<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
RYDEX VARIABLE TRUST
[RYDEX LOGO] SEMI-ANNUAL REPORT
June 30, 2000
6116 Executive Boulevard, Suite 400
Rockville, MD 20852
(301) 468-8520
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
DEAR SHAREHOLDER:
After a positive, although volatile first quarter, the second quarter saw
all of the major market indices in negative territory. A few old economy stocks
fared well, but the broad markets were dragged down by the dismal performance of
the new economy technology stocks. After peaking in the middle of March, the
tech heavy NASDAQ Composite Index fell by more than 20.00%. The central bank has
stayed on its tightening course and has continued to successfully fight
inflation as the economy sails along in a record expansion.
FIRST HALF REVIEW
The prolonged tech rally started to fizzle out in late March when Abby
Joseph Cohen, a long standing bull and influential market strategist from
Goldman Sachs, recommended cutting back on stocks and moved to a neutral
position on technology. Her recommendation helped spur an 8.00% decline in the
NASDAQ Composite in the last week of the first quarter. In April, Judge Thomas
Penfield Jackson ruled in the closely watched Microsoft case that the tech
bellwether illegally protected its software monopoly by forcing computer makers
and Internet services not to use rival software. The ruling set the stage for a
potential break-up of the company and a further slide in tech stocks. Although
tech stocks recovered somewhat in June, the NASDAQ Composite was down 2.54%, its
first negative rolling six-month return since October of 1998.
While tech stocks struggled, major pharmaceutical companies posted a hefty
first half gain. The S&P Health Care index, a benchmark for major healthcare
companies, advanced 21.63% for the period. Also, major oil companies fared well
during the first half as oil and gas prices rose substantially from their near
record 1998 lows. These two sectors helped the S&P 500, which was down 0.99%,
from going into further negative territory.
During the first half of 2000, stock market volatility ran higher and
eclipsed the levels seen in 1974 and 1987. Even more volatile than the broad
market were the high multiple technology growth stocks as evidenced by the
NASDAQ 100. That tech laden index moved more than 2.00% on two thirds of all
trading days during the period.
As the stock market languished, the bond market held its own, enduring three
more rate increases by the Fed. The last one in May was a 50 basis point hike
which raised the fed funds rate to 6.50%, its highest level in 9 years. The
central bank left U.S. interest rates unchanged at the June FOMC meeting in part
because of May's weak employment report. The yield on the 30-year Treasury
<PAGE>
Bond fell from 6.48% to 5.90% during the reporting period. Investors switching
from equities into bonds and a shrinking supply of government bonds fueled the
rally.
The U.S. economy continued its record expansion with GDP growth exceeding a
5.00% annual rate. Corporate investment in high technology has produced record
growth in productivity, which, in turn, has offset any wage gains brought on by
the low unemployment rate. Thus, inflation still shows little signs of
accelerating.
SUMMARY
Although earnings reports for the first half showed excellent aggregate
growth, the stock market failed to rally in the wake of the Fed's decision to
raise interest rates. The Fed will continue to watch the market with keen eyes.
Now, while the economy is still expanding at a strong pace, consumer
spending--the force behind the record expansion--and the economy's overall
performance is starting to show signs of moderation. Some of this slowdown can
be attributed to the market pullback.
Looking forward, investors will be looking for more signs that growth is
slowing. They will also be watching corporate earnings reports for evidence that
higher interest rates and a mildly decelerating economy are not diminishing
companies profitability.
In closing, I would like to thank you for using the Rydex Funds. As always,
we welcome your questions or comments. Feel free to contact us over the Internet
via our web site at www.rydexfunds.com or call us at 800-820-0888.
Sincerely,
/s/ Albert P. Viragh
Albert P. (Skip) Viragh, Jr.
Chairman of the Board
2
<PAGE>
RYDEX VARIABLE TRUST
NOVA FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
CONTRACTS (NOTE 1)
----------- ------------
<S> <C> <C>
OPTIONS PURCHASED 6.1%
Call Options on:
S&P 500 September 2000 Futures
Contracts,
Expiring September 2000 with strike
1000............................... 122 $ 14,277,050
Put Options on:
S&P 500 July 2000 Futures Contracts,
Expiring July 2000 with strike
950................................ 10 --
S&P 500 July 2000 Futures Contracts,
Expiring July 2000 with strike
975................................ 540 --
------------
Total Options Purchased (Cost
$15,095,666)...................... 14,277,050
------------
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT
-----------
<S> <C> <C>
U.S. TREASURY OBLIGATIONS 12.7%
U.S. Treasury Bill 5.30% 7/20/00....... $25,000,000 24,930,069
U.S. Treasury Bill 5.93% 11/30/00...... 5,000,000 4,874,811
------------
Total U.S. Treasury Obligations
(Cost $29,804,880)................ 29,804,880
------------
FEDERAL AGENCY DISCOUNT NOTES 50.6%
Fannie Mae 6.41% 8/31/00............... 25,000,000 24,728,465
Farmer Mac 6.01% 7/5/00................ 10,000,000 9,993,322
Federal Farm Credit Banks 6.42%
7/18/00.............................. 25,000,000 24,924,208
Federal Home Loan Banks 6.45%
7/10/00.............................. 25,000,000 24,959,688
Freddie Mac 6.45% 7/25/00.............. 25,000,000 24,892,500
Freddie Mac 6.30% 8/3/00............... 9,000,000 8,948,025
------------
Total U. S. Treasury & U.S. Agency
Obligations (Cost $118,446,208)... 118,446,208
------------
REPURCHASE AGREEMENTS 30.6%
Repurchase Agreements Collateralized by
U.S. Treasury Obligations (Note 5):
6.45% 7/3/00......................... 36,311,750 36,311,750
6.50% 7/3/00......................... 35,471,020 35,471,020
------------
Total Repurchase Agreements (Cost
$71,782,770)...................... 71,782,770
------------
Total Investments 100% (Cost
$235,129,524)..................... $234,310,908
============
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNREALIZED
LOSS
CONTRACTS (NOTE 1)
--------- --------------
<S> <C> <C>
FUTURES CONTRACTS PURCHASED
S&P 500 Futures Contracts Expiring
September 2000
(Underlying Face Amount at Market
Value $314,173,400).................. 856 $(3,227,095)
===========
</TABLE>
See Notes to Financial Statements. 3
<PAGE>
RYDEX VARIABLE TRUST
URSA FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
CONTRACTS (NOTE 1)
----------- -----------
<S> <C> <C>
OPTIONS PURCHASED 3.2%
Put Options on:
S&P 500 September 2000 Futures
Contracts, Expiring September 2000
with strike 1800................... 10 $ 829,750
-----------
Total Options Purchased
(Cost $750,075).................. 829,750
-----------
<CAPTION>
FACE
AMOUNT
-----------
<S> <C> <C>
FEDERAL AGENCY DISCOUNT NOTES 57.7%
Federal Farm Credit Banks 6.43%
7/24/00.............................. $10,000,000 9,958,919
Federal Home Loan Banks 6.48% 7/6/00... 5,000,000 4,995,500
-----------
Total Federal Agency Discount Notes
(Cost $14,954,419)............... 14,954,419
-----------
REPURCHASE AGREEMENTS 39.1%
Repurchase Agreements Collateralized by
U.S. Treasury Obligations (Note 5):
6.45% 7/3/00......................... 5,115,416 5,115,416
6.50% 7/3/00......................... 4,996,979 4,996,979
-----------
Total Repurchase Agreements
(Cost $10,112,395)............... 10,112,395
-----------
Total Investments 100%
(Cost $25,816,889)............... $25,896,564
===========
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNREALIZED
GAIN
CONTRACTS (NOTE 1)
--------- -----------
<S> <C> <C>
FUTURES CONTRACTS SOLD SHORT
S&P 500 E-Mini Futures Contracts
Expiring September 2000.............. 34 $ 47,495
S&P 500 Futures Contracts Expiring
September 2000....................... 39 192,557
--------
