1997 Semi Annual Report
Taking a cautionary investment strategy in a surprising up market along with
unexpected sector losses has casued the Fund to report a negative return of
2% for C shares and 1.4% for D shares during the six months ended June 30,
1997. The Fund's return is based on a decrease in net asset value from
$3.51 per share for Class C and D shares on December 31, 1996 to $3.44 and
$3.46, respectively, per share on June 30, 1997. During this six months the
market, as measured by the S&P 500 index, increased 14.7%. As a hedge
against market overvaluation and anticipated highter inflation rates, the Fund
owned precious metals and gold stocks representing aproximately 9% of the
portfolio. During the last six months bullion prices declined due to low
inflation. Additionally, growth gold compaines experienced a universal
decline when the claimes by Bre-X Mineral Ltd. were determined to be bogus.
The Fund did not own any Bre-X Minerals. The apparent hoax had a negative
effect in the mining industry and stock prices of junior to mid-size gold
companies dropped. We believe that this industry is an appropriate
investment in the type of market and that the prices will rebound and make
money.
Portfolio Manager Review
The past 24 months have seen acceleration of a trend that is now a decade old,
namely, steadily increasing equity prices. Because of the steady increases,
virtually all of the old benchmarks of value appear useless and outdated.
As first time investors and young mutual fund managers (average age
approximately 29) have entered the markets, the common belief is, this is a
"new era" and making money in equities is easy and riskless as the market
has undergone a major change.
Since the 1920s, this is the third time equities in the United States have
entered "new eras". The first occurred in the late 1920s and the second
occurred from the late 1960s to the early '70s (the latter is when I first
entered the market). Both of these periods wer heady experiences at the
time but proved to be short-lived. When these "new eras" ended, equity
prices fell 50% to 70% on a inflation ajdusted basis, which were much greater
than the typical bear market decline of 20%. One indicator of the "new eras"
is the total equity capitalization of the stock market as a percentage of
gross domestic product. For example, in August 1929, this indicator reached a
high of 81.4% pointing to stock market capitalization that almost equalled
the value of the total output of the nation. It subsequently fell to 16%.
The second "new ear" occurred between 1969 and December 1972 when the
indicator rose to 78.1% (subsequently fell to approximately 26%). Our
current "new era" shows that today the market capitalization of all equities
is 121% of gross domestic/international product. This means that today the
market value of all equities is 20% greater than the entire output of all the
nation's mines, factories, utilities and services. All of these periods had
several characteristics. First, skeptics of the "new eras" eventually threw
in the towel and began to promote a view that a "new era" had arrived. Just
a little over a year and a half ago, Robert Prector wrote a book called "At the
Crest of the Tidal Wave" which forescast a bear market with the DOW dropping
to below 1000. In the last weeks, Mr. Prector has also jumped on the market
bandwagon and is now forecasting that this "new era" will soon drive the DOW
over 10,000.
The second common thing the ears have in a tightening of currency controls or
interest rates. in the late 20s, the U.S. responded to the currency problems
that the British were experiencing by raising tariffs. In 1979 Paul Voecker,
who was the Chairman of the Federal Reserve, started raising interest rates
and this, combined with the oil embargo, produced a major sell off. Today
we have many external factors which could cause such a sell-off. The specter
of interest rate increases, foreign uncertainty and perhaps a more unique
possibility. Several weeks ago, an article was published by James Cramer, a
hedge fund manager and co-chairman of the Street.Com. Mr. Cramer stated
that the biggest risk the U.S. ecomony is the U.S. stock market. He states
that consumers are investing with money managers instead of spending on cars,
travel and discretionary spending, and that this diverted money (lack of
spending) could cause earnings to fall short for many companies by year-end.
Mr. Cramer recognizes that this is not the typical vision. He states that
"After all, we are known as a nation of incredible spenders who wouldn't
save a dime if we didn't have to worry about retiring one day". He states
that demographics and the amazing "U.S. Stock Market" are changing that. He
believes that we have stared to see a big change in what Americans are doing
with their excess spendable income. Before the recent market blow-off, he
stated "The dialogue in American homes might have been, should we take that
trip to California or buy a new car". Now the question seems to be phrased
somthing like this "How much money can I make buying a new Ford Taurus
versus my return in a equity mutual fund? Why should I take that three, four
or seven day cruise if I could give the money to a money manage?" He is
comparing the pruchase of sticks to buying cars for a reason. People are
beginning to enjoy the investing process. It has the kind of appeal that
sports have, people want to know what the market is up to adn they want to
participate. The net effect of all this could be a tremendous decline in
consumer spending and an inflow into investment vehicles.
The stock market is riddled with cycles. Everyone is familiar with the
investment cycle, the one where the economy gets hot and then cools. But it
is tough to make money in cycle if everybody else is banking on it. For
example, for the last several years the technology sector, which includes the
personal computer companies, has shown strength and has enjoyed a nice
run-up. Currently, however, this sector has seffered. Intel's problems and
the massive supplies of disk drives on the market have rendered this sector,
at least in the short-term, unplayable by many of the money managers that
specialize in tech stocks. They are all currently looking to fish in another
pond. The year's big losers in mutual funds, and yes there are many, have
been those that have specialized in cycle bets. When they are right, they
produce great returns but when they're wrong, they can produce horrifying
negative returns, but since there is no such thing as a free lunch, it will
also underperform in markets that go straight up.
Summary
During the first half of 1997, we have seen a market correction of almost 10%
as well as smaller corrections only to rebound to higher highs. Due to
size of the correction and the unpredictability of the fluctuation in the stock
market, we believe more now that the message we have been sending is the
last reports is correct. Your portfolio should be balanced between stocks,
bonds, and money market and you should be flexible. Although the results
during the first six months of 1997 were disppointing, we believe patience
over the long-term will be rewarding.
For the first time over two years we are seeing some cylce rotation is the
markets. The March and April sell off and the subsequent rally are what
Centurion Counsel and your, our investors, need to produce the returns you
expect. We are confident that the ecomonic cycle, business cycle and the
old rules have not been abolished, and we appreciate your patience over the
last two years and are confident in the subsequent years will earn that trust.
Sincerely,
CENTURION T.A.A. FUND, INC.
Jack K. Heilbron
Chief Executive Officer
Chief Investment Officer
CENTURION T.A.A. FUND, INC.
