EDWARD D.
JONES & CO.
DAILY PASSPORT
CASH TRUST
SEMI-ANNUAL REPORT
TO SHAREHOLDERS
AUGUST 31, 1995
ESTABLISHED 1980
[LOGO]
DAILY
PASSPORT
CASH TRUST
EDWARD D. JONES & CO.
[LOGO]
FEDERATED SECURITIES CORP.
Distributor
A subsidiary of FEDERATED INVESTORS
FEDERATED INVESTORS TOWER
PITTSBURGH, PA 15222-3779
Cusip 480023100
8092605 (10/95)
[LOGO]
PRESIDENT'S MESSAGE
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<TABLE>
<S> <C>
Dear Fellow Shareholder:
I am pleased to present the Semi-Annual Report to Shareholders for the Edward D.
Jones & Co. Daily Passport Cash Trust. This report covers the six-month period ended
August 31, 1995. It begins with an interview with
the Trust's portfolio manager, Susan R. Hill, Assistant Vice President of Passport
Research, Ltd., and continues with a complete list of the fund's
holdings and financial statements.
The Trust, now in its 16th year of working for Edward D. Jones clients like
you, remains the keystone of the Full Service Account. As a shareholder,
your cash is working for you every day, earning income from short-term
U.S. government securities.
These securities are among the safest available, because the payment of
principal and interest is guaranteed by the U.S. government.* Of course, as a money
market fund, the Trust also pursues stability of principal and offers you daily
access to your money.
During the six-month reporting period, the Trust paid dividends to shareholders
totaling $0.03 per share, or $72.7 million. Net assets rose considerably, from $2.5
billion on the first day of the period to $3.2 billion on August 31, 1995. The
Trust's 7-day yield on the last day of the period was 4.88%.**
Thank you for participating in Edward D. Jones & Co. Daily Passport Cash Trust. As
always, we welcome your questions and comments.
Sincerely,
Richard B. Fisher
President
October 15, 1995
</TABLE>
* Shares of the Trust are not federally insured or government guaranteed.
Although money market funds seek to maintain a stable net asset value of $1.00
per share, there is no assurance that they will be able to do so.
** Performance quoted represents past performance and is not indicative of
future results. Yield will vary.
INVESTMENT REVIEW
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<TABLE>
<S> <C>
Q Could you begin with an overview of the interest rate environment during the
six-month reporting period?
A Over the six months ended August 31, 1995, the Federal Reserve
Board (the "Fed") reversed its course in monetary policy, lower-
ing the Fed funds target rate by 25 basis points in early July from 6% to
5.75%. This easing in monetary policy came on the heels of seven consec-
utive tightenings from February 1994 to February 1995, which brought the
Fed funds target rate from 3% to 6%. The Fed cited receding inflationary
pressures as the reason for the ease, although weak economic reports in
the second quarter of 1995 were also thought to have had an influence.
Short-term interest rates led the Fed move downward. The rate on the
three-month Treasury bill declined from 5.9% at the end of February to 5.45% at the
end of August. The front end of the yield curve, typically one
Susan R. Hill year and shorter for money market funds, flattened significantly over the period,
Assistant Vice from a spread of 48 basis points between the three-month Treasury bill and one-year
President, Treasury bill at the end of February to a spread of only 19 basis points by the end
Passport Research, Ltd. of August.
Q How has the Trust's yield responded to this rate environment?
A The yield of the Trust lagged behind the downward movement in short-term
interest rates, because of its holdings of fixed-rate Treasury and Federal
agency securities. While the yield on the three-month Treasury bill declined by 45
basis points over the period, the yield on the Edward D. Jones & Co. Daily Passport
Cash Trust fell by only 21 basis points, from 5.19% at the end of February to 4.98%
at the end of August.*
</TABLE>
* Performance quoted represents past performance and is not indicative of
future results. Yield will vary.
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<TABLE>
<S> <C>
Q Have you made any strategic changes to the Trust's portfolio?
A The total assets of the Trust have grown notably since the beginning of the
period, from $2.5 billion to $3.2 billion. We extended the average maturity
target range of the Trust from 30-40 days to 40-50 days in the face of slower
economic growth and still restrained inflation, a strategy that has served the Trust
well in light of the rather significant decline in interest rates in recent months.
The Trust's average maturity, which was 32 days at the beginning of the period,
stood at 45 days at the end of August.
We reinforced the barbelled structure of the Trust's portfolio over the reporting
period. The Trust continued to combine attractive yields from repurchase agreements
collateralized by U.S. government agency-
sponsored mortgage-backed securities with short-term agency floating rate notes and
Treasury and agency securities with longer maturities of 6 to 12 months. A yield
advantage continued to exist for investments in repurchase agreements versus direct
investments in short-term fixed rate Treasury and agency securities. This portfolio
structure has performed well in the current interest rate environment.