(Total Underlying Face Amount at
Market Value $16,809,745)......... $240,052
========
</TABLE>
See Notes to Financial Statements. 4
<PAGE>
RYDEX VARIABLE TRUST
U.S. GOVERNMENT MONEY MARKET FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
FACE VALUE
AMOUNT (NOTE 1)
----------- -----------
<S> <C> <C>
FEDERAL AGENCY DISCOUNT NOTES 78.7%
Fannie Mae 6.40% 7/3/00................ $ 1,500,000 $ 1,499,467
Fannie Mae 6.40% 7/7/00................ 3,500,000 3,496,266
Farmer Mac 6.01% 7/5/00................ 10,000,000 9,993,322
Federal Farm Credit Banks 6.43%
7/24/00.............................. 10,000,000 9,958,919
Federal Home Loan Banks 5.65%
7/28/00.............................. 10,000,000 9,957,625
Freddie Mac 6.45% 7/25/00.............. 10,000,000 9,957,000
-----------
Total Federal Agency Discount Notes
(Cost $44,862,599)............... 44,862,599
-----------
REPURCHASE AGREEMENTS 21.3%
Repurchase Agreements Collateralized by
U.S. Treasury
Obligations (Note 5):
6.45% 7/3/00........................... 6,126,448 6,126,448
6.50% 7/3/00........................... 5,984,600 5,984,600
-----------
Total Repurchase Agreements
(Cost $12,111,048)............... 12,111,048
-----------
Total Investments 100%
(Cost $56,973,647)............... $56,973,647
===========
</TABLE>
See Notes to Financial Statements. 5
<PAGE>
RYDEX VARIABLE TRUST
OTC FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (NOTE 1)
------- ------------
<S> <C> <C>
COMMON STOCKS 97.0%
Cisco Systems, Inc.*................... 918,358 $ 58,373,130
Intel Corp............................. 431,571 57,695,648
Microsoft Corp.*....................... 666,508 53,320,640
Oracle Corp.*.......................... 435,543 36,612,833
JDS Uniphase Corp.*.................... 261,764 31,378,960
Sun Microsystems, Inc.*................ 254,493 23,142,957
Nextel Communications, Inc.,
Class A*............................. 342,512 20,957,453
QUALCOMM, Inc.*........................ 328,905 19,734,300
MCI WorldCom, Inc.*.................... 379,017 17,387,405
Dell Computer Corp.*................... 350,502 17,284,130
VERITAS Software Corp.*................ 149,878 16,938,556
Siebel Systems, Inc.*.................. 86,142 14,089,601
Applied Materials, Inc.*............... 153,691 13,928,247
Xilinx, Inc.*.......................... 159,034 13,130,245
Immunex Corp.*......................... 252,695 12,492,609
Amgen, Inc.*........................... 176,118 12,372,290
ADC Telecommunications,
Inc.*................................ 147,492 12,370,892
Yahoo! Inc.*........................... 96,106 11,905,131
VeriSign, Inc*......................... 67,086 11,840,679
PMC-Sierra, Inc.*...................... 59,208 10,520,521
Altera Corp.*.......................... 103,036 10,503,232
CIENA Corp.*........................... 61,679 10,281,118
Maxim Integrated Products, Inc.*....... 145,755 9,902,230
Linear Technology Corp................. 153,998 9,846,247
VoiceStream Wireless Corp.*............ 83,964 9,764,751
Network Appliance, Inc.*............... 117,110 9,427,355
SDL, Inc.*............................. 32,451 9,254,620
Global Crossing, Ltd.*................. 348,578 9,171,959
Telefonaktiebolaget LM Ericsson,
Sponsored ADR*....................... 437,730 8,754,600
Apple Computer, Inc.*.................. 167,071 8,750,344
Level 3 Communications,
Inc.*................................ 93,482 8,226,416
<CAPTION>
MARKET
VALUE
SHARES (NOTE 1)
------- ------------
<S> <C> <C>
i2 Technologies, Inc.*................. 76,613 $ 7,988,102
Metromedia Fiber Network, Inc.,
Class A*............................. 192,202 7,628,017
Comcast Corp., Special Class A......... 157,734 6,388,227
NTL, Inc.*............................. 103,126 6,174,669
MedImmune, Inc.*....................... 82,433 6,100,042
Tellabs, Inc.*......................... 85,891 5,878,165
Adobe Systems, Inc..................... 43,182 5,613,660
Comverse Technology, Inc.*............. 59,437 5,527,641
Paychex, Inc........................... 129,714 5,447,988
BroadVision, Inc.*..................... 105,415 5,356,400
CMGI, Inc.*............................ 113,914 5,218,685
Applied Micro Circuits Corp.*.......... 52,103 5,145,171
Gemstar International Group, Ltd.*..... 79,754 4,901,132
KLA-Tencor Corp.*...................... 82,940 4,857,174
Vitesse Semiconductor Corp.*........... 65,585 4,824,597
Chiron Corp.*.......................... 92,477 4,392,657
Biogen, Inc.*.......................... 67,138 4,330,401
Sanmina Corp.*......................... 50,641 4,329,806
Conexant Systems, Inc.*................ 88,306 4,293,879
eBay, Inc.*............................ 72,127 3,917,398
Intuit, Inc.*.......................... 93,495 3,868,356
American Power Conversion Corp.*....... 93,772 3,827,070
3Com Corp.*............................ 65,534 3,776,397
NEXTLINK Communications, Inc.,
Class A*............................. 96,299 3,653,343
Starbucks Corp.*....................... 94,931 3,625,178
McLeodUSA, Inc., Class A*.............. 171,960 3,557,422
PanAmSat Corp.*........................ 74,125 3,238,336
Amazon.com, Inc.*...................... 85,807 3,115,867
RF Micro Devices, Inc.*................ 33,417 2,928,165
EchoStar Communications Corp.,
Class A*............................. 87,819 2,907,632
Costco Wholesale Corp.*................ 86,599 2,857,767
</TABLE>
* NON-INCOME PRODUCING SECURITIES
See Notes to Financial Statements. 6
<PAGE>
RYDEX VARIABLE TRUST
OTC FUND
SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (NOTE 1)
------- ------------
<S> <C> <C>
RealNetworks, Inc.*.................... 53,773 $ 2,718,897
Cintas Corp............................ 73,937 2,712,564
USA Networks, Inc.*.................... 125,403 2,711,840
Lycos, Inc.*........................... 50,155 2,708,370
Bed Bath & Beyond, Inc.*............... 69,930 2,534,962
BMC Software, Inc.*.................... 68,420 2,496,261
Fiserv, Inc.*.......................... 56,543 2,445,485
Peoplesoft, Inc.*...................... 143,506 2,403,726
Genzyme Corp. -- General Division*..... 39,125 2,325,492
Concord EFS, Inc.*..................... 88,132 2,291,432
Atmel Corp.*........................... 61,208 2,257,045
Biomet, Inc............................ 58,627 2,253,475
At Home Corp., Series A*............... 105,967 2,198,815
Adelphia Communications Corp.,
Class A*............................. 44,735 2,096,953
QLogic Corp.*.......................... 27,554 1,820,286
Staples, Inc.*......................... 116,410 1,789,804
Electronic Arts, Inc.*................. 23,835 1,738,465
Molex, Inc............................. 35,555 1,711,084
Citrix Systems, Inc.*.................. 80,936 1,532,725
Parametric Technology Corp.*........... 137,991 1,517,901
Dollar Tree Stores, Inc.*.............. 34,473 1,363,838
Novell, Inc.*.......................... 145,348 1,344,469
PACCAR, Inc............................ 31,563 1,252,656
Smurfit-Stone Container Corp.*......... 87,891 1,131,597
Network Associates, Inc.*.............. 52,979 1,079,447
Synopsys, Inc.*........................ 29,893 1,033,177
Sigma-Aldrich Corp..................... 33,000 965,250
CNET Networks, Inc.*................... 35,845 880,443
<CAPTION>
MARKET
VALUE
SHARES (NOTE 1)
------- ------------
<S> <C> <C>
Compuware Corp.*....................... 81,824 $ 848,924
Quintiles Transnational Corp.*......... 19,298 272,584
Northwest Airlines Corp.*.............. 8,346 254,031
Apollo Group, Inc., Class A*........... 8,406 235,368
VISX, Inc.*............................ 8,325 233,620
Adaptec, Inc.*......................... 10,235 232,846
PacifiCare Health Systems, Inc.*....... 3,848 231,602
Legato Systems, Inc.*.................. 11,305 170,988
------------
Total Common Stocks (Cost
$595,957,418).................... 770,824,865
------------
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT
-----------
<S> <C> <C>
REPURCHASE
AGREEMENTS 3.0%
Repurchase Agreements Collateralized by
U.S. Treasury Obligations (Note 5):
6.45% 7/3/00......................... $11,878,509 11,878,509
6.50% 7/3/00......................... 11,603,485 11,603,485
------------
Total Repurchase Agreements
(Cost $23,481,994)............... 23,481,994
