 $ 7,669,807
============== =============== ==============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 2.11% 2.29% 2.72% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 1.85% 1.85% 1.84% (a)
Ratio of net investment income
to average net assets.......................... .02% 0.46% 0.30% (a)
Portfolio turnover rate........................... 71% 55% 54% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(May 28, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
LARGE CAP VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class C
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 10.57 $ 12.16 $ 10.76
------------- ------------- -------------
Income (loss) from investment operations:
Net investment income (loss)................... (0.03) (0.02) (0.01)
Net realized and unrealized gains (losses)
on investments............................... 0.18 (1.45) 1.56
--------------- ------------- ------------
Total from investment operations.................. 0.15 (1.47) 1.55
---------------- ------------- ------------
Less distributions:
From net investment income..................... (0.01) ------ ------
From net realized gains........................ ------- (0.12) (0.15)
---------------- ------------ ------------
Total distributions............................... (0.01) (0.12) (0.15)
---------------- ------------- ------------
Net asset value at end of period.................. $ 10.71 $ 10.57 $ 12.16
================ ============= =============
Total return (b).................................. 1.38% (12.12)% 14.63%
================ ============= ============
Net assets at end of period....................... $ 511,730 $ 531,871 $ 136,237
================ ============== ============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 4.04% 8.53% 52.73% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 2.60% 2.60% 2.59% (a)
Ratio of net investment (loss)
to average net assets.......................... (.22)% (0.31)% (0.55)% (a)
Portfolio turnover rate .......................... 71% 55% 54% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(August 19, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class A
Year Year From
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998 (c)
Net asset value at beginning of period............ $ 9.15 $ 12.84 $ 10.00
------------ ------------- --------------
Income (loss) from investment operations:
Net investment income (loss)................... 0.14 0.08 0.03
Net realized and unrealized gains (losses)
on investments............................... (0.19) (3.03) 3.30
----------------- ------------- -------------
Total from investment operations.................. (0.05) (2.95) 3.33
----------------- ------------- -------------
Less distributions:
From net investment income..................... (0.15) (0.06) (0.02)
From net realized gains........................ ----- (0.68) (0.47)
------------------ ----------- ------------
Total distributions............................... (0.15) (0.74) (0.49)
------------------ -----------
Net asset value at end of period.................. $ 8.95 $ 9.15 $ 12.84
================= =========== ==============
Total return (b).................................. (0.53)% (23.39)% 33.86%
================== ============ ==============
Net assets at end of period....................... $ 13,333,607 $ 15,479,055 $ 19,437,554
================= =========== ============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 1.92% 1.89% 1.98% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 1.85% 1.85% 1.84% (a)
Ratio of net investment income (loss)
to average net assets.......................... 1.49% 0.83% 0.35% (a)
Portfolio turnover rate .......................... 90% 79% 62% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(May 28, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
SMALL CAP VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class C
Year Year From
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998 (c)
Net asset value at beginning of period............ $ 9.05 $ 12.79 $ 10.95
------------- ------------- ------------
Income (loss) from investment operations:
Net investment income (loss)................... (0.01) 0.01 (0.02)
Net realized and unrealized gains (losses)
on investments............................... (0.09) (3.03) 2.33
-------------- ----------- -------------
Total from investment operations.................. (0.10) (3.02) 2.31
-------------- ----------- -------------
Less distributions:
From net investment income..................... (0.15) (0.04) ------
From net realized gains........................ ----- (0.68) (0.47)
--------------- ----------- -------------
Total distributions............................... (0.15) (0.72) (0.47)
--------------- ----------- -------------
Net asset value at end of period.................. $ 8.80 $ 9.05 $ 12.79
=============== =========== =============
Total return (b).................................. (1.11)% (24.00)% 21.63%
=============== =========== =============