Q What is your outlook for rates in the near future?
A Market expectations of another ease in monetary policy by the Fed in the
near future have receded somewhat, as economic and inflation releases as of
late have painted a picture of an economy that is not teetering on the brink of
recession nor strong enough to spark a resurgence in inflation. Because the Fed
funds target rate is considered by many to be restrictive at its current 5.75%
level, we would expect to see another ease in monetary policy towards the end of
1995. A credible outcome toward deficit reduction from the ongoing budget
negotiations in Congress could also exert an influence with respect to the timing of
the next policy change from the Fed.
</TABLE>
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
PORTFOLIO OF INVESTMENTS
AUGUST 31, 1995
(UNAUDITED)
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<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
- -------------- ------------------------------------------------------------------------------ ----------------
SHORT-TERM OBLIGATIONS--32.8%
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STUDENT LOAN MARKETING ASSOCIATION, FLOATING RATE NOTES--2.5%
------------------------------------------------------------------------------
$ 80,000,000 5.65%-6.943%, 9/6/1995(b) $ 79,985,081
------------------------------------------------------------------------------ ----------------
FEDERAL FARM CREDIT BANK, DISCOUNT NOTES--0.5%
------------------------------------------------------------------------------
17,000,000 6.17%, 2/23/1996(a) 16,490,118
------------------------------------------------------------------------------ ----------------
FEDERAL HOME LOAN BANK, DISCOUNT NOTES--3.6%
------------------------------------------------------------------------------
119,065,000 5.90%-6.57%, 9/6/1995-1/16/1996(a) 117,105,760
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FEDERAL HOME LOAN MORTGAGE, DISCOUNT NOTES--1.4%
------------------------------------------------------------------------------
46,665,000 5.95%-6.575%, 10/23/1995-2/28/1996(a) 46,052,818
------------------------------------------------------------------------------ ----------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION, DISCOUNT NOTES--12.0%
------------------------------------------------------------------------------
400,230,000 5.49%-6.06%, 9/29/1995-4/15/1996(a) 391,435,031
------------------------------------------------------------------------------ ----------------
FEDERAL HOME LOAN BANK, FLOATING RATE NOTES--3.0%
------------------------------------------------------------------------------
98,000,000 5.845%-5.92%, 9/1/1995-9/6/1995(b) 97,960,145
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FEDERAL NATIONAL MORTGAGE ASSOCIATION, FLOATING RATE NOTES--3.4%
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110,000,000 5.50%-5.60%, 9/1/1995-9/6/1995(b) 109,863,859
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FEDERAL HOME LOAN BANK NOTES--2.1%
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67,100,000 6.05%-6.85%, 2/28/1996-6/5/1996 67,152,829
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U.S. TREASURY BILLS--1.4%
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46,000,000 5.27%-5.45%, 12/14/1995-6/27/1996(a) 44,477,184
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U.S. TREASURY NOTES--2.9%
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93,000,000 7.375%-9.25%, 1/15/1996-5/15/1996 94,059,851
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TOTAL SHORT-TERM OBLIGATIONS 1,064,582,676
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(C) REPURCHASE AGREEMENTS--66.3%
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150,000,000 Bear, Stearns & Co., Inc. 5.800%, dated 8/31/1995, due 9/1/1995 150,000,000
------------------------------------------------------------------------------
150,000,000 Bear, Stearns & Co., Inc., 5.830%, dated 8/31/1995, due 9/1/1995 150,000,000
------------------------------------------------------------------------------
150,000,000 Chase Government Securities, 5.820%, dated 8/31/1995, due 9/1/1995 150,000,000
------------------------------------------------------------------------------
</TABLE>
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
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<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
- -------------- ------------------------------------------------------------------------------ ----------------
$ 150,000,000 Daiwa Securities America, Inc., 5.800%, dated 8/31/1995,
due 9/1/1995 $ 150,000,000
------------------------------------------------------------------------------
150,000,000 Donaldson, Lufkin and Jenrette Securities Corp., 5.820%, dated
8/31/1995, due 9/1/1995 150,000,000
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240,000,000 NationsBank of North Carolina-Charlotte, 5.820%, dated 8/31/1995,
due 9/1/1995 240,000,000
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160,000,000 Sanwa Securities USA Co., L.P., 5.820%, dated 8/31/1995,
due 9/1/1995 160,000,000
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100,000,000 UBS Securities, Inc., 5.800%, dated 8/31/1995, due 9/1/1995 100,000,000
------------------------------------------------------------------------------
120,000,000 Fuji Securities, Inc., 5.800%, dated 8/31/1995, due 9/1/1995 120,000,000
------------------------------------------------------------------------------
150,000,000 BT Securities Corp., 5.850%, dated 8/31/1995, due 9/1/1995 150,000,000