------------
Total Investments 100%
(Cost $619,439,412).............. $794,306,859
============
</TABLE>
* NON-INCOME PRODUCING SECURITIES
See Notes to Financial Statements. 7
<PAGE>
RYDEX VARIABLE TRUST
OTC FUND
SCHEDULE OF INVESTMENTS (UNAUDITED) (CONCLUDED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNREALIZED
LOSS
CONTRACTS (NOTE 1)
--------- ------------
<S> <C> <C>
FUTURES CONTRACTS PURCHASED
NASDAQ 100 Futures Contracts, Expiring
September 2000
(Underlying Face Amount at Market
Value $23,283,700)................... 61 $(224,767)
=========
</TABLE>
* NON-INCOME PRODUCING SECURITIES
See Notes to Financial Statements. 8
<PAGE>
RYDEX VARIABLE TRUST
PRECIOUS METALS FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
SHARES (NOTE1)
------- ----------
<S> <C> <C>
COMMON STOCKS 99.5%
Barrick Gold Corp.................... 66,150 $1,203,103
Placer Dome, Inc..................... 66,995 640,640
Newmont Mining Corp.................. 28,317 612,355
AngloGold Ltd., Sponsored ADR........ 16,696 343,311
Gold Fields, Ltd., Sponsored ADR..... 72,140 284,051
De Beers Consolidated Mines,
Sponsored ADR...................... 11,600 282,025
Broken Hill Proprietary Co., Ltd.,
Sponsored ADR...................... 11,859 281,651
Homestake Mining Co.................. 40,941 281,469
Harmony Gold Mining Co., Ltd.,
Sponsored ADR...................... 48,883 271,912
Freeport-McMoRan Copper &
Gold, Inc., Class B*............... 25,433 235,255
Stillwater Mining Co.*............... 8,338 232,422
Battle Mountain Gold Co.*............ 102,680 224,612
Phelps Dodge Corp.................... 5,663 210,593
Meridian Gold, Inc.*................. 32,120 196,735
Apex Silver Mines, Ltd.*............. 15,223 151,279
Agnico-Eagle Mines, Ltd.............. 20,073 129,220
Anglo American, PLC, Unsponsored
ADR................................ 2,730 128,993
Coeur d'Alene Mines Corp.*........... 34,909 85,091
Kinross Gold Corp.*.................. 35,606 33,381
Glamis Gold, Ltd.*................... 14,776 28,629
Hecla Mining Co.*.................... 19,531 21,972
----------
Total Common Stocks
(Cost $5,730,376)................ 5,878,699
----------
<CAPTION>
FACE
AMOUNT
-------
<S> <C> <C>
REPURCHASE AGREEMENTS 0.5%
Repurchase Agreements Collateralized by
U.S. Treasury
Obligations (Note 5):
6.45% 7/3/00......................... $15,235 15,235
6.50% 7/3/00......................... 14,881 14,881
----------
Total Repurchase Agreements
(Cost $30,116)................... 30,116
----------
Total Investments 100%
(Cost $5,760,492)................ $5,908,815
==========
</TABLE>
* NON-INCOME PRODUCING SECURITIES
See Notes to Financial Statements. 9
<PAGE>
RYDEX VARIABLE TRUST
U.S. GOVERNMENT BOND FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
VALUE
CONTRACTS (NOTE1)
---------- ----------
<S> <C> <C>
OPTIONS PURCHASED 15.1%
Call Options on:
September 2000 U.S. Treasury Bond
Futures Contracts, Expiring
September 2000, with strike 80..... 18 $ 311,625
----------
Total Options Purchased (Cost
$286,673)........................ 311,625
----------
<CAPTION>
FACE
AMOUNT
----------
<S> <C> <C>
FEDERAL AGENCY DISCOUNT NOTES 48.6%
Federal Farm Credit Banks 6.57%
7/3/00............................... $1,000,000 999,635
----------
Total Federal Agency Discount Notes
(Cost $999,635) 999,635
----------
U.S. TREASURY OBLIGATIONS 31.2%
U.S. Treasury Bond 6.25% 5/15/30 614,000 643,644
----------
Total U. S. Treasury Obligations
(Cost $629,912).................. 643,644
----------
REPURCHASE AGREEMENTS 5.1%
Repurchase Agreements Collateralized by
U.S. Treasury
Obligations (Note 5):
6.45% 7/3/00......................... 52,646 52,646
6.50% 7/3/00......................... 51,425 51,425
----------
Total Repurchase Agreements (Cost
$104,071)........................ 104,071
----------
Total Investments 100% (Cost
$2,020,291)...................... $2,058,975
==========
</TABLE>
See Notes to Financial Statements. 10
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S.
GOVERNMENT
MONEY
NOVA URSA MARKET
FUND FUND FUND
------------ ----------- -----------
<S> <C> <C> <C>
ASSETS
Repurchase Agreements................ $ 71,782,770 $10,112,395 $12,111,048
Investment Securities................ 162,528,138 15,784,169 44,862,599
------------ ----------- -----------
Securities at Value (Note 1)--See
Accompanying Schedules............. 234,310,908 25,896,564 56,973,647
Segregated Cash with Broker.......... -- 472,750 --
Receivable for Futures Contracts
Settlement......................... 2,143,730 -- --
Investment Income Receivable......... 12,910 1,819 2,178
Receivable for Shares Purchased...... 406,644 -- --
Unamortized Organization Costs
(Note 1)........................... 52,129 41,700 55,493
Other Assets......................... 914 65,730 325
------------ ----------- -----------
Total Assets....................... 236,927,235 26,478,563 57,031,643
------------ ----------- -----------
LIABILITIES
Payable for Futures Contracts
Settlement......................... -- 163,537 --
Payable for Shares Redeemed.......... 115,471 5,988,180 831,704
Organizational Expense Payable to
Advisor (Note 1)................... 56,002 42,186 56,314
Investment Advisory Fee Payable
(Note 6)........................... 174,187 21,054 24,085
Transfer Agent Fee Payable
(Note 6)........................... 58,062 5,848 9,634
Service Fee Payable (Note 6)......... 58,062 5,848 12,043
Other Liabilities.................... 94,179 9,866 23,559
------------ ----------- -----------
Total Liabilities.................. 555,963 6,236,519 957,339
------------ ----------- -----------
NET ASSETS............................. $236,371,272 $20,242,044 $56,074,304
============ =========== ===========
Shares Outstanding..................... 13,416,595 3,695,257 56,088,224
Net Asset Value Per Share.............. $17.62 $5.48 $1.00
</TABLE>
See Notes to Financial Statements. 11
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED) (CONCLUDED)
--------------------------------------------------------------------------------
June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRECIOUS U.S.
OTC METALS GOVERNMENT
FUND FUND BOND FUND
------------ ---------- ----------
<S> <C> <C> <C>
ASSETS
Repurchase Agreements................ $ 23,481,994 $ 30,116 $ 104,071
Investment Securities................ 770,824,865 5,878,699 1,954,904
------------ ---------- ----------
Securities at Value (Note 1)--See
Accompanying Schedules............. 794,306,859 5,908,815 2,058,975
Segregated Cash With Broker.......... 2,104,500 -- --
Receivable for Futures Contracts
Settlement......................... 524,600 -- --
Investment Income Receivable......... 5,680 3,484 5,344
Receivable for Shares Purchased...... 54,757,711 -- --
Unamortized Organization Costs
(Note 1)........................... 48,352 41,635 43,290
Other Assets......................... 164 -- 3,149
------------ ---------- ----------
Total Assets....................... 851,747,866 5,953,934 2,110,758
------------ ---------- ----------
LIABILITIES
Payable for Securities Purchased..... 55,394,385 -- --
Payable for Shares Redeemed.......... 188,942 903 1,326
Organizational Expense Payable to
Advisor (Note 1)................... 57,497 41,678 43,314
Investment Advisory Fee Payable
(Note 6)........................... 401,866 2,340 712
Transfer Agent Fee Payable
(Note 6)........................... 133,955 780 285
Service Fee Payable (Note 6)......... 133,955 780 356
Other Liabilities.................... 256,565 1,053 697
------------ ---------- ----------
Total Liabilities.................. 56,567,165 47,534 46,690
------------ ---------- ----------
NET ASSETS............................. $795,180,701 $5,906,400 $2,064,068
============ ========== ==========
Shares Outstanding..................... 20,493,500 1,270,612 188,444
Net Asset Value Per Share.............. $38.80 $4.65 $10.95
</TABLE>
See Notes to Financial Statements. 12
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF OPERATIONS (UNAUDITED)
--------------------------------------------------------------------------------
Period Ended June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S.
