SMT FUND
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SCHEDULE OF INVESTMENTS
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As of November 30, 1998 (Unaudited)
Number Market
of Shares Value
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MONEY MARKET - 98.00%
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Star Bank Treasury Fund 11,289,501 11,289,501
Total Money Market
(Cost $11,289,501) 11,289,501
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Total Investments
(Cost $11,289,501) 11,289,501
Other Assets and Liabilities, Net - 2.00% 231,535
Net Assets - 100% $11,521,036
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The accompanying notes are an integral part of these financial statements.
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SMT FUND
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STATEMENT OF ASSETS AND LIABILITIES
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For the period-ended November 30, 1998 (Unaudited)
ASSETS
Investments, at value (cost $11,289,501) ................ $ 11,289,501
Receivable interest...................................... 31,548
Receivable for shares of beneficial interest sold ....... 200,000
Deferred organization costs.............................. 39,327
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Total assets ............................................ 11,560,376
LIABILITIES
Accrued management fees.................................. 38,631
Accrued trustee fees..................................... 344
Accrued miscellaneous expenses .......................... 365
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Total liabilities....................................... 39,340
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NET ASSETS ................................................... $ 11,521,036
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Net assets consist of:
Paid-in capital ......................................... 10,515,698
Undistributed net investment income ..................... (64,838)
Accumulated net realized gain on investments ............ 1,070,176
Net assets .............................................. $ 11,521,036
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Shares of capital stock
outstanding (no par value,
unlimited shares authorized)............................. 997,263
Net asset value, offering
and redemption price per share .......................... $ 11.55
The accompanying notes are an integral part of these financial statements.
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SMT FUND
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STATEMENT OF OPERATIONS
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For the period June 4, 1998 (commencement of investment operations) to November
30, 1998 (Unaudited)
INVESTMENT INCOME
Income:
Interest ................................................ $ 119,629
Dividends ............................................... 2,725
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Total net income ................................... 122,354
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EXPENSES:
Management fees expense.................................. 181,647
Trustee fee expense ..................................... 1,094
Organization expense..................................... 4,092
Other expenses .......................................... 359
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Total net expenses.................................... 187,192
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NET INVESTMENT INCOME ....................................... (64,838)
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REALIZED AND UNREALIZED GAIN/LOSS
ON INVESTMENTS
Net realized gain on investments......................... 1,070,176
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INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ............................... $ 1,005,338
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The accompaying notes are an integral part of these financial statements.
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SMT FUND
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STATEMENT OF CHANGES IN NET ASSETS
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For the period June 4, 1998 (commencement of investment operations) to November
30, 1998 (Unaudited)
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income ................................... $ (64,838)
Net realized gain on investments ........................ 1,070,176
Increase in net assets resulting from operations ........ 1,005,338
Capital share transactions:
Proceeds from shares sold................................. 10,847,686
Cost of shares redeemed................................... (331,988)
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Increase in net assets
resulting from capital share transactions ................. 10,515,698
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TOTAL INCREASE IN NET ASSETS................................... 11,521,036
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NET ASSETS:
Beginning of period ...................................... ---
End of period (including undistributed net
realized gains on investments) ...................... $ 11,521,036
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Shares of capital stock of the Fund sold and redeemed:
Shares sold .............................................. 1,027,916
Shares redeemed........................................... (30,653)
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NET INCREASE IN NUMBER
OF SHARES OUTSTANDING .................................... 997,263
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The accompanying notes are an integral part of these financial statements.
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SMT FUND
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FINANCIAL HIGHLIGHTS
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(Unaudited)
Period
Ended
November 30,
1998
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PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning ................................... $ 10.00
Income from investment
Operations:
Net investment income ................................... (0.09)
Net realized and
unrealized gain (loss) on investments................. 1.64
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Total from investment income ................................. 1.55
Net asset value at end of period ............................. $ 11.55
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TOTAL RETURN (b).............................................. 31.26%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period................................ 11,521,036
Ratio of total expenses to
average net assets (b).............................. 4.68%
Ratio of net investment
income to average net assets (b).................... (1.62%)
Portfolio turnover ...................................... 7495.27%
(a) For the period June 04, 1998 (commencement of operations) to November 30,
1998.
(b) Annualized.
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NOTES TO FINANCIAL STATEMENTS
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Note 1 - General
The SMT Fund (the "Fund") was organized as a series of Securities Management &
Timing Funds, an Ohio business trust (the"Trust") on February 20, 1998. The SMT
Fund is a diversified, open-end mutual fund whose investment objective is to
provide long term capital appreciation. The Fund seeks to achieve this objective
by following a market timing strategy which is based on a proprietary investment
model developed by Securities Management & Timing, Inc., the Fund's adviser. The
Fund attempts to be "in the market" (invested in a broad range of common stocks)
when the market is rising and "out of the market" (invested in money market
instruments) when the market is declining.
