PRESIDENT'S MESSAGE
[Graphic]
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 from March 1, 1996, through August 31, 1996. It begins with
an interview with portfolio manager Susan R. Hill, Assistant Vice President
of Passport Research, Ltd., and continues with a complete list of the
Trust's holdings and financial statements.
The Trust is now in its 17th year of working for Edward D. Jones clients
like you. As the keystone of the Full Service Account, the Trust keeps your
cash working every day, earning income from short-term U.S. government
securities. 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 $0.02 per share, for a net annualized total return of
2.26%**. The Trust's 7-day net yield on August 31, 1996, was 4.43%**, and
net assets stood at the $4 billion mark.
Thank you for participating in the daily earning power of Edward D. Jones &
Co. Daily Passport Cash Trust. As always, we welcome your questions and
comments.
Sincerely,
[Graphic]
Richard B. Fisher
President
October 15, 1996
* 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
[Graphic]
Susan R. Hill
Assistant Vice President, Passport Research, Ltd.
Q What is your analysis of the interest rate environment during the Trust's
six-month reporting period?
A Although the Federal Reserve Board ("the Fed") kept monetary policy on
hold over the six months ended August 31, 1996, the period was characterized
by shifts in market sentiment regarding the strength of the U.S. economy and
the extent and direction of future monetary policy changes. The last move in
monetary policy took place at the end of January 1996, when the Fed lowered
the federal funds target rate by 25 basis points to the current 5.25% amid
slowing economic growth and benign inflationary pressures. In early March
1996, however, the market was stunned by the release of a much larger than
expected increase in non-farm payroll jobs for the month of February 1996.
The solid employment gains continued and combined with signs of strength in
consumer spending and housing in the ensuing months painted a picture of an
economy that was clearly more robust than previously thought. Fears that the
economy might be growing faster than the non-inflationary potential rate of
growth surfaced, and sparked expectations that the Fed might be inclined to
raise the federal funds target rate to ward off potential inflationary
pressures.
Short-term interest rates rose fairly steadily from the beginning of the
reporting period through early June 1996, as conviction grew that the next
policy move might be a tightening. The yield on the six-month Treasury bill,
for example, rose from 5% to 5.5%. Market volatility increased over the
remainder of the reporting period, as sentiment regarding the timing of the
move swayed back and forth with each economic release. Short-term interest
rates rose in early July 1996, as job growth continued to be strong, then
fell again as signs of a long-awaited economic slowdown began to emerge, but
rose once more as fears of developing wage pressures gripped the market.
Over this latter period, the yield on the six-month Treasury bill rose to
5.6% in early July 1996, fell to 5.3% by early August, and finally rose to
5.5% by August 31, 1996.
Q What were your strategies for the Trust during the reporting period?
A As the signs of strength in the economy became more apparent, we lowered
the average maturity target range of the Trust from between 40 and 50 days
to between 35 and 45 days. We added to our government agency floating rate
position within the Trust, to enhance the portfolio's responsiveness to
rising interest rates. We also purchased securities with short-term
maturities -- both U.S. government agencies and term repurchase agreements
- -- that added relative value to our overnight repurchase agreement position,
and may allow for the potential of reinvestment at higher rates late in the
year.
Q As we approach the close of 1996, what is your outlook for interest rates?
A Amid some speculation to the contrary, the Fed voted to keep the federal
funds target rate unchanged. Such a decision, however, does not preclude the
Fed from tightening rates before the end of 1996, should they feel that
economic growth is not slowing appropriately. If the Fed does tighten
monetary policy, however, it is likely to be a fine-tuning of the current
stance rather than a prolonged cycle. We expect market volatility in the
near term to remain high, as participants continue to focus close attention
on each upcoming economic release for its impact on monetary policy.