GOVERNMENT
MONEY
NOVA URSA MARKET
FUND FUND FUND
------------ ---------- ----------
<S> <C> <C> <C>
INVESTMENT INCOME
Interest............................. $ 5,066,876 $ 900,074 $2,188,827
Other Income......................... (14,027) (26,484) --
------------ ---------- ----------
Total Income....................... 5,052,849 873,590 2,188,827
------------ ---------- ----------
EXPENSES
Advisory Fees (Note 6)............... 688,642 146,209 186,455
Transfer Agent Fees (Note 6)......... 229,547 40,613 74,582
Organizational Expenses (Note 1)..... 18,644 3,477 8,059
Servicing Fees (Note 6).............. 229,547 40,613 93,227
Custodian Fees....................... 5,142 2,762 4,021
Audit and Outside Services........... 14,916 3,093 7,468
Accounting Fees...................... 32,960 16,094 24,482
Legal................................ 1,298 376 779
Miscellaneous........................ 101,215 6,843 27,415
------------ ---------- ----------
Total Expenses..................... 1,321,911 260,080 426,488
------------ ---------- ----------
Net Investment Income.................. 3,730,938 613,510 1,762,339
------------ ---------- ----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net Realized Gain (Loss) on:
Investment Securities................ 680,379 (50,910) (449)
Futures Contracts.................... (13,893,057) (608,110) --
------------ ---------- ----------
Total Net Realized Loss............ (13,212,678) (659,020) (449)
------------ ---------- ----------
Net Change in Unrealized Appreciation
(Depreciation) on:
Investment Securities................ (1,620,563) 225,265 --
Futures Contracts.................... (6,579,630) 1,208,575 --
------------ ---------- ----------
Net Change in Unrealized
Appreciation (Depreciation)...... (8,200,193) 1,433,840 --
------------ ---------- ----------
Net Gain (Loss) on Investments..... (21,412,871) 774,820 (449)
------------ ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS...................... $(17,681,933) $1,388,330 $1,761,890
============ ========== ==========
</TABLE>
See Notes to Financial Statements. 13
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF OPERATIONS (UNAUDITED) (concluded)
--------------------------------------------------------------------------------
Period Ended June 30, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRECIOUS U.S.
OTC METALS GOVERNMENT
FUND FUND BOND FUND
------------ --------- -----------
<S> <C> <C> <C>
INVESTMENT INCOME
Interest............................. $ 598,430 $ 422 $ 46,108
Dividends, net of foreign tax
withheld........................... 76,677 19,190 --
Other Income......................... 58 (2,803) --
------------ --------- --------
Total Income....................... 675,165 16,809 46,108
------------ --------- --------
EXPENSES
Advisory Fees (Note 6)............... 2,036,522 17,336 4,146
Transfer Agent Fees (Note 6)......... 642,798 5,472 1,659
Organizational Expenses (Note 1)..... 55,863 479 170
Servicing Fees (Note 6).............. 678,841 5,779 2,073
Custodian Fees....................... 105,782 7,068 2,617
Audit and Outside Services........... 45,812 497 186
Accounting Fees...................... 66,360 2,403 811
Legal................................ 4,558 32 14
Miscellaneous........................ 339,335 8,278 4,018
------------ --------- --------
Total Expenses..................... 3,975,871 47,344 15,694
------------ --------- --------
Net Investment Income (Loss)........... (3,300,706) (30,535) 30,414
------------ --------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net Realized Gain (Loss) on:
Investment Securities................ (86,418,705) 358,026 (79,042)
Futures Contracts.................... 2,359,057 -- --
------------ --------- --------
Total Net Realized Gain (Loss)..... (84,059,648) 358,026 (79,042)
------------ --------- --------
Net Change in Unrealized Appreciation
(Depreciation) on:
Investment Securities................ 50,702,546 (104,867) 87,235
Futures Contracts.................... (1,783,657) -- --
------------ --------- --------
Net Change in Unrealized
Appreciation (Depreciation)...... 48,918,889 (104,867) 87,235
------------ --------- --------
Net Gain (Loss) on Investments..... (35,140,759) 253,159 8,193
------------ --------- --------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS...................... $(38,441,465) $ 222,624 $ 38,607
============ ========= ========
</TABLE>
See Notes to Financial Statements. 14
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NOVA FUND URSA FUND
----------------------------------------- -----------------------------------------
PERIOD ENDED PERIOD ENDED
JUNE 30, 2000 YEAR ENDED JUNE 30, 2000 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1999 (UNAUDITED) DECEMBER 31, 1999
----------------- --------------------- ----------------- ---------------------
<S> <C> <C> <C> <C>
CHANGES FROM OPERATIONS
Net Investment Income................ $ 3,730,938 $ 1,761,736 $ 613,510 $ 1,063,020
Net Realized Gain (Loss) on
Investments........................ (13,212,678) 11,592,765 (659,020) (10,817,608)
Net Change in Unrealized Appreciation
(Depreciation) on Investments...... (8,200,193) 1,935,080 1,433,840 (1,028,139)
------------ ----------- ----------- ------------
Net Increase (Decrease) in Net
Assets
from Operations.................. (17,681,933) 15,289,581 1,388,330 (10,782,727)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
(NOTE 1)
Net Investment Income................ -- (53,580) -- (12,321)
Net Realized Capital Gains........... -- (3,746,536) -- --
NET INCREASE (DECREASE) IN NET ASSETS
FROM
SHARE TRANSACTIONS (NOTE 10)......... 161,131,058 52,174,988 (13,456,600) 37,596,382
------------ ----------- ----------- ------------
Net Increase (Decrease) in Net
Assets............................. 143,449,125 63,664,453 (12,068,270) 26,801,334
------------ ----------- ----------- ------------
NET ASSETS--BEGINNING OF PERIOD........ 92,922,147 29,257,694 32,310,314 5,508,980
------------ ----------- ----------- ------------
NET ASSETS--END OF PERIOD.............. $236,371,272 $92,922,147 $20,242,044 $ 32,310,314
============ =========== =========== ============
</TABLE>
See Notes to Financial Statements. 15
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S. GOVERNMENT
MONEY MARKET FUND OTC FUND
----------------------------------------- -----------------------------------------
PERIOD ENDED PERIOD ENDED
JUNE 30, 2000 YEAR ENDED JUNE 30, 2000 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1999 (UNAUDITED) DECEMBER 31, 1999
----------------- --------------------- ----------------- ---------------------
<S> <C> <C> <C> <C>
CHANGES FROM OPERATIONS
Net Investment Income (Loss)......... $ 1,762,339 $ 2,458,916 $ (3,300,706) $ (1,540,458)
Net Realized Gain (Loss) on
Investments........................ (449) (1,351) (84,059,648) 5,515,278
Net Change in Unrealized Appreciation
on Investments..................... -- -- 48,918,889 120,350,530
----------- ----------- ------------ ------------
Net Increase (Decrease) in Net
Assets from Operations........... 1,761,890 2,457,565 (38,441,465) 124,325,350
DISTRIBUTIONS TO SHAREHOLDERS FROM:
(NOTE 1)
Net Investment Income................ (1,762,339) (2,472,993) -- --
Net Realized Capital Gains........... -- -- -- (4,739,037)
NET INCREASE (DECREASE) IN NET ASSETS
FROM SHARE TRANSACTIONS (NOTE 10).... (43,320,957) 58,440,511 460,164,641 231,833,530
----------- ----------- ------------ ------------
Net Increase (Decrease) in Net
Assets........................... (43,321,407) 58,425,083 421,723,176 351,419,843
----------- ----------- ------------ ------------
NET ASSETS--BEGINNING OF PERIOD........ 99,395,710 40,970,627 373,457,525 22,037,682
----------- ----------- ------------ ------------
NET ASSETS--END OF PERIOD.............. $56,074,304 $99,395,710 $795,180,701 $373,457,525
=========== =========== ============ ============
</TABLE>
See Notes to Financial Statements. 16
<PAGE>
RYDEX VARIABLE TRUST
STATEMENT OF CHANGES IN NET ASSETS (CONCLUDED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRECIOUS METALS FUND U.S. GOVERNMENT BOND FUND
----------------------------------------- -----------------------------------------
PERIOD ENDED PERIOD ENDED
JUNE 30, 2000 YEAR ENDED JUNE 30, 2000 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1999 (UNAUDITED) DECEMBER 31, 1999
----------------- --------------------- ----------------- ---------------------
<S> <C> <C> <C> <C>
CHANGES FROM OPERATIONS
Net Investment Income (Loss)......... $ (30,535) $ (28,335) $ 30,414 $ 100,368
Net Realized Gain (Loss) on
Investments........................ 358,026 (355,377) (79,042) (861,132)
Net Change in Unrealized Appreciation
(Depreciation) on Investments...... (104,867) 204,315 87,235 (27,848)
----------- ---------- ---------- ----------
Net Increase (Decrease) in Net