Portfolio Review
as of June 30, 1997
Fund Highlights Top Ten Holdings
Net Assets $9,183,211 Hershey Creamery 2.8%
Occidental Petoleum 2.7%
NAV Per Share: Foodmarker Corp. 9.25% 2.2%
Class A: $3.45 IBM 2.0%
Class B: $3.43 First National Bank of Anchorage 2.0%
Class C: $3.44 Omnipoint 1.8%
Class D: $3.46 Barrick Gold 1.5%
Frontier Corp 1.4%
Shares Outstanding2,665,382 National Bancorp of Alaska 1.4%
Galoob Toys 1.3%
Top 10 Sectors
Cash and Commercial Paper 11.4%
Mining and Precious Metals 9.8%
Retails 8.5%
Energy 7.6%
Computer and Related 7.6%
Communications 7.1%
Biotechnology 6.9%
Restuarants 5.9%
Consumer/Defensive 4.1%
Regional Banks 3.4%
Leaders Trailers
Securities Securities
Mariner Health Group Templeton Russia (Short)
Paging Network (Short) OEX Options (Short)
S3, Inc. Exide Electronics Group
Zitel Corp. TriQuent Semiconductor
Tyco Toys IBM
Diamond Multimedia Systems (Short) HNC Software
Noble Drilling Corp. Moulten Metals Technology
Our leader, Mariner Health, for the first half of 1997 was one of our worst
performers in 1996. This shows that good companies will generally reward
investor patience. During the prior six months we had good results from toys,
Tyco and Galood. The contining record setting US and Russia markets made the
two market hedges, Templeton and OEX short positions, our top two trailers.
In addition positions in the computer and electronic stocks resulted in poor
performance.
CENTURION T.A.A. FUND, INC.
STATEMENT OF INVESTMENTS SECURITIES
June 30, 1997
Shares or % of
Principal Net Market
Amount Description Assets COST (a) Value (b)
COMMON STOCKS
AUTO AND AUTO PARTS
5000 KEYSTONE AUTOMOTIVE 0.9% $77,500 $85,000
$77,500 $85,000
BIOTECHNOLOGY
4000 ALLIANCE PHARM 0.4% 51,050 (c) 40,250 (d)
7000 AMYLIN PHARM 1.0% 99,900 (c) 96,250 (d)
5000 BIOTECH GENERAL 0.7% 66,300 (c) 67,500 (d)
2000 CARDIAC PATHWAYS 0.2% 22,250 18,000 (d)
2000 GENENTECH 1.3% 116,800 (c) 117,875 (d)
3000 GENZYME 0.9% 79,560 83,250 (d)
10000 LIPOSOME CO. 1.0% 88,185 (c) 89,375 (d)
524,045 512,500
CHEMICALS
2200 MILLENNIUM CHEM 0.5% 46,330 49,775
46,330 49,775
COMMUNCIATIONS
6600 FRONTIER 1.4% 123,200 (c) 131,587
1500 GTE 0.7% 66,050 (c) 65,719
10000 OMNIPOINT 1.8% 135,695 (c) 166,250 (d)
3000 U.S. LONG DISTANCE 0.6% 39,800 (c) 51,750 (d)
3000 U.S. WEST 1.2% 99,830 (c) 112,875
10000 US SATELLITEBROADCAS0.9% 97,550 (c) 82,500 (d)
562,125 610,681
COMPUTER AND RELATED
10000 ALPHA MICROSYSTEMS 0.2% 15,988 15,312 (d)
1020 ANACOMP 0.1% 7,971 12,240 (d)
2000 ELECTRONS FOR IMAGING1.0% 93,125 (c) 94,500 (d)
2000 IBM 2.0% 172,155 (c) 180,375
500 INTEL 0.8% 77,968 (c) 70,906
1000 LEVEL ONE 0.4% 37,915 (c) 38,437 (d)
1200 NETSCAPE 0.4% 35,610 (c) 38,475 (d)
10000 SCAN-GRAPHICS 0.4% 39,738 33,750 (d)
480,469 483,995
CONSTRUCTION/BUILDING
1000 ALICO 0.2% 20,000 19,625
4000 SOUTHERN ENERGY HOME0.4% 56,000 36,500 (d)
76,000 56,125
CONSULTING
1500 AMERICAN MANAGEMENT 0.4% 38,103 (c) 40,125 (d)
38,103 40,125
CONSUMER/DEFENSIVE
1000 BEATRICE (TLC) 0.3% 61,000 29,000
25000 ERICIYAS BIRACILIK 0.5% 44,250 47,000
150 HERSHEY CREAMERY 2.8% 267,500 258,750
1000 PEPSICO 0.4% 31,070 (c) 37,625
403,820 372,375
ENERGY
2000 AMER OILFIELD DIVER 0.3% 23,375 24,000 (d)
2000 AQUILA GAS PIPELINE 0.3% 26,825 27,875
1000 BARRETT RESOURCES 0.3% 35,540 (c) 29,875 (d)
1200 BROOKLYN UNION GAS 0.4% 31,700 34,350
2000 CROWN CENTRAL PETE 0.3% 30,540 29,500 (d)
1200 ENSCO INTERNATIONAL 0.7% 59,750 (c) 63,300
3000 NOBLE DRILLING 0.7% 43,965 (c) 67,687 (d)
10000 OCCIDENTAL PETROLEUM2.7% 241,550 (c) 250,625
2500 VALERO ENERGY 1.0% 78,588 (c) 90,625
571,833 617,837
ENTERTAINMENT
3000 FAMILY GOLF CENTERS 0.8% 63,750 (c) 69,000 (d)
4000 MIRAGE RESORTS 1.1% 94,550 (c) 101,000
158,300 170,000
ENVIRONMENTAL
3000 WASTE MANAGEMENT 1.0% 91,915 (c) 96,375
91,915 96,375
FINANCE
2500 CREDIT ACCEPTANCE 0.4% 27,384 32,187 (d)
27,384 32,187
HEALTHCARE
1000 CHEMED CO. 0.4% 35,415 37,250
1850 ULTRAFEM 0.3% 29,716 25,437 (d)
65,131 62,687
INDUSTRIAL
5000 CMI CORP 0.2% 22,100 19,687
