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| SEMI-ANNUAL REPORT |
| MARCH 31, 1999 |
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| [GRAPHIC] |
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| CAPSTONE |
| SOCIAL ETHICS |
| AND |
| RELIGIOUS VALUES FUND |
| |
|-------------------------------------------------------------------------|
|-------------------------------------------------------------------------|
| |
| [GRAPHIC] A Member Of |
| THE CAPSTONE GROUP |
| OF MUTUAL FUNDS |
|-------------------------------------------------------------------------|
<PAGE>
[GRAPHIC] CAPSTONE
SERV FUNDS
|----------------------------|
| EQUITY |
| * LARGE CAP EQUITY FUND |
| * SMALL CAP EQUITY FUND |
|----------------------------|
|-----------------------------|
| FIXED INCOME |
| * MONEY MARKET FUND |
| * SHORT-TERM BOND FUND |
| * BOND FUND |
|-----------------------------|
|-------------------------------|
| INTERNATIONAL |
| * INTERNATIONAL FUND |
|-------------------------------|
For more complete information about the SERV Funds, including charges
and expenses, contact the Distributor at the address below to receive a
prospectus. Please read it carefully before you invest or send money.
CAPSTONE ASSET PLANNING COMPANY
5847 SAN FELIPE, SUITE 4100
HOUSTON, TEXAS 77057
1-800-262-6631
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
- ---------------------------------------------------------------------------
Dear Shareholder:
We are pleased to present the semi-annual report for Capstone Social
Ethics and Religious Values Fund for the period ended March 31, 1999.
PERFORMANCE
The performance of each of the portfolios and their designated
benchmarks are presented below:
10/1/98 - 03/31/99
Money Market Fund - Class A 2.31%
Money Market Fund - Class C 2.38%
IBC Index 2.21%
Bond Fund - Class A (1.33)%
Bond Fund - Class C (1.22)%
LBG/C Index (1.07)%
Large Cap Equity Fund - Class A 27.11%
Large Cap Equity Fund - Class C 27.27%
S&P 500 27.34%
Small Cap Equity Fund - Class A 6.76%
Small Cap Equity Fund - Class C 6.88%
S&P Small Cap 600 7.02%
International Fund - Class A 23.72%
International Fund - Class C 23.84%
EAFE 22.51%
01/4/99 - 03/31/99
Short-Term Bond Fund - Class A 0.40%
Short-Term Bond Fund - Class C 0.46%
Custom Index 0.85%
ECONOMIC OVERVIEW
Economic growth continues to be strong. The primary source of growth
in the U.S. economy is the consumer. Capital expenditures by corporations
continue to grow at a positive rate but not as strong as we have seen in
recent years, while the export sector continues to languish due to the
strong dollar. After dipping briefly last fall in the wake of the slide in
the stock market, consumer confidence rebounded back above the 130 level.
Within the confidence survey, 48% of the respondents described jobs as
"plentiful." Retail sales were brisk through the first two months of 1999,
rising 1.0% in January and 0.9% in February. Some of the strength in
retail sales can be attributed to the IRS; many early taxpayers received a
larger refund this year as a consequence of the new $400 per child tax
credit. Many consumers also received their refunds earlier as the number
of electronic filings was running 23% ahead of last year. The most recent
employment report was "mixed"; only 46,000 new jobs were created in March
(well below the pace of recent months), but the unemployment rate dropped
to 4.2% (the lowest level since February of 1970). One bit of bad news for
consumers was the rise in oil prices as OPEC reached an agreement to cut
production by 2.1 million barrels per day. Oil prices are now up 55% from
the mid-December lows.
While we usually refer to the much broader S&P 500 Index when we try to
assess the market's performance, much has been written recently about the
move in the Dow Jones Industrial Average above the 10,000 mark. A
historical look at the move through 1,000 may provide an important lesson
for investors who have grown accustomed to a market that seems to "bust
through milestones" with such ease. In February of 1966 the Dow came
within 5 points of the 1,000 level; it finally broke through the 1,000
level for the first time 81 months later in November of 1972. During the
ten-year period of 1973-1982 there were five years in which the Dow never
closed above 1,000. It was not until December 16th of 1982 that the Dow
closed below 1,000 for the last time, just over ten years from the time
that it first crossed that barrier. We recount this historical lesson not
to issue a warning that equities are overvalued in the current environment,
but rather to remind investors that long-term expectations should
incorporate the possibility of less stellar returns over the investment
horizon.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
- ---------------------------------------------------------------------------
EQUITY MARKET OVERVIEW
Looking into the remainder of 1999, we continue to be cautiously
optimistic that the year will be one of positive returns, but nothing
approaching the over 30% annualized compound return for the four years
ended 1998. While the environment for equities for the foreseeable future
remains positive, it is less positive than in prior years. Valuation, the
earnings outlook, the course of interest rates, the possibility that
inflation has bottomed out, and a recrudescence of armed conflict in
Europe, all point to a less ebullient market than we have seen in recent
years.
Of all the factors mentioned, the one to which we believe investors
should pay the greatest attention is inflation. Those of us (such as your
portfolio manager) who are old enough to remember when the Wall Street
Journal was published in one section, or worse yet, when the family bought
its first television set (ours was a Motorola), have a real appreciation of
price stability and fear of inflation. Table I below indicates how
inflation can deliver a double hit to equity investors. The most obvious
one is that it reduces the purchasing power of any gains that the investor
might enjoy. Over the past 50 years, the best example of this worst case
is the decade of the 70's when the return before inflation of 3.2% was
swamped by a 6.7% inflation rate, resulting in a negative real return for
the decade of 3.5%. In addition, inflation and the policy adjustments
required to fight it introduces uncertainty into the investment decision
which results in lower actual returns. As illustrated on Table I, an
inflation rate which is low but moving up is associated with lower
annualized returns, while an inflation rate that is high and moving down is
associated with higher annualized returns.
For now, signs of inflation are hard to find with some indicators of
more rapid inflation offset by others showing the opposite.
===========================================================================
TABLE I
ANNUALIZED ANNUALIZED
S&P 500 INFLATION REAL
DECADE RETURN RATE RETURN
------ ---------- ---------- ------
1950's 20.1% 1.9% 18.2%
1960's 10.0 2.1 7.9
1970's 3.2 6.7 -3.5
1980's 16.3 5.9 10.4
1990's 19.2 3.1 16.1
===========================================================================
FIXED INCOME MARKET OVERVIEW
Yield spreads in the corporate bond market continue to tighten. Recall
that as yield spreads tighten, a corporate bond will outperform a U.S.
Treasury of comparable maturity, while a wider corporate spread will cause
the corporate bond to underperform. We still maintain a positive outlook
on corporate bonds and expect that any future movement to tighter spreads
will be of this "slow grinding variety" rather than the dramatic movement
investors experienced in the final quarter of 1998.
Another theme in the corporate bond market is the wave of "mega" deals
that issuers have brought to the market. In the last week of March, AT&T
raised a total of $8.0 billion in a single day when they issued new five,
ten, and thirty-year notes. Other notable deals include: Amazon.com (a
$1.25 billion convertible deal for the internet bookseller), BankAmerica
($1.5 billion), Citigroup ($1.5 billion for what was formerly Citibank and
Salomon Smith Barney), Echostar ($1.625 billion for a high-yield communica-
tions company), Ford Motor Credit ($2.8 billion of ten-year notes), and
Merrill Lynch ($2.0 billion of ten-year notes). We view this trend as
positive since it will likely lead to a "more liquid tier" of corporate
bonds that can be traded more efficiently. There is also some news to
report in the agency market. In one of our recent publications we
described the programs that Federal National Mortgage Association (FNMA)
and the other federally sponsored agencies have established to fill the
void created by the decline in the issuance of U.S. Treasury securities.
These agencies have issued a series of large global bonds with maturities
ranging from two years to ten years in an effort to create a more reliable
agency yield curve. To date, all the issues hav e been non-callable. The
latest twist is that FNMA now plans to issue securities that include a call
feature. Structures under consideration include a 5nc2 (five year final
maturity callable after two years), a 5nc3, a 10nc2, and a 10nc3. We also
view this as a positive development for the fixed income markets.
If you have any questions please feel free to contact us at (800)
262-6631. We thank you for your continued support.
Sincerely,
/S/EDWARD L. JAROSKI /S/DAN E. WATSON
Edward L. Jaroski Dan E. Watson
President and Chairman of the Board Executive Vice President
<PAGE>
<TABLE>
<CAPTION>
THE CAPSTONE SOCIAL ETHICS AND RELIGIOUS VALUES FUND
STATEMENTS OF ASSETS AND LIABILITIES (Unaudited) March 31, 1999
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MONEY MARKET SHORT-TERM BOND BOND LARGE CAP SMALL CAP INTERNATIONAL
FUND FUND FUND EQUITY FUND EQUITY FUND FUND
-----------------------------------------------------------------------------------
ASSETS:
Investments, at value (identified cost
$21,990,444, $21,918,276, $62,131,147,
$35,051,054, $59,299,169 and
$36,511,175 respectively) (Note 3) $21,990,444 $21,814,347 $60,129,931 $43,805,042 $60,921,382 $38,732,749
Cash denominated in foreign currency,
at value (identified cost $1,506,700) - - - - - 1,489,413
Cash - - 186 - - -
Receivables:
Dividends and interest 89,996 311,220 851,123 44,869 37,027 28,181
Prepaid expenses 814 3 1,365 1,365 1,365 1,365
----------- ----------- ----------- ----------- ----------- -----------
Total assets 22,081,254 22,125,570 60,982,605 43,851,276 60,959,774 40,251,708
----------- ----------- ----------- ----------- ----------- -----------
LIABILITIES:
Payables:
Distributions payable $ 82,772 $ - $ - $ - $ - $ -
Due to Advisor - 6,767 10,389 7,789 10,991 6,713
Variation margin payable - - - - - 421,346
Accrued expenses 10,485 6,353 10,482 2,607 6,053 9,380
----------- ----------- ----------- ----------- ----------- -----------
Total liabilities 93,257 13,120 20,871 10,396 17,044 437,439
----------- ----------- ----------- ----------- ----------- -----------
NET ASSETS $21,987,997 $22,112,450 $60,961,734 $43,840,880 $60,942,730 $39,814,269
=========== =========== =========== =========== =========== ===========
NET ASSETS CONSIST OF:
Common stock $ - $ 887,362 $ 2,521,354 $ 1,383,889 $ 2,288,686 $ 1,364,785
Additional capital paid-in 21,988,005 21,301,085 60,353,174 33,356,982 56,006,969 33,001,875
Undistributed net investment income (8) 32,068 99,256 13,578 98,651 36,140
Accumulated realized gain (loss)
on investments - (4,136) (10,834) 332,443 926,211 3,150,941
Net unrealized appreciation
(depreciation) on
Investments - (103,929) (2,001,216) 8,753,988 1,622,213 2,221,574
Translation of assets and liabilities
in foreign currencies - - - - - 38,954
----------- ----------- ----------- ----------- ----------- -----------
Net Assets $21,987,997 $22,112,450 $60,961,734 $43,840,880 $60,942,730 $39,814,269
=========== =========== =========== =========== =========== ===========
CLASS A SHARES (NOTE 1):
Net assets for 1, 1, 1, 1, 1 and
1 share outstanding, respectively $ 1 $ 25 $ 24 $ 32 $ 27 $ 29
Net asset value and redemption price
per Class A Share $ 1.00 $ 24.92 $ 24.18 $ 31.68 $ 26.60 $ 29.14
CLASS C SHARES (NOTE 1):
Net assets for 21,987,996, 887,361,
2,521,353, 1,383,888, $21,987,996 $22,112,425 $60,961,710 $43,840,848 $60,942,703 $39,814,240
2,288,685, and 1,364,784 shares
outstanding, respectively
Net asset value and redemption price
per share $ 1.00 $ 24.92 $ 24.18 $ 31.68 $ 26.63 $ 29.17
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
<TABLE>
<CAPTION>
THE CAPSTONE SOCIAL ETHICS AND RELIGIOUS VALUES FUND
STATEMENTS OF OPERATIONS FOR THE PERIOD OCTOBER 1, 1998 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1999 (Unaudited)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MONEY MARKET SHORT-TERM BOND BOND LARGE CAP SMALL CAP INTERNATIONAL
FUND FUND FUND EQUITY FUND EQUITY FUND FUND
-----------------------------------------------------------------------------------
INVESTMENT INCOME:
Interest $ 589,002 $ 219,102 $ 1,430,180 $ 4,949 $ 4,910 $ 529,260
Dividends - - - 270,300 308,832 58,187
----------- ----------- ----------- ----------- ----------- -----------
Total Investment Income 589,002 219,102 1,430,180 275,249 313,742 587,447
----------- ----------- ----------- ----------- ----------- -----------
EXPENSES:
Investment advisory fees (Note 3) 11,826 6,679 42,304 28,890 41,896 28,326
Administration fee (Note 3) 5,913 2,226 14,101 9,630 13,965 9,442
Accounting fee 8,478 4,006 8,478 8,478 8,478 8,478
Custodian fees 1,332 390 3,666 3,124 4,308 2,355
Transfer agency fees 3,740 2,333 3,740 3,740 3,740 3,740
Trustee expense 2,244 1,060 2,244 2,244 2,244 2,244
Audit fees 2,493 1,576 2,493 2,493 2,493 2,493
Legal fees 2,244 1,060 2,244 2,244 2,244 2,244
Consulting fees 2,957 1,113 7,051 4,815 6,983 4,721
Pricing fees - 891 3,355 7,824 11,735 786
Registration fees 4,987 2,356 4,987 4,987 4,987 4,987
Reports to shareholders - 118 249 249 249 249
Other 2,204 1,013 4,652 3,467 4,726 6,040
----------- ----------- ----------- ----------- ----------- -----------
Total expenses before waivers 48,418 24,821 99,564 82,185 108,048 76,105
Fees waived (Note 3) (19,369) (8,905) - - - -
----------- ----------- ----------- ----------- ----------- -----------
Total expenses, net 29,049 15,916 99,564 82,185 108,048 76,105
----------- ----------- ----------- ----------- ----------- -----------
Net investment income 559,953 203,186 1,330,616 193,064 205,694 511,342
----------- ----------- ----------- ----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain (loss) on:
Investments - (4,136) (10,834) 332,443 1,018,557 546,982
Foreign currency transactions - - - - - 4,472,268
Net unrealized appreciation (depreciation)
during the period on:
Investments - (103,929) (2,001,216) 8,753,988 1,622,213 2,221,574
Translation of assets and liabilities in
foreign currencies - - - - - 38,954
----------- ----------- ----------- ----------- ----------- -----------
Net gain (loss) on investments and currency - (108,065) (2,012,050) 9,086,431 2,640,770 7,279,778
----------- ----------- ----------- ----------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 559,953 $ 95,121 $ (681,434) $ 9,279,495 $ 2,846,464 $ 7,791,120
=========== =========== =========== =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
<TABLE>
<CAPTION>
THE CAPSTONE SOCIAL ETHICS AND RELIGIOUS VALUES FUND
STATEMENTS OF CHANGES IN NET ASSETS FOR THE PERIOD OCTOBER 1, 1998 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1999 (Unaudited)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MONEY MARKET SHORT-TERM BOND BOND LARGE CAP SMALL CAP INTERNATIONAL
FUND FUND FUND EQUITY FUND EQUITY FUND FUND
----------- ----------- ----------- ----------- ----------- -----------
INCREASE IN NET ASSETS
Operations
Net investment income $ 559,953 $ 203,186 $ 1,330,616 $ 193,064 $ 205,694 $ 511,342
Net realized gain (loss) on:
Investments - (4,136) (10,834) 332,443 1,018,557 546,982
Foreign currency transactions - - - - - 4,472,268
Net unrealized appreciation (depreciation)
during the period on:
Investments - (103,929) (2,001,216) 8,753,988 1,622,213 2,221,574
Translation of assets and liabilities
in foreign currencies - - - - - 38,954
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 559,953 95,121 (681,434) 9,279,495 2,846,464 7,791,120
----------- ----------- ----------- ----------- ----------- -----------
Distributions to shareholders from:
Net investment income
Class A - - (1) - - -
Class C (559,961) (171,118) (1,231,359) (179,486) (107,043) (475,202)
Net realized gain
Class A - - - - - (1)
Class C - - - - (92,346) (1,868,308)
----------- ----------- ----------- ----------- ----------- -----------
Total Distributions (559,961) (171,118) (1,231,360) (179,486) (199,389) (2,343,511)
----------- ----------- ----------- ----------- ----------- -----------
Increase in net assets from Fund share
transactions (Note 5) 21,988,005 22,188,447 62,874,528 34,740,871 58,295,655 34,366,660
----------- ----------- ----------- ----------- ----------- -----------
Increase in net assets 21,987,997 22,112,450 60,961,734 43,840,880 60,942,730 39,814,269
NET ASSETS:
Beginning of period - - - - - -
----------- ----------- ----------- ----------- ----------- -----------
End of period $21,987,997 $22,112,450 $60,961,734 $43,840,880 $60,942,730 $39,814,269
=========== =========== =========== =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
<TABLE>
<CAPTION>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
FINANCIAL HIGHLIGHTS (Unaudited) COMMENCEMENT OF OPERATIONS TO MARCH 31, 1999
- -------------------------------------------------------------------------------------------------------------
The following tables include selected data for a share outstanding throughout each fiscal year or period and
other performance information derived from financial statements. They should be read in conjunction with the
financial statements and notes thereto.