Assets from Operations........... 222,624 (179,397) 38,607 (788,612)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
(NOTE 1)
Net Investment Income................ -- (250) (30,414) (101,492)
Net Realized Capital Gains........... -- (121,417) -- --
NET INCREASE (DECREASE) IN NET ASSETS
FROM SHARE TRANSACTIONS (NOTE 10).... (1,308,176) 4,597,986 920,142 (2,946,879)
----------- ---------- ---------- ----------
Net Increase (Decrease) in Net
Assets........................... (1,085,552) 4,296,922 928,335 (3,836,983)
----------- ---------- ---------- ----------
NET ASSETS--BEGINNING OF PERIOD........ 6,991,952 2,695,030 1,135,733 4,972,716
----------- ---------- ---------- ----------
NET ASSETS--END OF PERIOD.............. $ 5,906,400 $6,991,952 $2,064,068 $1,135,733
=========== ========== ========== ==========
</TABLE>
See Notes to Financial Statements. 17
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NOVA FUND
------------------------------------------------------------
PERIOD ENDED
JUNE 30, YEAR ENDED YEAR ENDED PERIOD ENDED
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1999 1998 1997*
------------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $18.57 $15.88 $12.21 $10.00
-------- ------- ------- ----------
Net Investment Income................ .35 .49 .04 .07
Net Realized and Unrealized Gains
(Losses) on Securities............. (1.30) 3.10 3.63 2.14
-------- ------- ------- ----------
Net Increase (Decrease) in Net Asset
Value Resulting From Operations.... (.95) 3.59 3.67 2.21
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net Investment Income................ -- (.01) -- --
Net Realized Capital Gains........... -- (.89) -- --
-------- ------- ------- ----------
Net Increase (Decrease) in Net Asset
Value.............................. (.95) 2.69 3.67 2.21
-------- ------- ------- ----------
NET ASSET VALUE--END OF PERIOD......... $17.62 $18.57 $15.88 $12.21
======== ======= ======= ==========
TOTAL INVESTMENT RETURN................ (5.12%) 23.28% 30.06%
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 1.44%** 1.55% 3.26% 9.09%**
Net Expenses......................... 1.44%** 1.55% 3.22% 2.80%**
Net Investment Income................ 4.07%** 2.90% 0.27% 0.91%**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 0% 0% 0% 178%
Net Assets, End of Period (000's
omitted)........................... $236,371 $92,922 $29,258 $10,448
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 7, 1997
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 18
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
URSA FUND
-----------------------------------------------------------------------------------
PERIOD ENDED JUNE 10, MAY 24, MAY 7,
JUNE 30, YEAR ENDED YEAR ENDED 1997 TO 1997 TO 1997 TO
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31, JUNE 3, MAY 21,
(UNAUDITED) 1999 1998 1997+ 1997+ 1997+*
------------ ------------ ------------ ------------ --------- -----------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $5.35 $6.30 $8.07 $9.36 $9.57 $10.00
---------- ---------- ---------- ----------- -------- ----------
Net Investment Income (Loss)......... .10 .20 .06 (.01) -- (.04)
Net Realized and Unrealized Gains
(Losses) on Securities............. .03 (1.15) (1.83) (1.28) .01 (.33)
---------- ---------- ---------- ----------- -------- ----------
Net Increase (Decrease) in Net Asset
Value Resulting from Operations.... .13 (.95) (1.77) (1.29) .01 (.37)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net Investment Income................ -- -- -- -- -- --
Net Realized Capital Gains........... -- -- -- -- -- --
---------- ---------- ---------- ----------- -------- ----------
Net Increase (Decrease) in Net Asset
Value.............................. .13 (.95) (1.77) (1.29) .01 (.37)
---------- ---------- ---------- ----------- -------- ----------
NET ASSET VALUE--END OF PERIOD......... $5.48 $5.35 $6.30 $8.07 $9.58 $9.63
========== ========== ========== =========== ======== ==========
TOTAL INVESTMENT RETURN................ 2.43% (15.06%) (21.93%)
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 1.60%** 1.73% 3.76% 9.21%** 85.10%** 13.62%**
Net Expenses......................... 1.60%** 1.73% 3.59% 2.90%** 2.90%** 2.90%**
Net Investment Income (Loss)......... 3.77%** 3.34% 0.89% (0.27%)** 2.76%** (10.05%)**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 0% 0% 0% 0% 0% 0%
Net Assets, End of Period (000's
omitted)........................... $20,242 $32,310 $5,509 $2,879 $-- $--
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 7, 1997
+ DUE TO THE NATURE OF THE INVESTMENT ACTIVITY, THE FUND EXPERIENCED
PERIODS WITH ZERO NET ASSETS. FINANCIAL HIGHLIGHTS ARE PRESENTED ONLY
FOR PERIODS WITH NET ASSETS GREATER THAN ZERO.
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 19
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U.S. GOVERNMENT MONEY MARKET FUND
-----------------------------------------------------------
PERIOD ENDED
JUNE 30, YEAR ENDED YEAR ENDED PERIOD ENDED
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1999 1998 1997*
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $1.00 $1.00 $10.32 $10.00
---------- ------- ------- ----------
Net Investment Income................ .02 .04 .08 .31
Net Realized and Unrealized Gains on
Securities......................... -- -- -- .01
---------- ------- ------- ----------
Net Increase in Net Asset Value
Resulting From Operations.......... .02 .04 .08 .32
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net Investment Income................ (.02) (.04) (.01) --
Adjustment due to Reorganization
(Note 1)........................... -- -- (9.39) --
---------- ------- ------- ----------
Net Increase (Decrease) in Net Asset
Value.............................. -- -- (9.32) .32
---------- ------- ------- ----------
NET ASSET VALUE--END OF PERIOD......... $1.00 $1.00 $1.00 $10.32
========== ======= ======= ==========
TOTAL INVESTMENT RETURN................ 2.42% 3.92% 2.22%
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 1.14%** 1.39% 2.99% 6.82%**
Net Expenses......................... 1.14%** 1.39% 2.67% 2.20%**
Net Investment Income................ 4.73%** 3.64% 2.61% 3.34%**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 0% 0% 0% 0%
Net Assets, End of Period (000's
omitted)........................... $56,074 $99,396 $40,971 $17,903
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 7, 1997
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 20
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
OTC FUND
-----------------------------------------------------------
PERIOD ENDED
JUNE 30, YEAR ENDED YEAR ENDED PERIOD ENDED
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1999 1998 1997*
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $38.52 $19.57 $10.65 $10.00
----------- -------- ------- -----------
Net Investment Loss.................. (.24) (.33) (.40) (.09)
Net Realized and Unrealized Gains on
Securities......................... .52 19.88 9.32 .74
----------- -------- ------- -----------
Net Increase in Net Asset Value
Resulting From Operations.......... .28 19.55 8.92 .65
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net Investment Income................ -- -- -- --
Net Realized Capital Gains........... -- (0.60) -- --
----------- -------- ------- -----------
Net Increase in Net Asset Value...... .28 18.95 8.92 .65
----------- -------- ------- -----------
NET ASSET VALUE--END OF PERIOD......... $38.80 $38.52 $19.57 $10.65
=========== ======== ======= ===========
TOTAL INVESTMENT RETURN................ 0.73% 101.32% 83.76%
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 1.46%** 1.55% 2.96% 9.07%**
Net Expenses......................... 1.46%** 1.55% 2.96% 2.80%**
Net Investment Loss.................. (1.21%)** (1.24%) (2.67%) (1.22%)**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 207% 953% 1,077% 450%
Net Assets, End of Period (000's
omitted)........................... $795,181 $373,458 $22,038 $2,367
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 7, 1997
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 21
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRECIOUS METALS FUND
---------------------------------------------------------
PERIOD ENDED
JUNE 30, YEAR ENDED YEAR ENDED PERIOD ENDED
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1999 1998 1997*
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $5.43 $5.81 $7.02 $10.00
----------- ---------- ---------- -----------
Net Investment Loss.................. (.03) (.07) (.16) (.11)
Net Realized and Unrealized Losses on
Securities......................... (.75) (.14) (1.05) (2.87)
----------- ---------- ---------- -----------
Net Decrease in Net Asset Value
Resulting from Operations.......... (.78) (.21) (1.21) (2.98)
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net Investment Income................ -- -- -- --