1500 EMERSON ELECTRIC 0.9% 72,445 (c) 82,594
1000 SUNDSTRAND 0.6% 39,935 (c) 55,812
134,480 158,093
MINING AND PRECIOUS METALS
5000 ALTA GOLD 0.1% 17,565 12,344 (d)
2000 ASARCO 0.7% 56,820 61,000
6300 BARRICK GOLD 1.5% 164,410 (c) 138,600
8000 COEUR D'ALENE MINES 1.1% 102,660 (c) 103,500
1400 FRANCO NEVADA (CN) 0.8% 71,078 69,734
3300 FREEPORT COP & GOLD 1.1% 101,865 (c) 102,713
1400 FREESTATES CONS GOLD0.1% 10,463 7,000
600 GETCHELL GOLD 0.2% 23,738 (c) 21,000 (d)
1400 GLAMIS GOLD 0.1% 10,935 (c) 10,150
5000 GOLDEN KNIGHT RES(CN) 0.1% 17,950 10,050 (d)
4000 HECLA MINING 0.2% 23,660 21,500 (d)
6300 HOMESTK MNG 0.9% 109,203 (c) 82,294
2000 KINROSS GOLD 0.1% 14,450 9,000 (d)
2000 NEWMONT GOLD 0.9% 102,005 (c) 80,250
816 NEWMONT MINING 0.3% 28,406 31,773
2200 PEGASUS GOLD 0.1% 19,360 (c) 13,475 (d)
1400 ROYAL GOLD 0.1% 19,593 11,900 (d)
2000 STILLWATER MINING 0.5% 45,875 (c) 43,000 (d)
33800 SUNSHINE MINING 0.3% 34,345 23,237
2800 TVX GOLD 0.2% 21,100 (c) 14,875 (d)
995,479 867,395
PACKAGING AND CONTAINERS
2000 ASIA PULP & PAPER 0.3% 22,830 (c) 30,250 (d)
500 BUCKEYE CELLULOSE 0.2% 15,915 16,969 (d)
9000 GAYLORD CONTAINER 0.8% 66,263 (c) 69,750 (d)
1000 INTERNATIONAL PAPER0.5% 40,185 (c) 48,563
145,193 165,532
REAL ESTATE
1000 HIGHWOODS PROP 0.3% 31,665 32,000
1500 MID-AMERICA APART 0.5% 39,050 42,094
1900 NEW PLAN REALTY 0.5% 41,613 42,156
700 US RESTAURANT PROP 0.2% 16,295 20,650
1800 WASHINGTON REIT 0.3% 28,665 31,950
1200 WEEKS CORP 0.4% 37,690 37,500
194,978 206,350
REGIONAL BANKING
100 1ST NATL BK ANCH 2.0% 154,250 182,500
1500 NATL BANCORP ALASKA1.4% 93,425 126,750
247,675 309,250
RESTAURANT
2500 APPLE SOUTH 0.4% 33,850 38,125
4000 CRACKER BARRELL 1.2% 111,050 (c) 106,000
2500 FOODMAKER 0.4% 17,906 (c) 40,937 (d)
5000 GRILL CONCEPTS 0.1% 7,071 6,719 (d)
8000 NPC INTERNATIONAL 1.0% 73,820 93,000
2000 O'CHARLEY'S 0.4% 28,250 34,000 (d)
11500 ROCK BOTTOM 1.2% 133,703 109,250 (d)
1500 SBARRO 0.5% 37,778 41,531
1641 SHONEY'S 0.1% 13,207 9,641 (d)
456,635 479,203
RETAIL
3000 BROWN GROUP 0.6% 62,410 56,062
6000 CANDIE'S 0.3% 29,675 26,625 (d)
2000 CUC INTERNATIONAL 0.6% 49,594 (c) 53,000 (d)
1372 DONNA KARAN INTL. 0.2% 15,380 15,264 (d)
1800 GAP STORES 0.8% 57,200 (c) 70,088
1000 GUCCI 0.7% 74,910 (c) 64,375
1000 J.C. PENNY 0.6% 52,824 52,187
2000 NAUTICA ENTERPRISES0.6% 49,750 (c) 52,875 (d)
1000 NEIMAN MARCUS 0.3% 25,675 26,250 (d)
3000 OFFICE DEPOT 0.6% 58,650 (c) 57,750 (d)
5000 WEST COAST ENTERPR 0.3% 44,375 26,250 (d)
1000 WILLIAMS-SONOMA 0.5% 30,810 (c) 42,750 (d)
551,253 543,476
STEEL
4300 BETHLEHEM STEEL 0.5% 45,322 44,881 (d)
1000 BRITISH STEEL PLC 0.3% 24,925 25,250
70,247 70,131
TRANSPORTATION
2500 JB HUNT TRANSPORT 0.4% 38,594 37,187
1000 ROADWAY EXPRESS 0.3% 19,625 (c) 23,375
2200 SIMON TRANSPORTATION0.5% 44,550 43,725 (d)
2800 SMITHWAY MOTOR 0.3% 25,200 31,850 (d)
3500 WERNER ENTERPRISES 0.7% 60,425 (c) 67,812
188,394 203,949
TOTAL COMMON STOCKS 67.4% $6,107,284 $6,193,041
OPTIONS AND WARRANTS
AGRICULTURE
1000 PIONEERHYBRED, SEP, 65, PUTS 0.0% 4,794 688
4,794 688
AUTO AND AUTO PARTS
3000 COOPER TIRE, NOV, 20, PUTS 0.0% 8,334 1,688
2000 DANA, JAN (98), 40, PUTS 0.1% 7,814 6,125
3000 EXIDE CORP, AUG, 25, PUTS 0.1% 14,709 10,875
1000 FED MOGUL, JUL, 20, CALLS 0.2% 6,528 15,000
37,383 33,688
BIOTECHNOLOGY
5000 AMGEN, JAN, 50, CALLS 0.6% 65,749 56,250
10000 GENOME THER, NOV, 5, CALLS 0.4% 34,050 38,125
99,799 94,375
COMPUTER AND RELATED
2000 ADAPTEC, OCT, 32.5, CALLS 0.1% 19,564 (c) 10,625
2500 ANALOG DEVICES, SEP, 25, PUTS0.0% 13,199 4,063
2000 APPLIED MAT, JAN(98),60,PUTS 0.1% 24,564 10,125
2000 ASPECT TELCOM, SEP, 25, PUTS 0.1% 9,814 8,375
1200 BRITE VOICE, SEP, 12.5, PUTS 0.1% 4,538 5,625
12000 CABLETRON, JAN, 30, PUTS 0.6% 48,360 55,500
1500 DELL, JAN (99), 100, PUTS 0.3% 54,991 23,625
1400 DIGITAL EQUIP, JAN(98),40,P 0.1% 11,594 10,325
2500 EMC CORP, OCT, 40, PUTS 0.1% 19,136 9,219
500 INTEL, JAN, 150, (99), PUTS 0.1% 14,534 12,250
2000 LSI TECH, JUL, 30, CALLS 0.1% 23,564 (c) 6,250