MONEY MARKET FUND(A) SHORT-TERM BOND FUND(B)
---------------------- -----------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD..................... $ 1.00 $ 1.00 $25.00 $25.00
------ ------ ------ ------
INVESTMENT OPERATIONS:
Net investment income.................................. 0.02 0.02 0.20 0.23
Net realized and unrealized gain (loss) on investments
and foreign currency transactions.................... 0.00 0.00 (0.12) (0.12)
------ ------ ------ ------
Total from investment operations..................... 0.02 0.02 0.08 0.11
------ ------ ------ ------
Distributions:
From net investment income............................. (0.02) (0.02) (0.16) (0.19)
From net realized capital gain......................... - - - -
------ ------ ------ ------
Total distributions.................................. (0.02) (0.02) (0.16) (0.19)
------ ------ ------ ------
NET ASSET VALUE - END OF PERIOD........................... $1.00 $1.00 $24.92 $24.92
====== ====== ====== ======
TOTAL RETURN.............................................. 2.31% 2.38% 0.40% 0.46%
Ratios of expenses to average net assets:
before fee waivers..................................... 0.51%(1) 0.41%(1) 1.01%(1) 0.76%(1)
after fee waivers...................................... 0.35%(1) 0.25%(1) 0.81%(1) 0.56%(1)
Ratios of net investment income to average net assets:
before fee waivers..................................... 4.72%(1) 4.82%(1) 4.66%(1) 4.91%(1)
after fee waivers...................................... 4.88%(1) 4.98%(1) 4.86%(1) 5.11%(1)
Portfolio turnover rate................................... N/A N/A 12.45% 12.45%
Net assets, end of period................................. $1 $21,987,996 $25 $22,112,425
BOND FUND(A) LARGE CAP EQUITY FUND(A)
-------------------- -----------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
NET ASSET VALUE - BEGINNING OF PERIOD.................... $25.00 $25.00 $25.00 $25.00
------ ------ ------ ------
INVESTMENT OPERATIONS:
Net investment income................................. 0.53 0.56 0.11 0.14
Net realized and unrealized gain (loss) on investments
and foreign currency transactions................... (0.86) (0.86) 6.67 6.67
------ ------ ------ ------
Total from investment operations.................... (0.33) (0.30) 6.78 6.81
------ ------ ------ ------
Distributions:
From net investment income............................ (0.49) (0.52) (0.10) (0.13)
From net realized capital gains....................... - - - -
------ ------ ------ ------
Total distributions................................. (0.49) (0.52) (0.10) (0.13)
------ ------ ------ ------
NET ASSET VALUE - END OF PERIOD.......................... $24.18 $24.18 $31.68 $31.68
====== ====== ====== ======
TOTAL RETURN............................................. (1.33)% (1.22)% 27.15% 27.27%
Ratios of expenses to average net assets:
before fee waivers.................................... 0.60%(1) 0.35%(1) 0.67%(1) 0.42%(1)
after fee waivers..................................... 0.60%(1) 0.35%(1) 0.67%(1) 0.42%(1)
Ratios of net investment income to average net assets:
before fee waivers.................................... 4.82%(1) 5.07%(1) 1.17%(1) 1.42%(1)
after fee waivers..................................... 4.82%(1) 5.07%(1) 1.17%(1) 1.42%(1)
Portfolio turnover rate.................................. 9.28% 9.28% 10.92% 10.92%
Net assets, end of period................................ $24 $60,961,710 $32 $43,840,848
<FN>
(1) Annualized
(A) Commenced operations on 10/1/98.
(B) Commenced operations on 1/4/99.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
<TABLE>
<CAPTION>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
FINANCIAL HIGHLIGHTS - continued COMMENCEMENT OF OPERATIONS TO MARCH 31, 1999
- -------------------------------------------------------------------------------------------------------------
SMALL CAP
EQUITY FUND(A) INTERNATIONAL FUND(A)
---------------------- -----------------------
CLASS A CLASS C CLASS A CLASS C
------- ------- ------- -------
<S> <C> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD.................... $25.00 $25.00 $25.00 $25.00
------ ------ ------ ------
INVESTMENT OPERATIONS:
Net investment income................................. 0.10 0.13 0.35 0.38
Net realized and unrealized gain on investments and
foreign currency transactions...................... 1.59 1.59 5.52 5.52
------ ------ ------ ------
Total from investment operations................... 1.69 1.72 5.87 5.90
------ ------ ------ ------
Distributions:
From net investment income............................ (0.09) (0.09) (0.35) (0.35)
From net realized capital gains....................... 0.00 0.00 (1.38) (1.38)
------ ------ ------ ------
Total distributions................................. (0.09) (0.09) (1.73) (1.73)
------ ------ ------ ------
NET ASSET VALUE - END OF PERIOD.......................... $26.60 $26.63 $29.14 $29.17
====== ====== ====== ======
TOTAL RETURN............................................. 6.76% 6.88% 23.72% 23.84%
Ratios of expenses to average net assets:
before fee waivers.................................... 0.63%(1) 0.38%(1) 0.65%(1) 0.40%(1)
after fee waivers..................................... 0.63%(1) 0.38%(1) 0.65%(1) 0.40%(1)
Ratios of net investment income to average net assets:
before fee waivers.................................... 0.87%(1) 1.12%(1) 2.84%(1) 3.09%(1)
after fee waivers..................................... 0.87%(1) 1.12%(1) 2.84%(1) 3.09%(1)
Portfolio turnover rate.................................. 20.37% 20.37% 18.23% 18.23%
Net assets, end of period................................ $27 60,942,703 $29 $39,814,240
<FN>
(1)Annualized
(A) Commenced operations on 10/1/98.
(B) Commenced operations on 1/4/99.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
MONEY MARKET FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
------ -----
SHORT-TERM INVESTMENTS (100.01%)
AIM Prime Portfolio - Cash Management Class.......... 21,990,444 $21,990,444
-----------
TOTAL INVESTMENTS (Cost $21,990,444) (100.01%).. 21,990,444
OTHER ASSETS & LIABILITIES, NET ((0.01)%)....... (2,447)
-----------
NET ASSETS (100.00%)............................ $21,987,997
===========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SHORT-TERM BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
AGENCY OBLIGATIONS (34.02%)
FEDERAL FARM MORTGAGE CO. (4.60%)
6.10%, 11/19/01.................................... $1,000,000 $1,016,603
----------
FEDERAL HOME LOAN BANK (7.63%)
4.885%, 02/23/01................................... 1,700,000 1,687,791
----------
FEDERAL HOME LOAN MORTGAGE CO. (8.12%)
5.375%, 03/01/01................................... 1,800,000 1,795,219
----------
FEDERAL NATIONAL MORTGAGE ASSOC. (13.67%)
5.72%, 01/09/01.................................... 3,000,000 3,023,493
----------
TOTAL AGENCY OBLIGATIONS (Cost $7,556,962)......... 7,523,106
----------
CORPORATE BONDS (32.96%)
BANKS (5.87%)
Chase Manhattan Corp., 5.50%, 02/15/01............. 700,000 697,593
Mercantile Bancorp, 6.80%, 06/15/01................ 590,000 599,870
----------
1,297,463
----------
COMPUTER SYSTEMS (1.85%)
Honeywell, Inc., 7.35%, 05/15/00................... 400,000 407,758
----------
FINANCIAL SERVICES (10.08%)
Associates Corp., 6.70%, 05/29/01.................. 500,000 511,036
Ford Motor Co., 9.0%, 09/15/01..................... 700,000 750,942
General Motors Accept. Corp., 9.625%, 12/15/01..... 150,000 164,267
Lehman Brothers Holdings, Inc., 6.20%, 01/15/02.... 300,000 299,497
Merrill Lynch & Co., 6.06%, 10/15/01............... 500,000 504,105
----------
2,229,847
----------
INSURANCE (2.29%)
Travelers Property Casualty Corp., 6.75%, 04/15/01. 500,000 507,213
----------
INVESTMENT COMPANIES (2.48%)
Bear Stearns Co., Inc., 5.75%, 02/15/01............ 550,000 549,064
----------
MEDICAL PRODUCTS (3.23%)
American Home Products, 7.70%, 02/15/00............ 700,000 714,146
----------
PHARMACEUTICAL (1.36%)
Upjohn Co., 5.875%, 04/15/00....................... 300,000 301,517
----------
PUBLISHING (2.26%)
Tribune Company, 5.30%, 04/17/00................... 500,000 498,673
----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SHORT-TERM BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
RAILROADS (2.35%)
Consolidated Rail Corp., 9.75%, 06/01/00........... 497,000 $ 520,271
-----------
RETAIL STORES (1.19%)
Penney (J.C.) Co., Inc, 9.05%, 03/01/01............ 250,000 262,373
-----------
TOTAL CORPORATE BONDS (Cost $7,322,548)............ 7,288,325
-----------
U.S. TREASURY OBLIGATIONS (30.89%)
U.S. Treasury Notes
7.75%, 12/31/99.................................... 2,100,000 2,143,970
6.625%, 06/30/01................................... 2,500,000 2,581,250
4.625%, 12/31/00................................... 2,120,000 2,105,425
-----------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $6,866,495).. 6,830,645
-----------
REPURCHASE AGREEMENTS (0.78%)
Fifth Third Bank, 4.30%, dated 03/31/99,
due 04/01/99, repurchase price $172,293
(collateralized by FHLMC pool #G10657,
7.50%, due 01/01/12, market value
$176,450 (Cost $172,271)........................... 172,271
-----------
TOTAL INVESTMENTS (Cost $21,918,276) (98.65%)... 21,814,347
OTHER ASSETS & LIABILITIES, NET (1.35%)......... 298,103
-----------
NET ASSETS (100%) $22,112,450
===========
Cost for federal income tax at March 31, 1999,
was $21,918,276 and net unrealized depreciation
consisted of:
Gross unrealized appreciation................... $ 2,630
Gross unrealized depreciation................... (106,559)
---------
Net unrealized depreciation..................... $(103,929)
=========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
AGENCY OBLIGATIONS (13.39%)
FEDERAL HOME LOAN BANK (5.88%)
5.77%, 12/22/99.................................... 1,000,000 $ 1,004,897
5.50%, 07/14/00.................................... 1,100,000 1,103,186
5.125%, 09/15/03................................... 1,500,000 1,474,708
---------
3,582,791
---------
FEDERAL HOME LOAN MORTGAGE CO. (1.61%)
4.75%, 12/14/01.................................... 1,000,000 984,381
---------
FEDERAL NATIONAL MORTGAGE ASSOC. (5.90%)
5.625%, 03/15/01................................... 1,000,000 1,007,425
6.96%, 04/02/07.................................... 1,000,000 1,070,458
6.00%, 05/15/08.................................... 1,500,000 1,517,091
---------
3,594,974
---------
TOTAL AGENCY OBLIGATIONS (Cost $8,327,630)......... 8,162,146
---------
CORPORATE BONDS (26.88%)
AEROSPACE (0.63%)
Lockheed Martin Corp., 6.85%, 05/15/01............. 200,000 204,427
McDonnell Douglas Corp., 6.875%, 11/01/06.......... 175,000 181,116
---------
385,543
---------
AGRICULTURAL (0.29%)
Weyerhaeuser Co., 7.25%, 07/01/13.................. 175,000 178,477
---------
AIRLINES (0.74%)
AMR Corp., 9.00%, 08/01/12......................... 175,000 208,750
Delta Air Lines, 9.75%, 05/15/21................... 200,000 240,848
---------
449,598
---------
APPLIANCES (0.34%)
Whirlpool Corp., 9.5%, 06/15/00.................... 200,000 206,637
---------
AUTO PARTS & EQUIPMENT (0.37%)
Autozone, Inc., 6.50%, 07/15/08.................... 225,000 225,030
---------
BANKS (4.53%)
Bank of America Corp., 6.625%, 05/30/01............ 100,000 101,491
BankBoston NA, 6.375%, 04/15/08.................... 175,000 170,344
Bankers Trust Corp., 9.0%, 08/01/01................ 100,000 105,632
Bankers Trust Corp., 8.125%, 05/15/02.............. 110,000 115,317
Chase Manhattan Corp., 7.125%, 02/01/07............ 225,000 236,332
Citicorp, 5.625%, 02/15/01......................... 100,000 99,717
First Chicago Corp., 9.875%, 08/15/00.............. 175,000 184,746
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
First Union Corp., 8.125%, 06/24/02................ 175,000 $ 186,169
KeyCorp, 7.5%, 06/15/06............................ 185,000 197,318
Mellon Financial Co., 6.875%, 03/01/03............. 100,000 102,872
Nationsbank Corp., 6.875%, 02/15/05................ 100,000 103,563
Norwest Financial, Inc., 7.00%, 01/15/03........... 100,000 103,865
PNC Funding Corp., 6.875%, 03/01/03................ 200,000 205,187
Republic NY Corp., 7.75%, 05/15/02................. 175,000 184,141
Southtrust Bank, Inc. 6.125%, 01/09/28............. 175,000 171,721
Suntrust Bank, Inc. 7.375%, 07/01/06............... 200,000 213,432
Wachovia Corp., 6.605%, 10/01/25................... 175,000 178,120
Wells Fargo Co., 6.875%, 04/01/06.................. 100,000 103,654
---------
2,763,621
---------
CHEMICALS (1.05%)
Dow Chemical Co., 6.85%, 08/15/13.................. 175,000 176,981
E.I. Dupont De Nemours Co., 8.125%, 03/15/04....... 175,000 191,945
FMC Corp., 8.75%, 04/01/99......................... 100,000 100,000
Lubrizol Corp., 5.875%, 12/01/08................... 175,000 168,411
---------
637,337
---------
COSMETICS & TOILETRIES (0.34%)
Procter & Gamble Co., 8.00%, 10/26/29.............. 175,000 207,636
---------
DIVERSIFIED CONGLOMERATES (0.47%)
PPG Ind., Inc., 7.375%, 06/01/16................... 175,000 183,882
Tenneco, Inc., 8.075%, 10/01/02.................... 100,000 105,014
---------
288,896
---------
ELECTRONIC EQUIPMENT (0.59%)
Motorola, Inc. 6.50%, 03/01/08..................... 175,000 180,126
Texas Instruments, Inc., 6.875%, 07/15/00.......... 175,000 178,175
---------
358,301
---------
FINANCIAL SERVICES (3.63%)
Allstate Corp., 6.75%, 05/15/18.................... 200,000 200,632
Associates Corp. of N.A., 6.5%, 10/15/02........... 200,000 204,934
Chrysler Financial Co. LLC, 5.875%, 02/07/01....... 170,000 170,917
Ford Motor Credit Co., 8.00%, 06/15/02............. 175,000 185,810
G.E. Capital Corp., 5.5%, 11/01/01................. 200,000 197,957
GMAC, 6.75%, 02/07/02.............................. 200,000 205,105
Hartford Life, 7.65%, 06/15/27..................... 200,000 216,766
J.P. Morgan Co., Inc, 7.625%, 06/15/27............. 175,000 185,342
Lehman Bros. Holdings, 8.875%, 03/01/02............ 100,000 105,984
Lehman Bros. Holdings, 6.625%, 02/15/08............ 100,000 98,407
Merrill Lynch & Co., 6.25%, 01/15/06............... 100,000 98,986
Merrill Lynch & Co., 8.00%, 06/01/07............... 100,000 109,845
Morgan Stanley Dean Witter, 6.875%, 03/01/07....... 225,000 232,427
---------
2,213,112
---------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
FOOD & BEVERAGE (1.31%)
Archer Daniels ADM., 7.125%, 03/01/13.............. 225,000 $ 237,508
Campbell Soup Co., 6.90%, 10/15/06................. 175,000 185,183
Heinz Co., 6.00%, 03/15/08......................... 175,000 175,767
Kroger Co., 7.00%, 05/01/18........................ 200,000 200,605
----------
799,063
----------
PAPER AND FOREST PRODUCTS (0.32%)
Int'l Paper Co., 7.625%, 01/15/07.................. 185,000 197,260
----------
INSURANCE (0.63%)
International Lease Financial Corp.,
7.00%, 05/15/00................................. 100,000 101,604
International Lease Financial Corp.,
8.875%, 04/15/00................................ 100,000 106,166
Travelers Prop. Casualty, 6.75%, 04/15/01.......... 175,000 177,524
----------
385,294
----------
INVESTMENT COMPANIES (0.37%)
Bear Stearns Co., Inc., 6.625%, 01/15/04........... 225,000 227,544
----------
MEDICAL PRODUCTS (0.33%)
Bausch & Lomb, Inc., 6.75%, 12/15/04............... 200,000 201,692
----------
OFFICE EQUIPMENT (0.30%)
Xerox Corp., 7.2%, 04/01/16........................ 175,000 182,857
----------
OIL & GAS (2.35%)
Atlantic Richfield Co., 8.25%, 02/01/22............ 200,000 232,661
BP America, Inc., 9.375%, 11/01/00................. 175,000 185,410
Chevron Capital USA, Inc., 7.45%, 08/15/04......... 175,000 81,292
Consol Natural Gas, 6.625%, 12/01/08............... 175,000 180,882
Dresser Industries, Inc. 6.25%, 06/01/00........... 100,000 100,749
Mobil Corp., 8.375%, 02/12/01...................... 175,000 183,362
Southern Union Co., 7.60%, 02/01/24................ 175,000 178,612