Net assets at end of period....................... $ 2,344,244 $ 2,560,618 $ 1,392,036
============== =========== ============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 2.32% 2.70% 6.41% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 2.31% 2.60% 2.59% (a)
Ratio of net investment income (loss)
to average net assets.......................... (0.31)% 0.17% (0.42)% (a)
Portfolio turnover rate .......................... 90% 79% 62% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(August 1, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
BALANCED FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class A
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 10.75 $ 11.55 $ 10.00
-------------- -------------- --------------
Income (loss) from investment operations:
Net investment income (loss)................... 0.28 0.19 0.17
Net realized and unrealized gains (losses)
on investments............................... (0.66) (0.56) 1.62
--------------- -------------- --------------
Total from investment operations.................. (0.38) (0.37) 1.79
--------------- --------------- --------------
Less distributions:
From net investment income..................... (0.21) (0.19) (0.16)
From net realized gains........................ ----- (0.24) (0.08)
---------------- --------------- --------------
Total distributions............................... (0.21) (0.43) (0.24)
---------------- --------------- --------------
Net asset value at end of period.................. $ 10.16 $ 10.75 $ 11.55
================ ============== ==============
Total return (b).................................. (3.52)% (3.22)% 18.07%
================ ============== ==============
Net assets at end of period....................... $ 8,606,480 $ 10,391,582 $ 7,262,670
================ ============== ===============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 2.13% 2.09% 2.60% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 1.85% 1.85% 1.84% (a)
Ratio of net investment income (loss)
to average net assets.......................... 2.63% 1.79% 1.85% (a)
Portfolio turnover rate .......................... 196% 60% 64% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(May 28, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
BALANCED FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class C
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 10.73 $ 11.52 $ 10.71
------------- -------------- --------------
Income (loss) from investment operations:
Net investment income (loss)................... (0.22) 0.11 0.07
Net realized and unrealized gains (losses)
on investments............................... (0.34) (0.55) 0.92
------------- -------------- -------------
Total from investment operations.................. (0.56) (0.44) 0.99
------------- -------------- -------------
Less distributions:
From net investment income..................... (0.17) (0.11) (0.10)
From net realized gains........................ ----- (0.24) (0.08)
-------------- ------------- --------------
Total distributions............................... (0.17) (0.35) (0.18)
-------------- ------------- --------------
Net asset value at end of period.................. $ 10.00 $ 10.73 $ 11.52
============== ============= ===============
Total return (b).................................. (5.24)% (3.81)% 9.37%
============== ============= ===============
Net assets at end of period....................... $ 1,291,000 $ 1,885,376 $ 1,083,890
============== ============= ==============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 2.74% 3.14% 7.39% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 2.60% 2.60% 2.59% (a)
Ratio of net investment income (loss)
to average net assets.......................... (2.13)% 1.04% 0.99% (a)
Portfolio turnover rate .......................... 196% 60% 64% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(August 1, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class A
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 12.41 $ 11.76 $ 10.00
------------- ----------- ------------
Income (loss) from investment operations:
Net investment income (loss)................... (0.13) (0.01) (0.05)
Net realized and unrealized gains (losses)
on investments............................... 8.36 0.69 1.81
-------------- ------------ ------------
Total from investment operations.................. 8.23 0.68 1.76
--------------- ------------ -------------
Less distributions:
From net investment income..................... ----- ---- -----
From net realized gains........................ (0.67) (0.03) -----
--------------- ------------- --------------
Total distributions............................... (0.67) (0.03) -----
--------------- ----------- --------------
Net asset value at end of period.................. $ 19.97 $ 12.41 $ 11.76
=============== =========== ==============
Total return (b).................................. 68.08% 5.82% 17.60%
=============== =========== ==============