------------------------------------------------------------------------------
71,400,000 BZW Securities, Inc., 5.850%, dated 8/31/1995, due 9/1/1995 71,400,000
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110,000,000 Deutsche Bank Government Securities, Inc., 5.850%, dated
8/31/1995, due 9/1/1995 110,000,000
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150,000,000 Swiss Bank Corp., New York, 5.840%, dated 8/31/1995, due 9/1/1995 150,000,000
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86,000,000 (d)CS First Boston Corp., 5.780%, dated 8/29/1995, due 10/3/1995 86,000,000
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62,000,000 (d)Goldman, Sachs & Co., 5.750%, dated 7/25/1995, due 10/23/1995 62,000,000
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61,000,000 (d)Goldman, Sachs & Co., 5.750%, dated 7/7/1995, due 9/5/1995 61,000,000
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88,000,000 (d)Goldman, Sachs & Co., 5.750%, dated 8/25/1995, due 11/22/1995 88,000,000
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TOTAL REPURCHASE AGREEMENTS 2,148,400,000
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TOTAL INVESTMENTS, AT AMORTIZED COST(E) $3,212,982,676
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</TABLE>
(a) Discount rate at time of purchase.
(b) Floating rate note with current rate and next reset date shown.
(c) The repurchase agreements are fully collateralized by U.S. government and/or
agency obligations based on market prices at the date of the portfolio. The
investments in the repurchase agreements are through participation in joint
accounts with other Federated funds.
(d) Although final maturity falls beyond seven days, a liquidity feature is
included in each transaction to permit termination of the repurchase
agreement within seven days if the creditworthiness of the issuer is
downgraded.
(e) Also represents cost for federal tax purposes.
Note: The categories of investments are shown as a percentage of net assets
($3,241,108,879) at August 31, 1995.
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 1995
(UNAUDITED)
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<TABLE>
<S> <C> <C>
ASSETS:
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Investments in repurchase agreements $ 2,148,400,000
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Investments in other securities 1,064,582,676
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Total investments in securities, at amortized cost and value $ 3,212,982,676
- -----------------------------------------------------------------------------------------------
Cash 3,966,938
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Income receivable 6,474,090
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Receivable for shares sold 48,183,919
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Total assets 3,271,607,623
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LIABILITIES:
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Payable for shares redeemed 24,096,741
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Income distribution payable 4,286,380
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Accrued expenses 2,115,623
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Total liabilities 30,498,744
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NET ASSETS for 3,241,108,879 shares outstanding $ 3,241,108,879
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NET ASSET VALUE, Offering Price and Redemption Proceeds Per Share:
$3,241,108,879 / 3,241,108,879 shares outstanding $1.00
- ----------------------------------------------------------------------------------------------- ----------------
(See Notes which are an integral part of the Financial Statements)
</TABLE>
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
STATEMENT OF OPERATIONS
SIX MONTHS ENDED AUGUST 31, 1995
(UNAUDITED)
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<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
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Interest $ 86,496,100
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EXPENSES:
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Investment advisory fee $ 6,340,975
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Administrative personnel and services fee 1,081,102
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Custodian fees 241,122
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Transfer and dividend disbursing agent fees and expenses 2,189,511
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Directors'/Trustees' fees 16,000
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Auditing fees 9,000
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Legal fees 13,194
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Portfolio accounting fees 66,109
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Shareholder services fee 3,570,350
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Share registration costs 96,372
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Printing and postage 118,436
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Insurance premiums 18,220
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Miscellaneous 21,472
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Total expenses 13,781,863
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Net investment income $ 72,714,237
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</TABLE>
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
STATEMENT OF CHANGES IN NET ASSETS
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<TABLE>