Texaco Capital, 8.50%, 02/15/03.................... 175,000 191,544
----------
1,434,512
----------
PHARMACEUTICAL (0.30%)
Bristol-Myers Squibb, 6.80%, 11/15/26.............. 175,000 180,695
----------
PIPELINES (0.33%)
Enron Corp., 8.25%, 09/15/12....................... 175,000 202,107
----------
RAILROADS (0.62%)
Norfolk South Corp., 6.95%, 05/01/02............... 175,000 180,365
Union Pacific Corp., 6.125%, 01/15/04.............. 200,000 198,473
----------
378,838
----------
RETAIL STORES (1.57%)
J.C. Penney Co., Inc., 6.375%, 09/15/00............ 100,000 100,486
J.C. Penney Co., Inc., 7.25%, 04/01/02............. 100,000 102,080
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
Rite Aid Corp., 6.875%, 08/15/13................... 175,000 $ 169,128
Safeway, Inc., 7.00%, 09/15/07..................... 200,000 209,413
Sears, Roebucks & Co., 6.5%, 06/15/00.............. 200,000 202,502
Wal-Mart Stores, Inc., 5.875%, 10/15/05............ 175,000 175,603
----------
959,212
----------
TELECOMMUNICATIONS (2.22%)
AT&T Corp., 7.5%, 06/01/06......................... 200,000 217,032
Bell Tel-Penn Co., 6.625%, 09/15/02................ 175,000 180,182
GTE Florida, 6.86%, 02/01/28....................... 175,000 176,842
New York Tel. Co., 6.25%, 02/15/04................. 100,000 102,031
New York Tel. Co., 7.25%, 02/15/24................. 100,000 101,237
Pacific Bell, 6.25%, 03/01/05...................... 100,000 100,965
Southern Ne Tel, 7.00%, 08/15/05................... 100,000 104,632
US West Comm., 6.375%, 10/15/02.................... 225,000 230,413
Worldcom, Inc., 6.95%, 08/15/28.................... 140,000 142,306
----------
1,355,640
----------
UTILITIES (2.96%)
Baltimore G&E, 8.375%, 08/15/01.................... 175,000 185,182
Central P&L Co., 6.625%, 07/01/05.................. 175,000 178,859
Commonwealth Edison, 8.625% 02/01/22............... 150,000 160,437
Con. Edison, 7.6%, 01/15/00........................ 100,000 101,692
Con. Edison, 6.375%, 04/01/03...................... 100,000 102,253
Duke Energy Corp., 7.5%, 04/01/99.................. 100,000 100,000
Duke Power Corp., 7.0%, 06/01/00................... 100,000 101,679
Penn Power & Light, Inc., 7.875%, 02/01/23......... 175,000 191,987
So. Cal Edison, 6.5%, 06/01/01..................... 175,000 177,757
Tennessee Valley Authority, 6.00%, 03/15/13........ 500,000 502,128
----------
1,801,974
----------
WASTE MANAGEMENT (0.29%)
WMX Technology, Inc., 6.7%, 05/01/01............... 175,000 177,570
----------
TOTAL CORPORATE BONDS (Cost $16,766,655............ 16,398,446
----------
FOREIGN BONDS (6.44%)
FOREIGN CORPORATE BONDS (4.97%)
Abn Amro Bank, 7.55%, 06/28/06..................... 175,000 185,265
Amoco Canada Petro Co., Ltd., 7.25%, 12/01/02...... 200,000 209,476
Banque Paribas NY, 8.35%, 06/15/07................. 150,000 165,644
Bayerische Landsbk Ciro, 7.375%, 12/14/02.......... 100,000 105,568
Bell Canada, 9.5%, 10/15/10........................ 200,000 253,024
Cable and Wire Comm. PLC, 6.75%, 03/06/08.......... 175,000 175,835
Deutsche Bank Financial, 6.70%, 12/31/06........... 175,000 177,929
Dresdner Banks NY, 6.625%, 09/15/05................ 225,000 226,601
Hanson Over., 7.375%, 01/15/03..................... 100,000 104,546
LB Baden-Wuettenberg, 7.625%, 02/01/23............. 200,000 221,250
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
PRINCIPAL VALUE
--------- -----
Norsk Hydro, 6.70%, 01/15/18....................... 175,000 $ 165,647
Northern Tel. Co., 8.75%, 06/12/01................. 100,000 106,174
Santander Financial Issuances, 7.875%, 04/15/05.... 225,000 238,962
Sony Corp., 6.125%, 03/04/03....................... 225,000 227,667
Swiss Bank Corp. NY, 7.00%, 10/15/15............... 225,000 225,551
Toronto-Dominion Bank NY, 6.45%, 01/15/09.......... 230,000 231,628
----------
3,020,767
----------
FOREIGN GOVERNMENT REGIONAL (1.47%)
Province of Manitoba, 8.00%, 04/15/02.............. 175,000 186,414
Nova Scotia, 7.25%, 07/27/13....................... 100,000 108,033
Ontario, 6.125%, 06/28/00.......................... 175,000 176,696
Province of Quebec, 6.5%, 01/17/06................. 225,000 229,862
Saskatchewan, 8.00%, 02/01/13...................... 170,000 197,693
----------
898,698
----------
TOTAL FOREIGN BONDS (Cost $3,999,785) 3,919,465
----------
U.S. TREASURY OBLIGATIONS (51.78%)
TREASURY BONDS (5.79%)
6.25%. 08/15/23.................................... 1,000,000 1,046,875
7.87%, 02/15/21.................................... 2,000,000 2,476,876
----------
3,523,751
----------
TREASURY NOTES (45.99%)
6.75%, 08/15/26.................................... 2,000,000 2,232,500
7.5%, 11/15/16..................................... 2,000,000 2,350,000
8.125%, 08/15/19................................... 2,000,000 2,518,126
6.875%, 03/31/00................................... 450,000 458,578
6.5%, 08/15//05.................................... 1,550,000 1,645,423
6.5%, 05/31/01..................................... 1,700,000 1,749,407
6.25%, 08/31/00.................................... 1,000,000 1,016,875
6.625%, 05/15/07................................... 600,000 646,688
6.25%, 02/15/07.................................... 200,000 210,438
7.50%, 02/15/05.................................... 1,800,000 1,995,750
7.25%, 05/15/04.................................... 900,000 980,437
5.75%, 08/15/03.................................... 1,700,000 1,734,000
6.375%, 08/15/02................................... 4,200,000 4,352,250
7.5%, 11/15/01..................................... 1,400,000 1,480,500
7.875%, 8/15/01.................................... 2,500,000 2,653,908
5.375%, 06/30/00................................... 2,000,000 2,010,000
----------
28,034,880
----------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $32,945,834). 31,558,631
----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
BOND FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
VALUE
-----
REPURCHASE AGREEMENTS (0.15%)
Fifth Third Bank, 4.30%, dated 03/31/99, due
04/01/99, repurchase price $91,254 (collateralized
by FHLMC Pool #G10657, 7.50%, due 02/01/12, market
value $93,900
(Cost $91,243).............................................. $ 91,243
-----------
TOTAL INVESTMENTS (Cost $62,131,147) (98.64%).......... 60,129,931
OTHER ASSETS & LIABILITIES, NET (1.36%)................ 831,803
-----------
NET ASSETS (100%)...................................... $60,961,734
===========
Cost for federal income tax at March 31, 1999 was
$62,131,147 and net unrealized depreciation consisted of:
Gross unrealized appreciation.......................... $ 30,697
Gross unrealized depreciation.......................... (2,031,913)
-----------
Net unrealized depreciation............................ $(2,001,216)
===========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
COMMON STOCK (97.99%)
ADVERTISING (0.31%)
Intepublic Group of Cos., Inc...................... 812 $ 63,235
Omnicom Group, Inc................................. 910 72,742
----------
135,977
----------
AEROSPACE (1.40%)
Alliedsignal, Inc.................................. 2,102 103,392
Boeing Co.......................................... 4,229 144,315
General Dynamics Corp.............................. 460 29,555
BF Goodrich Co..................................... 231 7,926
Lockheed Martin Corp............................... 2,126 80,124
Northrop Grumman Corp.............................. 390 23,351
Raytheon Co. Cl B.................................. 1,543 90,457
United Technologies Corp........................... 1,010 136,792
----------
615,912
----------
AGRICULTURAL (0.38%)
Monsanto Co........................................ 2,361 108,458
Pioneer Hi-Bred Intl., Inc......................... 1,525 57,378
----------
165,836
----------
AIRLINES (0.44%)
AMR Corp.*......................................... 854 50,012
Delta Air Lines, Inc............................... 920 63,940
Southwest Airlines................................. 1,851 55,993
US Airways Group, Inc.*............................ 453 22,112
----------
192,057
----------
APPAREL (0.22%)
Fruit of the Loom Cl A*............................ 397 4,119
Nike, Inc. - Cl B.................................. 1,202 69,340
VF Corp............................................ 448 21,140
----------
94,599
----------
APPLIANCES (0.07%)
Maytag Corp........................................ 150 9,056
Whirlpool Corp..................................... 414 22,511
----------
31,567
----------
AUTOMOBILE MANUFACTURERS (1.32%)
Ford Motor Co...................................... 5,158 292,717
General Motors Corp................................ 3,034 263,579
Navistar International Corp.*...................... 200 8,038
Paccar, Inc........................................ 326 13,427
----------
577,761
----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
AUTO PARTS & EQUIPMENT (0.23%)
Autozone, Inc.*.................................... 387 $ 11,755
Dana Corp.......................................... 25 31,350
Genuine Parts Co................................... 760 21,898
TRW Corp........................................... 755 34,353
----------
99,356
----------
BANKS (7.43%)
BB&T Corp.......................................... 670 24,246
Banc One Corp...................................... 5,234 288,197
Bank America Corp.................................. 7,468 527,428
Bank of New York, Inc.............................. 2,618 94,084
Bankboston Corp.................................... 1,208 52,322
Bankers Trust Corp................................. 644 56,832
Chase Manhattan Corp............................... 3,702 301,019
Comerica, Inc...................................... 798 49,825
Fifth Third Bankcorp............................... 1,288 84,927
First Union Corp................................... 4,214 225,186
Firstar Corp....................................... 1,010 90,395
Fleet Financial Group, Inc......................... 2,542 95,643
Golden West Financial Corp......................... 640 61,120
J.P. Morgan & Co, Inc.............................. 1,002 123,622
Keycorp............................................ 1,620 49,106
Mellon Bank Corp................................... 1,150 80,931
Mercantile Bancorp................................. 520 24,700
National City Corp................................. 1,547 102,682
Northern Trust Corp................................ 660 58,616
PNC Bank Corp...................................... 1,435 79,732
Regions Financial Corp............................. 280 9,695
Republic New York Corp............................. 300 13,838
State Street Boston Corp........................... 870 71,503
Summit Bancorp..................................... 370 14,430
Suntrust Banks, Inc................................ 1,275 79,369
Synovus Financial Corp............................. 525 10,730
U.S. Bancorp....................................... 3,002 102,256
Union Planters Corp................................ 610 26,802
Wachovia Corp...................................... 1,082 87,845
Washington Mutual Financial Services, Inc.......... 2,781 113,673
Wells Fargo & Co................................... 7,264 254,694
----------
3,255,448
----------
BROADCASTING (0.92%)
CBS Corp.*......................................... 5,526 226,221
Clear Channel Comm, Inc.*.......................... 2,240 150,220
Meridith Corp...................................... 848 26,659
----------
403,100
----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
BUILDING (0.13%)
Armstrong World Industries......................... 360 $ 16,268
Masco Corp......................................... 1,170 33,053
Owens Corning...................................... 236 7,507
-----------
56,828
-----------
BUILDING MAINTENANCE & SERVICE (0.03%)
Ecolab, Inc........................................ 426 15,122
-----------
CHEMICALS (1.33%)
Air Products & Chemicals, Inc...................... 1,158 39,662
Dow Chemical....................................... 1,181 110,054
Dupont De Nemours & Co............................. 4,964 288,222
Eastman Chemical Co................................ 470 19,769
Engelhard Corp..................................... 534 9,045
Great Lakes Chem Corp.............................. 200 7,350
Hercules, Inc...................................... 453 11,438
Morton International, Inc.......................... 538 19,772
Praxair, Inc....................................... 621 22,395
Rohm & Haas Co..................................... 320 10,740
Sigma Aldrich Corp................................. 498 14,567
Union Carbide Corp................................. 546 24,672
W. R. Grace & Co.*................................. 384 4,656
-----------
582,342
-----------
COMPUTER HARDWARE (3.81%)
Apple Computer, Inc.*.............................. 439 15,777
Compaq Computer Corp............................... 6,690 211,989
Dell Computer Corp.*............................... 10,372 423,956
EMC Corp.*......................................... 2,128 271,852
Gannett Inc........................................ 2,734 172,242
Gateway 2000 Inc.*................................. 640 43,880
Hewlett-Packard Co................................. 4,513 306,038
Seagate Technology, Inc.*.......................... 855 25,276
Sun Microsystems, Inc.*............................ 1,593 199,025
-----------
1,670,035
-----------
COMPONENTS (0.26%)
Honeywell, Inc..................................... 610 46,246
Johnson Controls, Inc.............................. 434 27,071
Parker Hannifin Corp............................... 421 14,419
Perkin Elmer Corp.................................. 275 26,692
-----------
114,428
-----------
COMPUTER SERVICES & SOFTWARE (7.75%)
3Com Corp*......................................... 1,423 33,174
Adobe Systems, Inc................................. 370 20,997
America Online Inc.*............................... 3,840 560,640
Ascend Communications Inc.*........................ 990 82,851
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Autodesk, Inc...................................... 150 $ 6,066
Automatic Data Processing, Inc..................... 3,040 125,780
BMC Software Inc.*................................. 850 31,503
Cabletron Systems*................................. 640 5,240
Ceridian Corp.*.................................... 880 32,175
Computer Associates International, Inc............. 2,435 86,595
Computer Sciences Corp.*........................... 738 40,728
Compuware Corp.*................................... 1,680 40,110
Electronic Data Systems............................ 2,240 109,060
First Data Corp.................................... 1,711 73,145
Microsoft Corp.*................................... 20,644 1,850,219
Novell, Inc.*...................................... 1,019 25,666
Oracle Corp.*...................................... 7,838 206,727
Parametric Technology Corp......................... 880 17,380
Peoplesoft, Inc.*.................................. 850 12,431
Silicon Graphics, Inc.*............................ 605 10,096
Unisys Corp.*...................................... 1,000 27,687
-----------
3,398,270
-----------
COMPUTER SYSTEMS (1.60%)
International Business Machine..................... 3,948 699,783
-----------
COMMERCIAL SERVICES (0.12%)
Cendant Corp.*..................................... 3,236 50,967
-----------
CONSUMER PRODUCTS (0.75%)
American Greetings Corp. Cl A...................... 550 13,956
The Unilever Group................................. 3,494 232,133
The Clorox Co...................................... 656 76,875
Tupperware Corp.................................... 371 6,678
-----------
329,642
-----------
CONTAINERS (0.10%)
Bemis Co.......................................... 115 3,572
Crown Cork & Seal Co., Inc........................ 556 15,881
Owens Illinois, Inc.*............................. 500 12,500