The Adviser's market timing strategy uses a proprietary, computer-driven
technical model that generates buy and sell signals. When the technical
indicators in the model generate a buy signal, the Fund will substantially
invest in a broad range of high quality stocks selected by the Adviser. When the
indicator generates a sell signal, the stocks will be sold and the proceeds
invested in money market instruments.
Note 2 - Significant Accounting Policies
The following is a summary of the significant accounting policies followed by
the Fund in the preparation of its financial statements.
A) Security Valuations
Securities which are traded on any exchange or on the NASDAQ over-the-counter
market are valued at the last quoted sale price. Lacking a last sale price, a
security is valued at its last bid price except when, in the Adviser's opinion,
the last bid price does not accurately reflect the current value of the
security. All other securities for which over-the-counter market quotations are
readily available are valued at their last bid price. When market quotations are
not readily available, when the Adviser determines the last bid price does not
accurately reflect the current value or when restricted securities are being
valued, such securities are valued as determined in good faith by the Adviser,
subject to review of the Board of Trustees of the Trust.
B) Securities Transactions and Related Income
Securities transactions are recorded on a trade date. Realized gains and losses
from securities transactions are recorded on the identified cost basis. Interest
income is recorded on the accrual basis and dividend income is recorded on the
ex-dividend date.
C) Dividends and Distributions to Shareholders
The Fund intends to distribute substantially all of its net investment income as
dividends to its shareholders on an annual basis, and intends to distribute its
net long-term capital gains and its short-term capital gains at least once a
year. However, to the extent that net realized gains of the Fund could be
reduced by any capital loss carry-overs, such gains will not be distributed.
D) Federal Income Taxes
It is the policy of the Fund to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to its shareholders.
E) Expenses
Organizational costs represent costs incurred in connection with the
organization and the initial public offering of the Fund. Organizational costs
are deferred and will be amortized on a straight-line basis over five years. In
the event that the original shareholder (or any subsequent transferee) redeems
any of its original capital (seed capital) prior to these organizational costs
being fully amortized, the redemption proceeds will be reduced by a pro-rata
portion of any then unamortized organizational costs.
At November 30, 1998, the unamortized balance was $39,327.
F) Estimates
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
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Note 3 - Agreements and Other Transactions with Affiliates
The Fund retains Securities Management & Timing, Inc., (the "Adviser") to manage
the Fund's investments. The Fund is authorized to pay the Adviser a fee equal to
an annual average rate of 4.95% of its average daily net assets, minus the
amount by which the Fund's total expenses (including organizational expenses,
but excluding brokerage, taxes, interest and extraordinary expenses) exceeds
4.99%. The Adviser pay all of the operating expenses of the Fund except
brokerage, taxes, interest, fees and expenses on non-interested persons trustees
and extraordinary expenses. At November 30, 1998 the Adviser received $181,647.
The Funds retains Unified Fund Services, Inc., (the "Administrator") to manage
the Fund's business affairs and provide the Fund with administrative services,
including all regulatory reporting and necessary office equipment, personnel and
facilities. The Fund also retains Unified Fund Services, Inc. (the Transfer
Agent) to serve as transfer agent, dividend paying agent and shareholder service
agent. For its services as Administrator, Unified Fund Services, Inc. receives a
monthly fee from the Adviser equal to an annual average rate of 0.08% of the
Fund's average daily net assets, subject to an annual minimum fee of $17,500.
The Fund retains Unified Management Corporation, (the"Distributor") to act as
the principal distributor of the Fund's shares. The services of the
Administrator, Transfer Agent, and Distributor are operating expenses paid by
the Adviser.
Note 4- Securities Transactions
For the six months ended November 30, 1998, purchases and sales proceeds from
investment securities, excluding short-term investments were as follows:
Purchases Sales
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The SMT Fund $ 88,770,320 $ 89,840,496
Note 5- Unrealized Appreciation (Depreciation)
At November 30, 1998, the Fund had no unrealized appreciation (depreciation) of
investment securities.
Year 2000 Issue. Like other mutual funds, financial and business organizations
and individuals around the world, the Fund could be adversely affected if the
computer systems used by the Adviser, Administrator or other service providers
to the Fund do not properly process and calculate date-related information and
data from January 1, 2000. This is commonly known as the "Year 2000 Issue". The
Adviser and Administrator have taken steps that they believe are reasonably
designed to address the Year 2000 Issue with respect to computer systems that
are used and to obtained reasonable assurances that comparable steps are being
taken by the Fund's major service providers. At this time, however, there can be
no assurance that these steps will be sufficient to avoid any adverse impact on
the Fund. In addition, the Adviser cannot make any assurances that the Year 2000
issue will not affect the companies in which the Fund invests or worldwide
markets and economies.