10000 MICRON, JAN (98), 35, PUTS 0.3% 77,800 (c) 28,750
1400 PEOPLESOFT, JUL, 50, PUTS 0.0% 14,744 1,488
1500 REMEDY, SEP, 35, PUTS 0.1% 13,366 4,875
2000 STRCTRAL DYN, AUG, 17.5,CALL 0.2% 9,564 17,750
2000 SUNMICRO, JAN(98), 17.5,CALLS0.4% 31,314 (c) 41,125
2000 SYMANTEC, OCT, 12.5, CALLS 0.2% 9,064 (c) 15,000
1000 TELLABS, DEC, 50, PUTS 0.0% 7,544 4,063
407,250 269,033
CONSTRUCTION/BUILDING
5000 SO. ENERGY HOME, DEC,7.5,CALL0.2% 18,874 14,063
18,874 14,063
CONSULTING
1500 AMER MGMT SYS, OCT, 20, PUTS 0.0% 2,022 656
2,022 656
ENTERTAINMENT
10000 WESTNHOUSE, JAN, 20, CALLS 0.5% 43,425 45,000
43,425 45,000
ENVIRONMENTAL
10000 MOULTEN METALS,OCT, 5,CALLS 0.1% 28,425 8,750
28,425 8,750
FINANCE
1500 AMERICREDIT, NOV, 20, PUTS 0.0% 6,429 2,438
3000 1ST PAYMENTEC, SEP, 35, PUTS 0.2% 22,959 19,875
10000 BANK AMER, JAN(98), 50, PUTS0.1% 21,374 6,250
2000 BANK TRUST, JAN(98), 70, PUTS0.0% 4,564 1,375
2000 CHECKFREE, AUG, 15, PUTS 0.0% 6,806 1,000
4000 CHSE MANHTTEN, DEC, 90, PUTS 0.2% 20,104 15,000
5000 CITICORP, JAN(98), 100, PUTS 0.1% 14,811 9,375
4500 COAMERICA, OCT, 55, PUTS 0.0% 5,451 844
2500 CREDIT ACCEPT, SEP, 25, PUTS 0.3% 18,511 30,469
1000 HOUSEHOLD INTL, OCT, 90, PUTS0.0% 7,794 687
2000 MONEY STORE, AUG, 22.5, PUTS 0.0% 8,064 625
7500 NATIONS BANK, NOV, 55, PUTS 0.1% 19,392 8,437
2100 PAYCHEX, SEP, 33.375, PUTS 0.0% 10,894 1,837
2500 WELLS FARGO, OCT, 250, PUTS 0.1% 21,324 13,437
188,473 111,649
HEALTHCARE/MEDICAL
2500 DIAGNOS PROD, SEP, 35, PUTS 0.1% 18,511 9,844
10000 HEALTH MGMT, DEC, 5, CALLS 0.1% 25,144 11,250
1500 LILLY (ELI), JAN (98), 70, C0.7% 36,991 (c) 61,125
6500 MARINER, AUG, 5, CALLS 0.7% 22,083 (c) 68,250
5000 MAXICARE, SEP, 20, CALLS 0.2% 22,624 (c) 15,312
125,352 165,781
INDUSTRIAL
3750 BLYTHE INDS, SEP, 23.375, P0.0% 11,949 1,550
2000 HITACHI, JUL, 90, PUTS 0.0% 11,314 250
2500 OREGON METAL, AUG, 25, PUTS0.0% 12,761 1,094
1000 ROPER IND, DEC, 45, PUTS 0.0% 5,419 1,688
41,442 4,582
INSURANCE
2000 AETNA, OCT, 95, PUTS 0.1% 22,564 4,875
1500 CIGNA, OCT, 160, PUTS 0.0% 30,429 3,563
3000 CONSECO, NOV, 45, PUTS 0.3% 27,084 25,125
2500 TRAVELERS, SEP, 60, PUTS 0.1% 31,949 6,094
112,024 39,657
MINING & PRECIOUS METALS
26900 SUNSHINE MINING WARRANTS 0.1% 23,672 5,884
1000 GLD/SVR INDEX, JAN, 110, C 0.1% 22,919 5,063
46,590 10,947
RESTAURANTS
3000 SHONEY'S, JAN, 5, CALLS 0.0% 4,590 4,313
10500 SHELL'S SEAFOOD WARRANTS0.5% 26,337 43,313
30,927 47,626
RETAIL
17500 GALOOB, NOV, 12.5, CALLS 1.3%104,275 (c) 122,500
2500 PAC SUNWARE, SEP, 22.5, C 0.3% 28,199 (c) 25,625
2000 ROSS STORES, NOV, 22.5, C 0.2% 14,056 22,250
1000 WET SEAL, JUL, 12.5, CALLS 0.2% 10,159 19,125
1300 INLAND STEEL, SEP, 20, CALL0.1% 4,588 (c) 8,288
161,276 197,788
TRANSPORTATION
10000 FED EXPRESS, OCT, 60, CALL0.3% 29,675 30,000
29,675 30,000
TOTAL OPTIONS AND WARRANTS 11.7% $1,377,730$13,460,365$1,074,283
FIXED INCOME SECURITIES
CORPORATE BONDS
100 AGNICO, CVT, 3.5%, 1/27/04 0.9% 82,246 80,250
200 FOODMAKER CORP., 9.25%, 9/25/99 2.2% 199,418 206,180
40 GOLDEN BOOK 7.65 9-15-02 0.4% 38,205 37,552
1.199 MTN STS GTY MTG 1-G, 9.4%,8/1/180.0% 1,242 1,260
100 NOVA CARE, CV, 5.5%, 1/15/00 1.0% 93,932 94,000
40 TIME WARNER, 0%, 6/22/13 0.2% 17,323 18,400
100 TRANSMARITIME, 8.5%, 2000 1.1% 100,024 99,140
532,390 536,892
U.S. GOVERNMENT AND AGENCY BONDS
0.924 FHLMC 1294 A, 6.5%, 4/15/21 0.0% 786 924
66.203 FNMA 61G, 7.0%, 1/1/01 0.7% 65,933 66,597
19.513 FNMA G93-40 ZC, 6.5%,12/25/230.2% 16,342 16,032
200 U.S.TREASURY, 5 7/8%, 2/15/00 2.2% 199,176 198,563
100 U.S.TREASURY, 6 3/8%, 4/30/99 1.1% 99,858 99,858
382,095 381,974
COMMERCIAL PAPER
300 GECC, DUE 7/24/97 3.3% 298,948 298,948
298,948 298,948
TOTAL FIXED INCOME SECURITIES 13.3% $1,213,433 $1,217,814
TOTAL INVESTMENTS 92.4% $8,698,448 $8,485,138
COVERED CALL OPTIONS WRITTEN -3.4% ($310,613) ($311,756)
SECURITIES SOLD SHORT 0.0% $0 $0
EXCESS OF CASH AND OTHER
ASSETS OVER LIABLITIES 11.0% $1,009,829
NET ASSETS 100% $8,698,448 $9,183,211
NOTES:
(a) Also represents cost for Federal Income Tax purposes.