Sealed Air Corp.*................................. 205 10,083
-----------
42,036
-----------
COSMETICS & TOILETRIES (2.90%)
Avon Products, Inc................................ 1,248 58,734
Colgate Palmolive C............................... 1,724 158,608
Gillette Co....................................... 5,148 305,984
Int'l Flavors & Fragrance, Inc.................... 946 35,534
Kimberly Clark Corp............................... 2,486 119,173
Procter & Gamble Co............................... 6,072 594,677
-----------
1,272,710
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
DIVERSIFIED CONGLOMERATES (4.81%)
Cooper Industries, Inc............................ 454 $ 19,352
Corning, Inc...................................... 933 55,980
Danaher Corp...................................... 410 21,423
Eaton Corp........................................ 400 28,600
General Electric Co............................... 13,876 1,535,032
Illinois Tool Works, Inc.......................... 1,216 75,240
ITT Industries, Inc............................... 588 20,801
National Service Industries, Inc.................. 200 6,813
PPG Industries, Inc............................... 1,005 51,506
Raychem Corp...................................... 260 5,866
Tenneco, Inc...................................... 818 22,853
Textron, Inc...................................... 820 63,447
Tyco International Ltd............................ 2,828 202,909
-----------
2,109,822
-----------
ELECTRONIC EQUIPMENT (3.53%)
Advanced Micro Devices*........................... 579 8,975
AMP, Inc.......................................... 834 44,775
Applied Materials, Inc.*.......................... 1,490 91,914
Emerson Electric Co............................... 2,016 106,722
Intel Corp........................................ 6,836 814,339
KLA-Tencor Corp.*................................. 300 14,569
LSI Logic Corp.*.................................. 425 13,255
Micron Technology, Inc.* ......................... 1,038 50,084
Motorola Rights Exp. 11/08/08 .................... 2,670 0
Motorola, Inc. ................................... 2,670 195,577
Solectron Corp.* ................................. 780 37,879
Texas Instruments, Inc. .......................... 1,632 161,976
Thomas & Betts Corp. ............................. 245 9,202
-----------
1,549,267
-----------
ENGINEERING (0.03%)
Fluor Corp. ...................................... 480 12,960
-----------
ENTERTAINMENT & LEISURE (0.28%)
Brunswick Corp. .................................. 774 14,754
Hasbro, Inc. ..................................... 1,125 32,555
Mattel, Inc. ..................................... 1,501 37,337
-----------
84,646
-----------
FINANCIAL SERVICES (5.38%)
American Express Co. ............................. 2,006 235,705
Associates First Capitol Corp. ................... 3,352 150,840
Capital One Financial Corp. ...................... 310 46,810
Citigroup, Inc. .................................. 9,403 600,617
Countrywide Credit Industries, Inc. .............. 450 16,875
Deluxe Corp. ..................................... 537 15,640
Dun & Bradstreet Corp. ........................... 796 28,357
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Equifax, Inc. .................................... 510 $ 17,531
Fannie Mae ....................................... 4,561 315,849
Federal Home Loan Mortgage Corp. ................. 2,938 167,833
H.R. Block, Inc. ................................. 300 14,213
Household International, Inc. .................... 1,879 85,729
Lehman Brothers Holding, Inc. .................... 420 25,095
MBNA Corp. ....................................... 2,665 63,627
Morgan Stanley Dean Witter & Co. ................. 2,517 251,542
Paychex, Inc. .................................... 790 37,476
Providian Financial Corp. ........................ 606 66,660
Schwab (Charles) Corp. ........................... 1,800 173,025
Service Corp. International ...................... 1,282 18,269
SLM Holding Corp. ................................ 630 26,303
-----------
2,357,996
-----------
FOOD & BEVERAGE (3.40%)
Albertson's, Inc. ................................ 1,222 66,370
American Stores Co. .............................. 1,144 37,752
Archer-Daniels Midland Co. ....................... 3,197 46,956
Best Foods Co. ................................... 2,578 121,166
Campbell Soup Co. ................................ 3,004 122,225
General Mills, Inc. .............................. 1,634 123,469
Great Atlantic & Pacific Tea Co. ................. 300 9,000
Heinz (H.J.) Co. ................................. 2,847 134,877
Hershey Foods Corp. .............................. 1,190 66,640
Kellogg Co. ...................................... 2,800 94,675
Kroger Co.* ...................................... 1,242 74,365
Quaker Oats Co. .................................. 1,171 73,261
Ralston-Ralston Purina Group ..................... 1,468 39,177
Safeway, Inc.* ................................... 2,280 116,993
Sara Lee Corp. ................................... 5,140 127,215
Supervalu, Inc. .................................. 1,500 30,937
Sysco Corp. ...................................... 2,108 55,467
Winn Dixie Stores, Inc. .......................... 880 32,890
Wm. Wrigley Jr. Co. .............................. 1,315 118,925
-----------
1,492,360
-----------
FOREST & PAPER PRODUCTS (0.54%)
Boise Cascade Corp. .............................. 225 7,256
Champion Int'l Corp. ............................. 362 14,865
Fort James Corp. ................................. 822 26,047
Fort James Rights ................................ 822 0
Georgia-Pacific Group ............................ 493 36,605
Int'l Paper Co. .................................. 1,330 56,109
Temple Inland, Inc. .............................. 180 11,295
Union Camp Corp. ................................. 391 26,246
Westvaco Corp. ................................... 206 4,326
Weyerhaeuser Co. ................................. 834 46,287
Willamette Ind., Inc. ............................ 146 5,512
-----------
234,548
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
HEALTHCARE SERVICES (0.56%)
Alza Corp. Cl A* ................................. 300 $ 11,475
Columbia/HCA Healthcare Corp. .................... 2,892 54,767
HCR Manor Care, Inc.* ............................ 485 11,064
Healthsouth Rehabilitation Corp.* ................ 1,550 16,081
Mekesson HBOC, Inc. .............................. 1,119 73,854
Tenet Healthcare Corp.* .......................... 1,303 24,676
United Healthcare Corp. .......................... 1,060 55,783
-----------
247,700
-----------
HOME FURNISHINGS (0.14%)
Newell Rubbermaid, Inc. .......................... 1,299 61,694
-----------
HOTELS (0.0%)
Marriott International, Inc. ..................... 1,633 36,028
-----------
INSURANCE (3.64%)
Aetna Life & Casualty, Inc. ...................... 744 61,752
Allstate Corp. Right ............................. 2,926 0
Allstate Corp. ................................... 2,926 108,445
American General Corp. ........................... 1,227 86,504
American International Group, Inc. ............... 5,440 656,200
Aon Corp. ........................................ 716 45,287
Chubb Corp. ...................................... 730 42,751
Cigna Corp. ...................................... 968 81,131
Cincinnati Financial Corp. ....................... 600 21,862
Conseco Co., Inc. ................................ 1,146 35,382
Hartford Financial Services Group, Inc. .......... 678 38,519
Humana, Inc.* .................................... 605 10,436
Jefferson Pilot Corp. ............................ 769 52,100
Lincoln National Corp. ........................... 494 48,844
Marsh & Mclennan Co., Inc. ....................... 1,423 105,569
MBIA, Inc. ....................................... 430 24,940
Mgic Investment Corp. ............................ 300 10,519
Progressive Corp. ................................ 370 53,095
Provident Companies, Inc. ........................ 110 3,802
Safeco Corp. ..................................... 329 13,304
Saint Paul Cos. .................................. 200 6,212
Torchmark Corp. .................................. 350 11,069
Transamerica Corp. ............................... 840 59,640
Unum Corp. ....................................... 414 19,690
-----------
1,597,053
-----------
INVESTMENT COMPANIES (0.39%)
Bear Stearns Cos., Inc. .......................... 168 7,507
Franklin Resources, Inc. ......................... 1,070 30,094
Merrill Lynch & Co. .............................. 1,532 135,486
-----------
173,087
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
INDUSTRIAL (0.59%)
Black & Decker Corp. ............................. 481 $ 26,665
Case Corp. ....................................... 238 6,039
Caterpillar, Inc. ................................ 1,662 76,348
Deere & Co. ...................................... 808 31,209
Dover Corp. ...................................... 880 28,930
Grainger, Inc. ................................... 190 8,182
Ingersoll-Rand Co. ............................... 673 33,397
McDermott International, Inc. .................... 200 5,063
Rockwell International Corp. ..................... 856 36,327
Thermo Electron Corp.* ........................... 552 7,487
-----------
259,647
-----------
MEDICAL DRUGS (1.36%)
Schering-Plough Corp. ............................ 6,460 357,319
Warner Lambert Co. ............................... 3,592 237,746
-----------
595,065
-----------
MEDICAL PRODUCTS (11.45%)
Abbott Labs ...................................... 6,686 312,988
Allergan, Inc. ................................... 340 29,878
American Home Products Corp. ..................... 5,420 353,655
Amgen, Inc.* ..................................... 3,140 235,108
Bausch & Lomb, Inc. .............................. 325 21,125
Baxter Intl., Inc. ............................... 1,493 98,538
Becton, Dickinson Co. ............................ 1,080 41,378
Biomet, Inc. ..................................... 350 14,678
Boston Scientific Corp.* ......................... 1,892 76,744
Bristol-Myers Squibb Co. ......................... 12,698 816,640
C R Bard, Inc. ................................... 330 16,644
Cardinal Health, Inc. ............................ 1,170 77,220
Guidant Corp. .................................... 1,496 90,508
IMS Health, Inc. ................................. 1,602 53,066
Johnson & Johnson ................................ 6,066 568,308
Lilly (Eli) & Co. ................................ 4,800 407,400
Mallinckrodt, Inc. ............................... 500 13,313
Medtronic, Inc. .................................. 2,616 187,698
Merck & Co. ...................................... 9,980 800,271
Pfizer, Inc. ..................................... 5,648 783,660
Shared Medical Systems, Inc. ..................... 190 10,581
St. Jude Medical Inc.* ........................... 467 11,383
-----------
5,020,784
-----------
METALS (0.45%)
Alcan Aluminum Ltd. .............................. 1,317 33,995
Alcoa, Inc. ...................................... 1,934 79,657
Asarco, Inc. ..................................... 350 4,812
Freeport- McMoran Copper & Gold, Inc. ............ 1,090 11,854
Inco Ltd. ........................................ 1,167 15,536
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Phelps Dodge Corp. ............................... 220 $ 10,835
Placer Dome, Inc. ................................ 947 10,595
Reynolds Metals Co. .............................. 477 23,045
Timken Co. ....................................... 350 5,687
-----------
196,016
-----------
MINING AND BUILDING MATERIALS (0.09%)
Barrick Gold Corp. ............................... 1,441 24,587
Newmont Mining Corp. ............................. 958 16,765
-----------
41,352
-----------
MISCELLANEOUS MANUFACTURING (0.35%)
Minnesota Mining and Manufacturing Co. ........... 2,102 148,717
Pall Corp. ....................................... 209 3,462
-----------
152,179
-----------
OFFICE EQUIPMENT (0.62%)
Avery Dennison Corp. ............................. 231 13,283
Ikon Office Solutions, Inc. ...................... 672 8,610
Pitney Bowes, Inc. ............................... 1,314 83,767
Xerox Corp. ...................................... 3,082 164,502
-----------
270,162
-----------
OIL & GAS (5.60%)
Amerada Hess Corp. ............................... 518 26,062
Anadarko Petro Corp. ............................. 290 10,948
Ashland, Inc. .................................... 345 14,123
Atlantic Richfield Co. ........................... 1,682 122,786
Baker Hughes, Inc. ............................... 610 14,831
Burlington Resource, Inc. ........................ 697 27,836
Chevron Oil Corp. ................................ 3,007 265,932
Chevron Oil Rights Corp. ......................... 3,007 0
Exxon Corp. ...................................... 10,278 725,241
Halliburton Co. .................................. 1,558 59,983
Mobil Corp. ...................................... 3,486 306,767
Occidental Petroleum Corp. ....................... 1,053 18,954
Phillips Petroleum Co. ........................... 994 46,967
Royal Dutch Petroleum Co. ........................ 9,170 476,840
Schlumberger, Ltd. ............................... 2,410 145,052
Sempra Energy .................................... 215 4,125
Texaco, Inc. ..................................... 2,112 119,856
The Costal Corp. ................................. 300 9,900
Union Pacific Resource Group, Inc. ............... 381 4,524
Unocal Corp. ..................................... 722 26,579
USX Marathon Group, Inc. ......................... 996 27,390
-----------
2,454,696
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
PAINT & RELATED PRODUCTS (0.05%)
Sherwin Williams Co. ............................. 796 $ 22,387
-----------
PHARMECEUTICAL (0.31%)
Pharmacia & Upjohn, Inc. ......................... 2,214 138,098
-----------
PHOTOGRAPHY EQUIPMENT (0.25%)
Eastman Kodak Co. ................................ 1,654 105,649
Polaroid Corp. ................................... 300 6,019
-----------
111,668
-----------
PIPELINES (0.49%)
Columbia Energy Group ............................ 388 20,273
Consolidated National Gas Co. .................... 651 31,696
Enron Corp. ...................................... 1,496 96,118
Sonat, Inc. ...................................... 346 10,380
Williams Cos., Inc. .............................. 1,410 55,695
-----------
214,162
-----------
PRINTING (0.07%)
R. R. Donnelley & Son Co. ........................ 1,008 32,445
-----------
PUBLISHING (0.84%)
Dow Jones & Co. .................................. 715 33,739
Knight-Ridder, Inc. .............................. 819 40,950
McGraw-Hill Cos., Inc. ........................... 1,950 106,275
New York Times Co. Cl A .......................... 834 23,769
Times Mirror Co. Cl A ............................ 768 41,520
Tribune Co. ...................................... 1,850 121,059
-----------
367,312
-----------
RETAIL STORES (6.0%)
Circuit City Stores, Inc. ........................ 435 33,332
Consolidated Stores Corp.* ....................... 350 10,609
Costco Cos., Inc.* ............................... 990 90,647
CVS Corp. ........................................ 1,834 87,115
Dayton Hudson Corp. .............................. 1,904 126,854
Dillard's, Inc. .................................. 300 7,612
Dollar General ................................... 582 19,787
Federated Department Stores, Inc.* ............... 717 28,770
Fred Meyer, Inc.* ................................ 610 35,914
Gap, Inc. ........................................ 2,487 167,406
Harcourt General, Inc. ........................... 694 30,753
Home Depot, Inc. ................................. 6,246 388,814