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
PORTFOLIO OF INVESTMENTS
AUGUST 31, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
SHORT-TERM OBLIGATIONS -- 42.2%
$ 24,000,000 Federal Farm Credit Bank -- 0.6%
5.60%, 6/3/1997 $ 23,974,633
40,000,000 (a)Federal Farm Credit Bank, Floating Rate Notes -- 1.0%
5.61%, 10/1/1996 39,981,191
206,015,000 (b)Federal Home Loan Bank, Discount Notes -- 5.0%
5.303%-5.719%, 9/3/1996 - 1/22/1997 203,661,627
50,000,000 (a)Federal Home Loan Bank, Floating Rate Notes -- 1.2%
5.24%, 9/4/1996 49,993,230
27,000,000 Federal Home Loan Mortgage Corp. -- 0.7%
5.64%, 8/28/1997 26,934,896
74,533,000 (b)Federal Home Loan Mortgage Corp., Discount Notes -- 1.8%
5.319%-5.409%, 9/12/1996 - 11/14/1996 74,076,530
27,000,000 (a)Federal Home Loan Mortgage Corp., Floating Rate Notes -- 0.7%
5.40%, 9/10/1996 26,984,714
48,000,000 Federal National Mortgage Association -- 1.2%
5.41%-5.60%, 11/1/1996 - 12/6/1996 47,983,473
317,750,000 (b)Federal National Mortgage Association, Discount Notes -- 7.7%
5.159%-5.726%, 9/18/1996 - 1/21/1997 314,630,327
246,700,000 (a)Federal National Mortgage Association, Floating Rate Notes -- 6.0%
5.175%-5.47%, 9/4/1996 - 9/17/1996 246,564,204
20,000,000 Student Loan Marketing Association -- 0.5%
5.62%, 6/30/1997 19,940,940
133,000,000 (a)Student Loan Marketing Association, Floating Rate Notes -- 3.3%
5.27%-5.53%, 9/10/1996 132,999,912
168,000,000 (b)U.S. Treasury Bills -- 4.0%
4.996%-5.666%, 9/19/1996 - 8/21/1997 165,149,032
342,000,000 U.S. Treasury Notes -- 8.5%
6.50%-8.50%, 9/30/1996 - 4/15/1997 344,477,527
TOTAL SHORT-TERM OBLIGATIONS 1,717,352,236
(C)REPURCHASE AGREEMENTS -- 57.9%
63,200,000 Barclays de Zoete Wedd Securities, Inc., 5.26%, dated 8/30/1996,
due 9/3/1996 63,200,000
140,000,000 Bear, Stearns and Co., 5.25%, dated 8/30/1996, due 9/3/1996 140,000,000
</TABLE>
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
(C)REPURCHASE AGREEMENTS -- CONTINUED
$ 111,200,000 Bear, Stearns and Co., 5.29%, dated 8/30/1996, due 9/3/1996 $ 111,200,000
150,000,000 Daiwa Securities America, Inc., 5.25%, dated 8/30/1996,
due 9/3/1996 150,000,000
205,000,000 Donaldson, Lufkin and Jenrette Securities Corp., 5.25%, dated
8/30/1996, due 9/3/1996 205,000,000
200,000,000 First Union Capital Markets, 5.25%, dated 8/30/1996, due 9/3/1996 200,000,000
100,000,000 Goldman Sachs Group, LP, 5.28%, dated 8/30/1996, due 9/3/1996 100,000,000
300,000,000 Goldman Sachs Group, LP, 5.31%, dated 8/30/1996, due 9/3/1996 300,000,000
100,000,000 Harris Government Securities, Inc., 5.25%, dated 8/30/1996,
due 9/3/1996 100,000,000
40,000,000 Nomura Securities International, Inc., 5.30%, dated 8/30/1996,
due 9/3/1996 40,000,000
210,000,000 UBS Securities, Inc., 5.25%, dated 8/30/1996, due 9/3/1996 210,000,000
200,000,000 UBS Securities, Inc., 5.30%, dated 8/30/1996, due 9/3/1996 200,000,000
120,000,000 (d)CS First Boston, Inc., 5.40%, dated 7/11/1996, due 9/9/1996 120,000,000
96,000,000 (d)Lehman Brothers, Inc., 5.43%, dated 6/13/1996, due 9/11/1996 96,000,000
47,000,000 (d)Merrill Lynch, Pierce, Fenner and Smith, 5.43%, dated 6/13/1996,
due 9/11/1996 47,000,000
90,000,000 (d)J.P. Morgan & Co., Inc., 5.35%, dated 8/7/1996, due 10/7/1996 90,000,000
95,000,000 (d)J.P. Morgan & Co., Inc., 5.45%, dated 8/2/1996, due 10/31/1996 95,000,000
47,000,000 (d)CS First Boston, Inc., 5.35%, dated 8/26/1996, due 11/25/1996 47,000,000
47,000,000 (d)Lehman Brothers, Inc., 5.34%, dated 8/26/1996, due 11/25/1996 47,000,000
TOTAL REPURCHASE AGREEMENTS 2,361,400,000
TOTAL INVESTMENTS (AT AMORTIZED COST)(E) $ 4,078,752,236
</TABLE>
(a) Floating rate note with current rate and next reset date shown.