(b) See Note 1 of Notes to Financial Statements.
(c) Call options have been written against all or some of these positions.
(d) Non-income producing securities.
CENTURION T.A.A. FUND, INC.
STATEMENT OF COVERED CALL OPTIONS WRITTEN
JUNE 30, 1997
Shares % of
Subject Net Premium Market
to Call Stock/Expiration Date/Exercise Price Assets Received Value (b)
BIOTECHNOLOGY
4000 ALLIANCE PHARM, AUG, 10 $3,896 $4,000
3000 AMYLIN PHARM, JUL, 15 4,229 3,750
4000 AMYLIN PHARM, JULY, 12.5 5,656 1,000
5000 BIOTECH GENERL, OCT, 15 6,751 6,250
2000 GENENTECH, JAN, 60 4,186 4,875
5000 LIPOSOME, AUG, 7.5 9,225 9,375
$33,944 $29,250
COMMUNICATIONS
3000 FRONTIER, JUL, 17.5 2,354 7,313
1500 GTE, JULY, 45 2,759 844
10000 OMNIPOINT, JULY, 15 17,249 20,000
3000 U.S.LONG DISTANCE, AUG, 15 2,541 7,688
3000 U.S.WEST, JULY, 37.5 4,416 2,063
9000 US SAT BROAD, AUG, 10 7,042 3,375
1000 US SAT BROAD, JUL, 10 407 125
36,770 41,408
COMPUTER AND RELATED
2000 ADAPTEC, JUL, 40 7,186 500
2000 ELECTRONS FOR IMAGNG, JUL, 50 10,466 3,625
2000 IBM, OCT, 75 30,955 34,750
500 INTEL, JAN (98), 170 7,966 3,875
1000 LEVEL ONE, JULY, 40 1,081 1,688
2000 LSI TECH, JUL, 40 9,436 375
3000 MICRON, JUL, 30 3,291 188
1200 NETSCAPE, JULY, 35 2,127 1,125
2000 SUNMICRO, JULY, 37 2,061 5,500
2000 SUNMICRO, OCT, 37.5 6,936 6,750
2000 SYMANTEC, OCT, 20 3,936 4,000
85,444 62,376
CONSULTING
1500 AMER MGMT SYSTEMS, OCT, 30 3,415 2,906
3,415 2,906
CONSUMER/DEFENSIVE
1000 PEPSI, JULY, 37.5 894 1,000
894 1,000
ENERGY
1000 BARRETT RESOURCES, SEP, 40 4,216 375
1200 ENSCO, JULY, 50 5,652 4,350
10000 OCCIDENTAL PETROLEUM, JAN, 25 12,200 17,500
1000 VALERO, DEC, 40 1,456 1,875
23,525 24,100
ENTERTAINMENT
3000 FAMILY GOLF, JUL, 25 4,035 1,875
3000 MIRAGE, NOV, 25 5,166 7,875
9,201 9,750
ENVIRONMENTAL
3000 WASTE MANAGEMENT, JAN, 35 3,666 5,625
3,666 5,625
HEALTHCARE/MEDICAL
1500 LILLY(ELI), JAN, 105 16,821 19,125
3500 MARINER, AUG, 10 9,750 18,813
3000 MARINER, AUG, 15 2,166 4,875
28,737 42,813
INDUSTRIAL
1500 EMERSON ELECTRIC, AUG, 55 2,759 2,250
1000 SUNSTRAND, SEP, 60 1,206 938
3,965 3,188
MINING & PRECIOUS METALS
1000 BARRICK GOLD, JUL, 30 1,269 63
3000 BARRICK GOLD, OCT, 25 3,666 1,875
6000 COUR D'ALN, NOV, 12.5 8,070 10,875
2500 FREEPORT C&G, AUG, 35 1,333 625
600 GETCHELL GOLD, SEP, 50 1,914 225
1400 GLAMIS GOLD, DEC, 7.5 823 1,050
1000 HOMESTAKE MINING, JUL, 15 831 63
800 NEWMONT MINE, DEC, 45 1,260 1,250
2200 PEGASUS GOLD, NOV, 7.5 1,445 688
2000 STILLWATER MINE, JUL, 25 1,811 375
2800 TVX , DEC, 7.5 1,495 700
23,919 17,789
PACKAGING AND CONTAINERS
2000 ASIA P&P, AUG, 15 1,936 2,000
9000 GAYLORD CONTAINER, JUL, 7.5 4,296 3,375
1000 INTERNATIONAL PAPER, AUG, 50 1,581 1,188
7,814 6,563
RESTAURANT
4000 CRACKER BARRELL, AUG, 30 1,916 1,000
2500 FOODMAKER, SEP, 12.5 2,114 10,313
4,030 11,313
RETAIL
2000 CUC INTERNATIONAL, NOV, 25 2,936 5,500
10000 GALOOB, AUG, 20, 10,950 10,625
1800 GAP, SEP, 35 2,640 9,900
1000 GUCCI, JULY, 75 6,956 125
2000 NAUTICA, JUL, 30 1,811 625
3000 OFFICE DEPOT, AUG, 15 1,791 7,125
2500 PACIFIC SUNWARE, SEP, 35 8,364 6,094
1000 WET SEAL, JULY, 25 4,956 6,250
1000 WILLIAM SONOMA, JULY, 40 1,706 3,625
42,112 49,869
TRANSPORTATION
1000 ROADWAY EXPRESS, JULY, 22.5 644 1,625
3500 WERNER ENTERTAINMENT, DEC, 22.5 2,531 2,188
3,175 3,813
TOTAL COVERED CALL OPTIONS WRITTEN $310,613 $311,763
CENTURION T.A.A. FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1997
ASSETS
Investments in Securities, at value,
(identified cost $8,698,448) $8,485,138
Cash 971,917
Receivables:
Dividends 8,613
Interest 15,000
Investment Securities Sold 381,882
Prepaid Expenses 4,969
TOTAL ASSETS $9,867,519
LIABILITIES
Covered Call Options Written, at market value,
(premiums received $310,613) $311,756
Payables:
Accounts Payable 56,581
Investment Securities Purchased 315,970
TOTAL LIABILITIES 684,307
NET ASSETS $9,183,211
Class A:
Net asset value and offering price per share
($8,861 divided by 2,563 shares outstanding) $3.46
ClassB:
Net asset value and offering price per share
($494 divided by 144 shares outstanding) $3.44
Class C:
Net asset value and offering price per share
($7,741,866 divided by 2,248,763 shares outstanding) $3.44
Class D:
Net asset value and offering price per share
($1,431,990 divided by 413,913 shares outstanding) $3.46
The accompanying notes are an integral part of the financial statements.
CENTURION T.A.A. FUND, INC.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1997
INVESTMENT REVENUE
Dividends $38,018
Interest 82,906
Total Investment Revenue 120,924
EXPENSES
Investment advisory fees $46,959
Distribution expenses 38,717
Registration and filing fees 9,336
Fund accounting fees(Note 4) 9,050
Custodian fees and expenses 13,273
Audit fees and expenses 3,600