J.C. Penney Co. .................................. 1,347 54,554
K-Mart Corp.* .................................... 1,498 25,185
Kohl's Corp.* .................................... 690 48,904
Longs Drug Stores Corp. .......................... 150 4,566
Lowe's Cos. ...................................... 1,538 93,049
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
May Department Store Co. ......................... 1,938 $ 75,824
Nordstrom, Inc. .................................. 480 19,620
Reebok International Ltd.* ....................... 300 4,763
Rite Aid Corp. ................................... 932 23,300
Sears, Roebuck & Co. ............................. 1,654 74,740
Staples, Inc.* ................................... 1,470 48,326
Tandy Corp. ...................................... 410 26,163
The Limited, Inc. ................................ 1,105 43,786
TJX Companies, Inc. .............................. 1,180 40,120
Toys 'R' Us, Inc.* ............................... 1,041 19,584
Wal Mart Stores, Inc. ............................ 9,519 877,532
Walgreen Co. ..................................... 4,336 122,492
-----------
2,630,121
-----------
STEEL (0.09%)
Allegheny Teledyne, Inc. ......................... 343 6,496
Nucor ............................................ 561 24,719
USX-U.S. Steel Group, Inc. ....................... 423 9,940
-----------
41,155
-----------
TELECOMMUNICATIONS (12.18%)
Airtouch Communications, Inc.* ................... 2,526 244,075
Alltel Corp....................................... 1,268 79,092
Ameritech Corp. .................................. 4,816 278,726
Andrew Corp.* .................................... 412 5,073
AT&T Corp. ....................................... 7,787 621,500
Bell Atlantic Corp. .............................. 6,906 356,954
Bellsouth Corp. .................................. 8,856 354,794
Cisco Systems, Inc. .............................. 6,542 716,758
Frontier Corp. ................................... 433 22,462
General Instrument Corp.* ........................ 499 15,126
GTE Corp. ........................................ 4,396 265,957
Lucent Technologies, Inc. ........................ 5,418 583,790
MCI Worldcom, Inc.* .............................. 7,823 692,824
Nextel Communications Cl A* ...................... 1,250 45,781
Northern Telecom Ltd. ............................ 2,777 172,521
SBC Communications, Inc. ......................... 8,314 391,797
Sprint Corp. (PCS Group) ......................... 1,760 77,990
Sprint Corp. ..................................... 2,061 202,236
Tellabs, Inc.* ................................... 816 79,764
US West, Inc. .................................... 2,375 130,773
-----------
5,337,993
-----------
TIRE & RUBBER (0.09%)
Goodyear Tire & Rubber Co. ....................... 800 39,850
-----------
TOOLS (0.02%)
Stanley Works .................................... 260 6,663
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
TRANSPORTATION (0.45%)
Burlington Northern Santa Fe Corp. ............... 894 $ 29,390
CSX Corp. ........................................ 825 32,123
FDX Corp.* ....................................... 653 60,607
Norfolk Southern Corp. ........................... 696 18,357
Union Pacific Corp. .............................. 1,103 58,942
-----------
199,419
-----------
TRUCKING & LEASING (0.02%)
Ryder Systems, Inc. .............................. 250 6,906
-----------
UTILITIES (2.10%)
AES Corp. ........................................ 960 35,760
Ameren Corp. ..................................... 798 28,878
American Electric Power Co. ...................... 1,277 50,681
Baltimore Gas & Electric Co. ..................... 189 4,796
Carolina Power & Light Co. ....................... 934 35,317
Central & Southwest Corp. ........................ 766 17,953
Cinergy Corp. .................................... 664 18,260
Consolidated Edison, Inc. ........................ 1,329 60,220
Dominion Resources, Inc. ......................... 1,224 45,212
DTE Energy Co. ................................... 789 30,327
Duke Energy Co. .................................. 1,843 100,674
Edison International ............................. 1,206 26,834
Entergy Corp. .................................... 1,055 29,013
Firstenergy Corp. ................................ 435 12,152
FPL Group, Inc. .................................. 1,079 57,457
GPU, Inc. ....................................... 575 21,455
GPU, Inc. Rights ................................ 575 0
Northern States Power-Mn Co. ..................... 950 22,027
PP&L Resource, Inc. ............................. 275 6,806
PG&E Corp. ....................................... 1,999 62,094
Pacificorp ....................................... 496 8,556
PECO Energy Co. .................................. 736 34,040
Public Service Enterprise, Inc. .................. 1,087 41,510
Reliant Energy, Inc. ............................. 830 21,632
Southern Co. ..................................... 2,650 61,777
Texas Utilities Co. .............................. 1,451 60,489
Unicom Corp. ..................................... 782 28,592
-----------
922,512
-----------
WASTE MANAGEMENT (0.32%)
Browning Ferris Ind., Inc. ....................... 898 34,629
Waste Management Services, Inc. .................. 2,353 104,414
-----------
139,043
-----------
TOTAL COMMON STOCK (Cost $34,211,876) ............ 42,960,572
-----------
MISCELLANEOUS ASSETS (1.81%)
Amex S & P Depository ............................
(Cost $788,838) .................................. 6,180 794,130
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
LARGE CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
VALUE
-----
139,043
-----------
REPURCHASE AGREEMENTS (0.12%)
Fifth Third Bank, 4.30%, dated 03/31/99,
due 04/01/99, repurchase price $50,346
(collateralized by FHLMC Pool #G10657, 7.50%,
due 02/01/12, market value $51,593
(Cost $50,340) ................................... $ 50,340
-----------
TOTAL INVESTMENT ($35,051,054) (99.92%) ....... 43,805,042
OTHER ASSETS & LIABILITIES, NET (.08%) ........ 35,838
-----------
NET ASSETS (100%) ............................. $43,840,880
===========
* Non-income producing security.
Cost for federal income tax at March 31, 1999 was
$35,051,054 and net unrealized depreciation
consisted of :
Gross unrealized appreciation ................. $9,458,048
Gross unrealized depreciation ................. (704,060)
-----------
Net unrealized appreciation ................... $8,753,988
===========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
COMMON STOCK (99.59%)
ADVERTISING (0.60%)
Ha-Lo Industries, Inc.* .......................... 8,160 $ 100,470
True North Communications, Inc. .................. 9,389 264,066
-----------
364,536
-----------
AEROSPACE (1.09%)
AAR Corp. ........................................ 6,022 107,267
Alliant Techsystems, Inc.* ....................... 2,513 195,228
BE Aerospace, Inc.* .............................. 5,480 80,830
Kaman Corp. Cl A ................................. 4,493 57,566
Orbital Sciences Corp.* .......................... 7,922 224,291
-----------
665,182
-----------
AGRICULTURAL (0.40%)
Delta & Pine Land Co. ............................ 7,916 243,416
-----------
AIRLINES (0.34%)
Comair Holdings, Inc. ............................ 2,786 65,807
Skywest, Inc. .................................... 4,850 140,043
-----------
205,850
-----------
APPAREL (1.62%)
Authentic Fitness Corp. .......................... 4,943 76,308
K-Swiss, Inc. Cl A ............................... 3,920 98,980
Kellywood Co. .................................... 5,650 124,652
Nautica Enterprises, Inc. ........................ 7,326 82,875
Oshkosh B'Gosh Cl A ............................. 4,320 76,410
Oxford Industries, Inc. .......................... 3,170 77,269
St. John Knits, Inc. ............................. 4,203 110,853
The Dress Barn, Inc.* ............................ 5,356 74,315
Timberland Co. Cl A* ............................. 2,999 189,123
Wolverine World Wide, Inc. ....................... 8,038 76,361
-----------
987,146
-----------
AUTO PARTS & EQUIPMENT (0.96%)
Discount Auto Parts, Inc.* ....................... 3,991 85,806
O'Reilly Automotive, Inc.* ....................... 4,540 203,164
Standard Motor Products, Inc. .................... 3,956 81,840
Standard Products Co. ............................ 4,802 78,033
Standard Products Co. Rights* .................... 4,602 -
Wabash National Corp. ............................ 6,050 70,331
Wynns International, Inc. ........................ 3,930 68,529
-----------
587,703
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
BANKS (7.39%)
Anchor Bancorp Wisconsin, Inc. ................... 2,680 $ 41,205
Banknorth Group, Inc. ............................ 5,520 155,940
Carolina First Corp. ............................ 4,840 106,480
Centura Banks, Inc. ............................. 5,866 341,328
Commerce Bancorp, Inc. ........................... 5,548 228,855
Commercial Federal Corp. ......................... 11,890 275,699
Cullen Frost Bankers, Inc. ....................... 6,111 292,946
Downey Financial Corp. ........................... 5,166 94,602
First Merit Corp. ................................ 16,462 423,897
First Midwest Bancorp, Inc. ...................... 6,510 247,380
First Bancorp Puerto Rico ....................... 4,820 115,981
Hubco, Inc. ...................................... 8,892 298,438
JSB Financial, Inc. .............................. 3,905 195,738
MAF Bancorp, Inc. ................................ 3,600 80,100
Premier Bancshares, Inc. ......................... 4,160 82,160
Provident Bancshares Corp. ....................... 5,200 135,850
Queens County Bancorp, Inc. ...................... 3,745 101,115
Riggs National Corp. ............................. 5,966 100,676
Silicon Valley Bancshares ........................ 4,130 85,439
Susquehanna Bancshares, Inc. ..................... 5,475 100,603
Trustco Bank Corp. ............................... 4,448 111,200
United Bankshares, Inc. .......................... 7,520 172,020
US Trust Corp. ................................... 4,102 304,317
UST Corp. ........................................ 8,790 192,007
Whitney Holdings Corp. ........................... 5,988 220,995
-----------
4,504,971
-----------
BUILDING PRODUCTS (0.29%)
Republic Group, Inc. ............................. 2,760 41,573
Texas Industries, Inc. ........................... 5,540 137,461
-----------
179,034
-----------
BROADCASTING (0.87%)
Barnes Group, Inc. ............................... 3,920 73,500
Metro Networks, Inc.* ............................ 3,710 204,050
P-Com, Inc.* ..................................... 8,880 67,710
Westwood One, Inc.* .............................. 6,520 185,820
-----------
531,080
-----------
BUILDING (4.76%)
ABM Industries, Inc. ............................. 4,820 147,010
Apogee Enterprises, Inc. ......................... 5,680 67,450
Butler Manufacturing Co. ......................... 3,045 71,367
Champion Enterprise, Inc.* ....................... 8,985 174,084
D.R. Horton, Inc. ................................ 10,647 178,337
Dycom Industries, Inc.* .......................... 4,500 195,750
Eagle Hardware & Garden, Inc.*.................... 5,972 228,056
Florida Rock Industries, Inc. .................... 3,810 130,016
Hughes Supply, Inc. .............................. 5,395 122,736
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Insituform Technologies Cl A* .................... 3,630 63,525
Juno Lighting, Inc. .............................. 3,600 80,775
Lone Star Industries, Inc. ....................... 4,822 149,482
MDC Holdings, Inc. ............................... 3,420 49,163
Morrison-Knudson, Inc.*........................... 6,440 63,998
Oakwood Homes Corp. .............................. 9,638 135,534
Ryland Group, Inc. ............................... 4,489 113,628
Service Experts, Inc.* ........................... 3,990 53,865
Skyline Corp. .................................... 3,030 84,083
Standard Pacific Corp. ........................... 6,320 81,370
Stone & Webster, Inc. ............................ 4,830 110,486
Thor Industries, Inc. ............................ 4,200 95,025
TJ International, Inc. ........................... 4,214 101,663
Toll Brothers, Inc.* ............................. 6,795 123,159
Universal Forest Products, Inc. .................. 4,080 83,640
US Home Corp.* ................................... 3,868 126,194
Winnebago Industries, Inc. ....................... 5,090 71,260
-----------
2,901,656
-----------
CHEMICALS (1.44%)
Cambrex Corp. .................................... 6,004 132,839
Chemfirst, Inc. .................................. 5,317 124,950
Macdermid, Inc. .................................. 5,070 172,063
McWhorter Technologies, Inc.* .................... 2,820 38,423
Mississippi Chemicals Corp........................ 4,888 45,825
OM Group, Inc. ................................... 5,761 190,113
Quaker Chemical Corp. ............................ 3,480 49,155
The Geon Co. ..................................... 5,585 127,059
-----------
880,427
-----------
COMPUTER HARDWARE (0.79%)
Hutchinson Technology, Inc.* ..................... 5,250 130,594
Intervoice, Inc.* ................................ 5,360 58,960
Komag, Inc.* ..................................... 10,580 46,288
Kronos, Inc* ..................................... 3,180 77,910
Microage, Inc.* .................................. 4,380 23,543
Paxar Corp.* ..................................... 6,179 45,956
Read-Rite Corp.* ................................. 10,015 66,037
Telxon Corp. ..................................... 3,658 34,522
-----------
483,810
-----------
COMPONENTS (0.96%)
C-Cor Electronics, Inc.* ......................... 2,370 40,883
Coherent, Inc.* .................................. 5,570 76,588
Dionex Corp.* .................................... 4,718 178,105
Electric Scientific Industries, Inc.* ............ 2,750 127,875
Harman International Industries, Inc. ............ 4,430 162,803
-----------
586,254
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
[S] [C] [C]
COMPUTER SERVICES & SOFTWARE (8.32%)
Acxiom Corp.* .................................... 14,644 $ 388,066
American Management Systems, Inc.* ............... 7,958 271,567
Analysis International Corp. ..................... 4,165 47,898
Anixter International, Inc.* ..................... 6,816 81,366
Auspex Systems, Inc.* ............................ 4,990 53,331
Avid Technology, Inc.* ........................... 5,540 96,604
Bisys Group, Inc.* ............................... 5,321 299,306
BMC Software, Inc.* .............................. 3,829 141,897
Ciber, Inc.* ..................................... 10,700 205,306
Computer Task Group, Inc.......................... 4,540 97,043
Dendrite International, Inc.* .................... 4,240 94,605
Dialogic Corp.* .................................. 3,690 112,545
Factset Research Systems, Inc. ................... 3,030 131,048
Fair Issac & Co. ................................. 3,109 115,227
Filenet Corp.* ................................... 5,572 39,004
Harbinger Corp.* ................................. 6,910 46,643
HNC Software, Inc.* .............................. 5,320 174,230
Hyperion Solutions Corp.* ........................ 6,406 92,887
Inter Tel, Inc. .................................. 5,350 83,259
Macromedia, Inc.* ................................ 7,960 360,688
Mercury Interactive Corp.* ....................... 7,420 264,338
Midway Games, Inc.* .............................. 6,260 54,384
National Data Corp. .............................. 7,046 295,932
National Instrument Corp.* ....................... 6,770 192,945
Platinum Software Corp.* ......................... 7,400 54,575
