Calvert First Government Money Market Fund
Semi-Annual Report
June 30, 1995
(Logo)
Investing with Vision (TM)
Calvert Group (R)
A member of The Acacia Group (R)
To Open an Account:
800-368-2748
Yields and Prices:
Calvert Information Network
24 hours, 7 days a week
800-368-2745
Service for Existing Account:
Shareholders: 800-368-2745
Brokers: 800-368-2746
TDD for Hearing Impaired:
800-541-1524
Branch Office:
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
Registered, Certified or Overnight Mail:
Calvert Group
c/o NFDS, 6th Floor
1004 Baltimore
Kansas City, MO 64105-1807
Principal Underwriter:
Calvert Distributors, Inc.
4550 Montgomery Avenue
Suite 1000N
Bethesda, Maryland 20814
This report is intended to provide fund information to shareholders.
It is not authorized for distribution to prospective investors unless
preceded or accompanied by a prospectus.
Semi-Annual Report-June 30, 1995 (Unaudited)
CALVERT FIRST GOVERNMENT MONEY MARKET FUND
Dear Investor:
The stock and bond markets soared during the first six months of 1995,
following a bleak 1994. Money market issues did not keep pace, as the
economy slowed and the Federal Reserve was able to relax its grip on
short-term market rates.
Stocks and bonds advanced as investors realized that the slowing pace
of economic growth made further interest rate hikes unlikely and a cut even
possible. In general, U.S. companies continued to post strong earnings,
which also worked to drive stock prices higher. Shortly after the close of
this reporting period, the Federal Reserve moved to lower rates by reducing
its target for the federal funds rate (the rate banks charge each other)
from 6% to 5.75%.
Performance and Strategy Review
After rising sharply in 1994, short-term interest rates fell slightly
during the period covered by this report. The Fund's 12-month annualized
yield was a bit higher than its year-ago level, due to the higher rates
available in the second half of 1994. The annualized compound dividend
yield for the 12-months ended June 30, 1995 was in line with the yield
available on an average of similar funds.
Anticipating that the steep run-up in interest rates was nearing an
end, we began to select longer-term money market issues to lock in their
higher rates. The Fund's weighted average maturity increased from 38 days
on December 31, 1994 to 43 days on June 30, 1995.
Outlook
We believe the Fed will continue to have a neutral to easier policy
bias in reaction to mixed economic data. Stock and bond markets will likely
be volatile until a clearer picture of second and third quarter economic
activity forms.
While it's not likely that money market investors will see yields rise
as steeply as they did in 1994, this Fund continues to provide a safe
harbor for those investors concerned primarily with principal stability.
Sincerely,
(Signature)
David R. Rochat
Senior Vice President
July 19, 1995
Portfolio Statistics
Weighted Average Maturity
12/31/94 6/30/95
Calvert First Government
Money Market Fund 38 Days 43 Days
Average Annual Total Returns
for periods ended 6/30/95
One Year 4.79%
Five Year 4.35%
Ten Year 5.69%
Since Inception (12/76) 7.90%
Calvert First Government Money Market Fund
Change in value of a hypothetical $10,000 investment.
Chart 1: A line graph showing the rise of a $10,000 investment from 6/85 to
$17,389 by 6/95.
Total returns assume reinvestment of dividends. Past performance is no
guarantee of future results.
Calvert First Government Money Market Fund
Portfolio of Investments
June 30, 1995 (Unaudited)
VARIABLE RATE LOANS GUARANTEED BY AGENCIES OF THE U.S. GOVERNMENT(2.4%)
CURRENT
INTEREST INTEREST RATE ADJUSTS PRINCIPAL
RATE (1) TO (2)(3) MATURITY AMOUNT VALUE
9.875% Prime +0.875 6/25/1996 - $53,392 $64,274
6/25/1998
8.125% Prime -0.875 2/25/2010 80,042 79,676
8.00% Prime -1.00 8/25/2012 2,842,980 2,807,905
8.125% Prime -0.875 6/30/2008 211,596 211,643
7.875% Prime -1.125 9/25/1998 281,637 282,769
7.25% Prime -1.75 10/20/2001 291,498 291,498
8.84375% Prime -0.15625 3/30/1999 58,496 58,496
6.75% Prime -2.25 3/1/2007 1,650,894 1,617,012
Total Variable Rate Loans Guaranteed by Agencies
of the U.S. Government (Cost $5,413,273) $ 5,413,273
See notes to portfolio of investments.