Directors fees and expenses 6,989
Transfer agent fees 2,217
Insurance 0
Other expenses 9,968
Total Expenses 140,109
Fees and Expenses Absorbed by Investment Advisor 0
Net Expenses 140,109
Net Investment Income (Loss) (19,185)
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT SECURITIES
Net Realized Gain from Securities Transactions 9,045
Unrealized Depreciation of Investments 141,608
Unrealized Appreciation of Call Options Written
Net Gain on Investments (150,653)
Net Increase in Net Assets from Operations ($169,838)
The accompanying notes are an integral part of the financial statements.
CENTURION T.A.A. FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND
THE YEAR ENDED DECEMBER 31, 1996
June 30, December 31,
1997 1996
OPERATIONS
Net investment income (loss) ($19,185) ($48,070)
Net realized gain from securities
transactions (9,045) 264,245
Net change in unrealized appreciation
(depreciation) of investments (141,607) (106,453)
Net change in unrealized appeciation of
securities sold short 11,068
Net change in unrealized depreciation of
investments of covered call options written 0 (8,727)
Net increase in net assets resulting from
operations (169,838) 112,063
Class C:
Distribution to shareholders
Ordinary income dividend ($0.0024 per share) 0 (3,637)
CAPITAL SHARE TRANSACTIONS: (NOTE 5)
Increase from capital shares sold 1,357,591 6,424,359
Increase from capital shares reinvested 3,597
Decrease from capital shares repurchased(1,698,665)(1,212,546)
Net increase from capital share t
ransactions (341,074) 5,215,410
Total increase in net assets (510,912) 5,323,836
NET ASSETS
Beginning of period 9,694,123 4,370,287
End of period (includes no undistributed
investment income) $9,183,211 $9,694,123
The accompanying notes are an integral part of the financial statements.
CENTURION T.A.A. FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Fund commenced operations in January 1982. At the shareholders meeting on
December 20, 1994, the shareholders voted to change the name of the fund to
Centurion T.A.A. Fund, Inc. ("Fund") from Excel Value Fund, Inc. The Fund is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The objective of the Fund
is to achieve long-term investment return, including both capital appreciation
and current income, consistent with reasonable risk.
At the shareholder meeting on August 6, 1996, the shareholders approved the
Fund to offer Class A, Class B, Class C and Class D shares, each of which has
equal rights as to assets and voting privileges. Class A and Class B each
has exclusive voting rights with respect to its distribution plan. Investment
income, realized and unrealized capital gains and losses, and the common
expenses of the Fund are allocated on a pro rata basis to each class based on
the relative net assets of each class to the total net assets of the Fund.
Each class of shares differ in its respective service and distribution
expenses, and may differ in its transfer agent, registration, and certain
other class-specific fees and expenses.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
Portfolio Valuation:
The Fund calculates its net asset value and completes orders to purchase,
exchange or repurchase its shares on each business day, with the exception of
those days on which the New York Stock Exchange is closed.
Investments in securities traded on major exchanges are valued at the last
quoted sales price on that exchange wher such securities are primarily traded.
Securities traded in the over-the-counter market are valued at the last sales
price. Over-the-counter and listed securities that have not been traded on a
certain day are valued at the average between the last bid and asked price. If
market quotations or pricing service valuations are not readily available,
securities are valued at fair value as determined in good faith by the Fund's
Board of Directors. Debt securities are valued in accordance with the
procedures above. Short-term securities are stated at amortized cost (which
aproximates market value) if maturity is 60 days or less, or at market value
if maturity is greater than 60 days.
Security Transactions and Related Investment Income:
Security transactions are accounted for on the trade date (date the
order to buy or sell is executed). The cost of securities sold is determined
on a first-in, first-out basis, unless otherwise specified. Dividends are
recorded on the ex-dividend date. Interest income, which may be comprised of
stated coupon rate, market discount and original issue discount, is recorded
on the accrual basis. Discounts on debt securities purchased are amortized
over the life of the respective security as adjustments to interest income.
Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported aounts of assets and liabilities and
disclosure of contingent assests 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 those estimates.
Income Taxes:
It is the policy of the Fund to meet the requirements for qualification as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended ("Code"). It is also the intention of the Fund to make distributions
sufficient to aviod imposition of any excise tax under Section 4982 of the
Code. Therefore, no provision has been made for Federal
taxes on income,
capital gains, or unrealized appreciation of securities held, and excise tax
on income and capital gains. The Fund currently has a capital loss carry
forward of $90,807 which begin to expire in 2002.
Distributions to Shareholders:
Distributions to shareholders are recorded by the Fund on the ex-dividend date.
Income and capital gain distributions are determined in accordance with Federal
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments of
income and gains on various investment securities held by the Fund and timing
defferences.
Restricted Securities:
The Fund is permitted to invest in privately placed restricted securities.
These securities may be resold in transactions exempt from registration or to
the public if the securities are registered. Disposal of these securities may
involve time-consuming negotiations and expense, and prompt sale at an
acceptable price may be difficult.
Cash Deposits:
At June 30, 1997 the Fund had cash on deposit at one financial institution of
$971,917. Thus, all cash amounts over the maximum Federal Deposit Insurance
Corporation coverage are not insured. From time to time, the Fund evaluates the
credit worhtiness of the financial institution and considers alternatives.
NOTE 2 - NET ASSETS
At June 30, 1997, net assets consisted of :
Net proceeds from capital stock $9,912,050
Unrealized depreciation of securities (236,491)
Unrealized appreciation of securities sold short 0
Unrealized depreciation of covered call
options written (1,143)
Excess distributions over accumulated net income (346,761)
Undistributed net realized loss from security
transactions (144,444)
$9,183,211
NOTE 3 - COVERED CALL OPTIONS WRITTEN
As of June 30, 1997, portfolio securities valued at $311,756 were held by the
custodian in connection with covered call options written by the Fund.
NOTE 4 - PAYMENTS TO RELATED PARTIES
Centurion Counsel, Inc. ("Centurion") is the Fund's investment manager. The
Fund pays investment management fees to Centurion at the annualized rate of
1.00% on the first $200 million of average daily net assest of the Fund, 0.85%
on the next $200 million, 0.80% on the next $200 million, 0.75% on the next
$200 million, 0.60% on the next $200 million and 0.50% on amounts over $1
billion. These fees are computed daily and paid quarterly and are subject to
reduction in any year to the extent that the Fund's expenses (exclusive of
brokerage commissions, taxes, interest, distribution-related expenses and
extraordinary expenses) exceed 3.625% based on the average total net asset
value of the Fund. During the six months ended June 30, 1997 Centurion received
investment management fees of $46,959 and was not required to waive any of the
fee.
Centurion Institutional Services, Inc. ("CISI"), an affiliate of Centurion,
serves as the Fund'd distributor. The Fund offers Class A, Class B, Class C
and Class D shares for purchase.
Class A shares are subject to initial sales charges imposed at the time of
purchase, in accordance with the schedule included in the Fund's current
prospectus. CISI collects the sales charges imposed on the sale of Class A
shares, and re-allows a portion of such charges to dealers who sold the shares.
During the year ended December 31, 1996 no shares of Class A shares were sold
and, accordingly, CISI did not retain any such charges. CISI also makes ongoing
shareholder servicing and trail commission payments to dealers whose clients
hold Class A shares.
Class B shares are not subject to initial sales charges. When Class B shares
are sold, CISI from its own resources pays commissions to dealers who sell these
shares. Certain redeptions of Class B shares made within six years of purchases
are subject to contingent deferred sales charges ("CDSC") upon redemption, in
accordance with the Fund's current prospectus. During the year ended
December 31, 1996 no shares of Class B shares were sold and, accordingly, CISI
did not collect any CDSC charges. In addition, CISI makes ongiong shareholder
servicing and trail commission payments to dealers whose clients hold Class B
shares.
Class D shares are not subject to initial sales charges, CDSC, service fees or
distribution fees. These shares are only available to Advisor professionals
and eligible employees of the Fund, Centurion and its affiliates or service
organizations.
Pursuant to Rule 12b-1 under the 1940 Act, the Company's Board of Directors has
adopted separate plans of distribution with respect to the Fund's Class A
shares ("Class A Plan"), Class B shares ("Class B Plan"), and Class C shares
("Class C Plan"), pursuant to which the Fund reimburses CISI for a portion of
its shareholder servicing and distribution expenses. Under the Class A Plan,
the Fund may pay CISI a service fee at the annualized rate of up to 0.25% of
the average daily net assets of the Fund's Class A shares for CISI's
expenditures incurred in servicing and maintaining shareholder accounts.
Pursuant to the Fund's Class B Plan, the Fund may pay CISI a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class B shares for CISI's expenditures incurred in servicing and maintaining
shareholder accounts, and may pay CISI a distribution fee at the annualized
rate of up to 0.75% of the average daily net assets of the Fund's Class B
shares for CISI's expenditures incurred in providing services as distributor.
Expenses incurred under the Class B Plan in excess of 1.00% annually may be
carried forward for reimbursement in subsequent years as long as that Plan
continues in effect.
Pursuant to the Fund's Class C Plan, the Fund may pay CISI a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class C shares for CISI's expenditures incurred in servicing and maintaining
shareholder accounts, and may pay CISI a distribution fee at the annualized rate
of up to 0.75% of the average daily net assets of the Fund's Class B shares for
CISI's expenditures incurred in providing servies as distributor. Expenses
incurred under the Class B Plan in excess of 1.00% annually may be carried
forward for reimbursement in subsequent years as long as that Plan continues
in effect.
Pursuant to the Fund's Class C Plan, the Fund may pay CISI a service fee at the
annualized rate of up to 0.25% of the average daily net assets of the Fund's
Class C shares for CISI's expenditures incurred in servicing and maintaining
shareholder accounts, and may pay CISI a distribution fee at the annualized
rate of up to 0.75% of the average daily net assets of the Fund's Class C
shares for CISI's expenditures incurred in providing services as distributor.