Progress Software Corp.* ......................... 3,798 129,607
SEI Corp. ........................................ 3,631 335,868
Technology Solutions Co.* ........................ 6,295 44,852
Vantive Corp.* ................................... 5,680 68,515
Wall Data, Inc.* ................................. 2,290 32,919
Whittman-Hart, Inc.* ............................. 9,970 214,355
Xircom, Inc.* .................................... 4,800 120,600
Xylan Corp.* ..................................... 8,860 326,159
-----------
5,067,569
-----------
COMPUTER SYSTEMS (0.87%)
Banctec, Inc. .................................... 4,774 58,780
Jack Henry & Associates, Inc. .................... 3,841 141,157
Micros Systems, Inc.* ............................ 3,640 120,120
National Computer Systems, Inc. .................. 5,956 145,922
S3, Inc.* ........................................ 8,490 63,675
-----------
529,654
-----------
COMMERCIAL SERVICES (1.80%)
Central Parking Corp. ............................ 6,255 215,798
Kroll-O'Gara Co.* ................................ 4,010 108,771
Lason, Inc.* ..................................... 3,120 175,500
NFO Worldwide, Inc.* ............................. 4,220 42,200
Plexus Corp.* .................................... 3,340 93,103
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Prepaid Legal Services, Inc.* .................... 4,910 $ 120,295
Primark Corp.* ................................... 4,859 103,254
Quintiles Transnational Corp.* ................... 6,268 236,601
-----------
1,095,522
-----------
CONSULTING SERVICES (0.18%)
Franklin Covey Co.* .............................. 4,544 40,896
Inacom Corp.* .................................... 8,651 67,047
-----------
107,943
-----------
CONSUMER PRODUCTS (0.70%)
Russ Berrie & Co. ................................ 5,428 141,807
Scotts Co.* ...................................... 4,479 167,402
Toro Co. ......................................... 3,829 120,135
-----------
429,344
-----------
CONTAINERS (0.18%)
Shorewood Packaging Corp. 5,483 107,604
-----------
DISTRIBUTION WHOLESALE (0.75%)
Aviation Sales Co.* .............................. 2,970 132,165
Brightpoint, Inc.* ............................... 10,210 60,303
Insight Enterprises, Inc.* ....................... 5,190 128,453
Owens & Minor, Inc. Holding Co. .................. 5,574 56,437
Watsco, Inc. ..................................... 5,465 79,926
-----------
457,284
-----------
DIVERSIFIED CONGLOMERATES (2.46%)
Blount International, Inc. Cl A .................. 7,630 220,316
Chemed Corp. ..................................... 5,115 131,711
Clarcor, Inc. .................................... 5,220 89,066
Justin Industries ................................ 3,260 35,860
Mascotech, Inc. .................................. 10,090 156,395
Myers Industries, Inc. ........................... 4,160 89,440
Roper Industries, Inc. ........................... 6,576 157,002
SPS Technologies, Inc.* .......................... 3,198 125,522
Standex International Corp. ...................... 3,850 84,219
Tredegar Industries, Inc. ........................ 7,384 228,443
Triarc Co., Inc.* ............................... 6,769 118,034
Volt Info Sciences, Inc.* ........................ 3,710 60,983
-----------
1,496,991
-----------
EDUCATION (0.63%)
Devry, Inc.* 13,268 384,772
-----------
ELECTRONIC EQUIPMENT (8.51%)
Analogic Corp. ................................... 3,420 112,646
Benchmark Electronics* ........................... 2,850 85,500
Burr-Brown Corp.* ................................ 7,355 172,843
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
C-Cube Microsystems, Inc.* ....................... 7,940 $ 157,311
CTS Corp. ........................................ 3,350 165,616
Dallas Semiconductors Corp. ...................... 5,899 227,849
Electroglas, Inc.* ............................... 4,320 55,620
Etec Systems, Inc.* ............................. 4,631 136,325
General Semi-Conductors, Inc.* .................. 5,050 36,613
Gentex Corp.* .................................... 14,260 307,481
Hadco Corp.* ..................................... 3,260 102,690
Harmon Industries, Inc. .......................... 2,340 46,946
Innovex, Inc. ................................... 3,490 46,679
Integrated Circuit Systems, Inc.* ................ 2,860 51,659
International Rectifier Corp.* ................... 8,754 61,278
Kemet Corp.* .................................... 7,295 83,893
Kent Electronics Corp.* .......................... 5,813 57,767
Lattice Semiconductor Corp.* ..................... 5,129 233,690
Marshall Industries* ............................. 4,103 55,391
Marshall Industries Rights* ...................... 3,833 -
Methode Eletronics, Inc. ......................... 6,200 68,975
Micrel, Inc.* .................................... 4,130 206,758
Novellus Systems, Inc.* .......................... 7,810 430,526
Oak Industries, Inc.* ............................ 4,085 129,699
Park Electrochemical Co. ......................... 3,013 70,806
Photronics, Inc.* ................................ 5,350 99,644
Pioneer Standard Electronics, Inc................. 4,680 30,713
Sanmina Corp* .................................... 9,928 632,910
Technitrol, Inc................................... 3,930 90,636
TNP Enterprises, Inc. ............................ 3,370 96,888
Ultratech Stepper* ............................... 4,860 68,648
Unitrode Corp.* .................................. 5,470 77,606
Vitesse Semiconductor Corp.* ..................... 14,368 727,380
VLSI Technology, Inc.* ........................... 9,613 186,252
Watkins Johnson Co. .............................. 3,170 71,721
-----------
5,186,959
-----------
ENGINEERING (0.18%)
Tetra Tech, Inc.* 5,260 110,789
-----------
ENTERTAINMENT & LEISURE (0.24%)
Family Golf Centers, Inc.* ....................... 5,260 39,121
Prime Hospitality Corp.* ......................... 10,960 108,915
-----------
148,036
-----------
FINANCIAL SERVICES (0.92%)
Americredit Corp.* ............................... 13,330 174,956
Amresco, Inc.* ................................... 8,820 67,804
Billing Concepts Corp.* .......................... 6,420 76,238
Pioneer Group, Inc.* ............................. 5,910 87,542
St. Paul Bancorp, Inc. ........................... 7,035 152,352
-----------
558,892
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
FIREARMS & AMMUNITION (0.07%)
Sturm Ruger & Co., Inc. 4,086 $ 40,860
-----------
FOOD & BEVERAGE (1.98%)
Chiquita Brands International, Inc. .............. 11,380 115,934
Corn Products International, Inc. ................ 8,690 208,017
Earthgrains Co. .................................. 7,944 176,258
Fleming Co., Inc. ................................ 5,970 51,118
J&J Snack Foods Corp.*............................ 2,530 50,916
Michael Foods, Inc. .............................. 4,260 81,206
Ralcorp Holdings, Inc.* .......................... 5,570 105,830
Richfood Holdings, Inc. .......................... 9,608 207,173
Whole Foods Market, Inc.* ........................ 6,029 207,247
-----------
1,203,699
-----------
FOREST & PAPER PRODUCTS (0.42%)
Buckeye Technology, Inc.* ........................ 6,720 94,080
Caraustar Industries, Inc......................... 5,735 131,905
Pope & Talbot, Inc. .............................. 5,165 32,927
-----------
258,912
-----------
HEALTHCARE SERVICES (2.22%)
American Oncology Resources, Inc.* ............... 6,570 59,130
Curative Health Services, Inc.* .................. 3,360 38,640
Genesis Health Ventures, Inc.* .................. 6,797 33,135
Integrated Health Services, Inc.* ................ 10,798 59,389
Magellan Health Services, Inc.* .................. 4,870 20,393
Medquist, Inc.* ................................. 6,130 183,900
Orthodontic Centers of America, Inc.* ............ 8,360 131,670
Pediatrix Medical Group, Inc.* ................... 3,720 104,625
Phycor, Inc.* .................................... 11,945 56,739
Priority Healthcare Corp. Cl B* .................. 2,563 115,976
Renal Care Group, Inc.* .......................... 8,270 162,299
Sierra Health Services, Inc.* .................... 5,341 69,433
Universal Health Services, Inc.* ................. 7,284 315,033
-----------
1,350,362
-----------
HOME FURNISHING (2.25%)
Bassett Furniture Industries, Inc. ............... 3,668 81,155
Ethan Allen Interiors, Inc. ...................... 5,984 248,710
Inteface, Inc. Cl A .............................. 7,958 76,596
La Z Boy Chair Co. ............................... 9,573 181,887
Libbey, Inc. ..................................... 3,920 121,520
Mohawk Industries, Inc.* ......................... 11,463 343,890
National Presto Industries, Inc. ................. 4,080 144,585
Pier One, Inc..................................... 14,914 121,176
Pillowtex Corp. .................................. 3,668 52,040
-----------
1,371,559
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
HUMAN RESOURCES (0.53%)
CDI Corp.* ....................................... 4,439 $ 106,813
Interim Services, Inc.* .......................... 9,708 145,620
Norrell Corp. .................................... 5,509 71,961
-----------
324,394
-----------
INDUSTRIAL (0.57%)
Cognex Corp.* .................................... 8,447 200,088
Gerber Scientific, Inc............................ 4,341 87,634
Whittaker Corp.* ................................. 2,740 60,109
-----------
347,831
-----------
INSURANCE (5.91%)
American Bankers Insurance Group, Inc............. 8,412 437,424
Arthur J. Gallagher & Co. ........................ 3,622 166,612
Capital Re Corp. ................................. 5,970 102,983
CMAC Investment Corp. ............................ 4,847 189,033
Compdent Corp.* .................................. 2,520 31,500
Coventry Corp.* .................................. 10,625 79,688
Delphi Financial Group, Inc.* .................... 4,212 142,682
Enhance Financial Services Group, Inc............. 6,698 152,380
Executive Risk, Inc. ............................. 2,590 183,890
Express Scripts, Inc.* ........................... 6,732 578,531
Fidelity National Financial, Inc. ................ 5,298 79,470
Fremont General Corp. ............................ 12,272 233,935
Frontier Insurance Group, Inc. ................... 6,685 79,384
Mutual Risk Management, Ltd. ..................... 8,156 311,967
NAC Re Corp. ..................................... 3,910 209,918
Orion Capital Corp. .............................. 5,724 178,875
Selective Insurance Group, Inc. .................. 4,678 82,450
The First American Financial Corp. ............... 10,748 169,953
Trenwick Group, Inc. ............................. 3,107 87,384
Zenith National Insurance Corp. .................. 4,218 102,550
-----------
3,600,609
-----------
INVESTMENT COMPANIES (1.71%)
Dain Rauscher Corp. .............................. 3,608 122,672
Eaton Vance Corp. ................................ 6,356 127,915
Jefferies Group, Inc. ............................ 4,620 219,161
Legg Mason, Inc. ................................. 11,376 383,229
Raymond James Financial, Inc. .................... 9,661 190,805
-----------
1,043,782
-----------
LINEN SUPPLY & RELATED ITEMS (0.43%)
Angelica Corp. ................................... 3,320 46,480
G & K Services, Inc. ............................. 4,717 217,866
-----------
264,346
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
MACHINERY, GENERAL INDUSTRIAL (2.67%)
Applied Industrial Technologies, Inc. ............ 3,610 $ 40,161
Applied Power Cl A ............................... 8,254 224,922
Astec Industries, Inc.* .......................... 3,560 109,915
Baldor Electric Co. .............................. 6,030 121,354
Gardner Denver, Inc.* ............................ 3,320 52,705
Global Industrial Technologies, Inc.* ............ 4,760 49,980
Graco, Inc. ...................................... 3,900 86,044
Helix Technologies Corp. ......................... 5,300 81,488
JLG Industries, Inc. ............................. 6,750 91,969
Kulicke & Soffa Industries, Inc.* ................ 4,990 125,998
Lindsay Manufacturing Co. ........................ 3,379 67,158
Regal-Beloit Corp. .............................. 4,708 85,038
Robbins & Meyers, Inc. ........................... 3,270 56,408
Speedfam International, Inc.* .................... 3,990 47,880
The Manitowoc Co., Inc. .......................... 4,018 168,254
Thomas Industries, Inc. .......................... 3,300 61,875
Zebra Technologies Cl A* ......................... 6,466 153,568
-----------
1,624,717
-----------
MARKETING SERVICES (0.68%)
Advo, Inc.* ..................................... 4,115 79,471
Catalina Marketing Corp.* ........................ 3,905 335,342
-----------
414,813
-----------
MEDICAL DRUGS (0.07%)
Immune Response Corp.* ........................... 4,620 40,714
-----------
MEDICAL PRODUCTS (6.74%)
ADAC Labs* ...................................... 3,975 54,159
Alpharma, Inc. ................................... 5,478 215,012
Ballard Medical Products ......................... 5,863 142,911
Barr Labs, Inc.* ................................. 4,820 147,010
Bindley Western Industries, Inc................... 4,400 125,675
Bio Technology General Corp.* .................... 6,780 40,468
Cephalon, Inc.* .................................. 6,330 55,388
Cerner Corp.* .................................... 6,740 108,261
Cooper Co.* ...................................... 3,370 51,814
Datascope Corp.* ................................. 3,740 100,980
Diagnostic Products Corp. ........................ 3,520 85,360
Enzo Biochem, Inc................................. 5,426 50,869
Idexx Labs, Inc.* ................................ 7,649 183,098
Incyte Pharmaceuticals, Inc.* .................... 5,920 118,770
Invacare, Inc. ................................... 5,746 139,700
Liposome Co., Inc.* .............................. 7,250 97,422
Maxxim Medical, Inc.* ............................ 3,140 59,268
Medimmune, Inc.* ................................. 10,630 629,163
Mentor Corp. ..................................... 5,193 76,272
North American Vaccine, Inc.* .................... 6,323 37,938
Organogenesis, Inc.*.............................. 6,180 71,456
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
Patterson Dental Co.* ............................ 6,757 $ 292,240
Protein Design Labs, Inc.* ....................... 4,575 68,911
Respironics, Inc.* ............................... 6,110 80,576
Safeskin Corp.* .................................. 10,550 78,466
Scott Technologies, Inc.* ........................ 3,850 66,894
Sola International, Inc.* ........................ 5,471 65,994
Spacelabs Medical, Inc.* ......................... 3,060 51,446
Sunrise Medical, Inc.* ........................... 4,641 29,006
Syncor International Corp.*....................... 2,650 73,869
Visx, Inc.* ...................................... 6,082 654,195
Vital Signs, Inc. ................................ 2,923 52,614
-----------
4,105,205
-----------
METAL PRODUCTS (0.20%)
Amcast Industrial Corp. .......................... 3,420 55,148
Valmont Industries, Inc........................... 4,980 69,098
-----------
124,246
-----------
METALS (1.78%)
Brush Wellman, Inc. .............................. 4,550 65,975
Castle Am & Co. .................................. 3,507 42,303
Commercial Metals Co. ............................ 4,455 89,100
Commonwealth Industries, Inc...................... 4,320 38,880
Intermet Corp. ................................... 4,934 65,992
Lawson Products, Inc. ............................ 3,480 71,340
Meuller Industries, Inc.* ........................ 7,762 173,675
Quanex Corp. ..................................... 3,938 61,039
Reliance Steel & Aluminum Co...................... 4,470 128,792