<CAPTION>
SIX MONTHS ENDED
(UNAUDITED) YEAR ENDED
AUGUST 31, 1995 FEBRUARY 28, 1995
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
- ----------------------------------------------------------------------
OPERATIONS--
- ----------------------------------------------------------------------
Net investment income $ 72,714,237 $ 81,047,463
- ---------------------------------------------------------------------- ------------------- ---------------------
DISTRIBUTIONS TO SHAREHOLDERS
- ----------------------------------------------------------------------
Distributions from net investment income (72,714,237) (81,047,463)
- ---------------------------------------------------------------------- ------------------- ---------------------
SHARE TRANSACTIONS
- ----------------------------------------------------------------------
Proceeds from sale of shares 6,737,703,250 10,047,201,714
- ----------------------------------------------------------------------
Net asset value of shares issued to shareholders in payment of
distributions declared 69,885,611 78,525,018
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Cost of shares redeemed (6,030,739,482) (9,832,691,748)
- ---------------------------------------------------------------------- ------------------- ---------------------
Change in net assets resulting from share transactions 776,849,379 293,034,984
- ---------------------------------------------------------------------- ------------------- ---------------------
Change in net assets 776,849,379 293,034,984
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NET ASSETS:
- ----------------------------------------------------------------------
Beginning of period 2,464,259,500 2,171,224,516
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End of period $ 3,241,108,879 $ 2,464,259,500
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</TABLE>
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
(UNAUDITED)
AUGUST 31, YEAR ENDED FEBRUARY 28 OR 29,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1995 1995 1994 1993 1992 1991 1990 1989 1988
NET ASSET VALUE,
BEGINNING OF PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- -------------------------
INCOME FROM INVESTMENT
OPERATIONS
- -------------------------
Net investment income 0.03 0.04 0.02 0.03 0.05 0.07 0.08 0.07 0.06
- -------------------------
LESS DISTRIBUTIONS
- -------------------------
Distributions from net
investment income (0.03) (0.04) (0.02) (0.03) (0.05) (0.07) (0.08) (0.07) (0.06)
- ------------------------- ----- ---- ---- ---- ---- ---- ---- ---- ----
NET ASSET VALUE, END OF
PERIOD $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------- ----- ---- ---- ---- ---- ---- ---- ---- ----
TOTAL RETURN(A) 2.59% 3.78% 2.33% 2.82% 4.98% 7.39% 8.63% 7.24% 6.15%
- -------------------------
RATIOS TO AVERAGE NET
ASSETS
- -------------------------
Expenses 0.96%* 0.98% 0.95% 0.95% 0.87% 0.83% 0.88% 1.01% 1.03%
- -------------------------
Net investment income 5.08%* 3.74% 2.31% 2.79% 4.89% 7.13% 8.23% 7.14% 6.00%
- -------------------------
SUPPLEMENTAL DATA
- -------------------------
Net assets, end of
period
(000 omitted) $3,241,109 $2,464,260 $2,171,225 $2,223,226 $2,469,295 $2,631,671 $2,235,991 $1,279,762 $744,107 $656,730
- -------------------------
<CAPTION>
<S> <C>
1987
NET ASSET VALUE,
BEGINNING OF PERIOD $ 1.00
- -------------------------
INCOME FROM INVESTMENT
OPERATIONS
- -------------------------
Net investment income 0.06
- -------------------------
LESS DISTRIBUTIONS
- -------------------------
Distributions from net
investment income (0.06)
- ------------------------- ----
NET ASSET VALUE, END OF
PERIOD $ 1.00
- ------------------------- ----
TOTAL RETURN(A) 5.79%
- -------------------------
RATIOS TO AVERAGE NET
ASSETS
- -------------------------
Expenses 1.03%
- -------------------------
Net investment income 5.63%
- -------------------------
SUPPLEMENTAL DATA
- -------------------------
Net assets, end of
period
(000 omitted)
- ------------------------- $656,730
</TABLE>
* Computed on an annualized basis.
(a) Based on net asset value, which does not reflect the sales load or
contingent deferred sales charge, if applicable.
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 1995
(UNAUDITED)
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1. ORGANIZATION
Edward D. Jones & Co. Daily Passport Cash Trust (the "Trust") is registered
under the Investment Company Act of 1940, as amended (the "Act"), as a
diversified, open-end management investment company.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
A. INVESTMENT VALUATIONS--The Trust's use of the amortized cost method to value
its portfolio securities is in accordance with Rule 2a-7 under the Act.
B. REPURCHASE AGREEMENTS--It is the policy of the Trust to require the
custodian bank to take possession, to have legally segregated in the Federal
Reserve Book Entry System, or to have segregated within the custodian bank's
vault, all securities held as collateral under repurchase agreement
transactions. Additionally, procedures have been established by the Trust to
monitor, on a daily basis, the market value of each repurchase agreement's
collateral to ensure that the value of collateral at least equals the
repurchase price to be paid under the repurchase agreement transaction.
The Trust will only enter into repurchase agreements with banks and other
recognized financial institutions, such as broker/dealers, which are deemed
by the Trust's adviser to be creditworthy pursuant to guidelines and/or
standards reviewed or established by the Board of Trustees (the "Trustees").