<TABLE>
<CAPTION>
Calvert First Government Money Market Fund
Portfolio of Investments (continued)
June 30, 1995 (Unaudited)
<S> <C> <C>
DEPOSITORY RECEIPTS FOR U.S. GOVERNMENT PRINCIPAL
GUARANTEED LOANS (13.1%) (5) AMOUNT VALUE
Colson Services Corporation, current interest rate 10.09375%
adjusted quarterly to Prime + 1.09375%, 1/13/98-4/11/98 $77,835 $78,237
Colson Services Corporation, current interest rate 9.09375%
adjusted quarterly to Prime + .9375%, 1/17/10 120,528 126,240
Colson Services Corporation, current interest rate 8.84375%
adjusted quarterly to Prime - .15625%, 1/3/97-3/12/00 394,441 396,108
Colson Services Corporation, current interest rate 8.09375%
adjusted quarterly to Prime - .90625%, 1/1/00-7/20/00 49,792 49,843
Colson Services Corporation, current interest rate 7.4375%
adjusted quarterly to Prime - 1.5625%, 10/1/96-7/26/10 1,719,394 1,721,392
Colson Services Corporation, current interest rate 7.59375%
adjusted quarterly to Prime - 1.40625%, 9/22/98-4/26/09 1,486,344 1,492,449
Colson Services Corporation, current interest rate 7.34375%
adjusted quarterly to Prime - 1.65625%, 4/21/98-5/18/02 172,574 172,838
Colson Services Corporation, current interest rate 7.75%
adjusted monthly to Prime - 1.25%, 8/1/10-2/11/11 1,341,404 1,342,957
Colson Services Corporation, current interest rate 9.00%
adjusted quarterly to Prime + .00%, 10/02/95 11,473 11,585
Colson Services Corporation, current interest rate 8.75%
adjusted monthly to Prime - .25%, 6/2/97-5/21/11 381,116 396,389
Colson Services Corporation, current interest rate 9.25%
adjusted quarterly to Prime + .25%, 9/15/99 93,174 95,522
Colson Services Corporation, current interest rate 6.75%
adjusted quarterly to Prime - 2.25%, 10/1/95 5,179 5,179
Colson Services Corporation, current interest rate 7.875%
adjusted quarterly to Prime - 1.125%, 1/29/01-9/9/06 405,864 408,926
Colson Services Corporation, current interest rate 8.75%
adjusted quarterly to Prime - .25%, 4/28/97-4/1/12 385,449 395,934
Colson Services Corporation, current interest rate 7.75%
adjusted monthly to Prime - 1.25%, 11/19/07-8/10/12 12,239,738 12,269,729
Colson Services Corporation, current interest rate 8.00%
adjusted monthly to Prime - 1.00%, 6/5/09-3/23/12 2,765,575 2,805,438
Colson Services Corporation, current interest rate 9.00%
adjusted quarterly to Prime + .00%, 3/6/96-2/4/12 732,145 750,740
Colson Services Corporation, current interest rate 7.875%
adjusted monthly to Prime - 1.125%, 3/12/05-5/29/12 2,436,012 2,441,447
Colson Services Corporation, current interest rate 7.75%
adjusted quarterly to Prime - 1.25%, 10/30/01-9/2/12 5,397,405 5,410,263
Colson Services Corporation, current interest rate 9.5%
adjusted monthly to Prime +.50%, 4/15/96 95 156
Total Depository Receipts for U.S. Government
Guaranteed Loans (Cost $30,371,372) $ 30,371,372
See notes to portfolio of investments.