Net assets at end of period....................... $ 19,523,637 $ 5,981,899 $ 1,295,896
=============== ============ =============
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 2.89% 4.25% 16.66% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 2.09% 2.09% 2.04% (a)
Ratio of net investment (loss)
to average net assets.......................... (0.82)% (0.70)% (1.30)% (a)
Portfolio turnover rate .......................... 157% 100% 109% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(October 13, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS
Per Share Data for a Share Outstanding Throughout Each Period
<TABLE>
<S> <C> <C> <C>
Class C
Year Year From (c)
Ended Ended Inception
March 31, March 31, Through
2000 1999 March 31, 1998
Net asset value at beginning of period............ $ 12.28 $ 11.72 $ 9.89
------------- ------------- -------------
Income (loss) from investment operations:
Net investment income (loss)................... (0.24) (0.10) (0.04)
Net realized and unrealized gains (losses)
on investments............................... 8.43 0.69 1.87
-------------- ------------- --------------
Total from investment operations.................. 8.19 0.59 1.83
--------------- -------------- --------------
Less distributions:
From net investment income..................... ----- ----- -----
From net realized gains........................ (0.71) (0.03) -----
--------------- -------------- ---------------
Total distributions............................... (0.71) (0.03) -----
--------------- --------------- ---------------
Net asset value at end of period.................. $ 19.76 $ 12.2 $ 11.72
=============== ============== ================
Total return (b).................................. 68.54% 5.07% 18.50%
=============== ============= ================
Net assets at end of period....................... $ 1,902,892 $ 1,453,569 $ 87,249
=============== ============== ================
Ratio of expenses to average net assets:
Before fee waivers and/or expense reimbursements
by Adviser................................... 3.53% 5.91% 58.89% (a)
After fee waivers and/or expense reimbursements
by Adviser................................... 2.71% 2.84% 2.82% (a)
Ratio of net investment (loss)
to average net assets.......................... (1.61)% (1.23)% (1.94)% (a)
Portfolio turnover rate .......................... 157% 100% 109% (a)
</TABLE>
See accompanying notes to financial statements.
(a) Annualized
(b) Total returns shown exclude the effect of applicable sales loads and are not
annualized. (c) Represents the period from the initial Public Offering of Shares
(November 6, 1997) through March 31, 1998.
<PAGE>
DEAN FAMILY OF FUNDS
NOTES TO FINANCIAL STATEMENTS
March 31, 2000
1. Organization
The Dean Family of Funds (the Trust) is registered under the Investment Company
Act of 1940, 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 capital appreciation and dividend
income 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
(normally 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.
<PAGE>
2. Significant Accounting Policies (continued)
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.
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.
Dividends from net investment income and from net realized capital gains are
determined in accordance with income tax regulations, which may differ from
generally accepted accounting principles. These differences are primarily due to
differing treatments for foreign currency transactions, deferrals of certain
losses, and differing book/tax treatment of certain income items.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the composition of net assets based on their federal
tax-basis treatment; temporary differences do not require reclassifications.
As of March 31, 2000, the following reclassifications have been made to increase
(decrease) such accounts with offsetting adjustments made to paid-in capital:
<TABLE>
<S> <C> <C>
Accumulated Accumulated Net
Undistributed Net Realized gain/(loss)
Investment Income on Investments
----------------------------- ---------------------------
Small Cap Value Fund $ (38,418) $ 38,418
Balanced Fund (6,447) 7,184
International Value Fund 109,295 (564,335)
</TABLE>
Allocation between classes - Investment income earned, realized capital gains
and losses, and unrealized appreciation and depreciation for the Funds are
allocated daily to each class of shares based upon its proportionate share of
total net assets of the Fund. Class specific expenses are charged directly to
the class incurring the expense. Common expenses which are not attributable to a
specific class are allocated daily to each class of shares based upon its
proportionate share of the total net assets of the Fund.
Organization expenses - Expenses of the 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 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 income and expense
during the reporting period. Actual results could differ from those estimates.