Net Realized Capital Gains........... -- (.17) -- --
----------- ---------- ---------- -----------
Net Decrease in Net Asset Value...... (.78) (.38) (1.21) (2.98)
----------- ---------- ---------- -----------
NET ASSET VALUE--END OF PERIOD......... $4.65 $5.43 $5.81 $7.02
=========== ========== ========== ===========
TOTAL INVESTMENT RETURN................ (14.36%) (3.58%) (17.24%)
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 2.07%** 2.17% 3.39% 9.76%**
Net Expenses......................... 2.07%** 2.17% 3.23% 2.80%**
Net Investment Loss.................. (1.34%)** (1.39%) (2.31%) (2.19%)**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 516% 1,239% 1,739% 914%
Net Assets, End of Period (000's
omitted)........................... $5,906 $6,992 $2,695 $518
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 29, 1997
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 22
<PAGE>
RYDEX VARIABLE TRUST
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
U. S. GOVERNMENT BOND FUND
----------------------------------------------------------------------------------
PERIOD ENDED AUGUST 18, JULY 29, JUNE 24,
JUNE 30, YEAR ENDED YEAR ENDED 1997 TO 1997 TO 1997 TO
2000 DECEMBER 31, DECEMBER 31, DECEMBER 31, AUGUST 12, JULY 14,
(UNAUDITED) 1999 1998 1997+ 1997+ 1997+
------------ ------------ ------------ ------------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $10.17 $13.28 $11.82 $10.70 $10.92 $10.44
---------- ---------- --------- ---------- --------- --------
Net Investment Income................ .20 .41 .24 .15 .02 .10
Net Realized and Unrealized Gains
(Losses) on Securities............. .78 (3.09) 1.28 .97 (.38) .13
---------- ---------- --------- ---------- --------- --------
Net Increase (Decrease) in Net Asset
Value Resulting from Operations.... .98 (2.68) 1.52 1.12 (.36) .23
DISTRIBUTIONS TO SHAREDHOLDERS FROM:
Net Investment Income................ (.20) (.43) (.06) -- -- --
---------- ---------- --------- ---------- --------- --------
Net Increase (Decrease) in Net Asset
Value.............................. .78 (3.11) 1.46 1.12 (.36) .23
---------- ---------- --------- ---------- --------- --------
NET ASSET VALUE--END OF PERIOD......... $10.95 $10.17 $13.28 $11.82 $10.56 $10.67
========== ========== ========= ========== ========= ========
TOTAL INVESTMENT RETURN................ 9.66% (20.45%) 12.86%
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 1.89%** 1.52% 2.71% 8.47%** 49.63%** 12.68%**
Net Expenses......................... 1.89%** 1.52% 2.71% 2.40%** 2.40%** 2.40%**
Net Investment Income................ 3.67%** 3.55% 1.92% 3.49%** 3.80%** 7.94%**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 866% 1,611% 1,463% 761% 0% 0%
Net Assets, End of Period (000's
omitted)........................... $2,064 $1,136 $4,973 $892 $-- $--
<CAPTION>
MAY 29,
1997 TO
JUNE 5,
1997+*
--------
<S> <C>
PER SHARE OPERATING PERFORMANCE:++
NET ASSET VALUE--BEGINNING OF PERIOD... $10.00
-------
Net Investment Income................ --
Net Realized and Unrealized Gains
(Losses) on Securities............. .15
-------
Net Increase (Decrease) in Net Asset
Value Resulting from Operations.... .15
DISTRIBUTIONS TO SHAREDHOLDERS FROM:
Net Investment Income................ --
-------
Net Increase (Decrease) in Net Asset
Value.............................. .15
-------
NET ASSET VALUE--END OF PERIOD......... $10.15
=======
TOTAL INVESTMENT RETURN................
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses....................... 5.43%**
Net Expenses......................... 2.40%**
Net Investment Income................ 1.86%**
SUPPLEMENTARY DATA:
Portfolio Turnover Rate***........... 0%
Net Assets, End of Period (000's
omitted)........................... $--
</TABLE>
* COMMENCEMENT OF OPERATIONS: MAY 29, 1997
+ DUE TO THE NATURE OF THE INVESTMENT ACTIVITY, THE FUND EXPERIENCED
PERIODS WITH ZERO NET ASSETS. FINANCIAL HIGHLIGHTS ARE PRESENTED ONLY
FOR PERIODS WITH NET ASSETS GREATER THAN ZERO.
** ANNUALIZED
*** PORTFOLIO TURNOVER RATIO IS CALCULATED WITHOUT REGARD TO SHORT-TERM
SECURITIES HAVING A MATURITY OF LESS THAN ONE YEAR.
++ CALCULATED USING THE AVERAGE DAILY SHARES OUTSTANDING FOR THE PERIOD.
See Notes to Financial Statements. 23
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
The Rydex Variable Trust (the "Trust") is registered with the Securities and
Exchange Commission under the Investment Company Act of 1940 as a
non-diversified, open-ended investment company and is authorized to issue an
unlimited number of shares. The Trust currently has six operating Funds: the
Nova Fund, the Ursa Fund, the U.S. Government Money Market Fund, the OTC Fund,
the Precious Metals Fund, and the U.S. Government Bond Fund (collectively the
"Funds"), and is managed by Rydex Global Advisors (the "Advisor"). Rydex
Distributors, Inc. acts as principal underwriter for the Trust.
The Trust was organized on June 11, 1998 as a Delaware business trust. Effective
November 2, 1998, the fund assets and liabilities of the Rydex Advisor Variable
Annuity Account (the "Separate Account"), a segregated investment account of
Conseco Variable Insurance Company (formerly Great American Reserve Insurance
Company), were transferred to the Trust in exchange for shares of the Funds of
the Trust (the "Separate Account Restructuring"). Shares of the Funds (full and
fractional) were issued to corresponding subaccounts of the Separate Account.
The value per share of each Fund, except for U.S. Government Money Market Fund
shares which were adjusted to $1.00, was equivalent in value to the value of
outstanding accumulation units of the corresponding subaccount. The Trust offers
shares of the Funds to insurance companies for their variable annuity and
variable life insurance contracts.
The following significant accounting policies are in conformity with generally
accepted accounting principles and are consistently followed by the Trust.
SECURITY VALUATION
Securities listed on an exchange are valued at the latest quoted sales price as
of 4:00 P.M. on the valuation date. Securities not traded on an exchange are
valued at their last sales price. Listed options held by the Trust are valued at
their last bid price. Over-the-counter options held by the Trust are valued
using the average bid price obtained from one or more securities dealers. The
value of futures contracts purchased and sold by the Trust is accounted for
using the unrealized gain or loss on the contracts that is determined by marking
the contracts to their current realized settlement prices. Short-term securities
are valued at amortized cost, which approximates market value. Securities and
assets for which market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of the Board of
Trustees or by the Advisor using methods established or ratified by the Board of
Trustees.
24
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Securities transactions are recorded on the trade date for financial reporting
purposes and realized gains and losses from securities transactions are recorded
using the identified cost basis. Dividend income is recorded on the ex-dividend
date, net of applicable taxes withheld by foreign countries, and subsequently
adjusted to reflect actual holdings on the record date. Interest income is
accrued on a daily basis.
ORGANIZATION COSTS
Deferred organization costs, which totaled approximately $821,573, represent
expenses incurred and paid on behalf of the Trust by the Advisor. These initial
costs were allocated to the Funds within the Trust and are being amortized on a
straight line basis over a five year period beginning with the commencement of
operations. These amortized costs are then allocated to the Funds daily and
reconciled and settled monthly between the Funds on the basis of the relative
net assets of each Fund to the total net assets of the Trust. The monthly
amortized amount is reimbursed to the Advisor. An additional $35,000 of
organization costs associated with the Separate Account Restructuring were
incurred by the Trust and allocated to the Funds during the year ended
December 31, 1998. These costs are being amortized over the remaining
amortization period of the initial organization costs. At June 30, 2000, accrued
organization costs payable by the Trust were $296,991.
DISTRIBUTIONS
Distributions to shareholders are recorded on the ex-dividend date.
Distributions from net investment income and net realized capital gains are
determined in accordance with income tax regulations which may differ from
generally accepted accounting principles. These differences are primarily due to
differing treatments for items such as deferral of wash sales and post-October
losses and regulated futures contracts and options. Net investment income and
loss, net realized gains and losses, and net assets were not affected by this
difference.