(b) Discount rate at time of purchase.
(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
($4,072,821,077) at August 31, 1996.
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
AUGUST 31, 1996 (UNAUDITED)
<S> <C> <C>
ASSETS:
Investments in repurchase agreements $ 2,361,400,000
Investments in other securities 1,717,352,236
Total investments in securities, at amortized cost and value $ 4,078,752,236
Income receivable 18,562,322
Total assets 4,097,314,558
LIABILITIES:
Income distribution payable 5,489,650
Payable to Bank 16,546,506
Accrued expenses 2,457,325
Total liabilities 24,493,481
NET ASSETS for 4,072,821,077 shares outstanding $ 4,072,821,077
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PROCEEDS PER SHARE:
$4,072,821,077 O 4,072,821,077 shares outstanding $1.00
(See Notes which are an integral part of the Financial Statements)
EDWARD D. JONES & CO. DAILY PASSPORT CASH TRUST
STATEMENT OF OPERATIONS
SIX MONTHS ENDED AUGUST 31, 1996 (UNAUDITED)
<S> <C> <C>
INVESTMENT INCOME:
Interest $ 108,912,539
EXPENSES:
Investment advisory fee $ 8,792,660
Administrative personnel and services fee 1,542,717
Custodian fees 231,822
Transfer and dividend disbursing agent fees and expenses 2,237,221
Directors'/Trustees' fees 8,096
Auditing fees 10,120
Legal fees 4,048
Portfolio accounting fees 93,970
Shareholder services fee 5,101,577
Share registration costs 177,376
Printing and postage 188,968
Insurance premiums 22,632
Taxes 3,864
Miscellaneous 25,146
Total expenses 18,440,217
Net investment income $ 90,472,322
(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
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
(UNAUDITED) FEBRUARY 28 OR 29,
AUGUST 31, 1996 1996
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS--
Net investment income $ 90,472,322 $ 157,505,033
DISTRIBUTIONS TO SHAREHOLDERS--
Distributions from net investment income (90,472,322) (157,505,033)
SHARE TRANSACTIONS--
Proceeds from sale of shares 7,812,345,412 14,038,245,342
Net asset value of shares issued to shareholders in payment of
distributions declared 88,068,789 153,374,221
Cost of shares redeemed (7,778,747,915) (12,704,724,272)
Change in net assets resulting from share transactions 121,666,286 1,486,895,291
Change in net assets 121,666,286 1,486,895,291
NET ASSETS:
Beginning of period 3,951,154,791 2,464,259,500
End of period $ 4,072,821,077 $ 3,951,154,791
</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,
1996 1996 1995 1994 1993 1992 1991 1990 1989 1988
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING
OF PERIOD $ 1.00 $ 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 0.02 0.05 0.04 0.02 0.03 0.05 0.07 0.08 0.07 0.06
LESS
DISTRIBUTIONS
Distributions
from net
investment
income (0.02) (0.05) (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 $ 1.00
TOTAL
RETURN(A) 2.26% 5.06% 3.78% 2.33% 2.82% 4.98% 7.39% 8.63% 7.24% 6.15%
RATIOS TO
AVERAGE NET
ASSETS
Expenses 0.90%* 0.96% 0.98% 0.95% 0.95% 0.87% 0.83% 0.88% 1.01% 1.03%
Net
investment
income 4.43%* 4.92% 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) $4,072,821 $3,951,155 $2,464,260 $2,171,225 $2,223,226 $2,469,295 $2,631,671 $2,235,991 $1,279,762 $744,107
</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, 1996 (UNAUDITED)
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. The investment objective
of the Trust is stability of principal and current income consistent with
stability of principal.