Expenses incurred under the Class C Plan in excess of 1.00% annually may be
carried forward for reimbursement in subsequent years as long as that Plan
continues in effect. During the six months ended June 30, 1997, CISI received
servicing and distribution fees from the Fund of #48,712 pursuant to the Class
C Plan.
CISI also executes some of the Fund's portfolio transactions. During the six
monthly ended June 30, 1997, CISI received commissions of $18,265 from the Fund
for this service.
Centurion Group, Inc. ("CGI"), an affiliate of Centurion and CISI, is the
administrator and transfer agent of the Fund. CGI is paid an account
$50 per 1,000 statements and other miscellaneous charges and expenses. During
the six months ended June 30, 1997, CGI received transfer fees of $2,217 from
the Fund.
CGI is also the accounting agent for the Fund. The monthly fee for these
services paid to CGI is 0.15% of the Fund's average daily net assets with a
minimum fee of $18,000 per year. During the year ended June 30, 1997, CGI
received accounting fees of $9,000 from the Fund.
The Fund pays each of its Directors who is not an employee, officer or
director of Centurion or any affiliate $250 for each meeting of the Board
or any committee thereof attended by the Director. In addition the Fund
pays each Director's expenses to attend the meetings.
NOTE 5 - CAPITAL SHARE TRANSACTIONS
As of June 30, 1997, there were 100,000,000 shares of the Company's common
stock authorized, at $0.01 par value. Transactions in capital stock of the
Fund for the year ended June 30, 1997 were as follows:
June 30, 1997 December 31, 1996
Shares Amount Shares Amount
Class A Shares:
Shares sold 2,563 $8,664 0 0
Shares inssued in
reinvestment
of dividends 0 0 0 0
2,563 8,664 0 0
Shares redeemed 0 0 0 0
Net Increase 2,563 8,664 0 0
Class B Shares:
Shares sold 144 $500 0 0
Shares issued in
reinvestment
of dividends 0 0 0 0
144 500 0 0
Shares redeemed 0 0 0 0
Net increase 144 500 0 0
Class C Shares:
Shares sold 291,174 $998,253 1,800,452 $6,424,359
Shares issued in
reinvestment
of dividends 0 0 983 3,597
291,174 998,253 1,801,435 6,427,956
Shares redeemed 283,602 964,952 344,840 1,212,546
Net increase 7,572 $33,301 1,456,595 $5,215,410
Class D Shares:
Shares sold 101,267 $350,174 0 0
Shares issued in
reinvestment
of dividends 0 0 0 0
101,267 350,174 1,801,435 6,427,956
Share redeemed 211,763 733,671 344,840 1,212,546
Net increase -110,496 -$383,497 1,456,595 $5,215,410
NOTE 6 - INVESTMENT TRANSACTIONS
Purchase and sales of investment securities (excluding short-term
securities) were $6,100,468 and $6,273,877 respectively. Net loss on
investments for the six months ended June 30, 1997 was $150,653. That amount
represents the net decrease in value of investments held during the year.
As of June 30, 1997, the unrealized appreciation on investments consists of
gross unrealized gains of $666,515 and gross unrealized losses of $880,969.
NOTE 7 - PER SHARE INFORMATION
Selected data for each share of capital stock outstanding throughout the
period is as follows:
<TABLE>
Year Ended December 31,
<CAPTION>
Six
Months
CLASS C Shares (b) 06/30/97 1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period 3.51 3.34 3.43 4.55 4.96 5.17
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income -0.01 -0.03 -0.05 -0.18 -0.21 -0.03
Net Gains or (Losses) on Securities
(Both Realized and Unrealized)-0.06 0.20 -0.04 -0.94 -0.20 -0.18
Total From Investment OperationsNote -0.07 0.17 -0.09 -1.12 -0.41 -0.21
LESS DISTRIBUTIONS
Dividends from Net Investment Income 0.00 0.00 0.00 0.00 0.00 0.00
Distributions from Capital Gains 0.00 0.00 0.00 0.00 0.00 0.00
Returns of Capital Total Distributions0.00 0.00 0.00 0.00 0.00 0.00
Net Asset Value, End of Period $,3.44 $,3.51 $,3.34$,3.43$,4.55,$4.96
TOTAL RETURN -1.99% 5.16%-2.62%-28.01%-12.39%-8.38%
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period
($000 Omitted) $,7,742 $,7,855 $4,370$,452 $ ,757
Ratio to net assets
Expenses,before waiver of fees(d) 3.21% 3.54% 4.82%9.04% 6.19%
Expenses,after waiver of fees(d) 3.21% 3.54% 3.53%6.00% 5.19%
Net investment income -0.43% -0.43% 0.17%-4.78%-4.50%
Portfolio Turnover Rate 93.0% 129.2% 57.20%148.21%143.11%
Number of Shares Outstanding
at End of Period (000 Omitted) 2,249 2,241 1,309 132 166
CLASS D Shares (a) Six 12/09/96
Months through
6/30/97 12/31/96
Per Share Operating Performance:
Net asset value, beginning of period 3.51 3.46
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.01 0.00
Net Gains or (Losses) on Securities
(Both Realized and Unrealized)-0.06 0.05
Total From Investment OperationsNote -0.05 0.05
LESS DISTRIBUTIONS
Dividends from Net Investment Income 0.00 0.00
Distributions from Capital Gains 0.00 0.00
Returns of Capital Total Distributions0.00 0.00
Net Asset Value, End of Period $,3.46 $,3.51
TOTAL RETURN -1.42% 5.16%
RATIOS AND SUPPLEMENTAL DATA
Net Assets, End of Period
($000 Omitted) $,1,432 $,1,839
Ratio to net assets
Expenses,before waiver of fees(d) 2.14% 2.13%
Expenses,after waiver of fees(d) 2.14% 2.13%
Net investment income 0.21% 0.00%
Portfolio Turnover Rate 93.0% 129.2%
Number of Shares Outstanding
at End of Period (000 Omitted) 414 524
</TABLE>
(a) Commencement of offering of sales of Class D Shares was December 9, 1996.
(b) All Capital shares issued and outstanding as of November 6, 1996 were
reclassified as Class C shares.
(c) Allocated between Net Investment Income and Net Gains or (Losses) on
Securities based on monthly weighted average shares outstanding.
(d) Annualized