Calvert First Government Money Market Fund
Portfolio of Investments (continued)
June 30, 1995 (Unaudited)
PRINCIPAL
U.S. GOVERNMENT AGENCY OBLIGATIONS (59.8%) AMOUNT VALUE
Federal Farm Credit Bank, Discount Note, 7/5/95 $ 10,000,000 $ 9,996,728
Federal Farm Credit Bank, Discount Note, 8/2/95 9,835,000 9,786,972
Federal National Mortgage Association, Discount Note, 9/7/95 10,000,000 9,893,666
Federal Home Loan Bank, Discount Note, 10/6/95 4,070,000 4,009,424
Federal Home Loan Mortgage Corporation, Discount Note, 7/10/95 9,240,000 9,229,148
Federal Home Loan Mortgage Corporation, Discount Note, 7/27/95 10,000,000 9,960,933
Federal Home Loan Mortgage Corporation, Discount Note, 9/8/95 6,500,000 6,430,078
Federal Home Loan Mortgage Corporation, Discount Note, 9/14/95 5,000,000 4,941,904
Federal Home Loan Mortgage Corporation, Discount Note, 9/25/95 10,000,000 9,866,066
Federal National Mortgage Association, Discount Note, 7/5/95 10,000,000 9,996,722
Federal National Mortgage Association, Discount Note, 8/8/95 9,500,000 9,444,710
Federal National Mortgage Association, Discount Note, 8/14/95 5,000,000 4,965,933
Federal Farm Credit Bank, Discount Note, 9/14/95 5,000,000 4,949,163
Federal National Mortgage Association, Discount Note, 10/6/95 10,000,000 9,848,263
Federal National Mortgage Association, Discount Note, 11/7/95 3,080,000 3,018,283
Federal National Mortgage Association, Discount Note, 11/13/95 5,060,000 4,953,632
Federal National Mortgage Association, Discount Note, 12/12/95 7,000,000 6,822,024
Federal National Mortgage Association, Discount Note, 12/14/95 5,000,000 4,870,850
Federal National Mortgage Association, Discount Note, 12/18/95 5,000,000 4,868,866
Student Loan Marketing Association, Variable Rate, 2/14/97 475,000 474,831
Total U.S. Government Agency Obligations
(Cost $138,328,196) 138,328,196
REPURCHASE AGREEMENTS, FOR DELIVERY AT COST,
COLLATERALIZED BY SECURITIES ISSUED OR
GUARANTEED BY THE U.S. GOVERNMENT (25.0%)
UBS Securities: 6.20%, dated 6/30/95, due 7/3/95
($5,769,000 FHLMC Bond, 7.50%, 11/1/23) 5,000,000 5,000,000
Prudential Securities, Inc.: 6.08%, dated 6/30/95, due 7/5/95
($19,463,000 FNMA Bond, 7.50%, 3/1/24) 17,800,000 17,800,000
Morgan Stanley & Co.: 5.93%, dated 6/5/95, due 7/7/95
($24,943,000 FNMA Bond, 8.0%, 5/1/07) 10,000,000 10,000,000
Morgan Stanley & Co.: 5.96%, dated 6/8/95, due 7/10/95
$18,259,000 FNMA Bond, 6.0%, 6/1/08) 15,000,000 15,000,000
Smith Barney Shearson, Inc.: 5.96%, dated 5/25/95, due
7/25/95 ($18,990,000 U.S. Treasury Strip 5/15/05) 10,000,000 10,000,000
Total Repurchase Agreements (Cost $57,800,000) 57,800,000
TOTAL INVESTMENTS (100.3%) (6)
(Cost $231,912,841) (4) $231,912,841
</TABLE>
See notes to portfolio of investments.
Calvert First Government Money Market Fund
Portfolio of Investments (continued)
June 30, 1995 (Unaudited)
Notes to Portfolio of Investments:
(1) Represents rates in effect at June 30, 1995, after regularly scheduled
adjustments on such date.
(2) Interest rates adjust monthly and quarterly, generally at the
beginning of the month or calendar quarter, or semiannually. As of June 30,
1995, the prime interest rate was 9.00%.
(3) Interest on some securities is limited by applicable law or by the
terms of the related agreements.
(4) Cost of investments is substantially the same for federal income tax
purposes.
(5) During 1986, Colson Services Corporation purchased Fidata Trust
Company of New York and was assigned the obligations of the Fund's
depository receipt agreements and now acts as the custodial, collection,
and transfer agent for certain of the Fund's U.S. Government guaranteed
variable rate loans. Each depository receipt pertains to a set, grouped by
interest rate, of these loans. For various reasons, including differences
in the timing of principal and interest payments and in the current
interest rates, the outstanding principal balances of the underlying
variable rate loans may vary from those of the corresponding depository
receipt. However, the agreement provides that in no case will this
difference be greater than 3%.
(6) The percentages shown represent the percentage of the investments to
net assets.