RTI International, Inc.* ......................... 4,280 40,125
Stillwater Mining Co.* ........................... 7,017 185,073
WHX Corp.* ....................................... 5,354 42,163
Wolverine Corp.* ................................. 3,825 80,803
-----------
1,085,260
-----------
MINING & BUILDING MATERIALS (0.31%)
Getchell Gold Corp.* ............................. 7,166 187,212
-----------
MISCELLANEOUS MANUFACTURING (0.56%)
A.O. Smith Corp. ................................. 5,322 101,118
Aptargroup, Inc. ................................. 7,308 190,008
Huffy Corp. .... ................................. 4,367 52,404
-----------
343,530
OFFICE EQUIPMENT (0.47%)
Brady Corp. Cl A ................................. 5,180 108,456
John H. Harland Co................................ 4,770 61,712
New England Business, Inc......................... 3,980 114,176
-----------
284,344
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
OIL & GAS (4.98%)
Atmos Energy Corp. ............................... 5,206 $ 125,269
Barrett Resources Corp.*.......................... 7,679 192,455
Cabot Oil & Gas Corp. ............................ 6,721 97,034
Connecticut Energy Corp........................... 2,590 62,808
Cross Timbers Oil Co. ............................ 7,477 52,806
Daniel Industries, Inc. .......................... 4,290 65,423
Devon Energy Corp. ............................... 8,138 224,304
Energen Corp. .................................... 4,780 71,401
HS Resources, Inc.* .............................. 4,310 37,713
Input/Output, Inc.* .............................. 7,834 49,452
New Jersey Resources Corp. ....................... 3,756 133,573
Newfield Exploration Co.* ........................ 8,842 200,050
Northwest Natural Gas Co. ........................ 3,832 83,825
Oceaneering International, Inc.*.................. 4,986 75,413
Pennsylvania Enterprises, Inc..................... 2,720 65,280
Piedmont Natural Gas, Inc......................... 4,919 172,165
Plains Resources, Inc.*........................... 4,220 63,300
Pogo Producing Co. ............................... 9,096 118,248
Pool Energy Service Co.* ......................... 5,500 84,219
Pride International, Inc.* ....................... 9,645 79,571
Public Service Company of N.C. ................... 3,500 99,313
Santa Fe Resources, Inc.*......................... 13,220 96,671
Seitel, Inc.* .................................... 4,900 68,294
Snyder Oil Corp. ................................. 7,642 113,197
Southwest Gas Corp................................ 5,209 143,248
St. Mary Land & Exploration Co. .................. 4,020 69,848
Tuboscope, Inc.* ................................. 7,915 71,235
Vintage Petroleum, Inc. .......................... 11,326 101,934
WD-40 Co. ........................................ 4,060 117,740
Wicor, Inc. ...................................... 4,930 99,833
-----------
3,035,622
-----------
PAINT & RELATED PRODUCTS (0.12%)
Lilly Industries, Inc. ........................... 4,709 72,695
-----------
PHARMACEUTICAL (1.81%)
Biomatrix, Inc.*.................................. 2,470 192,660
Cor Therapeutics, Inc.*........................... 4,910 48,793
Jones Pharmaceutical, Inc......................... 6,160 214,060
NCS Healthcare Cl A*.............................. 5,090 61,079
Parexel Technology Corp.*......................... 5,380 111,299
Pharmaceutical Product Development, Inc.*......... 4,780 160,428
Regeneron Pharmaceutical, Inc.*................... 4,210 27,891
Roberts Pharmaceutical Corp.* .................... 6,625 137,469
Vertex Pharmaceutical, Inc.* ..................... 5,902 149,026
-----------
1,102,705
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
PHOTOGRAPHY & EQUIPMENT (0.11%)
CPI Corp. ........................................ 3,060 $ 68,468
-----------
PRINTING (1.40%)
Bowne & Co., Inc. ................................ 6,274 73,327
Consolidated Graphic, Inc.*....................... 2,980 172,095
Merrill Corp. .................................... 3,410 45,609
Valassis Communications, Inc.*.................... 7,572 391,851
World Color Press, Inc.* ......................... 8,040 170,850
-----------
853,732
-----------
RECREATION VEHICLE MANUFACTURING (0.31%)
Polaris Industries, Inc. ......................... 5,880 186,690
-----------
RECYCLING (0.08%)
IMCO Recycling, Inc. ............................. 3,940 50,727
-----------
RESTAURANT-RETAIL (1.53%)
CEC Entertainment, Inc.* ......................... 4,695 168,433
Cheesecake Factory, Inc.*......................... 5,205 123,619
CKE Restaurants, Inc.............................. 11,540 227,914
IHOP Corp.* ...................................... 3,420 134,234
Landry's Restaurants, Inc.*....................... 5,600 35,874
Luby's Cafeterias, Inc............................ 6,480 109,350
Ruby Tuesday, Inc. ............................... 7,530 130,834
-----------
930,258
-----------
RETAIL STORES (5.14%)
Ann Taylor Stores Corp.* ......................... 5,360 236,845
Books A Million, Inc.* ........................... 2,980 30,359
Brown Group, Inc. ................................ 4,459 58,803
Casey's General Stores, Inc. ..................... 8,332 122,897
Cash America International, Inc. ................. 3,930 50,599
Cato Corp. Cl A .................................. 4,950 46,097
Customtracks Corp.* .............................. 3,020 45,300
Footstar, Inc.* .................................. 5,560 177,920
Footstar, Inc. Rights* ........................... 5,450 -
Goody's Family Clothing, Inc.*.................... 6,570 91,569
Gymboree Corp.* .................................. 4,200 37,538
Jo-Ann Stores, Inc. Cl A*......................... 4,295 59,056
Just For Feet, Inc.*.............................. 6,480 81,000
Linens N' Things, Inc.*........................... 7,600 344,850
Mens Warehouse, Inc.*............................. 7,615 219,882
Michaels Stores, Inc.*............................ 6,810 168,122
Pacific Sunwear of California, Inc.*.............. 4,450 154,637
Regis Corp. ...................................... 7,785 207,275
Shopko Stores, Inc.*.............................. 5,494 164,133
Stein Mart, Inc.*................................. 7,752 77,520
Stride Rite Corp.................................. 7,270 89,058
The Sports Authority, Inc.*....................... 6,200 45,338
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
US Bioscience, Inc.* ............................. 4,940 $ 53,723
Williams Sonoma, Inc.*............................ 11,018 311,259
Zale Corp.* ...................................... 7,500 256,406
-----------
3,130,186
-----------
TELECOMMUNICATIONS (1.10%)
Aspect Tele-Communications Corp.*................. 8,894 58,922
California Microwave, Inc.* ...................... 4,310 46,333
Commscope, Inc.* ................................. 8,960 187,599
Picturetel Corp.* ................................ 6,010 42,070
Plantronics, Inc.* ............................... 3,490 218,342
Tel-Save Holding, Inc.* .......................... 11,240 117,317
-----------
670,583
-----------
TEXTILE PRODUCTS (0.08%)
Guilford Mills, Inc. ............................. 5,537 48,449
-----------
TRANSPORTATION (2.18%)
Air Express International Corp.................... 6,670 100,884
American Freightway Corp.*........................ 5,670 73,001
Expeditors International, Inc..................... 5,306 286,524
Fritz Co.*........................................ 5,793 39,827
Heartland Express, Inc.*.......................... 5,200 78,975
Kirby Corp.*...................................... 4,097 77,587
Landstar Systems, Inc.*........................... 2,355 78,009
MS Carriers, Inc.*................................ 3,040 80,370
Offshore Logistics, Inc.*......................... 5,150 59,868
Pittston Burlington Group......................... 3,850 26,709
USFreightways Corp................................ 5,802 190,740
Werner Enterprises, Inc........................... 8,448 133,056
Yellow Corp.* .................................... 5,916 102,791
-----------
1,328,341
-----------
TRUCKING & LEASING (0.11%)
Rollins Truck Leasing Corp. ...................... 6,969 65,770
-----------
UTILITIES (2.03%)
Central Hudson Gas & Electric Corp................ 3,230 115,674
Checkpoint Systems, Inc.* ........................ 5,510 45,802
Cilcorp, Inc. .................................... 3,270 196,403
Commonwealth Energy System Co..................... 4,872 187,571
Eastern Utilities Associates ..................... 3,928 111,211
Orange & Rockland Utilities, Inc. ................ 2,832 162,662
Sierra Pacific Resources ......................... 5,091 179,139
United Illuminating Co. .......................... 3,271 137,177
Vicor Corp.* ..................................... 8,359 104,487
-----------
1,240,126
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
SMALL CAP EQUITY FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
VITAMINS & NUTRITION PRODUCTS (0.14%)
NBTY, Inc.* ...................................... 9,503 $ 46,327
Natures Sunshine Products, Inc. .................. 3,271 35,981
-----------
82,308
-----------
WASTE MANAGEMENT (0.20%)
Superior Services, Inc.* ......................... 6,070 120,261
-----------
WATER (1.02%)
American States Water Co. ........................ 2,910 70,567
Aquarion Co. ..................................... 3,810 104,774
Ionics, Inc.* .................................... 4,405 132,700
Philadelphia Suburban Corp. ...................... 8,652 196,291
United Water Resources, Inc....................... 5,660 117,445
-----------
621,777
-----------
WIRE & CABLE PRODUCTS (0.26%)
Beldon, Inc. ..................................... 5,520 94,185
Cable Design Technologies Corp.*.................. 6,150 67,650
-----------
161,835
-----------
WIRELESS EQUIPMENT (0.17%)
Digital Microwave Corp.*.......................... 12,440 104,185
-----------
TOTAL COMMON STOCK (Cost $59,071,668)............. 60,693,537
-----------
MISCELLANEOUS ASSETS
S&P Mid-Cap 400 Depository Receipts...............
(Cost $171,375) .................................. 2,500 171,719
-----------
REPURCHASE AGREEMENTS (0.09%)
Fifth Third Bank, 4.30%, dated 03/31/99, due
04/01/99, repurchase price $56,133
(collateralized by FHLMC Pool #G10657, 7.50%,
due 02/01/12, market value $57,785
(Cost $56,126) ................................... 56,126
-----------
TOTAL INVESTMENT ($59,299,169) (99.96%)........ 60,921,382
OTHER ASSETS & LIABILITIES, NET (.04%)......... 21,348
-----------
NET ASSETS (100%).............................. $60,942,730
===========
* Non-income producing security.
Cost for federal income tax at March 31, 1999 was
$59,299,169 and net unrealized appreciation
consisted of :
Gross unrealized appreciation ................. $ 7,643,020
Gross unrealized depreciation ................. (6,020,807)
-----------
Net unrealized appreciation ................... $ 1,622,213
===========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
INTERNATIONAL FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
COMMON STOCK (37.01%)
AUSTRALIA (2.92%)
World Equity Benchmark Securities -
Australia Series .............................. 114,823 $ 1,162,583
-----------
AUSTRIA (0.32%)
World Equity Benchmark Securities -
Austria Series ................................ 13,705 128,484
-----------
BELGIUM (1.70%)
Electrabel SA*.................................... 290 103,940
Fortis (B)*....................................... 4,540 167,622
KBC Bancassurance Holding NV*..................... 1,780 118,660
Solvay SA ........................................ 670 41,084
Tractebel ........................................ 410 64,623
World Equity Benchmark Securities -
Belgium Series ................................ 9,852 179,799
-----------
675,728
-----------
FRANCE (0.41%)
World Equity Benchmark Securities -
France Series ................................. 7,750 163,719
-----------
GERMANY (0.50%)
World Equity Benchmark Securities -
Germany Series ................................ 10,044 199,625
-----------
HONG KONG (2.24%)
World Equity Benchmark Securities -
Hong Kong Series .............................. 91,625 893,344
-----------
ITALY (3.13%)
World Equity Benchmark Securities -
Italy Series .................................. 47,956 1,246,856
-----------
JAPAN (10.18%)
World Equity Benchmark Securities -
Japan Series .................................. 352,500 4,053,750
-----------
NETHERLANDS (6.18%)
ABN AMRO Holding NV - Sponsored ADR ............. 7,091 146,695
Akzo Nobel NV - Sponsored ADR .................... 2,962 109,594
Elsevier NV - Sponsored ADR ...................... 3,004 90,120
Ing Groep NV - Sponsored ADR* .................... 5,224 286,994
KLM Royal Dutch Air - ADR* ....................... 2,229 61,855
Koninklijke Ahold - Sponsored ADR* ............... 3,783 144,700
Koninklijke KPN NV - Sponsored ADR* .............. 2,878 114,221
Koninklijke Philips Electronics - ADR ............ 2,102 173,284
Oce NV - Sponsored ADR ........................... 2,505 61,373
Royal Dutch Petroleum - ADR*...................... 13,608 707,616
Unilever NV - ADR ................................ 3,677 244,291
Wolters Kluwer NV - Sponsored ADR ................ 490 88,445
World Equity Benchmark Securities -
Netherlands Series ............. 9,760 231,800
-----------
2,460,988
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
INTERNATIONAL FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
SINGAPORE (0.74%)
World Equity Benchmark Securities -
Netherlands Series ............................ 49,002 $ 294,012
-----------
SPAIN (1.07%)
World Equity Benchmark Securities - Spain Series.. 15,579 425,501
-----------
SWEDEN (0.12%)
World Equity Benchmark Securities -
Sweden Series ................................. 2,370 47,400
-----------
SWITZERLAND (7.39%)
ABB AG - Sponsored ADR ........................... 1,038 133,383
Adecco SA - Sponsored ADR*........................ 2,516 157,250
Credit Suisse Group - Sponsored ADR*.............. 6,685 305,839
Nestle SA - Sponsored ADR*........................ 2,577 227,420
Novartis AG - ADR ................................ 10,246 809,434
Roche Holdings Ltd. - Sponsored ADR* ............. 6,808 820,364
UBS AG - Sponsored ADR ........................... 32,014 488,214
World Equity Benchmark Securities -
Switzerland Series ............................ 80 1,265
-----------
2,943,169
-----------
UNITED KINGDOM (0.11%)
World Equity Benchmark Securities -
United Kingdom Series ......................... 2,120 45,183
-----------
TOTAL COMMON STOCK (Cost $12,518,768)............. 14,740,342
-----------
PRINCIPAL
---------
SHORT-TERM INVESTMENTS (60.27%)
FEDERAL HOME LOAN BANK DISCOUNT CORP. (32.57%)
05/12/99, 4.70% .................................. 5,000,000 4,973,794
04/09/99, 4.70% .................................. 8,000,000 7,991,784
-----------
12,965,578
-----------
FEDERAL NATIONAL MORTGAGE ASSOC. (14.97%)
05/24/99, 4.75% .................................. 6,000,000 5,959,489
-----------
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
INTERNATIONAL FUND
SCHEDULE OF INVESTMENTS - March 31, 1999 (Unaudited)
- ------------------------------------------------------------------------------
SHARES VALUE
--------- -----
REPURCHASE AGREEMENT (12.73%)
Fifth Third Bank, 4.30%, dated 03/31/99, due
04/01/99, repurchase price $5,067,945
(collateralized by FHLMC Pool #G10657, 7.50%,
due 02/01/12, market value
$5,169,693 (Cost $5,067,340) .................... 5,067,340 $35,067,340
-----------
TOTAL SHORT-TERM INVESTMENTS (Cost $23,992,407).. 23,992,407
-----------
TOTAL INVESTMENTS (Cost $36,511,175) (97.28%). 38,732,749
OTHER ASSETS AND LIABILITIES, NET (2.72%)..... 1,081,520
-----------
NET ASSETS (100%)............................. $39,814,269
-----------
* Non-income producing security.