<PAGE>
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 investment income (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
As of March 31, 2000, for federal income tax purposes, the Funds have capital
loss carryforwards available to offset future capital gains, if any, in the
following amounts:
<TABLE>
<S> <C> <C> <C>
AMOUNT EXPIRES MARCH 31,
------------------------------------ ------------------- ------------------------------
Large Cap Value Fund $ 39,825 2007
276,731 2008
Small Cap Value Fund 622,259 2008
Balanced Fund 489,511 2008
</TABLE>
The following information is based upon the federal income tax cost of portfolio
investments as of March 31, 2000:
<TABLE>
<S> <C> <C> <C> <C>
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
Gross unrealized appreciation..................... $ 1,544,465 $ 1,821,528 $ 671,934 $ 5,710,176
Gross unrealized depreciation..................... (660,497) (4,013,700) (650,964) (516,386)
----------- ------------ ----------- ------------
Net unrealized appreciation (depreciation)........ $ 883,968 $ (2,192,172) $ 20,970 $ 5,193,790
============ ============ =========== =============
Federal income tax cost........................... $ 9,753,071 $ 18,038,220 $ 9,862,217 $ 16,347,717
============ ============ =========== =============
</TABLE>
3. Investment Transactions
Investment transactions, other than short-term investments, were as follows for
the year ended March 31, 2000:
<TABLE>
<S> <C> <C> <C> <C>
Large Cap Small Cap Balanced International
Value Fund Value Fund Fund Value Fund
Purchases of portfolio securities........................... $ 7,692,931 $ 16,255,154 $ 20,377,791 $ 25,896,189
=========== ============ ============ =============
Proceeds from sales and maturities of portfolio securities.. $ 7,320,108 $ 17,811,153 $ 20,667,284 $ 20,053,589
=========== ============ ============ ============
</TABLE>
4. Transactions with Affiliates
Certain trustees and officers of the Trust are also officers of C.H. Dean &
Associates, Inc. (the Advisor) or of Unified Fund Services (UFS), the
administrative services agent, shareholder servicing and transfer agent, and
accounting services agent for the Trust.
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 the
average daily net assets for the Large Cap Value Fund, the Small Cap Value Fund
and the Balanced Fund and 1.25% of the 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
the Fund's average daily net assets.
In order to voluntarily reduce operating expenses during the year ended March
31, 2000 the Adviser waived $27,290 of its advisory fees and reimbursed $8,842
of Class C expenses for the Large Cap Value Fund; waived $1,056 of its advisory
fee and reimbursed $9,076 of Class A expenses for the Small Cap Value Fund;
waived $16,223 of its advisory fee and reimbursed $13,449 of Class A expenses
for the Balanced Fund; and waived $103,091 of its advisory fee and reimbursed
$300 of Class C expenses for the International Value Fund.
ADMINISTRATION AGREEMENT
Under the terms of a Mutual Fund Services Agreement, UFS serves as
administrative services agent for the Trust. UFS supplies non-investment related
administrative and compliance services for the Funds. UFS prepares 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, UFS receives a monthly fee from each Fund
at an annual rate of 0.09% on its average daily net assets up to $100 million,
0.06% on the next $150 million of such net assets, and 0.05% on such net assets
in excess of $250 million, subject to a $1,250 minimum monthly fee.
<PAGE>
4. Transactions with Affiliates (continued)
Prior to November 15, 1999, Countrywide Fund Services (CFS) provided the above
administrative services to the Trust For these services, CFS received 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 the Mutual Fund Services Agreement, UFS serves as transfer
agent and shareholder services agent for the Trust. UFS maintains the records of
each shareholder's account, answers shareholder's 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, UFS receives a monthly fee based on the
number of shareholder accounts in each class of each Fund, subject to a $1,000
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.
Prior to November 15, 1999, CFS provided the above services to the Trust. For
these services, CFS received 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 the Mutual Fund Services Agreement, UFS serves as accounting
services agent for the Trust. UFS calculates the daily net asset value per share
and maintains the financial books and records of the Funds. For these services,
UFS receives a monthly fee from each Fund at an rate of 0.05% of its average
daily net assets up to $100 million, 0.04% of the next $150 million of such net
assets, and 0.03% of such net assets in excess of $250 million, subject to a
$26,000 minimum annual fee for each Fund. In addition, each Fund pays certain
out-of-pocket expenses incurred by UFS in obtaining valuations of such Fund's
portfolio securities.
Prior to November 15, 1999, CFS provided the above service to the Trust. For
these services, CFS received a monthly fee of $3,000 from each Fund, as well as
out-of-pocket expenses.
UNDERWRITING AGREEMENT
2480 Securities LLC (the 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 $2,169,
$8,196, $3,239, and $1,151 from underwriting and broker commissions on the sale
of shares of the Large Cap Value Fund, the Small Cap Value Fund, the Balanced
Fund, and the International Value Fund, respectively, during the year ended
March 31, 2000.
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 attributable to Class C shares. In
addition, the Class C shares may directly incur or reimburse the Underwriter in
an amount not to exceed
<PAGE>
4. Transactions with Affiliates (continued)
0.75% per annum of a Fund's average daily net assets attributable to Class C
shares for certain distribution-related expenses incurred in the distribution
and promotion of the Fund's Class C shares.