Calvert First Government Money Market Fund
Statement of Assets and Liabilities
June 30, 1995 (Unaudited)
Assets
Investments in securities,at value-see accompanying portfolio $231,912,841
Cash 2,508,986
Interest receivable 1,058,919
Receivable for shares sold 834,275
Other assets 34,922
Total assets 236,349,943
Liabilities
Payable to Calvert Asset Management Company, Inc. - Note B 125,784
Payable to Calvert Shareholder Services, Inc. - Note B 40,481
Payable for securities purchased 4,953,632
Payable for income distributions 26,365
Accrued expenses and other liabilities 14,481
Total liabilities 5,160,743
Net assets $231,189,200
Net Assets
Net assets consisting of:
Paid-in capital applicable to 231,620,401 outstanding
shares of beneficial interest, no par value (unlimited
number of shares authorized) 231,393,812
Accumulated net investment income - net of distributions 93,618
Accumulated realized gains/(losses) - net of distributions (298,230)
Net assets $231,189,200
Net Asset Value
Net asset value, offering and redemption price per share
($231,189,200 divided by 231,620,401 shares) $ 1.00
See notes to financial statements.
Calvert First Government Money Market Fund
Statement of Operations
Six Months Ended June 30, 1995 (Unaudited)
Investment Income
Interest income $ 7,031,195
Expenses - Note B
Investment advisory fee 576,008
Transfer, dividend disbursing and shareholder
servicing agent's fee 241,862
Federal and state registration fees 19,598
Postage and delivery 28,453
Printing and stationery 49,015
Trustees' fees and expenses 9,732
Professional fees 16,512
Telephone 3,992
Dues and subscriptions 3,694
Insurance 3,400
Miscellaneous 3,687
Total expenses 955,953
Net Investment Income 6,075,242
Realized Gain (Loss) on Investments
Net realized gain (loss) 17,654
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 6,092,896
Calvert First Government Money Market Fund
Statements of Changes in Net Assets
Six Months
Ended Year Ended
June 30, 1995 December 31,
Increase (Decrease) in Net Assets (Unaudited) 1994
Operations
Net investment income $ 6,075,242 $ 8,932,460
Net realized gain (loss) on investments 17,654 224,143
Net Increase (Decrease) in Net Assets
Resulting from Operations 6,092,896 9,156,603
Distributions to shareholders
Net investment income (6,089,521) (8,920,960)
Capital share transactions - Note C 1,002,394 (33,311,908)
Total Increase (Decrease) in Net Assets 1,005,769 (33,076,265)
Net Assets
Beginning of period 230,183,431 263,259,696
End of period (including accumulated net
investment income - net of distributions of
$93,618 and $107,897 for 1995 and 1994,
respectively.) $ 231,189,200 $230,183,431
See notes to financial statements.
Notes To Financial Statements (Unaudited)
Note A-Summary of Significant Accounting Policies
General: Calvert First Government Money Market Fund (the "Series") is a
series of First Variable Rate Fund (the "Fund"). The Fund is registered
under the Investment Company Act of 1940, as amended (the "Act"), as a
diversified, open-end investment company. The Fund operates as a series
fund, issuing shares of beneficial interest in two portfolios. The Fund
accounts separately for the assets, liabilities, and operations of each
series. The Series' shares are sold to the public without a sales charge.
Portfolio Valuation: Investments in the Series are carried at amortized
cost, which approximates market value. The Series may enter into
repurchase agreements only with recognized financial institutions and in
all instances holds underlying securities with a value at least equal to
the total repurchase price such financial institutions have agreed to pay.
When the Fund purchases securities under agreements to resell, the
securities are held for safekeeping by the Fund's custodian as collateral.
Should the market value of the securities purchased under such an agreement
decrease below the principal amount to be received at the termination of
the agreement plus accrued interest, the counter party is required to place
an equivalent amount of additional securities in safekeeping with the
Fund's custodian. Repurchase agreements with maturities in excess of seven
days may be terminated upon seven days notice.
Securities Transactions and Investment Income: Securities transactions are
recorded on a trade date basis. Interest income, including, where
applicable, amortization of premium and discount, is recorded on the
accrual basis. Realized gains and losses from securities transactions are
recorded on an identified cost basis.
Share Valuation, Dividends and Distributions to Shareholders: It is the
Fund's policy to maintain a constant net asset value of $1.00 per share for
the Series: the Fund has adopted certain investment, portfolio valuation
and dividend and distribution policies intended to enable it to do so. The
Series declares dividends of its net investment income on a daily basis and
distributes income monthly. Distributions to shareholders are recorded on
the ex-dividend date.