Cost for federal income tax at March 31, 1999 was
$36,511,175 and net unrealized depreciation
consisted of :
Gross unrealized appreciation................. $2,366,084
Gross unrealized depreciation................. (144,510)
-----------
Net unrealized appreciation................... $2,221,574
-----------
FUTURES CONTRACTS OUTSTANDING - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
UNREALIZED
TOTAL VALUE APPRECIATION
NUMBER OF CONTRACTS (U.S. DOLLARS) (DEPRECIATION)
- ------------------- -------------- --------------
81 CAC 40, delivery date 04/30/99 $3,650,815 $ (15,740)
28 DAX, delivery date 06/18/99 3,677,210 (174,565)
90 FTSE 100, delivery date 06/18/99 9,174,334 169,492
8 IBEX, delivery date 04/16/99 836,878 (38,432)
4 MIB 30, delivery date 06/21/99 789,593 (1,189)
80 NIKKEI 225, delivery date 06/15/99 5,322,976 87,816
119 OMX, delivery date 04/23/99 1,066,557 28,943
----------- ---------
$24,518,363 $ 56,325
=========== =========
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
(1) ORGANIZATION
The Capstone Social Ethics and Religious Values Fund (the "Trust") was
organized as a Massachusetts business trust on April 13, 1998 and is
registered under the Investment Company Act of 1940 (the "1940 Act") as a
diversified open-end management investment company. The Trust currently
consists of six diversified series: the Money Market Fund, the Short-Term
Bond Fund, the Bond Fund, the Large Cap Equity Fund, the Small Cap Equity
Fund, and the International Fund (each a "Fund" and collectively the
"Funds"). Between the date of organization and October 2, 1998, the Funds
had no operations other than those relating to organizational matters and
the sale of 1 Class A share and 1 Class C share of the Large Cap Equity
Fund to Capstone Asset Management Company ("Capstone"), the Trust's
adviser and administrator for $50, and the sale of 4,000 Class C shares of
the Large Cap Equity Portfolio to another shareholder for $100,000.
On October 1, 1998 each of the Funds acquired the net assets of separate
Portfolios of a tax-exempt business trust which had been managed by
Capstone. Each of these Portfolios had been managed following investment
objectives similar to those of the Funds and their net assets consisted
principally of investment securities. Class C shares of each Fund issued
to affect these acquisitions were distributed to each of the Portfolios'
beneficiaries in complete liquidation of the business trust.
The Trust is authorized to issue an unlimited number of shares of
beneficial interest of $.01 par value. The Fund currently offers two
Classes of shares ("Class A" and "Class C"). Each Class of shares has
equal rights as to earnings, assets and voting privileges, except that
Class A bears distribution expenses. Each Class of shares has exclusive
voting rights with respect to matters that affect just that Class.
Income, expenses (other than expenses attributable to a specific Class)
and realized and unrea lized gains or losses on investments are allocated
to each Class of shares based on its relative net assets.
(2) INVESTMENT OBJECTIVES
As a matter of fundamental investment policy, each of the Funds will
invest in companies that are managed in a socially responsible manner,
reflecting certain ethical and religious values. Accordingly, the Funds
will not invest in companies whose primary business is the manufacturing,
operation or distribution of alcohol, caffeine or tobacco products, meat
processing, pornography, or casinos and other gambling concerns.
The Money Market Fund's objective is to provide current income, stability
of capital and liquidity by investing in other money market funds and
short-term money market instruments. It seeks to maintain a constant net
asset value of $1.00 per share, although there can be no assurance that
this will be achieved.
The Short-Term Bond Fund's objective is to provide current income and
relative capital stability by attempting to match the price and yield
performance (before expenses) of a blended short-term index consisting of
one-third U.S. Treasury securities, one-third U.S. government securities
and one-third investment grade corporate obligations with maximum
maturities of three years.
The Bond Fund's objective is to provide current income by attempting to
match the price and yield performance (before expenses) of the Lehman
Brothers Government/Corporate Bond Index. The Bond Fund will invest
primarily in obligations of the U.S. Government, its agencies, and
instrumentalities, and investment grade corporate obligations having a
broad range of maturities.
The Large Cap Equity Fund's objective is to provide capital growth and
income by attempting to match the performance (before expenses) of the S &
P 500 Index. The Large Cap Equity Fund will invest primarily in the
common stocks of large companies whose securities are widely held and have
an active trading market.
The Small Cap Equity Fund's objective is to provide capital appreciation
by attempting to match the performance (before expenses) of the S & P
Small Cap 600 Index which consists of 600 stocks with smaller
capitalization that those included in the S & P 500 Index. The Small Cap
Equity Fund will invest primarily in equity securities of the type that
are included in the index.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
The International Fund's objective is to provide capital appreciation by
attempting to match the performance and yield characteristics of the
Morgan Stanley Capital International Europe, Australia, Far East Index,
net of withholding taxes. The International Fund will invest primarily in
securities with characteristics generally comparable to those included in
this index or whose performance is expected to be comparable.
(3) SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements.
A. SECURITY VALUATION
Portfolio equity securities which are primarily traded on security
exchanges are valued at the last sale price on that exchange or, if
there is no recent last sale price available, at the last current bid
quotation. A security which is listed or traded on more than one
exchange is valued at the quotation on the exchange determined to be
the primary market for such security. All other equity securities not
so traded are valued at the last current bid quotation prior to the
time of valuation.
Securities held by the Money Market Fund and other money market
securities held by the other Funds are valued using the amortized cost
method of valuation, which in the opinion of the Board of Trustees
reflects fair value.
Other debt securities are valued by using market quotations or
independent pricing services which use prices provided by market makers
or estimates of market values obtained from yield data relating to
instruments or securities with similar characteristics. Other
securities, including restricted securities, and other assets are
valued at fair value as determined in good faith by the Board of
Trustees.
B. FOREIGN CURRENCY TRANSLATION
Portfolio securities and other assets and liabilities denominated in
foreign currencies are translated into U.S. dollars based on the
exchange rate of such currencies against U.S. dollars on the date
of valuation. Purchases and sales of securities and income
items denominated in foreign currencies are translated into U.S.
dollars at the exchange rate in effect on the transaction date. The
Funds do not separately report the effect of changes in foreign
exchange rates from changes in market prices on secur ities held. Such
changes are included in net realized and unrealized gain or loss from
investments.
Realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions and the difference
between the recorded amounts of dividends, interest and foreign
foreign withholding taxes, and the U.S. dollar equivalent of the
amounts actually received or paid. Net unrealized foreign exchange
gains or losses arise from changes in foreign exchange rates on foreign
currency denominated assets and liabilities othe r than investments in
securities held at the end of the reporting period.
C. FEDERAL INCOME TAXES
It is the policy of the Funds to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and
to distribute substantially all of their taxable income to
their shareholders in a manner which results in no tax to the
Funds. Therefore, no federal income or excise tax provisions are
required.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
D. SECURITY TRANSACTIONS, INCOME AND DISTRIBUTIONS
Security transactions are accounted for on the trade date. Realized
gains and losses on security transactions are determined on the
specific identification basis. Interest income on debt securities is
recorded on the accrual basis. Discounts and premiums on debt
securities are amortized to income over their respective lives.
Dividends and distributions to shareholders are recorded on the
ex-dividend date.
E. FORWARD EXCHANGE CONTRACTS
The Funds may enter into forward exchange contracts to hedge against
foreign currency exchange risks. These contracts are valued daily and
any appreciation or depreciation therein is included in the
statement of assets and liabilities. Realized gains and losses
are included in the statement of operations.
F. FUTURES CONTRACTS
The Funds may invest in financial futures contracts. Upon entering
into a futures contract, the Fund is required to deposit with its
futures broker, cash or other securities equal to a certain percentage
of the futures contract amount ("initial margin"). During the term of
the futures contract, payments are exchanged daily between the Fund and
the futures broker in amounts equal to the appreciation or depreciation
in the value of the futures contract ("variation margin"). The Funds
recognize gains or losses equal to the variation margin payments paid
or received. Futures contracts involve market risks in excess of the
amounts recognized in the statement of assets and liabilities.
Additionally, there is a risk that a Fund may not be able to enter into
a closing transaction because of an illiquid secondary market.
G. REPURCHASE AGREEMENTS
In connection with transactions in repurchase agreements, it is the
Funds' policy that their custodian bank take possession of the
underlying collateral securities, the fair value of which must be
equal to the principal amount of the repurchase agreement
including accrued interest throughout the term of the repurchase
agreement. If the seller defaults and the fair value of the collateral
declines, realization of the collateral by the Funds may be delayed or
limited.
H. ORGANIZATION EXPENSES
Capstone has agreed to bear all of the costs incurred in connection
with the organization and registration of the Trust's shares.
I. USE OF ESTIMATES
In preparing financial statements in accordance with generally accepted
accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and the disclosure of contingent assets and liabilities at the
date of the financial statements. Actual results could differ
from those estimates.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
(3) INVESTMENT ADVISER AND ADMINISTRATOR
Capstone serves as each Fund's adviser and administrator. Pursuant to the
terms of the Investment Advisory Agreement, Capstone shall have full
discretion to manage the assets of the Funds in accordance with their
investment objectives. As compensation for its services each Fund pays
Capstone, on a monthly basis, an investment advisory fee. The advisory
fees for the Money Market Fund are calculated at the annual rate of 0.10%
of the Money Market Fund's average daily net assets. The advisory fees
for all of the other Funds are calculated at the annual rate of 0.15% on
the first $500 million of the other Funds' collective average daily net
assets and then allocated to each Fund based upon relative net assets.
The rate declines to 0.10% on the next $250 mill ion of average daily net
assets, 0.075% on the next $250 million of average daily net assets, and
to 0.05% on collective average daily net assets in excess of $1 billion.
Pursuant to the terms of the Administration Agreement, Capstone will
supervise the Fund's daily business affairs, coordinate the activities of
persons providing services to the Fund, and furnish office space and
equipment to the Fund. As compensation for its services Capstone receives
a monthly fee from each Fund calculated at the annual rate of 0.05% of
each Fund's average daily net assets.
Capstone has voluntarily agreed to waive its investment advisory and
administrative fees for the Money Market Fund and the Short-Term Bond
Fund, resulting in waivers of investment advisory fees for the period
ended March 31, 1999 of $11,826 and &6,679, respectively, and waivers of
administrative fees for the period ended March 31, 1999 of $5,913 and
$2,226, respectively. These waivers are voluntary and may be discontinued
at any time, however, Capstone intends to continue the waivers for the
Short-Term B ond Fund until its net assets reach $25 million. The Funds'
accounting agent waived its fees for these two Funds through December 31,
1998, resulting in waivers of fund accounting fees for the period ended
March 31, 1999 of $4,250 for the Money Market Fun d and $4,250 for the
Short-Term Bond Fund.
(4) DISTRIBUTION PLAN AND OTHER TRANSACTIONS WITH AFFILIATES
Capstone Asset Planning Company (the "Distributor") serves as the Trust's
principal underwriter pursuant to a Distribution Agreement. The
Distributor is an affiliate of Capstone.
The Class A shares of each Fund have adopted a Service and Distribution
Plan (the "Plan") pursuant to Rule 12(b)-1 under the 1940 Act. The Plan
provides that the Class A shares will make payments to the Distributor to
compensate the Distributor for expenditures incurred by it in connection
with the distribution of Class A shares and for the provision of certain
stockholder services including but not limited to the payment of
compensation to security dealers and other financial organizations to
obtain var ious distribution related and/or administrative services for
the Fund. As compensation for its services the Distributor receives a
monthly fee calculated at the annual rate of 0.10% of the average daily
net assets of the Class A shares of the Money Market Fund and 0.25% of the
average daily net assets of the Class A shares of the other Funds.
Certain officers of the Trust are also officers of Capstone and the
Distributor.
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
(5) SHARES OF CAPITAL STOCK
All Funds - The authorized capital stock of the funds is unlimited in
shares, with a par value of $1.00 per share. Transactions in shares of
capital stock, for the period from October 1, 1998 (commencement of
operations) to March 31, 1999, were as follows:
CLASS A CLASS C
------- -------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
MONEY MARKET FUND:
Shares issued in connection
with taxable reorganization $- 4,875,832 $ 4,875,832
Sold 1 1 21,826,385 21,826,393
Reinvested - 418,629 418,629
Redeemed - (5,132,850) (5,132,850)
___ ___ __________ ___________
Net Increase 1 $1 21,987,996 $21,988,004
=== === ========== ===========
SHORT-TERM BOND FUND:
Sold 1 $25 881,115 $22,073,011
Reinvested - 6,246 115,411
___ ___ __________ ___________
Net Increase 1 $25 887,361 $22,188,422
=== === ========== ===========
BOND FUND:
Shares issued in connection
with taxable reorganization $- 2,059,228 $51,480,690
Sold 1 25 459,698 11,334,984
Reinvested - 2,427 58,830
___ ___ __________ ___________
Net Increase 1 $25 2,521,353 $62,874,504
=== === ========== ===========
LARGE CAP EQUITY FUND:
Shares issued in connection
with taxable reorganization $- 921,070 $23,026,741
Sold 1 25 460,753 11,650,322
Reinvested - 2,065 63,776
___ ___ __________ ___________
Net Increase 1 $25 1,383,888 $34,740,839
=== === ========== ===========
SMALL CAP EQUITY FUND:
Shares issued in connection
with taxable reorganization $- 1,737,033 $43,425,834
Sold 1 25 551,450 14,864,314
Reinvested - 202 5,480
___ ___ __________ ___________
Net Increase 1 $25 2,288,685 $58,295,628
=== === ========== ===========
INTERNATIONAL FUND:
Shares issued in connection
with taxable reorganization $- 1,282,187 $32,054,682
Sold 1 25 79,051 2,211,840
Reinvested - 3,546 100,109
___ ___ __________ ___________
Net Increase 1 $25 1,364,784 $34,366,631
=== === ========== ===========
<PAGE>
CAPSTONE SOCIAL ETHICS & RELIGIOUS VALUES FUND
NOTES TO FINANCIAL STATEMENTS - MARCH 31, 1999 (UNAUDITED)
- -----------------------------------------------------------------------------
(6) INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term
securities) by the Funds for the period from inception to March 31, 1999
were as follows:
PURCHASES SALES
------------ ------------
Short-Term Bond Fund $ 23,606,348 $ 1,804,136
Bond Fund 15,899,265 4,432,326
Large Cap Equity Fund 16,471,407 3,725,572
Small Cap Equity Fund 24,884,619 9,971,644
International Fund 5,339,827 2,615,936
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