Risks may arise from the potential inability of counterparties to honor the
terms of the repurchase agreement. Accordingly, the Trust could receive less
than the repurchase price on the sale of collateral securities.
C. INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS--Distributions to shareholders
are recorded on the ex-dividend date. Interest income and expenses are
accrued daily. Bond premium and discount, if applicable, are amortized as
required by the Internal Revenue Code, as amended (the "Code").
D. FEDERAL TAXES--It is the Trust's policy to comply with the provisions of the
Code applicable to regulated investment companies and to distribute to
shareholders each year substantially all of its income. Accordingly, no
provisions for federal tax are necessary.
E. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS--The Trust may engage in
when-issued or delayed delivery transactions. The Trust records when-issued
securities on the trade date and maintains security positions such that
sufficient liquid assets will be available to make payment for the
securities purchased. Securities purchased on a when-issued or delayed
delivery basis are marked to market daily and begin earning interest on
the settlement date.
F. OTHER--Investment transactions are accounted for on the trade date.
3. SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value). At August
31, 1995, capital paid-in aggregated $3,241,108,879. Transactions in shares were
as follows:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
AUGUST 31, FEBRUARY 28,
<S> <C> <C>
1995 1995
- ------------------------------------------------------------------------------ ---------------- ----------------
Shares sold 6,737,703,250 10,047,201,714
- ------------------------------------------------------------------------------
Shares issued to shareholders in payment of distributions declared 69,885,611 78,525,018
- ------------------------------------------------------------------------------
Shares redeemed (6,030,739,482) (9,832,691,748)
- ------------------------------------------------------------------------------ ---------------- ----------------
Net change resulting from share transactions 776,849,379 293,034,984
- ------------------------------------------------------------------------------ ---------------- ----------------
</TABLE>
4. INVESTMENT ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEE--Passport Research, Ltd., the Trust's investment adviser
(the "Adviser"), receives for its services an annual investment advisory fee
based on average daily net assets of the Trust as follows: .50% on the first
$500 million, .475% on the next $500 million, .45% on the next $500 million,
.425% on the next $500 million and .40% thereafter.
ADMINISTRATIVE FEE--Federated Administrative Services ("FAS"), under the
Administrative Services Agreement, provides the Trust with administrative
personnel and services. This fee is based on the level of average aggregate
daily net assets of all funds advised by subsidiaries of Federated Investors for
the period. The administrative fee received during the period of the
Administrative Services Agreement shall be at least $125,000 per portfolio and
$30,000 per each additional class of shares.
SHAREHOLDER SERVICES PLAN--Under the terms of a Shareholder Services Agreement
with Edward D. Jones & Co., the Trust will pay Edward D. Jones & Co. up to .25
of 1% of average daily net assets of the Trust for the period. This fee is to
obtain certain services for shareholders and to maintain shareholder accounts.
TRANSFER AGENT FEES--Federated Services Company ("FServ") serves as transfer and
dividend disbursing agent for the Trust. This fee is based on the size, type,
and number of accounts and transactions made by shareholders. Edward D. Jones &
Co., L.P. is sub-transfer agent for the shares of the Trust.
PORTFOLIO ACCOUNTING FEES--FServ also maintains the Trust's accounting records
for which it receives a fee. The fee is based on the level of the Trust's
average daily net assets for the period, plus out-of-pocket expenses.
GENERAL--Certain of the Officers and Trustees of the Trust are Officers and
Directors or Trustees of the above companies.
TRUSTEES OFFICERS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
John F. Donahue John F. Donahue
John T. Conroy, Jr. Chairman
William J. Copeland Richard B. Fisher
James E. Dowd President
Lawrence D. Ellis, M.D. J. Christopher Donahue
Edward L. Flaherty, Jr. Executive Vice President
Peter E. Madden Edward C. Gonzales
Gregor F. Meyer Executive Vice President
John E. Murray, Jr. John W. McGonigle
Wesley W. Posvar Executive Vice President and Secretary
Marjorie P. Smuts David M. Taylor
Treasurer
Charles H. Field
Assistant Secretary
</TABLE>
Mutual funds are not bank deposits or obligations, are not guaranteed
by any bank, and are not insured or guaranteed by the U.S. government,
the Federal Deposit Insurance Corporation, the Federal Reserve Board,
or any other government agency. Investment in mutual funds involves
investment risk, including the possible loss of principal. Although
money market funds seek to maintain a stable net asset value of $1.00
per share, there is no assurance that they will be able to do so.
This report is authorized for distribution to prospective investors only
when preceded or accompanied by the Trust's prospectus which
contains facts concerning its objective and policies, management fees,