OPTIONS AND FUTURES
Upon the purchase of an option by a Fund, the premium paid is recorded as an
investment, the value of which is marked-to-market daily. When a purchased
option expires, the Fund will realize a loss in the amount of the cost of the
option. When a Fund enters into a closing sale transaction, the Fund will
realize a gain or loss depending on whether the proceeds from the closing sale
transaction are greater or less than the cost of the option. When a Fund
exercises a put option, it will realize a gain or loss from the sale of the
underlying security and the proceeds from such sale will be decreased by
25
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
the premium originally paid. When a Fund exercises a call option, the cost of
the security which the Fund purchases upon exercise will be increased by the
premium originally paid.
When a Fund writes (sells) an option, an amount equal to the premium received is
entered into the Fund's accounting records as an asset and equivalent liability.
The amount of the liability is subsequently marked to market to reflect the
current value of the option written. When an option expires, or if the Fund
enters into a closing purchase transaction, the Fund realizes a gain (or loss if
the cost of a closing purchase transaction exceeds the premium received when the
option was sold).
The Trust may purchase or sell stock and bond index futures contracts and
options on such futures contracts. Futures contracts are contracts for delayed
delivery of securities at a specified future delivery date and at a specific
price. Upon entering into a contract, the Trust deposits and maintains as
collateral such initial margin as required by the exchange on which the
transaction is effected. Pursuant to the contract, the Trust agrees to receive
from or pay to the broker an amount of cash equal to the daily fluctuation in
value of the contract. Such receipts or payments are known as variation margin
and are recorded by the Trust as unrealized gains or losses. When the contract
is closed, the Trust records a realized gain or loss equal to the difference
between the value of the contract at the time it was opened and the value at the
time it was closed. Futures contracts are valued daily at the settlement price
established by the board of trade or exchange on which they are traded.
SHORT SALES
When the Trust engages in a short sale, an amount equal to the proceeds is
reflected as an asset and an equivalent liability. The amount of the liability
is subsequently marked to market to reflect the market value of the short sale.
The Trust maintains a segregated account of the securities as collateral for the
short sales. The Trust is exposed to market risk based on the amount, if any,
that the market value of the stock exceeds the market value of the securities in
the segregated account.
2. FINANCIAL INSTRUMENTS
As part of its investment strategy, the Funds may utilize options and futures.
The risk associated with purchasing options is limited to the premium originally
paid. Options written by a Fund involve to varying degrees, risk of loss in
excess of the option value reflected in the Statement of Assets and Liabilities.
The risk in writing a covered call option is that a Fund may forego the
opportunity for profit if the market price of the underlying security increases
and the option is exercised. The risk in writing a covered put option is that a
Fund may incur a loss if the market price of the underlying security decreases
and the option is exercised. In addition, there is the risk that a Fund may not
be able to
26
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
enter into a closing transaction because of an illiquid secondary market or, for
over-the-counter options, because of the counterparty's inability to perform.
There are several risks in connection with the use of futures contracts. Futures
contracts involve, to varying degrees, risk of loss in excess of amounts
reflected in the financial statements. Risks may be caused by an imperfect
correlation between movements in the price of the instruments and the price of
the underlying securities. In addition, there is the risk that a Fund may not be
able to enter into a closing transaction because of an illiquid secondary
market.
In conjunction with the use of options and futures, as well as short sales of
securities, the Funds are required to maintain collateral in various forms. The
Funds use, where appropriate, depending upon the financial instrument utilized
and the broker involved, margin deposits at the broker, cash segregated at the
custodian bank, or the repurchase agreements allocated to each Fund.
3. FEDERAL INCOME TAXES
The Trust intends to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies and will distribute all net
investment income to its shareholders. Therefore, no Federal income tax
provision is required.
4. USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amount of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from these estimates.
5. REPURCHASE AGREEMENTS
The Trust transfers uninvested cash balances into a single joint account, the
daily aggregate balance of which is invested in one or more repurchase
agreements collateralized by U.S. Treasury obligations. The collateral is in the
possession of the Trust's custodians and is evaluated daily to ensure that its
market value exceeds the delivery value of the repurchase agreements at
maturity.
27
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The repurchase agreements that were executed and outstanding on June 30, 2000
are as follows:
<TABLE>
<CAPTION>
TERMS OF
COUNTERPARTY AGREEMENT FACE VALUE MARKET VALUE
--------------------------------------- ---------------- ----------- ------------
<S> <C> <C> <C>
Salomon Smith Barney, Inc.............. 6.45% due 7/3/00 $29,750,000 $ 29,750,000
Lehman Brothers, Inc................... 6.45% due 7/3/00 29,750,000 29,750,000
PaineWebber, Inc....................... 6.50% due 7/3/00 29,750,000 29,750,000
Fuji Securities........................ 6.50% due 7/3/00 28,372,393 28,372,393
------------
$117,622,393
============
</TABLE>
As of June 30, 2000, the collateral for the repurchase agreements in the joint
account was as follows:
<TABLE>
<CAPTION>
RANGE OF
SECURITY TYPE RATES PAR VALUE MARKET VALUE
--------------------------------------- ------------- ----------- ------------
<S> <C> <C> <C>
U.S. Treasury Notes.................... 5.250%-6.625% $28,444,000 $ 28,387,760
U.S. Treasury Bonds.................... 6.875%-8.875% 73,410,000 89,298,094
------------
$117,685,854
============
</TABLE>
6. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an investment advisory contract, the Trust pays Rydex Global
Advisors investment advisory fees calculated at an annual percentage rate of
one-half of one percent (0.50%) of the average daily net assets of the U.S.
Government Money Market Fund and the U.S. Government Bond Fund, three-quarters
of one percent (0.75%) of the average daily net assets of the Nova Fund, the
Precious Metals Fund, and the OTC Fund, and nine-tenths of one percent (0.90%)
of the average daily net assets of the Ursa Fund. Certain officers and trustees
of the Trust are also officers and directors of the Advisor.
PADCO Service Company, Inc., (the "Servicer") provides transfer agent and
administrative services to the Trust calculated at an annual percentage rate of
two-tenths of one percent (0.20%) of the average daily net assets of the U.S.
Government Money Market Fund and the U.S. Government Bond Fund; and at an annual
percentage rate of one-quarter of one percent (0.25%) of the average daily net
assets of the Nova Fund, the Ursa Fund, the OTC Fund, and the Precious Metals
Fund. Certain officers and trustees of the Trust are also officers and directors
of the Servicer.
The Trust paid PADCO Service Company, Inc. $143,110 in accounting fees for the
above six funds for the period ended June 30, 2000.
The Servicer also provides other necessary services to the Trust, such as
accounting and auditing services, legal services, custody, printing and mailing,
etc., on a pass-through basis. Such expenses
28
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
vary from Fund to Fund and are allocated to the Funds based on relative net
assets or average net assets, as applicable.
In 1997 and 1998, the Advisor and the Servicer voluntarily agreed to waive
certain fees and, if necessary, to reimburse any Fund expenses which would cause
the ratio of expenses to average net assets to exceed certain predetermined
expense ratio limits. Each Fund remained liable to the Advisor and the Servicer
for such expenses so long as any recapture would not cause the Fund's daily
expense ratio to exceed the amount of the expense ratio limits. The period for
which the Advisor
and the Servicer could recapture prior period waivers and expense reimbursements
expired on October 24, 1999.
The Trust has adopted an Investor Services Plan for which Rydex
Distributors, Inc. (an affiliated entity) and other firms that provide
shareholder services ("Service Providers") may receive compensation. The Trust
will pay fees to Rydex Distributors, Inc. at an annual rate not to exceed
one-quarter of one percent (0.25%) of average daily net assets. Rydex
Distributors, Inc., in turn, will compensate Service Providers for providing
such services, while retaining a portion of such payments to compensate itself
for shareholder services it performs.
7. SECURITIES TRANSACTIONS
During the six months ended June 30, 2000, purchases and sales of investment
securities, excluding short-term and temporary cash investments, were:
(Unaudited)
<TABLE>
<CAPTION>
U.S.
GOVERNMENT
MONEY U.S.
NOVA URSA MARKET OTC PRECIOUS GOVERNMENT
FUND FUND FUND FUND METALS FUND BOND FUND
---------- ---- ---- -------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Purchases.............................. $ -- $-- $-- $1,520,761,303 $29,965,583 $8,903,040
Sales.................................. $ -- $-- $-- $1,072,347,263 $31,297,218 $8,699,583
</TABLE>
29
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
8. NET UNREALIZED APPRECIATION (DEPRECIATION) OF SECURITIES
At June 30, 2000 unrealized appreciation (depreciation) and cost of investment
securities for Federal income tax purposes were: (Unaudited)
<TABLE>
<CAPTION>
U.S.