Federal Income Taxes: It is the policy of the Fund to continue to qualify
as a regulated investment company by complying with the provisions of the
Internal Revenue Code available to certain investment companies, and to
make distributions of taxable income and capital gains sufficient to
relieve it from all, or substantially all, federal income and excise taxes.
The Fund has unused realized capital loss carryforwards for federal income
tax purposes of $315,884 at June 30, 1995 which expire in 2001.
Note B-Investment Advisory and Other Transactions With Affiliates
The Fund's investment advisor is Calvert Asset Management Company, Inc.
("Advisor"), wholly-owned by Calvert Group, Ltd., which is an indirect
wholly-owned subsidiary of Acacia Mutual Life Insurance Company. Under the
Advisory Contract, the Advisor manages the investment and reinvestment of
the Series' assets, subject to the direction and control of the Trustees,
provides office space, investment research, and administrative services
including the preparation of regulatory filings and shareholder reports,-
the daily determination of net asset value per share and dividends of the
Fund, and the maintenance of the portfolio and general accounting records
of the Series, and pays for promotional expenses and the marketing of the
Series' shares. All other operating expenses are paid by the Series. The
Advisory Contract provides for the Series to pay to the Advisor a fee for
all services computed at the annual rate of 0.50% of the Series' average
daily net assets up to $500 million; 0.45% of the next $400 million of such
assets; 0.40% of the next $400 million of such assets; 0.35% of the next
$700 million of such assets; and 0.30% of all such assets over $2 billion.
The Advisory Contract provides for an expense reimbursement from the
Advisor should the Fund's aggregate expenses, exclusive of interest, taxes,
brokerage and extraordinary expenses, exceed, on an annual basis, 1% of the
Fund's average daily net assets.
Calvert Shareholder Services, Inc. ("CSSI"), a wholly-owned subsidiary of
Calvert Group, Ltd., has been retained by the Fund to act as transfer,
dividend disbursing and shareholder servicing agent for the Fund. For these
services, CSSI receives an annual fee of $22 per shareholder account plus
$1.60 per transaction.
Certain officers and trustees of the Fund are "affiliated persons," as
defined in the Act, of the Advisor. Each trustee of the Fund who is not
affiliated with the Advisor serves on the Board of Trustees of other Funds
sponsored by the Advisor, and receives an annual fee of $20,250 and a
meeting fee of $1,200 for each Board and Committee meeting attended. Such
fees are allocated among the Funds based upon their relative net assets.
Note C-Net Assets
The change in net assets (at $1.00 per share) resulting from capital share
transactions for 1995 and 1994 is indicated below:
Six Months
Ended Year Ended
June 30, 1995 December 31,
(Unaudited) 1994
In dollars
Shares sold $ 168,867,775 $ 563,478,111
Reinvestment of dividends 6,033,520 8,917,166
Shares redeemed (173,898,901) (605,707,185)
$ 1,002,394 $ (33,311,908)
Financial Highlights
Six Months
Ended Year Ended Year Ended
June 30, 1995 December 31, December 31,
(unaudited) 1994 1993
Net asset value, beginning of period $1.00 $1.00 $1.00
Income from investment operations
Net investment income .026 .036 .027
Distributions to shareholders
Dividends from net investment income (.026) (.036) (.027)
Net asset value, end of period $1.00 $1.00 $1.00
Total return 2.65% 3.66% 2.70%
Ratio of expenses to average net assets .83%<F1> .81% .81%
Ratio of net investment income to
average net assets 5.27%<F1> 3.56% 2.66%
Net assets, end of period $231,189,200 $230,183,431 $263,259,696
Number of shares outstanding at end
of period (in thousands) 231,620 230,618 263,930
Year Ended Year Ended
December 31, December 31,
1992 1991
Net asset value, beginning of year $1.00 $1.00
Income from investment operations
Net investment income .033 .055
Distributions to shareholders
Dividends from net investment income (.033) (.055)
Net asset value, end of year $1.00 $1.00
Total return 3.40% 5.65%
Ratio of expenses to average net assets .82% .82%
Ratio of net investment income to
average net assets 3.30% 5.49%
Net assets, end of year $314,999,180 $353,339,016
Number of shares outstanding at end
of year (in thousands) 315,667 353,851
[FN]
<F1> Annualized
[/FN]
(Logo)
Investing with Vision (TM)
Calvert Group (R)
A member of The Acacia Group (R)
4550 Montgomery Avenue, Suite 1000N
Bethesda, Maryland 20814