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 and
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 to the amounts actually received or paid.
Reported net unrealized foreign exchanges 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 translations 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.
<PAGE>
6. Forward Foreign Currency Exchange Contracts (continued)
As of March 31, 2000, the International Value Fund had forward foreign currency
exchange contracts outstanding as follows:
<TABLE>
<S> <C> <C> <C> <C> <C>
Net Unrealized
Settlement To Receive Initial Market Appreciation
Date (To Deliver) Value Value (Depreciation)
Contracts To Sell
06/15/00................................... (191,521) EUR $ (192,456) $ (184,238) $ 8,218
06/15/00................................... (39,114,000) JPY (368,913) (386,413) (17,500)
06/15/00................................... (47,635,000) JPY (464,392) (470,594) (6,202)
06/15/00................................... (50,142,000) JPY (473,775) (495,361) (21,586)
06/15/00................................... (17,500,000) JPY (170,607) (172,885) (2,278)
06/15/00................................... (32,800,000) JPY (328,435) (324,036) 4,399
08/15/00................................... (402,000) HKD (51,654) (51,638) 16
04/03/00................................... (206,789) GBP (329,912) (329,912) -----
04/03/00................................... (72,566) BRL (41,254) (41,585) (331)
04/03/00................................... (58,893) BRL (33,481) (33,750) (269)
----------- ------------ -------
Total sell contracts.......................... (2,454,879) (2,490,412) (35,533)
----------- ------------ -------
Contracts To Buy
04/03/00................................... 9,480,739 JPY 92,675 92,675 -----
04/03/00................................... 344,820 EUR 329,940 329,940 -----
06/15/00................................... 107,759 GBP 174,930 67,525 (107,405)
06/15/00................................... 363,800 EUR 375,824 349,967 (25,857)
06/15/00................................... 460,242 EUR 467,674 442,741 (24,933)
06/15/00................................... 294,071 GBP 476,248 184,274 (291,974)
06/15/00................................... 20,057,000 JPY 189,512 198,147 8,634
---------- ------------- -------
Total buy contracts........................... 2,106,803 1,665,269 (441,534)
---------- ------------- --------
Net Contracts................................. $ (348,076) $ (825,143) $ (477,067)
========= ========== ===========
</TABLE>
BRL - Brazilian Real
EUR - Euro Currency Unit
GBP - British Pound Sterling
HKD - Hong Kong Dollar
JPY - Japanese Yen
<PAGE>
Report of Independent Auditors
To the Shareholders and Trustees
Dean Family of Funds
We have audited the accompanying statements of assets and liabilities, including
the schedules of portfolio investments, of the Dean Family of Funds (consisting
of Large Cap Value Fund, Small Cap Value Fund, Balanced Fund, and International
Value Fund, collectively, the Funds) as of March 31, 2000, the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended and the financial
highlights for each of the periods indicated therein. 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 audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of March 31, 2000, by correspondence with the custodian and brokers. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the funds as of March 31, 2000, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for each of the periods indicated
therein, in conformity with accounting principles generally accepted in the
United States.
/s/ Ernst & Young LLP
Cincinnati, Ohio
June 12, 2000
<PAGE>
DEAN Family of Funds
2480 Kettering Tower
Dayton, Ohio 45423
BOARD OF TRUSTEES
Chauncey H. Dean
Dr. Robert D. Dean
Dr. Sam B. Gould
Frank J. Perez
Dr. David H. Ponitz
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
UNIFIED FUND SERVICES, INC.
P.O. Box 6110
Indianapolis, Indiana 46206-6110
SHAREHOLDER SERVICE
Nationwide: (Toll-Free) 888-899-8343
Table of Contents
------------------------------------
Chairman and President's Letter
Discussions of Performance:
Large Cap Value Fund
Small Cap Value Fund
Balanced Fund
International Value Fund
Fund Facts
Portfolios of Investments:
Large Cap Value Fund
Small Cap Value Fund
Balanced Fund
International Value Fund
Financial Statements
Notes to Financial Statements
Report to Independent Auditors