GOVERNMENT
NOVA URSA MONEY OTC PRECIOUS METALS U.S. GOVERNMENT
FUND FUND MARKET FUND FUND FUND BOND FUND
------------ ----------- ----------- ------------ ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Gross Unrealized Appreciation.......... $ -- $ 79,675 $ -- $ 61,740,784 $ -- $ --
Gross Unrealized (Depreciation)........ (818,616) -- -- (12,050,703) (404,981) (8,956)
------------ ----------- ----------- ------------ ---------- ----------
Net Unrealized Appreciation
(Depreciation)....................... $ (818,616) $ 79,675 $ -- $ 49,690,081 $ (404,981) $ (8,956)
------------ ----------- ----------- ------------ ---------- ----------
Cost of Investments for Federal Income
Tax Purposes......................... $235,129,523 $25,816,889 $56,973,647 $744,616,778 $6,313,796 $2,067,931
============ =========== =========== ============ ========== ==========
</TABLE>
9. NET ASSETS
At June 30, 2000, net assets consisted of: (Unaudited)
<TABLE>
<CAPTION>
U.S.
GOVERNMENT
NOVA URSA MONEY
FUND FUND MARKET FUND
------------ ------------ -----------
<S> <C> <C> <C>
Paid-In-Capital........................ $238,401,604 $ 30,201,213 $56,026,377
Undistributed Net Investment Income.... 5,530,855 1,692,456 49,727
Accumulated Net Realized Loss on
Investments.......................... (3,515,476) (11,971,352) (1,800)
Net Unrealized Appreciation
(Depreciation) on Investments,
Options and Futures Contracts........ (4,045,711) 319,727 --
------------ ------------ -----------
Net Assets............................. $236,371,272 $ 20,242,044 $56,074,304
============ ============ ===========
</TABLE>
<TABLE>
<CAPTION>
PRECIOUS
OTC METALS U.S. GOVERNMENT
FUND FUND BOND FUND
------------ ---------- ----------------
<S> <C> <C> <C>
Paid-In-Capital........................ $706,172,799 $6,263,339 $3,102,550
Undistributed Net Investment Income
(Loss)............................... (4,775,801) (30,535) 2,076
Accumulated Net Realized Loss on
Investments.......................... (80,858,977) (474,727) (1,079,242)
Net Unrealized Appreciation on
Investments,
Options and Futures Contracts........ 174,642,680 148,323 38,684
------------ ---------- ----------
Net Assets............................. $795,180,701 $5,906,400 $2,064,068
============ ========== ==========
</TABLE>
30
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10. SHARE TRANSACTIONS
The Trust is authorized to distribute an unlimited number of shares.
Transactions in shares for the six months ended June 30, 2000 were: (Unaudited)
<TABLE>
<CAPTION>
U.S.
GOVERNMENT U.S.
NOVA URSA MONEY OTC PRECIOUS GOVERNMENT
FUND FUND MARKET FUND FUND METALS FUND BOND FUND
----------- ----------- ------------ ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Shares Purchased....................... 45,715,902 55,416,578 425,330,787 40,241,407 6,061,685 739,009
Purchased through Dividend
Reinvestment......................... -- -- 1,762,661 -- -- 2,846
----------- ----------- ------------ ----------- ----------- ----------
Total Purchased........................ 45,715,902 55,416,578 427,093,448 40,241,407 6,061,685 741,855
Shares Redeemed........................ (37,302,577) (57,759,549) (470,414,405) (29,443,817) (6,079,909) (665,099)
----------- ----------- ------------ ----------- ----------- ----------
Net Shares Purchased (Redeemed)........ 8,413,325 (2,342,971) (43,320,957) 10,797,590 (18,224) 76,756
=========== =========== ============ =========== =========== ==========
</TABLE>
Transactions in shares for the year ended December 31,1999 were:
<TABLE>
<CAPTION>
U.S.
GOVERNMENT U.S.
NOVA URSA MONEY OTC PRECIOUS GOVERNMENT
FUND FUND MARKET FUND FUND METALS FUND BOND FUND
----------- ------------ ------------ ----------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Shares Purchased....................... 50,447,660 118,125,659 657,452,748 49,107,688 5,585,040 2,712,269
Purchased through Dividend
Reinvestment......................... 229,476 2,147 2,472,993 180,810 22,870 8,675
----------- ------------ ------------ ----------- ---------- ----------
Total Purchased........................ 50,677,136 118,127,806 659,925,741 49,288,498 5,607,910 2,720,944
Shares Redeemed........................ (47,515,999) (112,963,885) (601,487,187) (40,718,690) (4,783,248) (2,983,727)
----------- ------------ ------------ ----------- ---------- ----------
Net Shares Purchased (Redeemed)........ 3,161,137 5,163,921 58,438,554 8,569,808 824,662 (262,783)
=========== ============ ============ =========== ========== ==========
</TABLE>
Transactions in dollars for the six months ended June 30, 2000 were: (Unaudited)
<TABLE>
<CAPTION>
U.S.
GOVERNMENT U.S.
NOVA URSA MONEY OTC PRECIOUS GOVERNMENT
FUND FUND MARKET FUND FUND METALS FUND BOND FUND
------------- ------------- ------------- --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Shares Purchased....................... $ 809,180,661 $ 304,709,713 $ 425,330,786 $ 1,581,049,104 $ 28,817,723 $ 7,949,296
Purchased through Dividend
Reinvestment......................... -- -- 1,762,661 -- -- 30,413
------------- ------------- ------------- --------------- ------------ ------------
Total Purchased........................ 809,180,661 304,709,713 427,093,447 1,581,049,104 28,817,723 7,979,709
Shares Redeemed........................ (648,049,603) (318,166,313) (470,414,404) (1,120,884,463) (30,125,899) (7,059,567)
------------- ------------- ------------- --------------- ------------ ------------
Net Change............................. $ 161,131,058 $ (13,456,600) $ (43,320,957) $ 460,164,641 $ (1,308,176) $ 920,142
============= ============= ============= =============== ============ ============
</TABLE>
31
<PAGE>
RYDEX VARIABLE TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transactions in dollars for the year ended December 31, 1999 were:
<TABLE>
<CAPTION>
U.S.
GOVERNMENT U.S.
NOVA URSA MONEY OTC PRECIOUS GOVERNMENT
FUND FUND MARKET FUND FUND METALS FUND BOND FUND
------------- ------------- ------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Shares Purchased....................... $ 857,924,176 $ 693,165,161 $ 657,452,736 $1,297,846,511 $ 31,346,340 $ 32,066,740
Purchased through Dividend
Reinvestment......................... 3,800,116 12,321 2,472,993 4,739,037 121,667 100,795
------------- ------------- ------------- -------------- ------------ ------------
Total Purchased........................ 861,724,292 693,177,482 659,925,729 1,302,585,548 31,468,007 32,167,535
Shares Redeemed........................ (809,549,304) (655,581,100) (601,485,218) (1,070,752,018) (26,870,021) (35,114,414)
------------- ------------- ------------- -------------- ------------ ------------
Net Change............................. $ 52,174,988 $ 37,596,382 $ 58,440,511 $ 231,833,530 $ 4,597,986 $ (2,946,879)
============= ============= ============= ============== ============ ============
</TABLE>
11. LOSS CARRYFORWARD--FEDERAL INCOME TAX
At December 31, 1999, for Federal income tax purposes, the following funds have
capital loss carryovers which may be applied against future net taxable realized
gains of each succeeding year until the earlier of its utilization or
expiration.
<TABLE>
<CAPTION>
U.S.
GOVERNMENT U.S.
MONEY PRECIOUS GOVERNMENT
EXPIRES MARKET METALS BOND
DECEMBER 31 URSA FUND FUND FUND FUND
--------------------------------------- ---------- ---- -------- --------
<S> <C> <C> <C> <C>
2006................................... $ 494,808 -- -- $141,347
2007................................... $9,952,323 $719 $568,292 $798,692
</TABLE>
32
<PAGE>
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR THE
GENERAL INFORMATION OF OUR SHAREHOLDERS. THE REPORT IS NOT AUTHORIZED FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS UNLESS PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE PROSPECTUS.
[RYDEX LOGO]
RYDEX VARIABLE TRUST
SEMI-ANNUAL REPORT
JUNE 30, 2000
NOVA FUND
URSA FUND
U.S. GOVERNMENT MONEY MARKET FUND
OTC FUND
PRECIOUS METALS FUND
U.S. GOVERNMENT BOND FUND