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.
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.
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 the 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.
INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS -- 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").
Distributions to shareholders are recorded on the ex-dividend date.
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.
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.
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 amounts of assets, liabilities,
expenses, and revenues reported in the financial statements. Actual results
could differ from those estimated.
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, 1996, capital paid-in aggregated $4,072,821,077. Transactions in
shares were as follows:
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31,
1996 1995
<S> <C> <C>
Shares sold 7,812,345,412 14,038,245,342
Shares issued to shareholders in payment of distributions declared 88,068,789 153,374,221
Shares redeemed (7,778,747,915) (12,704,724,272)
Net change resulting from share transactions 121,666,286 1,486,895,291
</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:
0.50% on the first $500 million, 0.475% on the next $500 million, 0.45% on
the next $500 million, 0.425% on the next $500 million and 0.40% thereafter.
The Adviser will waive the amount that normal operating expenses of the
Trust (including the investment advisory fee, but excluding brokerage
commissions, interest, taxes and extraordinary expenses) exceed 2.5% per
year on the first $30 million of average daily net assets of the Trust, 2%
per year on the next $70 million of average daily net assets of the Trust,
and 1.5% per year on any additional net assets.
ADMINISTRATIVE FEE -- Federated Services Company ("FServ"), under the
Administrative Services Agreement, provides the Trust with administrative
personnel and services. The fee paid to FServ 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 FEE -- Under the terms of a Shareholder Services
Agreement with Federated Shareholder Services ("FSS"), the Trust will pay
FSS up to 0.25% of daily average net assets of the Trust shares for the
period. The fee paid to FSS is used to finance certain services for
shareholders and to maintain shareholder accounts.
TRANSFER AND DIVIDEND DISBURSING AGENT FEES AND EXPENSES -- FServ, through
its subsidiary, Federated Shareholder Services Company ("FSSC") serves as
transfer and dividend disbursing agent for the Fund. The fee paid to FSSC is
based on the size, type, and number of accounts and transactions made by
shareholders.
PORTFOLIO ACCOUNTING FEES -- FServ 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.
<TABLE>
<S> <S>
TRUSTEES OFFICERS
John F. Donahue John F. Donahue
Thomas G. Bigley Chairman
John T. Conroy, Jr. Richard B. Fisher
William J. Copeland President
James E. Dowd J. Christopher Donahue
Lawrence D. Ellis, M.D. Executive Vice President
Edward L. Flaherty, Jr. Edward C. Gonzales
Peter E. Madden Executive Vice President
Gregor F. Meyer John W. McGonigle
John E. Murray, Jr. Executive Vice President, Treasurer,
Wesley W. Posvar and Secretary
Marjorie P. Smuts Douglas L. Hein
Assistant Treasurer
S. Elliott Cohan
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 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, expenses, and other
information.
[Graphic]
Daily Passport Cash Trust
SEMI-ANNUAL REPORT
AUGUST 31, 1996
Edward Jones
201 Progress Parkway
Maryland Heights, MO 63043
1-800-331-2451
Distributor
[Graphic]
Cusip 480023100
8092605 (10/96)
